General Election 2019: The pensions manifesto pledges
All of the major political parties have now unveiled their policies on pensions ahead of the general election. Professional Pensions looks at what they have promised.
With this year's snap general election now just days away, all of the UK's major political parties have outlined their pension pledges in their manifestos.
As the parties vie for power, pensions do not get much of a look-in, especially with the political arena continuing to be dominated by Brexit. Nevertheless, the Conservatives, Labour, and the Liberal Democrats have made a number of commitments on retirement policy.
The pledges span across pensions taxation, collective defined contribution, pensions dashboards, and equal rights. Professional Pensions has outlined all you need to know.
Conservatives
The Conservative party has said it will hold reviews of the tapered annual allowance and net-pay schemes if it is elected into government.
In its manifesto, published on 25 November, the party also outlined plans to reintroduce the pension schemes bill and raise the National insurance threshold.
The party pledged to "address the ‘taper problem' in doctors' pensions" - this has caused senior NHS clinicians to reduce their working hours in order to avoid exorbitant tax bills. A future Conservative government would "hold an urgent review" with the British Medical Association and Academy of Medical Royal Colleges.
It also said it would also "conduct a comprehensive review" on how to "fix" an issue where savers in net-pay schemes do not receive the same level of tax relief on pension contributions as savers in relief-at-source schemes.
The Conservative manifesto said this was a "loophole" that particularly affected women earning between £10,000 and £12,500; these savers are not taxpayers, but would be eligible for 20% tax relief on contributions in a relief-at-source scheme.
Elsewhere, the party said it would retain the triple lock on the state pension, and "unlock long-term capital in pension funds to invest in and commercialise our scientific discoveries".
It also suggested it would reintroduce the pension schemes bill, which was introduced to Parliament in October to expand the powers of The Pensions Regulator, legislate for collective defined contribution schemes, and set out the parameters of a pensions dashboard.
Raising the National Insurance threshold would also affect how much people will need to earn a week to contribute towards their eligibility for a state pension. The lower earnings threshold for AE, currently set at £6,136, is also tied to National Insurance and a rise in this would mean a lower amount of earnings are pensionable.
Labour
The Labour manifesto, published on 21 November, outlined the party's plans to stop people being auto-enrolled into what it called "rip-off schemes", while expanding access to AE to low-income and self-employed workers.
It also pledged to review the tax and pension changes by the Conservative government, possibly including the tapered annual allowance.
The party also said it would "ask those who earn more than £80,000 a year to pay a little more income tax". Earlier this week, shadow chancellor John McDonnell said a 45% rate would be applied to income over £80,000, and a 50% rate on income over £125,000.
This would have a further impact on the upfront cost of tax relief to the Treasury, as relief is applied based on a saver's tax band - although many of those affected may be subject to just basic-rate income tax in retirement.
Labour said it would also establish an independent pensions commission, modelled on the Low Pay Commission, to recommend target levels for workplace pensions.
It said it will create a single, comprehensive and publicly-run pensions dashboard that is "fully transparent" and includes information about costs and charges.
On CDC, the party noted it will legislate to allow the Royal Mail scheme - the first of its kind in the UK - to proceed, and allow similar schemes to operate.
Furthermore, it proposed amending the Companies Act 2006 to require companies to prioritise long-term growth while strengthening protections for pension funds.
Labour also said it will abandon plans to raise the state pension age, leaving it at 66, but review retirement ages for "physically arduous and stressful occupations". It also said it would maintain the pensions triple lock.
Liberal Democrats
Meanwhile, the Liberal Democrat manifesto, published on 20 November, proposed a one pence rise on all income tax bands, thereby also increasing tax relief in pensions.
It also said it wants to "listen and act" on NHS pensions issues, which are "driving away our most experienced clinicians and worsening waiting times and the workforce crisis".
Meanwhile, the party said it wanted to review rules concerning pensions so that those in the gig economy - who are not always included in AE - do not lose out.
Its plans also include regulating financial services to encourage green investments, such as mandating all companies registered in the UK and listed on UK stock exchanges to set targets consistent with the Paris Agreement on climate change and to report on their implementation.
Further policies included addressing "continuing inequalities" in pensions law for same-sex couples, while retaining the triple lock on the state pension.
Greens
The party would require Local Government Pension Scheme funds to divest from fossil fuel-related investments, while also encouraging all private pension funds to do the same. This was outlined in the Green Party's manifesto, released 19 November.
The policies form part of the party's commitment of £100bn investment a year by 2030 to tackle climate change, which it aims to fund through borrowing.
It said: "Our programme of investment should be seen as a starting push on our national bicycle - giving us the momentum to set off and pedal with growing strength towards a better future."
The Greens' manifesto also outlines plans for a weekly universal basic income for pensioners of £178 - £10 higher than the current highest possible state pension payment.
The party has also pledged a 20% flat rate of pensions tax relief, which it estimates will contribute £6bn in revenue per year as part of its wider proposed tax changes.
Proposals also include limiting the 25% tax-free lump sum to £40,000 and cracking down on tax avoidance and evasion. The party calculated these could add a combined £5bn in annual revenue.
Ending "double taxation" on pension funds - currently subject to both income tax and corporation tax when paid out to individual pensioners - has also been laid out.
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