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Labour MP Cousins says pension delays betray the lowest-earners

Labour MP Jim Cousins has hit out at the Government for abandoning the lowest-earners through the delayed implementation of personal
accounts, calling it “an attack on fairness”.

Speaking at a Treasury select committee evidence session on the pre-Budget report on Tuesday this week, Cousins, who is MP for Newcastle Central, said the delay was unfair and would hit workers in the “most fragile sectors”.

In the PBR last week, Chancellor Alistair Darling announced that employers could contribute 1 per cent to their employees’ pensions for an extra year, thereby delaying the full 3 per cent employer contribution until as late as October 2017.

The delay will save the treasury £2.4bn.

Cousins said: “Are you not concerned about this fairly significant slower extension of involvement with personal pensions for workers on low incomes in the most fragile sectors?

“You are saving nearly £2.5bn over those years by not extending personal pensions to low-paid workers in the most fragile section of the economy.

“How can that possibly promote fairness? And, indeed, doesn’t it have enormous implications for Government spending in the longer run?”This is an attack on fairness. This is promoting an increase in dependency on welfare benefits in the longer run, is it not?”

Treasury director of personal tax and welfare reform Mike Williams said: “If the implementation were rushed and went wrong, then I think that the aim of promoting savings among this group might well be set back rather than achieve the aim of enhancing saving.

“The slowing of implementation will enable the Government to ensure that a very complicated and very large programme can be put into effect appropriately and in a timescale that fits the very large number of employers and employees involved.”

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  1. Yet another example, (not that one was needed) of the crass incompetence endemic within this Government. History will record how Labour failed millions of people from a pension perspective between 1997 and 2010, when they will be removed from governing for a very long time.

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