Pensions - Articles - Now Pensions, ARC Pensions Law and PMI comment on the Budget


Now Pensions, ARC Pensions Law and PMI comment on the Budget

 Adrian Boulding, Director of Policy NOW: Pensions said: “It’s extremely disappointing that the Chancellor has chosen to continue to ignore the 1.2 million low earners in ‘net pay’ schemes who are missing out on tax relief on their pension contributions through no fault of their own.

 “One of the headline benefits of saving into a workplace pension is when you pay in, the government pays in too. But, in net pay schemes, lower earners who don’t pay income tax don’t receive the government top up they would have received had they been paying into a ‘relief at source’ pension scheme.

 “This isn’t just a quirk of the tax system but something that affects working people’s living standards. The government must act urgently to end this injustice ensuring that all low earners receive tax relief regardless of which type of scheme they are in. We will continue to press for action until our voice is heard.”
  

 Rosalind Connor, Partner at ARC Pensions Law: "Philip Hammond’s 2018 Budget speech was the first for some time not to mention pensions at all. Despite rumours that he would be announcing further developments on 'defined ambition pensions' or on defined benefit 'superfunds', none of these materialised.

 "The Budget report did note that there would be funding available for the pension dashboard project, a proposal to allow individuals to see their different pension rights in one interface, and which had been subject to rumours of lack of political support earlier this year.

 The Budget also mentioned a paper to come from the Department of Work and Pensions dealing with boosting pension savings for the self-employed, in light of concerns noted in the review of automatic enrolment that the self-employed get left out on this issue.

 "However, pensions are not a highlight of the Budget, after some years of being the spotlight."

  

 PMI President Lesley Carline said: “It is a relief to see that the Chancellor has avoided potentially harmful changes to pensions policy in today’s Budget. It is also pleasing to see that the Government has listened to the industry, perhaps grudgingly allocating £5m to develop the pension dashboard in 2019. This move should serve to further modernise the sector and increase much needed member engagement across the country.

 “Nonetheless, it is disappointing that the Government has not used this opportunity to introduce much-needed improvements to the sector, and that pensions did not feature more heavily in the Chancellor’s speech. We would welcome the removal of the tapered Annual Allowance, which has discouraged higher earners from pension saving and proved administratively complex. 

 “More generally, we are greatly relieved that the Chancellor has not been tempted to prioritise short-term objectives over longer-term plans, and that the rumoured changes to tax relief have not materialised.”
  
  

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