The Labour Party’s long-awaited pension report by Cass Business School professor David Blake is due to be published “within days”, according to the party’s shadow secretary of state for work and pensions.
Speaking at today’s (4 February) TUC pensions conference, Owen Smith explained that in the coming weeks the document will be published, with the aim to kick-start fresh debate on “what pensions are for” in the wake of last year’s at-retirement reforms and ahead of tax relief changes.
In May 2014, his predecessor Rachel Reeves pledged to set up a commission under Mr Blake in order to consider the future of pensions in the wake of the recent changes.
Last March, the then shadow pensions minister Gregg McClymont stated that his party would monitor, but not unwind, the pension freedoms, if they had won the general election.
At Labour’s party conference in September, Mr Smith then warned “tougher questions” need to be asked about “this so-called pensions freedom”, adding that “we’ve seen too many mis-selling scandals in recent years and we can’t afford another”.
Speaking today, he commented that the country has not had a serious conversation about pensions for a long time. “It is the sleepy giant of politics,” he added.
“We need a bit more honesty and candour in the debate about pensions,” Mr Smith stated, adding that Labour get too cowed in the debate and have been letting the Conservatives “get away with murder” in recent years, making changes without proper consultation.
“It was nothing short of a dereliction of duty of the previous government to have introduced the pension freedoms without prior consultation.”
“Labour needs to stop apologising for the past and start engaging... we need to get back on the front foot and take the battle to the Tories.”
He also suggested that the current government is benefitting from policies set in train by the Labour administration.
“The government has to treat savers with more respect and be honest about the challenges they face in the future.”
Graeme Mitchell, managing director at Galashiels-based Lowland Financial, said Mr Smith’s comments were “a bit rich” considering the last Labour prime minister was responsible for raising the 10 per cent tax on pension dividends with no consultation.
“I suspect we are about to see the demise of higher rate reliefs, so Labour are a bit on the back foot there too. Pension freedoms were what people have been looking for years - access to their own money and ability to leave to family.
“I wish our politicians would embrace it and work together to have greater planning certainty - without all the constant tinkering.”
Mel Kenny, a Chartered financial planner at Radcliffe & Newlands, added: “Labour seem to have been too busy dealing with internal conflicts to get involved with pensions. What’s more, the government are making changes that flourished from the strong collective brain of the coalition, which is likely to completely laugh off any red-faced challenge.”