The lifetime allowance for pensions will be cut from £1.25m to £1m, George Osborne has announced in the 2015 budget.

The chancellor said in his speech to the House of Commons: 'From next year, we will further reduce the lifetime allowance from £1.25m to £1m. This will save around £600m a year.

'Fewer than 4 per cent of pension savers currently approaching retirement will be affected.'

Osborne also said that from 2018, the lifetime allowance will be indexed to protect against inflation.

The National Association of Pension Funds' director of external affairs, Graham Vidler, has welcomed the changes, but has voiced concern about the consistent erosion of the lifet...

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