Savers have received flexible pension payments worth a total of more than £6.1 billion since the introduction of the pension flexibilities in April 2015, according to data from HM Revenue and Customs (HMRC).
Its Flexible payments from pensions: July 2016 statistical bulletin found that between April and June 2016 approximately 159,000 individuals took advantage of the pension flexibilities to access a total of £1.7 billion of their pension savings.
In comparison, 74,000 individuals accessed their pension funds in this way between January and March 2016, and 84,000 individuals received flexible payments in April-June 2015.
Some 256,000 flexible pension payments were made in April-June 2016, with a total of 772,000 made since April 2015.
The figures are based on data reported to HMRC. Compulsory reporting came into effect in April 2016, so prior figures are not fully comprehensive.
Tom McPhail, head of retirement policy at Hargreaves Lansdown, said: “The data illustrates how popular this type of retirement income planning has become. For many people, for now at least, drawing cash directly from your pension fund is the new normal.
“The start of the new tax year is also an obvious trigger for withdrawals for prudent tax planning. Back in 2015, awareness of flexible payments was not as high and not all pension providers were ready in time to meet the demands of their customers.
“From a policy point of view, there are a couple of issues here. It is important to track not just what people are doing but why they are doing it and what they have got left behind in terms of pension provisions for later years.”