Tag Archives: pensions

The Independent View: Pensions reform – the right to advice is right

citizens adviceDuring the Budget last week George Osborne announced the right to free and impartial face-to-face advice in the context of pension reforms. On a day where we saw other good news — such as encouraging growth forecasts and falling unemployment figures — it was a poignant reminder of how vital advice is for anyone facing major life decisions at any time in their life.

We know more than most how invaluable quality advice is. This year is our 75th anniversary and, over the past 12 months, Citizens Advice helped more than …

Posted in The Independent View | Also tagged , and | 6 Comments

Steve Webb MP writes…Tackling rip-offs, standing up for savers

SavingsEarlier today, I had the pleasure of announcing in the House of Commons a raft of new measures designed to make sure that when people save for a pension they get value for money.

One of the Coalition’s most successful policies, for which I have had lead responsibility, is the introduction of ‘automatic enrolment’ into workplace pensions.   Starting with the biggest firms in October 2012, and reaching the smallest ones by 2017, employers now have a legal duty to put their workers in a pension scheme and to make an employer …

photo by: Tax Credits
Posted in Op-eds | Also tagged | 15 Comments

Opinion: Pensions move could negate the whole point of pensions saving

George Osborne’s announcement that people with  defined contribution (money purchase) pensions could take the lot as a lump sum on retirement kills several birds with one stone. First, it most definitely attracts the grey vote because the idea of getting your hands on your whole pension pot on retirement is very appealing.

But this also looks like a reaction to mounting evidence, including from the Financial Conduct Authority no less, that annuities are not good value for money. Defined Contribution schemes allow retirees to buy an annuity (your pension) on the open market, but the schemes provide a default annuity which …

Posted in Op-eds | Also tagged | 29 Comments

The price of trusting people with their own money

pensionsThe world of the private “Defined Contribution” pension is one that sees so many hidden fees it has been described as generating a greater return for the financial services industry than it does the saver. A large bite of this comes with the annuity purchase, where the pension pot, built up over the years, is spent on an annuity, converting a cash sum into a fixed (or index-linked) income for life.

Annuity purchase represents a kind of insurance against getting too old and running out of money.

Posted in Op-eds | Also tagged , and | 52 Comments

Steve Webb on switching annuities for a better pension

The Telegraph reports that Liberal Democrat pensions minister Steve Webb is considering allowing pensioners to switch annuity providers bringing more competition and better value for pensioners.

The intervention comes before a report from regulators that is expected to accuse pension firms of making excessive profits from millions of people converting their lifetime savings into annuities.

Currently, most people are forced to use their pension savings to buy an annuity — paying an annual income for the rest of their lives. For many people, it is the biggest financial decision they will make. However, in recent years annuity rates have plunged, trapping many people in poor-value schemes that have destroyed the value of their lifetime savings.

The ability to switch annuities after retirement would trigger a revolution for savers and kick-start an industry catering for people who are shopping around to boost the value of their pension.

Posted in News | Also tagged | 10 Comments

The battle for pensioners’ votes begins with Cameron on Liberal Democrat turf

The latest Ashcroft polling shows that the Conservatives have a long way to go to be within a shout of victory, with 37% of those who voted Tory saying at the moment that they would not do so if there were an election tomorrow. It’s hardly surprising, then, that David Cameron kicks off the next stage in the 2015 election campaign, in an interview with today’s Sunday Times (£), by pledging to stick to one of the Coalition’s most successful policies through another Parliament.

The Tories have previous for trying to claim the credit for a Liberal Democrat policy. Last …

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Steve Webb writes… 2 Millionth Person auto enrolled into a workplace pension

Today, the latest figures for the number of people placed into a workplace pension have been announced, and I am delighted to say that the 2 millionth person has now been auto enrolled into a pension.

It is essential that workers are encouraged to save towards their retirement, if they wish to maintain a standard of living comparable to what they have grown accustomed to whilst earning a wage. In the year leading up to the start of the scheme, across the private sector, only one worker out of three had any pension at all from their job – and …

Posted in Op-eds | 2 Comments

The Independent View: Want an extra £140,000 in your pension without paying a penny?

Pensions Road Sign 200This week brought welcome news for millions: Lib Dem minister Steve Webb wants to introduce a cap on pension fees.

Who cares? With 12 million people not saving enough for an adequate income in retirement, forcing charges to be capped could substantially improve the standard of living for pensioners without requiring an extra penny of their income.

The government is consulting on three different caps for workplace pensions: a 0.75 per cent cap, a 1 per cent cap, or a “comply or explain” cap, which would allow providers to charge between 0.75 and 1 per cent if they could justify doing so.

Posted in The Independent View | 20 Comments

LibLink: Steve Webb – Issue of pension charges has been neglected for too long

The BBC reports on Steve Webb’s planned “full frontal assault” on the charges that pensions companies levy for management of pensions funds:

Pensions minister Steve Webb told BBC Radio 5 Live Breakfast that the move was just the start of a much broader review into pensions charges.

He said: “We do have powers to cap a much wider range of charges. The document today looks at banning something called active member discounts. That means when you leave a firm they jack your charges up – we don’t think this is right so we will probably ban those.”

Steve has written an article …

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The Steve Webb interview: How I built a modern, inclusive, liberal State Pension system

steve webbAt the excellent Social Liberal Forum Conference on Saturday, a group of eight bloggers spent the lunch break interviewing Liberal Democrat Pensions Minister Steve Webb just before he delivered the second Beveridge Memorial Lecture.

The thing about Steve Webb is that he might have Professor in front of his name and MP after it, but he’s  in no way intimidating, though. He speaks with authority, but engagingly so,  has no airs and graces and has a knack of explaining some complex concepts in language that even I can understand. He …

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Interview: Nick Clegg on the economy, welfare, Cleggism and the “superb” Kung Fu Panda films

CleggWe brought you a taste of the Voice’s exclusive interview with the deputy prime minister yesterday. Here is the full interview, covering the economy, welfare reform, pensions, Cleggism, our approach to the manifesto, Kung Fu Panda and Clegg’s cooking.

Nick Thornsby: What’s your take on where the economy is now, three and a bit years into the coalition?

Nick Clegg: My overall assessment is that it is healing. There are signs of confidence slowly seeping back into the sinews of the economy. Some of the latest data on consumer confidence are better …

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Pensions, the triple lock and Scottish independence

Steve Webb has come under a bit of fire for comments that his triple lock, which guarantees a state pension rise by the higher of earnings, inflation or 2.5% can’t be guaranteed after the election. Let’s look at what he actually said to the Financial Times.

My view is it should be triple lock; to be absolutely clear, I would want to see that continue. But we, as a party, will have to thrash that one out.

He made clear that this would be something that all parties would have go deal with.

This is pretty much a statement of the obvious. …

Posted in News | Also tagged , , and | 11 Comments

Well done, Ed Balls. He’s opened up space for a proper welfare debate. Lib Dems now need to claim that space.

Ed Balls has done us all a favour. His announcement last week that if he were Chancellor he would put a stop to winter fuel allowances for well-off pensioners means Labour has joined the Lib Dems in saying we need to focus the welfare budget where it’s needed most, not keep on re-distributing from the worse off to the better off in the name of universalism. It’s why I chose him as my 38th Liberal Hero.

And yesterday he was at it again, highlighting quite how much of the welfare budget the state pension represents — some £74 …

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Nick Clegg’s Letter from the Leader: “Steve Webb’s pension reforms are a great step forward”

Europe might have been the focus for much of the commentariat this week, but there’s no doubt what’s been the most significant domestic news: the Coalition’s reforms of the state pension. And it’s that issue — and Steve Webb’s contribution to it — which is the focus of Nick Clegg’s latest letter: ‘you can tell that Steve Webb has delivered a pension change that makes it worthwhile to save, and simple to prepare for retirement.’

It’s not often (ever?) you’ll find the Lib Dem leader and the Daily Mail’s Quentin Letts on the same page: their admiration for the pensions minister is the exception to the rule.

lib dems pensionsThe party has produced three infographics that are easy to share via Facebook. Nick’s letter doesn’t link to them, or thank the hundreds who’ve already shared the news of this Lib Dem success in government with their friends — so here are the links for those who want to tell their friends of Steve Webb’s success:

libdem letter from nick clegg

This week I want to tell you about my good friend and colleague, Professor Steve Webb.

Posted in News | Also tagged , and | 3 Comments

Steve Webb MP writes… A truly radical pensions reform

As LDV readers will no doubt be aware, this year marks the 105th birthday of the 1908 Old-Age Pensions Act. Through this Act, Lloyd George introduced the first state pension to Britain, providing 5 shillings (£0.25) a week for those over 70. Fast forward nearly forty years to another great Liberal, William Beveridge, and the National Insurance Act of 1946 that gave birth to the modern state pension. Beveridge’s original idea was for a single, simple, decent state pension, paid after a lifetime of National Insurance Contributions and not subject to a means-test.

Beveridge’s principles have been subject to a sort …

Posted in Op-eds | Also tagged | 28 Comments

Danny Alexander fronts… a Liberal Democrat policy

Danny Alexander sometimes attracts a bit of criticism from party members for the number of times he’s done media appearances where he’s ended up spending much of the time defending Coalition policies which are predominantly Conservative. So good to see him out in the TV studios this morning fronting up a policy that the Liberal Democrats have strongly pushed for – and thereby emphasising the Liberal Democrat contribution:

Posted in News | Also tagged | 3 Comments

Next week in the Lords: 8-11 January

Whilst rumours of a list of new Peers swirls around the Palace of Westminster, the Lords returns to work on Tuesday, and a somewhat lop-sided week continues through to Friday in order to fit in the postponed debate on Leveson.
 
Never let it be said though that the Lords needs a gentle warm-up before asking the difficult questions. Tuesday sees oral questions on airport capacity in London, housebuilding in South East England and the effect of the ‘fiscal cliff’ solution on the UK economy, before the Growth and Infrastructure …

Posted in News and Parliament | Also tagged , , and | 1 Comment

Opinion: Pensions for property scheme is profoundly flawed and illiberal

One can just imagine the proposed pension for property scheme (which Nick Clegg has announced) being the product of committee thinking, for, typical of the produce of many committees, it tries to cram all of the trendier topics of the day into one proposal, resulting in something which is less than the sum of its parts.

The current scheme, the product presumably of the Liberal Democrats’ desire to create popular policies which differentiate us from the Tories among the voters of middle

Posted in Op-eds | Also tagged | 20 Comments

Calling them granny taxes doesn’t mean they’re unfair

The phasing out of the additional personal allowance was decried as a ‘granny tax’ but that move did not go far enough. A new CentreForum report looks at two unjustified and deeply regressive age-related tax breaks: the tax-free lump sum and the exemption from National Insurance.

There are many lonely, vulnerable and poor pensioners who need support. But it’s insulting to suggest that everyone over 60 or 65 can be lumped into the category of frail granny (to say nothing of grandpas!). There is a huge range of incomes amongst pensioners. At the very top, the average annual pension …

Posted in News and Op-eds | Also tagged and | 20 Comments

LibLink: Steve Webb – I will not hesitate to take action on pension charges

Steve Webb writes in The Telegraph:

Almost 11 million of the adult population are not saving enough for retirement. So if millions of people are not going to get a nasty shock when they retire we need some big changes in the world of pensions. …So what is the truth about pension scheme charges, and what is the Government doing to make sure that people get

Posted in LibLink | Also tagged | 5 Comments

Liberal Democrats deliver fair pensions for women

So, here it is in the Guardian, the paper that’s been so critical of the Coalition in general and the Lib Dems in particular, these past two years. The announcement that many of us have wanted to see for as long as we’ve been politically active. That women who take time out of the labour market to care for children or sick relatives will not be penalised in their old age.

This is an example of the Coalition delivering a major benefit to mainly women.  And although it’s Iain Duncan Smith who’s quoted in the article, make no mistake, it’s Liberal …

Posted in News | Also tagged , and | 18 Comments

Opinion: Civil Service strike – the follow up

“Once more unto the breach” goes the rallying call from my Union Reps as we prepare to strike on May 10 2012. Following up the N30 strike on public sector pensions which I have written about previously on this blog, I issued an alternative rallying call – to get round the table and negotiate. But unsurprisingly ignored.

I find myself weirdly ambivalent this time. I shouldn’t be. It is fundamentally about funding my life throughout retirement and yet, the approach taken by the union since the previous strike does not do anybody any favours.

The three tests for me are: Do we …

Posted in Op-eds | Also tagged | 10 Comments

Opinion: The pensions crisis

The Department for Work and Pensions warns that many final salary schemes have already closed down and those that survive will be closed to new entrants within six years.

The average defined contribution pot – the pension now replacing the more generous final salary scheme – is £26,000. At current rates, this fund would buy a Joint life 50%, 3% escalation annuity of less than £1000 per year.

One in six people retiring this year have not saved into a private pension or accumulated other assets, so will see their salaries replaced with the state pension only.

To provide for a pension in …

Posted in Op-eds | 32 Comments

Opinion: What do Charity tax and higher rate pension relief have in common?

We have seen much furore over the effects that a restriction on the level of higher rate tax relief for charitable deductions may have on philanthropy. Nine out of ten charities are opposed to such a move and warn that large donations could reduce by as much as 20%. In the Lib Dem 2010 manifesto, we proposed reforming gift aid to operate at a single rate of 23%, giving more money to charity while closing down a loophole for higher rate taxpayers.

The 2010 manifesto also proposed giving tax …

Posted in Op-eds | Also tagged | 8 Comments

Andrew Stunell MP writes… Launching the Liberal Democrats’ local election campaign

Local Election Day is now exactly a month away for most of Metropolitan England as well as across the whole of Scotland and Wales. Nick Clegg was in my own area of Stockport earlier today to officially launch the Liberal Democrat local election campaign, visiting a local business and speaking with councillors, business owners and local people.

I’ve no doubt that many of you have been out on the doorstep over the last few months, talking to people and showing them what we are achieving both nationally and locally.

You will already have your big messages in place. Number one has got …

Posted in Local government | Also tagged , , , , and | 8 Comments

Stephen Lloyd MP writes… £140 a week for every pensioner – sound familiar?

There’s no need to adjust your screens, it is true; we’re on the way to introducing a flat rate pension for all of £140 a week. You might be thinking you’ve heard this before; well you’re not wrong, except in opposition we used to call it the ‘Citizens Pension’.

We are on the verge of delivering on another key manifesto promise after the Chancellor announced in yesterday’s budget the coalition’s intention to give pensioners £140 a week. While this morning’s headlines are heavily slanted to the reduction of the 50% tax rate, and the ‘granny tax’, nestled away inside …

Posted in Op-eds | Also tagged | 20 Comments

Labour’s hypocrisy on the ‘Granny Tax’

The response from Labour and the tabloids to yesterday’s Budget have majored on the patronisingly termed ‘Granny Tax’.

However Ed Balls and colleagues must be delighted that so far everyone seems to have missed that the last Government froze the Age Allowance between 2009-11 – or as Shadow Chief Secretary to the Treasury Rachel Reeves would term it Labour imposed ‘an enormous stealth tax for older people’.

Posted in News | Also tagged , and | 31 Comments

Danny Alexander MP writes… Liberal Democrat budget victory for “further faster” tax campaign

Over 20 million working people will be better off next year after Liberal Democrats in the Coalition Government delivered the biggest ever increase in the income tax personal allowance in the Budget.

The increase of £1,100 is worth £220 to 21 million working people – taking the total income tax cut for working people delivered over 3 years by the coalition to nearly £550 a year. Two million people will pay no income tax at all. By going ‘further and faster’ as Nick Clegg promised, we’re getting real help to millions of hard-pressed people at a time when they need …

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Public sector pensions: what you find if you ask the obvious question

In the debates over public sector pensions, it has been very common to have figures quoted that are supposed to show how low public sector pensions are on average. In better coverage this sometimes results in some juggling about of means and medians so that the ‘average’ quoted is more meaningful. What is usually lacking, however, is the answer to the obvious question: how many years work has someone put in to get that apparently low average pension?

Talking about how much pension someone gets without talking about how many years they work is odd, to put it mildly. For example, …

Posted in News | 27 Comments

Please can we stop raising tax out of people’s pensions?

Reading my Spring Conference papers, I saw with interest the motion F7 “Making Tax Fairer”. Would we be doing something to simplify Britain’s massively over-complicated tax system, I thought? Might we be proposing something really radical like linking the personal allowance to the minimum wage or something to address the way people earning much less than the 50% top rate of £150,000 can pay much higher effective rates of tax, more than 50% – sometimes more than 60% – because of withdrawal of tax credits and then Labour’s inequitable withdrawal of the personal allowance?

No, I’m afraid we’re not doing any of those things..

Posted in Op-eds | Also tagged | 18 Comments



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