The Association of British Insurers (ABI) has called on the government to end the "salami-slicing approach to cutting pensions tax relief".
The trade body said it is willing to work with the government on any longer-term reforms to create stability, pointing out that since 2010 there have been six separate cuts to the annual and lifetime allowance alone.
The annual allowance - a limit on the amount that can be contributed to pensions each year, while still receiving tax relief – is currently £40,000.
The lifetime allowance, the limit on the amount of money that can be saved in a pension without triggering a tax charge, currently stands at £1,030,000. It will increase to £1,054,720 in 2019.
But as the government plans to provide an extra £20.5bn funding for the NHS by 2023/24, pension tax relief has been viewed as one of the likely targets of cuts in next week's Budget.
Chancellor of the Exchequer Philip Hammond has also said he considers tax relief to be "eye-wateringly expensive".
Yvonne Braun (pictured), director of long-term savings and protection at ABI, said the cycle of speculation, uncertainty and tinkering with pension tax relief needed to be broken.
She said: "In recent years, pensions has seen some tumultuous changes, including the implementation of the freedom and choice reforms and auto-enrolment into workplace pensions, so savers deserve a period of stability.
"We recognise the chancellor’s need to raise revenue, but the salami-slicing approach to pensions tax relief sends out the wrong message. Constant changes risk undermining people’s confidence and trust in long-term savings at the very point where auto-enrolment is bringing millions more into savings and contributions are rising to 8 per cent next April."
Ms Braun said rather than short-term chopping and changing, the ABI would like to see "meaningful discussion on sustainable long-term holistic reform in this area".
She added: "We are willing to work with government towards a pensions tax relief system that is fair, sustainable and does not undermine consumers’ confidence in long-term savings."
Pensions minister Guy Opperman said at the Pensions and Lifetime Savings Association (PLSA) annual conference last week (18 October) he wants to introduce a comprehensive private pensions bill in 2019, which should mark the end of tinkering with pensions for a "considerable period of time".
He said he has started the process of bidding for legislation to be included in next year’s Queen's Speech.
maria.espadinha@ft.com
