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Pensions muddle is our chance to help
Last year’s Pre-Budget Report was more of a non-event than a big deal. It was a missed opportunity to break down some of the issues around the UK’s lack of a savings culture.
Of course, managing the economy is a balancing act due to the funding issues that dominate the financial services marketplace, but where were the proposals to boost pension provisions?
I join the Association of British Insurers in its disappointment with chancellor Alistair Darling’s decision to restrict tax relief on pensions for higher earners and change employer pension contributions.
Peter Vipond, the ABI’s director of financial regulation and taxation, summed it up nicely when he said that “this can only do further damage to pensions and will not encourage a long-term commitment to saving”.
Attitudes towards retirement have changed in the past decade. Rather than everyone talking about retiring at 50 many clients now expect to work beyond 65. So what was highlighted in the Pre-Budget Report to help fix one of our most pressing social problems? Not a lot.
Instead, even more confusion was sprinkled over the pensions market as if it wasn’t already complicated enough for consumers.
Of course, where there are complications there are often opportunities so while the Pre-Budget Report added further confusion it raised the stock of good financial advice.
The time is right for brokers to reiterate the need for sensible retirement plans.
MARK CLINTON
DIRECTOR
MD PENSIONS SOLUTIONS
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