According to the Tory manifesto, published today, one of the party’s priorities is to encourage saving.
It states: “We will help stop the spread of means-testing by restoring the link between the basic state pension and average earnings, making it worthwhile for people to save.”
The basic state pension must be linked to earnings by 2015, regardless of which party comes to power. Yesterday the Labour party announced it plans to achieve this by 2012.
The Conservative manifesto reiterated plans to end compulsory annuitisation at 75. They also pledged to “reverse the effects of the abolition of the dividend tax credit for pension funds”, but gave no more details on how this will be done and said this would only happen once resources allow any changes.
The Tories say they will reinvigorate occupational pensions and work with employers and industry to support auto-enrolment into pensions, while also addressing the disparity between public and private sector pensions. They would cap public sector pensions above £50,000.
In addition, the Tories are promising to raise the IHT threshold to £1m , paid for by a flat-rate levy on all non-domiciled individuals.
The party would also permanently raise the stamp duty threshold to £250,000 for first-time buyers and push ahead with their plans for a free financial advice service, paid for by the industry.