Lib Dem manifesto omits pension tax relief reform

The Liberal Democrat manifesto for the upcoming General Election does not include reform to the pension tax relief system, including scrapping the tapered annual allowance, despite being included in its 2017 manifesto.

If it comes into power, the party has promised to “act on the pensions crisis that is driving away our most experienced clinicians and worsening waiting times and the workforce crisis” but did not commit to scrapping the taper.

Its manifesto pledged to retain the state pension triple lock and review rules concerning the pensions of self-employed workers.

“Looking through the Lib Dem manifesto it is good to see they are proposing an overhaul of bereavement benefits and that they are committed to maintaining the pensions triple lock,” began Royal London pension specialist, Helen Morrissey.

“However, comparing this manifesto to the one issued in 2017 it is telling that their proposals to overhaul the pension tax relief system are no longer included.”

AJ Bell senior analyst, Tom Selby, added: “Although political parties are acknowledging the pension tax regime is exacerbating strains in the NHS is good news, nobody seems willing to back the obvious solution – namely scrapping the annual taper altogether. This is somewhat perplexing.

“It may be that the major parties simply don’t like the electoral optics of removing something which places an extra tax burden on higher earners. But with patients’ lives potentially being put at risk, we need politicians to show real leadership in this area.”

The Lib Dems also promised that it would compensate the women born in the 1950s that were affected by increases in their state pension age, in line with recommendations from the parliamentary ombudsman.

Selby said that although the party had previously suggested that affected women should be given £15,000 compensation, “the manifesto instead passes the buck to the parliamentary ombudsman”.

“Although this promise may give hope to those women affected, caution is recommended at this stage, partly because we don’t know what the ombudsman will say, and more obviously because the Lib Dems are unlikely to be elected with a majority at the election,” he added.

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