Thursday, July 24, 2014

Choice on Pensions

Millions of people will benefit from a right to free and impartial guidance on how to make the most of the new pension choices that come into effect in April 2015.
Backing saving is a key part of the Conservatives' long-term economic plan to build a healthier economy. People who have taken the decision to save for their future should be rewarded – and that’s what these pension reforms are all about.
Under our reforms, everyone with a defined contribution savings reaching pension age will get free and impartial guidance on the choices available to them at retirement. We want to ensure this guidance is trusted and so we’re bringing together a range of partners to help deliver these changes – including the Pensions Advisory Service and Money Advice Service.
A simple principle is behind these changes: it’s your pension and you should be able to choose how to spend the money you’ve saved. It’s a principle which is at the heart of the Britain we’re trying to build: a country where everyone who works hard can have security and peace of mind for the future.


Jim said...

Oooooo, are they FINALLY going to undo the pension tax raid from "he who shall not be named"?

Chris Whiteside said...

I'd love to see that, but given the enormous cost don't hold your breath.

Jim said...

What enormous cost? there would be NO COST.

the equations do balance.

Less money in = less to go out


Less in = less spent.


less in + less spent leaves the balance in exactly the same state as it is if More in + more spent.

the only way that the equation fails is if you fail to balance it, i.e Less in + same spent. This is something that goes against all mathematical rules. You must balance each equation.

Though as the current government are still racking up debt at more than £3,000 per minute, it does appear that they are not much better at balancing than the last lot were.

It really is a simple mantra, if you dont spend it you dont need it, if you dont need it then there is no need to take it, and well low and behold people are better off and the books head towards the black.

If people want a service they will buy it, there is no need to steal from those who dont want a service in order to provide a second rate service to those who do want it.

Chris Whiteside said...

If you scrap a tax which brings in, currently about £6 billion a year in revenue, and you are trying to move towards balancing the books - the government has cut the defecit by a third but it is still too big, so this is very necessary, then to balance out scrapping the tax you need to cut spending by an additional six billion pounds.

Since Gordon Brown's £6 bllion a year tax on pension funds had catastrophic effects on incentives to save, I would like to see it scrapped. But finding £6 billion of cuts to offset this is going to be a challenge.

Where an economy has substantial spare capacity held back by lack of demand, tax cust can bring this back into use, but QE and help to buy have already boosted demand as much as is safe.

Jim said...

Another yes minster quote coming up, replace smoking with pensions tax and you can see where i am coming from.

"There is a moral principle involved in the government's attitude to smoking. But when four billion pounds of tax revenue is at stake, we have to consider very seriously how far we are entitled to indulge ourselves in the rather selfish luxury of pursuing moral principles.

but Ill tell you what, being as I am a nice guy and all. How to cut £6 billion in spends the easy way.

Drop the mantra of "if you dont spend your budget this year, then you lose it next year"
Do that across the public sector, thus encouraging and rewarding people for saving money rather than wasting it and you just saved more than enough.