View more on these topics

Leader: Chasing pipe dreams on pensions

It is a sad state of affairs when the thing you want most is the thing you cannot have. What is worse is when your stated aim is considered to be idealistic, nothing more than a pipedream by those in the know.

Before this all gets a bit deep and heavy, I am talking about a long-term vision for pension saving and tax planning in the UK. Many crave it, but no politician seems to have cracked it yet.

In the immediate aftermath of the Budget Philip Hammond’s spreadsheets have taken a battering, so much so that one of precious few standout measures in a quiet Budget has been scrapped.

Earlier this month, Money Marketing questioned the lack of help for long-term saving. I did not realise my words would be thrown back at me at such a rapid rate. Nothing says “long-term” like a U-turn within the space of a week.

The axed plans to increase Class 4 National Insurance contributions for the self-employed threaten the Chancellor’s ability to deliver real reform, at least in the immediate term. If policy is to be successfully shouted down in this way, what is to stop MPs taking the same tack again, for example, on changes to defined benefit pensions?

What it also suggests is the self-employed are another sacred cow which should remain untouched. This does not bode well for any efforts to bring the self-employed into pension saving.

It is argued that to expect anything other than constantly shifting sands on pensions and tax policy is unrealistic, given that governments and chancellors come and go.

But this is about being more than being averse to change. This is about a need for transparency from the Government about the future direction of pensions and investments.

As Royal London policy director and former pensions minister Steve Webb points out, as Isa allowances climb ever higher pension allowances are being curtailed at the same rate.

Webb argues if the Government is driving at making Isas the new pensions, politicians should be upfront about it. Speak now or forever hold your peace.

It is all advisers can do but watch from the sidelines with increasing frustration as sensible policymaking seems to slip further out of reach. Advisers are now resigned to lurching from one Budget to the next, trying to guide clients through the madness as best they can.

Natalie Holt is editor of Money Marketing. Follow her on Twitter: @Natalie_Holt_MM



Pension tax relief back on table after NICs u-turn

Chancellor Philip Hammond is said to be favouring a cut in the annual pension allowance over a flat rate system as pension tax relief reform appears to be back on the table. Pensions are in the firing line after the Government dropped its planned rise to national insurance contributions for the self-employed last week, and […]


Self-employed NICs to rise to 11%

Self-employed workers will face increases in their National Insurance contributions to reflect the increased state entitlements received by self-employed workers, Chancellor Philip Hammond has confirmed in today’s Budget. Class 4 National Insurance contributions will be increased by 1 per cent to 10 per cent from 2018, and to 11 per cent in 2019, raising £1.5bn […]

The Great British Break-Off

Despite predictions that a vote to leave the European Union would result in an economic apocalypse, UK equities have shown the market equivalent of a stiff upper lip: bouncing back, keeping calm, and carrying on. Although the road towards Brexit remains clouded in uncertainty, UK equities offer a range of opportunities to investors seeking returns […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers. Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and thought leadership.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm