Safeguarded Rights are to be abolished as at 6 April 09. Where a pension is shared on divorce to provide money purchase benefits, any contracted out benefits become Safeguarded Rights. The treatment of Safeguarded Rights is anomalous in that, unlike other pensions, benefits could only be accessed at age 60, could not be commuted for a lump sum, and could only provide a unisex annuity. From, 6 April 09 they will be able to provide benefits from age 50, a tax-free lump sum, and gender-based annuities.
Foster Denovo adviser, Ray Rastall, commented "...it's about time. I've had the crazy situation of a lady not yet 60 recieving a share of her retired ex-husbands pension, which was in payment, but she could not take an income from all of it! This change will help those between 50 and 60 who have already received Safeguarded Rights, and will add flexibility to the financial arrangements of divorcing couples from now on."