CHANCELLOR Philip Hammond was playing to the silver crowd this week when, in delivering his first and only Autumn Statement, he chose not to bow to pressure to abolish the controversial pension triple lock.

Denounced by many, including former work and pensions secretaries Steve Crabb and Iain Duncan Smith, as being unfairly advantageous to those in receipt of a state pension, the triple lock essentially guarantees that pension payments will increase yearly by the higher of inflation, average earnings or 2.5 per cent.

However, while pensioners can breathe a sigh of relief for the time being, Jon Greer, a pensions expert at investment business Old Mutual Wealth, pointed out that Mr Hammond has left the door open for reform of the measure in the not-too-distant future.

“While the removal of the triple lock is politically toxic, it is fiscally unsustainable and logical that it be removed eventually. However, it needs to be undone with careful thought,” Mr Greer said. “To make its removal viable policymakers need to reduce reliance on the state in retirement. One easy way to do this would be to introduce policies that encourage the retired or recently retired back into work.”

The only problem is that another of Mr Hammond’s Autumn Statement announcements may well put people off doing this. In what has widely been seen as a bid by the Chancellor to stop people ‘recycling’ pension savings, Mr Hammond has said the money purchase annual allowance will drop from £10,000 to £4,000 from April next year, although he plans to consult on the measure first.

What this means is that anyone who has withdrawn cash from their pension pot - as those aged 55 or over can do under pension freedoms introduced by Mr Hammond’s predecessor George Osborne - will only be allowed to save £4,000 a year into a defined contribution pension without incurring any tax.

While the point is to stop people using money that has already been saved tax-free from being saved tax-free again, a partner at pensions specialist Hymans Robertson said the move could end up being a disincentive to flexible working.

“Let’s take the example of a 57-year-old earning £50,000 per annum full time and they’ve already taken advantage of the 25 per cent tax-free lump sum [allowed under pension freedoms],” Chris Noon said.

“They decide to reduce their hours to a three-day week, bringing their earnings down to £30,000, and they decide to withdraw money from their pension to supplement their income.

“If we assume they have total contributions of 15 per cent into their [defined contribution] pension - a combination of theirs and their employer’s contribution - that equates to £4,500. What this means is people will either be deterred from withdrawing from their pension or they’ll stop saving into it.”

For Rachel Vahel, product technical manager at investment business Nucleus, the net effect will be that fewer people will be able to take advantage of pension freedoms that were supposed to give them greater flexibility in the way they fund their retirement.

“This makes it harder for those who want to merge working later in life with continued pension saving for their future,” she said.

One area related to pension freedoms that Mr Hammond has been praised for is his commitment to consult on banning pension cold calling, something the Department for Work and Pensions has been heavily criticised for refusing to do before now.

It is estimated that since pensioners were given the freedom to withdraw their pensions in whichever way they choose up to 10 million a year are being targeted by scammers who persuade vulnerable people to part with their pension savings in the belief they are making legitimate investments.

Angela Brooks, director of Pension Life, an organisation set up to identify and prevent pension scams, is currently working with hundreds of victims who have been tricked out of their retirement savings.

She welcomed Mr Hammond’s announcement on cold callers, though warned that any action will have to go further than a simple ban.

“It is a step that could be a complete waste of time and indeed counterproductive if it is not reinforced by a number of other essential measures, otherwise the scammers’ cold-calling operations will simply change tactics,” she said.

Mike Gordon, technical director at financial planner Rutherford Wilkinson, agreed and pointed out that it is unlikely that scammers will pay attention to such a ban.

“Surely it must be possible from a technology perspective for the telephone providers to be able to or obliged to identify such calls and block them at source?” he added.

With the timeline for the cold-calling consultation yet to be determined, such measures may well be for another Autumn Statement. Or Budget, as these November announcements will henceforth be known.