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&#39The Pensions Bill has become a dreadful piece of legislation&#39

Author of the pension simplification report Alan Pickering has launched a scathing attack on the Inland Revenue and the Pensions Bill.

Watson Wyatt partner Pickering says the Revenue&#39s efforts on the bill only merit two out of 10.

He also thinks that the bill fails to promote saving for pensions and would add to red tape.

He has developed a three-point action plan that he claims would increase the wealth of the nation.

Pickering believes that the Government needs to promote a labour market that is blind to age and is working until 70 by 2020.

He would modernise the state pension by brushing aside the current categories and means&#39 testing, and bringing in one simpler rate that provides a minimum state pension above the current level of £79 a week and at least level with the minimum income guarantee of £105 a week.

The Pensions Bill was drafted by the Department for Work and Pensions and is due to receive Royal Assent in November and be introduced in 2006.

The Inland Revenue worked on tax simplification of pensions and how this would be implemented in the bill.

Pickering says: “The Pensions Bill has become a dreadful piece of legislation. It has been amended and amended and amended. It is the wrong sort of legislation because there is no one policy. The policy gets changed and so the bill changes. It is dreadful.

“I think I would give the Inland Revenue 10 out of 10 for their role in the Finance Bill. I would only give them two out of 10 for the Pensions Bill. What they have done is jeopardise what was a well intended bill.

“Just getting people to save more is not the answer. You need people to push up the retirement age because of the ageing population. It would be better if they tore up the bill and started again.”

An Inland Revenue spokesman says there was no Inland Revenue contribution to the Pensions Bill and that it is “entirely DWP legislation”.

The new tax regime for pensions comes into effect from April 2006 and the Inland Revenue and DWP have been working closely together to ensure consistency.


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