Gordon Brown Removes Pension Term Tax Relief

The government have said they are looking at this as they believe these types of policies are not being bought/sold in the spirit of what they were originally intended for. My view is that the Chancellor has once again performed a spectacular pensions U-Turn only 7 months after pension term assurance was 'relaunched'.

Only last year he announced that you'd be able to place a residential property in a pension fund (giving generous tax breaks), only to withdraw it a few months before launch.
  
Providers have spent millions getting their systems and staff ready and all this has been undermined without consultation. The Regulator, the Financial Services Authority, wants all advisers and companies to 'Treat Customers Fairly'. How is this action by Gordon Brown following this principle?

It's reported that there may be up to 40,000 applications in the pipeline that may now not be able to go ahead if tax relief is removed.

My other thought is that the availability of tax relief may have encouraged many to buy life assurance for the first time, therefore providing valuable protection to their families.

What will these people do now?

Will they cancel their applications or perhaps accept a lower amount of cover and still pay the same net premium?

Will their families be a greater burden on the state (as they have the lower amount of cover) if the worst happens?

My only hope is that the insurance companies lobby the Treasury as hard as they can to make the case on behalf of policyholders.