Speaking to Money Marketing at the Conservative conference, Shadow pensions minister Nigel Waterson said the “huge delay” potentially “changes everything” as to whether personal accounts will work or not.
Waterson said: “Whatever happened to consensus? I would have expected that, if not the Government, then certainly the Personal Accounts Delivery Authority would have had a word with us warning us of this announcement. We were as surprised as anyone else when that announcement was made. It is incredibly serious because it means some people will not be getting the full contributions until 2016.”
Waterson said he was particularly concerned that smaller employers are at the end of the queue for phasing in. He said: “Something that Lord Turner thought should start in 2010 for some people will not start properly until 2016, which means that there are years and years of contributions that can never be made up by people on modest incomes. I think that does cast a real shadow over the whole project.”
Waterson said the Tories would consider reinstating the higher rate of pension tax relief for people earning £150,000 . He said: “We do not like it but it is not a priority for a new Government. Maybe in the future but we are not going to do it straight away.”