UK - A former Tory minister wants English regional government plans scrapped and the cash saved used to give further tax relief to occupational pension schemes.
John Redwood – in an interview with IPN’s sister magazine Professional Pensions – said the government must “ease the corporate squeeze” to help relieve the pension crisis.
He said: “I’m recommending that public expenditure be reduced, for example, by getting rid of regional government in England – which is a complete waste of money – and that money be given back to the pension funds.”
Redwood – who was Welsh secretary in the last Conservative government – said: “About £15bn a year of extra regulatory costs have been heaped on businesses in recent years.
“If you ease that, it would leave companies with a bit more money, some of which could be spent on their pension funds.
“The government has to tax less one way or another.”
But Liberal Democrats spokesman Steve Webb doubted whether scrapping regional government would ease the pensions problem. He said: “These are relatively small sums of money he is talking about. “If the pensions deficit is as large as we are being told, the scale of the problem compared with the savings just doesn’t match up.”
A spokesman for the Treasury said that, despite Redwood’s claims, the government had eased the corporate strain through the withdrawal of payable tax credits and cuts in corporation tax rates.
He also pointed out that pension saving continued to enjoy very generous tax privileges, including up-front income tax relief and tax-free lump sums on retirement.
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