Pensions Minister Richard Harrington has faced calls from advisers to abolish the lifetime allowance.
Speaking at Money Marketing In Focus this morning, Harrington could not ignore advisers’ frustration with the allowance as audience members called it out as being a “disgrace”.
Addressing Harrington, Yellowtail Financial Planning chief executive Dennis Hall said: “One of the areas that is very complicated is that you apply the same rules to DB and DC which leads to a very fair outcome for DB people, which you are a beneficiary, but unfair to DC, namely the annual allowances and lifetime allowance.”
He said: “When are you going to recognise that those are completely different from each other and need a completely different set of rules?”
Harrington asked Hall what he would do if he was in government.
Hall responded: “I would just remove the lifetime allowance. Because I get penalised for having too big of a fund and it doesn’t match the benefits that you get.”
The comment drew a round of applause from the adviser delegates.
Harrington later said he had “sensed from the room” advisers’ views on the conflict between encouraging pension saving but imposing a cap on the amount people can save into a pension.
Another adviser posted on the event app: “Lifetime allowance will not pay for a nursing home. Needs to be stopped.”