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Pickering attacks industry Nimps who resist change

The tax-free lump sum on pensions must not be a sacred cow blocking the route to radical reform, warned Alan Pickering in a blistering attack on the pensions establishment last week.

Describing pension professionals resisting change as Nimps – Not In My Pension Scheme – Pickering told delegates at the Pensions Management Institute annual conference in London that it should not issue a blanket condemnation of proposals for taxation changes but should ask what incentives would be put in its place.

He said the Inland Rev-enue was bound to have looked at axing the tax-free lump sum because it was asked to look at all aspects of pension taxation.

Pickering said: “There is a name for us in the pension profession faced with the opportunity to simplify – Nimps. Look at the furore that surrounded the debate over possible removal of tax-free cash. If you were starting a pension scheme from scratch, you would not put in the tax-free lump sum as it means you have got less left for your retirement.”

Informed Choice managing director Nick Bamford says: “I partially agree with him – if you are going to take away one incentive, then you have to ask, what is going to replace it?

“But a careful balancing act is needed between being open to change and rolling over to whatever changes the Government and the Inland Revenue want to push onto us.”

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