Pension investments in the third quarter dropped for the first time in the year, down to £0.38bn, according to Equifax Touchstone.

Inflows for the quarter (including transfers) stood at £7.98bn, a fall of 4.6 per cent on the previous quarter, but up 7.7 per cent (£0.57bn) year-on-year.

The data, which covers more than 90 per cent of the UK’s leading life and pensions companies, shows that SIPP sales (transfers and single premiums) were down 5.5 per cent (£0.23bn) compared to Q2, personal pensions fell 9.0 per cent (£0.13bn) and individual stakeholder pension investments plummeted by 65.0 per cent to just £12.5m.

Overall, new pension investments (excluding transfers) were £3.91bn, down 8 per cent (£0.34bn) on Q2. Transfers were more resilient, down by 1.2 per cent (£47.9m) to £4.07bn, marking the continued demand for investors to make adjustments to their retirement arrangements to access the right product for their needs.

Commenting on the results, Equifax Touchstone director John Driscoll said: “Pension investments in the third quarter went against the upward trend seen so far this year, as market uncertainty and volatility from events including Brexit hit investor sentiment.

“Growth in pension inflows over the last two years has however emphasised the awareness clients have about the tax benefits of pensions, despite market volatility. Data from HMRC also of course confirms that many clients are continuing to take advantage of pension freedoms. As a result, we expect 2017 to remain a very active year for pensions.

“Transfers in particular are an interesting area to watch; we expect there will be further increases in transfer volumes as ‘insistent’ clients consider final salary transfers in order to access their savings.”

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