The number of defined benefit transfers has fallen to its lowest level since September 2022.
XPS Pensions Group’s transfer activity index showed an annualised rate of 38 members out of every 10,000 transferred their DB pensions in March.
This was down from an annualised rate of 42 in February and 39 in January.
The transfer activity index has been falling steadily since 2017 when there were some 200 members out of every 10,000 transferring.
But the value of these transfers rose by 4 per cent in March to an average of £175,000, the same month end level as in January.
This increase was primarily down to a slight fall in gilt yields.
But transfer values remain far below their peak in 2021, when they reached £270,000. Values fell quickly during 2022 as inflation rose around the globe.
In addition, the XPS red flag index found 90 per cent of transfers showed at least one warning sign indicative of a potential scam or poor member outcomes.
This compared to 92 per cent the previous month and 93 per cent in January.
As part of regulations introduced in November 2021, trustees are now able to pause or block pension transfers if they deem necessary, by raising a ‘red flag’.
In addition, they can raise an ‘amber flag’ if they suspect a potential scam, which will mean the member will have to provide evidence they have taken specific scam guidance from the Money and Pensions Service before they are allowed to transfer.
amy.austin@ft.com
