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Treasury knew about legal problems of limiting Asps

The Treasury was warned of the human rights problems of limiting alternatively secured pensions to the Plymouth Breth-ren when pension simplification legislation was being drawn up.

As late as July, Treasury Economic Secretary Ed Balls told Parliament: “It was always our intention that the rules would apply in the specific and narrow case of individuals with principled religious objections such as the Christian Brethren.”

But a freedom of information request received by Money Marketing reveals that the Treasury knew of the potential legal problems of limiting Asps to certain groups when legislation was being drawn up.

The recorded reference says: “Lawyers have advised that trying to limit access to alternatively secured pensions to religious groups may run into human rights problems.”

Hargreaves Lansdown head of pensions research Tom McPhail says this revelation is a further sign of the “incompetent consultation processes” surrounding tax and pension issues under the current administration.

The Treasury says it got 366 responses to its first consultation document in 2003, with over two-thirds of responses from representative bodies and pensions and financial services providers. Following changes to Asps in the Finance Act 2006 – which applied IHT to left over funds – a further 83 responses were received.

McPhail says: “This shows they cannot claim that they were not aware of the consequences of their actions and again reinforces the impression that this Government is very big on the appearance of consultation and creating consensus but ultimately then fails to listen.”

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