ALL pensioners locked into annuities which provide a monthly income must be given the right to access the money as a lump sum, Blaenau Gwent MP Nick Smith has said.

Although the UK Government changed the rules on annuities in 2015, meaning any bought after then can be withdrawn as a lump sum, many who bought policies before then are still being denied access to their cash.

Colin Jones of Tredegar, was one of them, and had spent seven years trying to get access to his money as a lump sum through his policy with ReAssure - and asked Mr Smith for help after being met with resistance.

Mr Jones, 71, was receiving just £2.70 a week from ReAssure, when cashing in his annuity would have provided him with a one-off sum of more than £2,400.

When he contacted ReAssure about cashing in his annuity he was sent a letter informing him the firm had refused his request in order to prevent him making “the wrong decision” - a response he branded "patronising".

After writing an angry letter to the company, he received a response reiterating it was “under no contractual or regulatory obligation to offer annuitants the option to surrender their ongoing annuity in return for a one-off cash settlement.”

It was only after Mr Smith contacted the Financial Conduct Authority on Mr Jones' behalf that ReAssure allowed him access to his cash.

Mr Jones said: “I’m delighted, but was this fight necessary? This could have been resolved years ago.

“It shows that companies are in a position to release people’s money if they wish to. There will be plenty of other people in the same position as I was.”

Mr Smith also wrote to chancellor Phillip Hammond and received a response from the Treasury which stated that “providers are not obliged to offer small pot lump sums” and that “the government has no plans at present to amend existing legislation.”

The Labour MP said: “The fact that the rules were changed for those who retired after 2015 is an acknowledgement that the system is unfair.

“I am delighted that Mr Jones will be allowed access to his money but it is inherently wrong that people are still being forced to continue receiving tiny sums each month and refused access to their money.

“People who retired prior to 2015 should in this instance be afforded the exact same rights as those who retired after."

He added he would be quizzing the chancellor about the issue in Parliament.

ReAssure was contacted for comment.