PensionsNov 25 2019

Conservatives target pension tax at both ends

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Conservatives target pension tax at both ends

Mr Greer said: “Boris Johnson’s Tory party appear to refuse to accept that the taper is not fit for purpose and should be scrapped, instead choosing to look for short term bespoke fixes for the NHS. 

“The manifesto pledge sounds the same, as the Tories commit to work with medical bodies to find a fix. A far simpler response would be to scrap the taper altogether, although this maybe something the Treasury is reticent to do.”

The manifesto also outlined the party’s plans to keep the pensions triple lock, contrary to previous pledges to scrap it.

This was originally introduced in 2011 to guarantee that the basic and new state pension will rise by the higher of inflation, average earnings growth or 2.5 per cent.

Mr Greer added: “With earnings forecast to exceed 2.5 per cent and inflation over the foreseeable future, keeping the triple lock won’t cost much – or possibly anything – over this term. 

“But at some point government is going to have to make a decision on the triple lock otherwise it will grow faster than either inflation or average earnings of the long term.”

The manifesto was also criticised by the industry for its lack of detail on how it plans to fix the social care funding crisis.

In his first speech as prime minister Boris Johnson promised to “fix the crisis in social care once and for all”.

But his manifesto only states that “nobody needing care should be forced to sell their home to pay for it,'' with no detail on how the party plans to address the funding issue.

Steven Cameron, pensions director at Aegon, said: “A restatement of the promise that people won’t have to sell their home to pay for care will be a relief to many, but we need far more detail and a long term sustainable plan. 

“Hopefully, whoever is in government next month will look at the ideas put forward by all parties and work quickly to deliver on the Holy Grail of cross-party consensus.”

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