New SIPP Laws Outlined by Minister

British savers are to be allowed to invest protected rights benefits to be held in Self-Invested Personal Pensions (SIPPs) from October, the government said today.

The move was announced by pensions minister Mike O'Brien, and follows a consultation conducted by the Department for Work and Pensions on the protected rights earlier this year. Previously, holders of SIPPs - a type of plan in which the saver can choose his or her own pension investments - have been forced to keep any protected rights held in other pension pots entirely separate.

The move is thought to be one of the most significant developments in pensions over recent years - although it has been suggested that firms that do not provide SIPPs could now face tougher market conditions.

Mr O'Brien said: "These changes will give more flexibility and investment choice to people taking an active interest in the management of their pension fund. It will also be easier for individuals to transfer funds between different types of pension schemes, and to consolidate pension rights in one place."

Responding to the proposed legislation in the Financial Times, Steve Folkard at Axa added: "The new flexibility is tidying up what was once an administrative mess."