Tag Archives: pensions

31 May 2024 – today’s press releases

  • Lib Dems announce plans for free school meals for all primary school children
  • NHS Confederation survey: Conservatives have run our health service into the ground
  • Premier League season tickets spiral as Lib Dems call for free-to-air football
  • Towns funding: Conservatives aren’t fooling anyone
  • Rennie responds to M9 crash after “unforgiveable” wait for findings
  • Cole-Hamilton commits to keeping triple lock on pensions

Lib Dems announce plans for free school meals for all primary school children

  • The Liberal Democrats have announced their ambition to extend free school meals to all primary school children, beginning with all children in poverty.
  • The party will fund their manifesto policy by introducing a share buyback tax, inspired by a similar tax introduced by Joe Biden in the US.
  • Lib Dem Leader Ed Davey slams Conservative government for “letting children go hungry in the worst cost of living crisis in a generation”.

The Liberal Democrats have launched their ambition to extend free school meals to all primary school children, funded by a new share buyback tax.

The party’s plan includes an immediate extension of free school meals to all 900,000 children living in poverty who currently miss out. The second phase would see all primary school children receiving free school meals as the public finances stabilise.

Analysis by PWC found that every £1 spent on free school meals for the poorest children generates £1.38 in health and earnings benefits, including improvements to children’s health, education and future working life opportunities.

The new policy will make the Liberal Democrats the most ambitious party on free school meals. The government currently only provides meals for all children in reception, year 1 and year 2. In year 3 and above, the government has set stringent conditions on family income for children receiving free school meals.

The manifesto pledge would be funded by a 4% levy on the share buybacks of FTSE 100 listed corporations, similar to the excise tax on buybacks implemented by President Biden in the US, which could raise around £1.4bn a year.

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The choice is yours – your full pension or your family

This is the stark choice facing half a million British pensioners abroad (outside Europe and the US) whose UK state pensions are currently frozen due to a flawed policy decision taken just after the Second World War and which no government has since had the courage to address.

On 4th December the Home Secretary announced a five-point plan to attempt to reduce immigration into the UK. As a result, from 24th April 2024, the minimum salary requirement for people who want to bring a foreign family member or partner to the UK will more than double from £18,600 to £38,700.

There is uncertainty as to whether the new income requirement will apply to people who already have a family member in the UK when their existing visa comes up for renewal.

This will have an immense impact on families across a broad spectrum of industries from health and caregivers to education.

That is why Lib Dems Abroad have launched a petition to gather public support against yet another injustice to those of us living overseas.

Here is the link to the petition.

Please join us by signing it!

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The Independent View:  WASPI is relying on the Lib Dems to lead the way for 1950s-born women

It is now eight years since we set up the Women Against State Pension Inequality (WASPI), to represent women born in the 1950s, whose state pension age was increased without proper notice.

As astute Lib Dems will know, the law was changed by John Major’s government in 1995, but neither his nor Tony Blair’s administration saw fit to tell women about these changes.

P60s were duly issued by HMRC each year, without a word about how women’s retirements would be affected.  The DWP website continued to say the state pension age for women was 60 until 2016!

Liberal Democrats have been the leading party on this issue, taking the trouble to understand what our campaign is really about.  Too often, ministers have hidden behind the completely false idea that we are arguing to reverse state pension age equalisation.  Quite obviously, that would be absurd.

Our campaign argues simply that women were – through no fault of their own – heavily disadvantaged by the Department of Work and Pensions’ successive failures over some two decades.  DWP’s own research in 2004 made clear that women simply didn’t know about the impending changes but still the Department did not get on with targeted mailings to those affected.

The impact of this incompetence and neglect is very real.  In a recent survey of 8,000 WASPI women, we found that three in five had already given up work or cut back on their hours by the time they discovered their state pension would not be paid when they’d expected it.

As anyone in our age group knows, getting back into the workplace at that stage in life is often nigh-on impossible, and as such women found themselves falling back on meagre savings to see them through the gap from 60 to 66.  No wonder one in three is now in debt and one in four has struggled to buy food or basic essentials in the last six months.

When we met with Lord (Dick) Newby recently to discuss the Liberal Democrat manifesto, he spoke for so many of us in saying it’s just unbelievable that this mess has yet to be sorted out.  Since 2015, more than 250,000 of the affected women have died awaiting justice.  Another dies every 13 minutes.

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18 October 2022 – today’s press releases

  • Triple lock: Truss looks set to betray struggling pensioners in the middle of a cost of living crisis
  • Lib Dem Amendment Put to Vote to End Sleaze in Parliament
  • Anti-sleaze amendment passed to stop MPs “marking their own homework”
  • Calls for Action as Drug-Related Deaths in Wales Rise to Highest Level Ever
  • Welsh Government Must Act to Stop the Brain Drain of Doctors in Wales

Triple lock: Truss looks set to betray struggling pensioners in the middle of a cost of living crisis

Responding to the Prime Minister’s spokesperson refusing to say the Government is committed to the triple lock pension, Liberal Democrat spokesperson for Work and Pensions Wendy Chamberlain MP said:

Liz Truss has trashed the economy and now looks set to betray struggling pensioners in the middle of a cost of living crisis.

This Conservative Government’s botched budget has already sent mortgage bills spiralling. It would be a kick in the teeth for millions of people if Truss now backtracks on her triple lock promise. The British public will never forgive the Conservative party if they break this promise.

This chaotic Government has to go. Britain needs a general election before Liz Truss and her Conservative Ministers do anymore damage.

Lib Dem Amendment Put to Vote to End Sleaze in Parliament

The Liberal Democrats have today led a cross-party Parliamentary effort to finally end the practice by which MPs are allowed to vote on motions regarding their own misconduct.

The Lib Dem Chief Whip Wendy Chamberlain is today putting an amendment to a vote on the Government’s motion on standards, which the Government has tabled to implement recommendations from the Standards Committee, later this afternoon.

This practice was notoriously brought to attention by the Owen Paterson scandal, when he voted against his own suspension from the House of Commons in 2021 – a saga which ultimately resulted in a Liberal Democrat victory in the North Shropshire by-election.

The amendments, which have support from Conservatives (David Mundell, Alicia Kearns), Labour (Kim Leadbeater, Cat Smith) and the Green Party (Caroline Lucas), would prohibit members from voting on anything concerning their own conduct.

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29 September 2022 – today’s press releases

  • Davey: Truss must cancel Conservative conference to deal with economic crisis
  • Revealed: 32 crumbling hospital buildings including in PM’s backyard
  • Truss in complete denial on BBC Local Radio round
  • Liz Truss refuses to guarantee people’s pensions are safe
  • Fracking interview: Truss shows contempt for rural communities

Davey: Truss must cancel Conservative conference to deal with economic crisis

Ed Davey demands Liz Truss and her ministers spend time fixing the budget as new research finds Government energy bill support will be wiped out by higher mortgage bills

Typical family faces £2,000 rise in mortgage bills following last week’s disastrous budget

Liberal Democrat Leader Ed Davey has called on Liz Truss to cancel the Conservative party conference this weekend, and instead recall Parliament to vote to fix the disastrous mini-budget. The party is also calling on the Government to bring forward a rescue package for homeowners unable to pay higher mortgage bills as a result of last week’s budget.

Ahead of the energy price cap rising on Saturday (1st October), new analysis by the Liberal Democrats reveals the predicted rise in mortgage bills is more than double what the Government has offered to support households with their energy bills.

The Government has pledged to freeze energy prices at £2,500 for the average household, which would have equated to around £1,000 support for the average household.

However, the fallout from last week’s budget is predicted to force the Bank of England to raise interest rates to as much as 5% next year, costing the average mortgage borrower on a Standard Variable Rate a staggering £2,100 per year. Those on an average tracker mortgage would face an even higher annual increase of £3,000 per year if interest rates rise to the predicted 5% next year.

Liberal Democrat Leader Ed Davey said:

There is no way the Conservative Party can hold their conference whilst the British economy nosedives. The arrogance of Liz Truss and Conservative Ministers is frankly an insult to millions who now face higher bills as a direct result of last week’s budget. From this weekend they will abandon their posts in Downing Street, leaving a mess behind them and heading for the cocktail parties and mutual back-patting of the classic conference season.

In one fell swoop, Liz Truss and Kwasi Kwarteng crashed the economy, trashed the pound and paved the way for record interest rate rises.

Innocent mortgage borrowers will be left to pick up the bill of this gross incompetence. It is time Parliament is recalled and new measures passed to save families and pensioners unable to cope with this mortgage crisis. This botched budget cannot survive any longer.

Revealed: 32 crumbling hospital buildings including in PM’s backyard

  • Dangerous roofs not set to be replaced until 2035, Freedom of Information request reveals.
  • Hospitals in the Prime Minister’s and Health Secretary’s local areas have roofs at risk of collapse.
  • Liberal Democrats call on Government to fix the budget to save NHS from real-terms cuts amid rising inflation

32 hospital buildings across the country are fitted with dangerous roofs at risk of sudden collapse, data uncovered by the Liberal Democrats have revealed.

The Freedom of Information request has revealed that 32 buildings at 19 NHS Trusts are fitted with reinforced autoclaved aerated concrete (RAAC) which is said to be ‘structurally weaker’, ‘lightweight’ and ‘cheaper’ than a regular fitting. NHS England has also revealed that the dangerous roofs are not set to be fully replaced until 2035.

Queen Elizabeth Hospital in King’s Lynn, near Liz Truss’s constituency, is the worst in the country with four buildings fitted with the dangerous material. The chief executive of the hospital has previously likened the material to a “chocolate Aero bar” with bubbles that could break and collapse at any point. Liz Truss this morning refused to guarantee that the hospital would be fixed in an interview with BBC Norfolk, adding that she couldn’t make any promises on the Health Secretary’s behalf.

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“Mind blowing” errors in pensions

Are you using software on your laptop that dates back to the 1980s? It sounds unlikely, although some standard office applications do go back that far –  a pre-cursor to Word was first launched in 1983 but it has gone through massive development since then. Indeed everyone who uses it is aware of its frequent upgrades and patches.

However it seems the Government is still using software dating from the 1980s which has not been properly maintained and updated. The BBC reports that millions of people have been receiving an incorrect pension for years, because of the failure to update the Pension Strategy Computer System to take account of Graduated Retirement Benefit.

It seems the individual discrepancies may be quite small, with some pensioners being overpaid and others underpaid, but the accumulated impact could be large. And last year a different issue was found with the system which had resulted in substantial underpayments for 134,000 people.

But the truly worrying fact is that this error has been known about for at least 20 years. Apparently the DWP decided it would be too complicated to fix.

Steve Webb – the Lib Dem pensions guru and former Pensions Minister – says:

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LibLink: Alistair Carmichael: SNP pension plans a good reason to stay in UK

So the SNP Government has assured Scots, with all the confidence of a Vote Leave spokesperson saying that there would be £350 million a week for the NHS, that their State Pensions would continue to be paid by the UK Government if Scotland became independent.

Will this persuade older Scots, who overwhelmingly voted to remain in 2014, that independence is worth pursuing? Alistair Carmichael, in a column for the Scotsman, thinks not.

By Blackford’s reckoning, if Scotland secedes from the United Kingdom we can still keep the good bits (like the currency or our pension entitlements) while leaving behind the bad bits (like the taxes that pay for the pensions). The SNP believe that they can reject any responsibility to pay for your pension, but demand that our neighbours to the south cover the tab.

I am no economist. There are others who have outlined far more eloquently than I could the challenges that our people and pensioners would face if the SNP actually tried to embark on this “offloaded pensions” policy – and the harsh spotlight this throws upon the fiscal challenges of secession generally.

He points out an inherent contradiction at the heart of the SNP’s thinking:

It seems more than a little odd that the SNP think that the rest of the UK is simultaneously irredeemable and yet eminently reasonable – made up solely of monstrous, thieving Tories who nevertheless will empty their pockets at the moment of asking. Is this Schrödinger’s United Kingdom?

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The Triple Lock: An 8% rise is justifiable

The Government appears to have forgotten why, the predominantly Conservative, Coalition Government introduced the “triple lock” whereby the State Pension increases in line with earnings, prices or 2.5%, whichever is the greatest.

It was an attempt to reverse the 30 years of erosion since Margaret Thatcher replaced the “earnings link” with a “prices link”. And after only ten years there is a long way to go to restore the pre 1980 relative value.

Prices are about the cost of static living. Earnings are about the standard of living and quality of life. As the economy grows so too do the expectations and necessities of life. For example, very few people had fridges in 1950; it would be difficult to manage without one today.

Posted in Op-eds | Also tagged and | 35 Comments

A longer read: Women born between 1954 and 1960 lose up to £40,000 each

Embed from Getty Images

From October 6th anyone born after 5th October 1954 will have a state pension age of 66 – for some women this is six years later than they were originally promised.

The 1995 Pensions Act intended raising the age of eligibility to the State Pension for women to 65 over a ten-year period between 2010 and 2020. The 2011 Pension Act accelerated this and raised the age to 66 for both men (previously 65) and women.

Women born in the 1950s might have spent half their working lives paying National Insurance in the knowledge they would get their State Pension at 60 years of age and may now get up to £40,000 less than they knew to be their entitlement.  There is evidence of women retiring only to discover they will not get their State Pension. Even some people closely involved with older people and pensions were unaware of the precise timetable as so little publicity was given to it.

The “Back to 60” campaign lost its appeal in the High Court, in October, but “Women Against State Pension Inequality” continue their campaign. These women have a very real grievance and yet appear to be being brushed aside. Both LibDems and Labour had it in their manifestos to do something about it. And former Pensions Minister, Baroness Ros Altmann would appear to support some compensation on grounds of maladministration as these women were not written to personally in either 1995 or 2011.

More than 1million female workers have no savings or private pension provision, of which 43% have less than £100 saved. Two million people over 75 live alone, of which 1.5 million are women.

There are 1.9m older people living in poverty in Britain today many of whom were forced into retirement and condemned to spending the rest of their lives in poverty. Britain has one of the lowest State Pensions in the developed world at just 29% of average earnings with the official definition of poverty being anything less than 60% of median household income. Britain’s 29% compares with 100.6% in Holland, 94.9% in Portugal, 93.9% in Italy, 91.8% in Austria, and 81.8% in Spain.

Posted in Op-eds | 12 Comments

Pensioners, You never had it so good…

…or so some people in this government want you to think

Everyone needs to ensure they get a good pension at the end of the day. So join Lib Dems Overseas Fringe Event: Frozen Pensions to Lost Pensions at the autumn conference 1pm  on Sunday 27 September to update yourselves on the politics of pensions and campaign to safeguard your future!

For decades the UK state pension lagged seriously behind the growth in average earnings. In 2011 the coalition government introduced a formula to protect pensions against the vagaries of inflation. It introduced a mechanism to guaranteeing that the state pension would rise every year by the highest of the following:

–  The rise in average earnings

–  The rise in the Consumer Price Index

–   Or 2.5%

It was called the Triple Lock and was hailed with great fanfare.

But no-one foresaw the coronavirus and the need to spend billions of pounds to shore up the economy and protect jobs.  Where would money to pay for it come from? One soft target identified is – you guessed it – the Triple Lock. The rationale is that earnings and prices this year could fall, yet pensioners would still get the 2.5%. Then, the following year pensions could surge in line with fast-rising earnings.

But those who think that our pensioners are spoilt are probably unaware of the fact that in 2019 the OECD provided data showing that the UK state pension was the worst in the developed world, paying only 29% of average earnings. By comparison, the Netherlands led the table at 100%. Mexico was closest to the UK at 29.6% while the average across the OECD was 62.9%.

What about occupational pensions?

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End of Triple Lock in sight? Why half a million pensioners are not concerned!

In 2011 the coalition government introduced a formula that would ensure that state pensions would henceforth be automatically protected against the vagaries of inflation. They introduced a so-called triple lock which would guarantee that the state pension would be increased every year by the highest of the following:

  • Average earnings
  • Price inflation as measured by the Consumer Price Index
  • 2.5%

Successive governments have honoured this formula (which produced an increase of 3.9% for pensioners in April this year) and the conservative manifesto in 2019 promised it would be maintained for the following five years.

But then came the coronavirus!

This has heaped a heavy financial toll …

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Pensioners and the impact of Covid-19

The global impact of Covid-19 is massive, and even more so for pensioners as the elderly have been singled out as the primary victims of the pandemic, with death rates rising dramatically with age.

There was some bright news for state pension holders in April as the ‘triple lock’ delivered them an increase of 3.9%. But this has been dampened by a ‘think tank’ recommendation for the scrapping of the ‘triple lock’ so that all generations can share in the cost of tackling the pandemic. What it did not acknowledge was that in relation to average wages the British state pension is among the lowest of the 20 developed countries in the OECD.

But there is a sizeable group of over half a million British pensioners living in certain countries abroad whose pensions have been frozen at the level of when they left the UK, whether it was last year, 20 or even 30 years ago. A huge injustice which is now magnified for those living under the threat of Covid-19 and many of whom do not even have access to free medical or care facilities.

I thank Ed Davey for raising this issue with Therese Coffey, Secretary of State for Work and Pensions, and asking for an immediate Covid-19 related intervention regarding the 500,000+ British citizens living overseas with frozen state pensions.

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Lib Dems secure major victory to limit cold calling

Those amazing  Lib Dem peers have been at it again – winning crucial changes to legislation.

As the Financial Guidance and Claims Bill completes its stages in the Upper House, the Liberal Democrats have secured a significant victory following the government’s acceptance of crucial Liberal Democrats amendments.

Led by John Sharkey, we campaigned in the House of Lords to end  cold-calling in relation to pensions, claims management and other financial services.

The Government have now committed to a total ban on pensions cold-calling, as well as prohibitions on other forms of cold-calling if these are shown to be detrimental.

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Work and Pensions Secretary agrees with Lib Dem pension proposal

This week, the government agreed to bring forward plans to review the current rules concerning the priority of pensioners when a company fails following pressure from the Liberal Democrats.

Responding to calls from Stephen Lloyd, our Spokesperson for the Department for Work & Pensions,  new DWP Secretary of State Esther McVey agreed that a review into the current rules – past and current – after companies go bust is “something that needs to be brought forward”.

Stephen said:

Under current rules, pension obligations are unsecured – meaning that insolvent companies only fund their pension schemes once they have compensated their other supposedly more ‘important’ secured creditors.

Today I urged the new Secretary of State to review the rules and provide further protection for employees with private pensions by giving them greater priority when companies fail. I was delighted to hear the Minister agree that this is something ‘which needs to be brought forward’.

Then and only then will employees with private pensions be wholly protected when large companies collapse. I will be making sure that the Minister sticks to her word on this.

You can watch Stephen’s question here.

Now, warm words in the Commons Chamber doesn’t necessarily translate into action from the Government, but you can bet your life that Stephen will be pursuing this. 

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Liberal Democrats will keep Pensions Triple Lock – Cable

Theresa May has been reticent about whether the Conservatives will commit to keeping the pensions triple lock which was introduced by then Liberal Democrat pensions minister Steve Webb.

Today, the Liberal Democrats are committing to keep it for the duration of the next Parliament.

Vince Cable explains why:

Liberal Democrats believe that an important test of a civilised society is the way in which it cares for the elderly. We will protect the Triple Lock unlike the Conservatives.

The guiding principle of the pensions system must be to ensure that none are left unable to meet their basic needs for survival and participation in

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Steve Webb talks about how a pension age “bad decision” was resolved

We’re hearing quite a lot about the ins and outs of the coalition government these days. Yesterday it was Vince talking about his relationship with Osborne or lack of it. Today, Steve Webb has been speaking to the Institute of Government about his experience as Pensions Minister.

Widely regarded as one of the most successful coalition ministers, Steve Webb reformed the Pensions system, making sure everyone has access to a workplace pension, introducing the triple lock to stop the paltry increases of Labour years and enabling people to access their pension fund early if they need to.

He specifically referred to a situation early on when ministers and made a decision about raising the pension age and had to later change their minds when it became clear how badly some women were going to be affected.

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Steve Webb on taking a chance to set pensioners free

Steve Webb, pensions minister, is interviewed in the Observer in the run-up to the big pensions change:

Plans to give millions of people powers to get access to their pensions savings from 6 April are a calculated risk, the minister in charge of the biggest pensions shakeup in decades has admitted.

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Tories try to take credit for Lib Dem Steve Webb’s Pensions Triple Lock

As the election campaign hots up, all the parties are emailing those who have signed up to their email lists on all sorts of issues.

In the past few days, we’ve seen one from Harriet Harman admonishing the recipient for not responding to Labour’s opinion survey. It had one question, basically “Are you voting Labour?” There wasn’t even a “maybe” option.

We’ve seen a missive David Cameron (or his digital equivalent) has emailed to his distribution list to take credit for the pensions triple lock. The wording looks like it’s been copied and pasted from a Liberal Democrat equivalent.

Now, everyone knows that that was Liberal Democrat pensions guru Steve Webb’s idea. If you look in the 2010 Tory manifesto, you see a commitment to restoring the link to earnings, but that’s about it.

In contrast, this is what the Lib Dem manifesto had to say:

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Opinion: Why it is wrong to enshrine the “triple lock” in law

pensionsOne of the now regular flow of “policy announcements” from the leadership calls for the 2010 ‘triple lock’ to be enshrined in law.  Passing for a moment over the fact that these “announcements” are of course nothing of the sort and discourteous to Conference which passes policy, (though, to be fair, as Mark Pack and others have pointed out, Steve Webb has been careful to avoid language some others have used that suggests these policies have been agreed without the party having a say), I think it’s the wrong idea.

Why? …

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Steve Webb writes… Lib Dems will write the pensions ‘triple lock’ guarantee into law

webb 01For decades, successive Labour and Conservative governments allowed the state pension to decline after Margaret Thatcher broke the ‘earnings link’ in 1980. The nadir of this was in the Labour years, when Gordon Brown increased the state pension by just 75p a week.

I was determined that the Liberal Democrats would do something about this appalling situation. In our manifesto in 2010 we campaigned on a ‘triple lock’ guarantee. This was a commitment that the pension would rise by whichever rating was highest in each year – by earnings, prices …

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Steve Webb: Pensions minister with the future of millions in his hands

webb 01In a profile in the FT, Pensions Minister Steve Webb is described as “one of the Coalition’s most hyperactive lieutenants”.

Now Steve is highly efficient and has achieved a huge amount since he took on the role four years ago, but he is also unflappable and “hyperactive” is not a term I would normally use about him. And whilst the term “lieutenant” usually refers to someone who is second in command, which is technically correct for a Junior Minister, no-one in Government beats his deep knowledge of his subject.

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Opinion: The most positive change for private sector pensions in half a century

webb 01The announcement in the Queen’s Speech of a new ‘Collective Defined Contribution’ pension is an historic achievement on the part of Lib Dem Pensions Minister Steve Webb, which shows that pensions are only safe in Liberal hands. It will bring about better quality pensions for millions in the private sector workforce. It’s taken him four years to arrive at this historic moment which starts to rectify the damage the Tories and Labour wrought on the retirement hopes of ordinary private sector workers.

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Opinion: The First Rule of Campaigning

pensionsWe wake today to news that the Government is planning Dutch-style collective pension schemes which the minister of state for pensions,the Liberal Democrat Steve Webb, says are “some of the best in the world”. The proposed legislation will include the previously announced removal of tax rules that have prevented pensioners taking more than a quarter of their savings in a cash lump sum.

OK, there is no need for switch off. This piece is not going to be about pensions.  It is about campaigning and in particular about integrated campaigning. The subject has been chosen purely at random.  It is Monday. What has a Liberal Democrat minister announced today?  Ah! Pensions.

Posted in Op-eds | Also tagged and | 31 Comments

Steve Webb proposes fairer tax relief on pension contributions

Not content with the most radical reforms to private pensions in a generation, Steve Webb is proposing a flat rate of 30% of tax relief on pension contributions. Currently savers enjoy tax relief at the marginal rate of income tax they pay, so higher rate tax payers get the lion’s share, and standard rate tax payers have less incentive to save for a pension.

Steve told the Daily Mail

I’d like to see the benefits of pensions tax relief spread much more evenly.

Most people get 20 per cent relief, some people get it at 40 per cent. But the people

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Steve Webb on working with IDS: “When it comes to pensions I think he trusts my judgment.”

steve webbPensions minister Steve Webb is one Lib Dem minister who has emerged from Coalition with his reputation enhanced, praised even by such diverse admirers as The Sun, The Guardian and Quentin Letts. Today’s Daily Mail features a warm profile of him talking about his passion: pensions. Here are a couple of excerpts that give a flavour…

On working with Iain Duncan Smith

Today, he and Work & Pensions Secretary Iain Duncan Smith have become Westminster’s odd couple. IDS is renowned for his Right-wing stance on benefits and welfare, and Mr Webb

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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 …

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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 …

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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 …

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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.

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