Pensions - Articles - Labour say scrapping LTA is GBP1bn bung to richest 1 percent

 Phil Duly, Associate at Barnett Waddingham and Chartered Financial Planner comments: “The Government’s proposed removal of the lifetime allowance is a blunt tool to encourage specific groups with defined benefit public sector pensions, such as doctors and consultants, to remain economically active. The proposal technically gives equal access to everyone to build up high value pension savings, but it is true that very few have the high earnings required to take advantage of it. The Labour Party has chosen this as a battle ground ahead of next year's election.

 "This is short sighted. In reality, we must focus more broadly on how to solve the pensions system's many inequalities, and there is much work to be done. This includes improvements to automatic enrolment, the state pension system, and the gender pensions gap.

 All of these would help the 'average worker'.

 "If the battle on LTA must be fought, the best solution is a significant increase to the LTA, to maintain a ceiling required for tax-free cash. In addition, a removal of the Money Purchase Annual Allowance (MPAA) to benefit those needing to dip into savings in the current cost of living climate would help to eliminate complexity.”