The government’s proposal of temporary changes to pension tax for public sector workers amid the Covid-19 pandemic is the fairest choice, says Royal London.
This follows provisional changes already approved to allow retired doctors and nurses to return to the NHS frontline to help contain the spread of coronavirus without jeopardising their pension provisions.
Royal London senior intermediary development and technical manager Moira Warner said: "After already making temporary changes for doctors and nurses, it is welcome to see government propose similar changes across the wider public sector so service quality can be maintained."
Relaxed rules would be applied across the whole public sector, around 5.42 million people according to 2019 statistics, for those who recently retired but have returned to work amid the crisis.
Warner said: "Public sector pensioners should note though, that the government does not appear to intend a wholesale relaxation of relevant rules.
"Anyone whose pension was already suspended or reduced prior to the current crisis as a result of returning to work is unlikely to benefit from these changes."
The written statement concerning the temporary measures was made by Treasury economic secretary John Glen at the House of Commons yesterday (22 April).
It read: "For public sector workers returning to support the government's response to Covid-19, the government intends to temporarily suspend tax rules that would otherwise apply significant tax charges to pension income received by recently retired individuals aged between 50 and 55."
Cabinet office minister of state Lord Agnew of Oulton added: "At this time, it is important that key public sector workforces can bring back workers with relevant and valuable experience to ensure that the government can continue to provide critical public services.
"Colleagues across government to ensure we remove any potential barriers to those who wish to return to work to help in our fight against Covid-19."
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