Labour tries again for pension freedoms review

Labour tries again for pension freedoms review

Labour politicians have again attempted to force the Government to review the upcoming pension freedoms.

The Pension Schemes Bill is currently making its way through the House of Lords where Labour peers have tabled a series of amendments.

Lord Bradley said the bill should include a provision for a review of the freedoms after 18 months.

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He said this would mean publishing the distribution impact by income decile of the population, a behavioural analysis, an analysis of the cumulative impact on Exchequer revenues and an analysis of the impact on the purchase of annuities.

One of the concerns raised was the use of so-called salary sacrifice schemes which involve employers paying part of a worker’s pay into their pension to take make tax savings.

The amendment was supported by Lord Hutton, former Secretary of State for Work and Pensions.

He said: “We must ensure people enter retirement with enough money to meet their lifestyle requirements and these two policies are competing with each other in this bill.

“If we get this wrong not only are we going to impoverish future generations of retirees but there is some risk that the costs of that will fall back on the sholders of the taxpayers.”

Labour MPs had previously attempted to secure a review when the pension freedoms were making their way through the House of Commons but were defeated.

The party’s second attempt at securing this review, this time in the House of Lords, also proved unsuccessful and the amendments failed.

Government peer Lord Newby said: “There is no need for further reviews of the Exchequer impacts of the policy as the government have already committed to keep these under review through the usual processes.”

Adviser view

Lyndon Heppolette, of London-based Helm Godfrey, said: “From a cynical point of view the Treasury will benefit from a higher tax take earlier but the new rules are brilliant for sensible people.”