New govt urged to prioritise pensions

The new government has been encouraged to prioritise pensions policy and follow through with their manifesto promises after the Conservative’s landslide election victory yesterday (12 December).

In its pre-election pledges, the Conservatives promised to review the public sector pension tax system, re-introduce the Pension Schemes Bill and consult on the net pay/relief-at-source pension systems.

The Pensions and Lifetime Savings Association (PLSA) has urged the government not only to fulfil its promises, but to go further and widen the scope of auto-enrolment and increase employer contributions.

PLSA director of policy, Nigel Peaple, said: “Ensuring adequate contributions, fostering effective engagement and allowing well-run schemes to operate at appropriate scale provides the blueprint for making the greatest difference to the greatest number of people. We must get on with improving the system.”

Aegon pensions director, Steven Cameron, added: “The Conservative manifesto committed to making sure 1.3 million non-taxpayers in ‘net pay’ schemes receive the 20 per cent tax relief on their pension contributions to which they are entitled.

“The lowest earners deserve every help they can get to save for their retirement so this must be another top priority. Tax rules and reliefs must be fit for the future and work together without unintended consequences across all earnings bands.”

Hargreaves Lansdown head of policy, Tom McPhail, agreed that it was time for the government to seize the opportunity to improve the pensions system.

He commented: “Undoubtedly, we will see the reintroduction of Guy Opperman’s oven-ready Pension Bill which ran out of time at the end of the last parliament.

“This bill will strengthen protections for occupational scheme members, pave the way for pensions dashboards to be developed and open up the option of a new type of shared-risk pension scheme.

“We believe there is a way the UK’s pension system could be made simpler, fairer and more efficient, with proper incentives to save for all; there is now the opportunity to pursue this reform.”

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