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On Commons ground…

In a recent poll commissioned by BB Radio 4 to find the most despised profession,MPs and Government ministers topped the hate list.

Despite this, Robin Cook,in the past few weeks in a submission to the committee on standards in public life, contended that MPs should be permitted to continue self-regulation.

Apart from the sleaze, accepting donations from dubious sources, cash for questions and substance being subordinate to style and spin, you are forced to concede that they are a fine body of people doing a magnificent job. After all, who has drawn attention to the very grave savings deficit in this country, one of the six major issues facing the nation today?

Well-intentioned words, however, are short and easy to speak but their echoes are truly endless. Isas, with an annual allowance of £7,000, replaced by Peps and Tessas. The former had a maximum contribution of £9,000 and the latter an annual average contribution over five years of £1,800.

The public were “encouraged” to contribute even more into their pension schemes in return for the same benefits, with the abolition of the tax dividend tax credit.

Taxation now swallows more of the typical pension than an adviser&#39s commission or management fees.

In a perverse move, the Government introduced the minimum income guarantee for pensioners of £98.15 a week. Presently, the average lump sum to purchase an annuity is £25,000. This returns an inflation-proofed income of £1,200 a year for a man aged 65. A woman aged 60 would need more than £41,000 to obtain an annuity income of £1,180, rising in line with average national earnings.

If they save nothing at all, the state will provide the extra income that the above pension funds could provide, so why bother? In addition, we need simplicity in retirement planning instead of constant changes and increasing complexity.

Frank Field made sensible proposals on how to proceed from here but the Government binned them immediately as they want a magical, painless solution.

The tax changes have endangered many final-salary schemes but there is one that is not under threat – that of the MPs themselves because it is funded by you and I, the taxpaying public. An actuary recently calculated than an MP&#39s pension would cost more than £630,000 to buy in the private sector.

If you are considering a change of career, then you do a lot worse than to look no further than the House of Commons.

Gerard O&#39Boyle

Anstey Financial Planning,

South Molton



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