Adviser > News > April 2010 > Pre-election manifestos and pensions
Pre-election manifestos and pensions
Find out what the main political parties are saying about pensions.
As the General Election looms ever closer, we've taken a look at what the three main parties are saying about pensions. Weighing in at a total of 306 pages, we've picked out the pensions bits from the manifestos. This wasn't a particularly easy task, apart from the Liberal Democrats who at least included an index - something that the others should perhaps take note of.
Here's our at-a-glance guide based purely on what the manifestos say:
|
Labour |
Conservative |
Liberal Democrats |
Basic State Pension Re-linking to earnings
State pension age |
Yes, in 2012
Raise to age 68 by 2046 |
Yes, within next parliament Will hold a review to bring forward the date at which state pension age starts to increase to 66 but no sooner than 2016 for men, 2020 for women |
Yes, immediately
No stated policy |
Auto enrolment and National Employment Savings Trust (NEST) |
Planned introduction from 2012 |
Will work with employers and industry to support auto-enrolment, no stated policy on NEST |
In the long term, aim to bring in a Citizen's Pension, subject to resource |
Tax relief on pension payments |
Relief to be tapered from higher rate to basic rate for those earning more than £150,000 from 6 April 2011 |
No stated policy |
Remove all higher rate tax relief |
Defined Benefit schemes |
Will continue to protect pension schemes when a firm's company goes bust. |
Will ‘reinvigorate' occupational pensions. Reverse the effect of the abolition of dividend tax credits for pension schemes when resources allow |
No stated policy |
Flexibility in pensions Early access
Age 75 rule |
No stated policy
No stated policy |
No stated policy
End the requirement to annuitise at age 75 |
Allowing access to pension funds early, for example in times of financial hardship End the requirement to annuitise at age 75 |
Public vs private sector |
'Tough measures' already introduced for public sector pensions to make them sustainable and affordable over the long term |
Cap pensions above £50,000 Work with trade unions, businesses and others to address the ‘growing disparity' between public and private sectors whilst protecting existing rights |
Reforming public sector pensions with an independent review to agree a settlement Comprehensive Spending Review of all government departments would include a focus on pensions. |
MPs pensions |
Independent Parliamentary Standards Authority (IPSA) to set pay and pensions for MPs |
Consult with the independent Parliamentary Standards authority on how to move away from final-salary pensions for MPs Rewrite the Ministerial Code so that former Ministers who break the appointment rules lose some, or all, of their pension rights |
No stated policy |
Default retirement age (65) |
All main parties are looking at abolishing |
||
Other aspects
|
The Pension Credit capital disregard will increase from £6,000 to £10,000 NIC credits towards State Pension for grandparents giving up work to look after grandchildren Will promote stakeholder pensions offering simple, low-cost and flexible products From 2014, the National Care Service will cap the costs of residential care so that everyone's homes and savings are protected from care charges after two years |
Propose that anyone can protect their home from being sold to fund residential care costs by paying a one-off voluntary premium with a top-up required for care in their own home. |
In the long term, aim to bring in a Citizen's Pension, set at the level of the pension credit, subject to resource Would set up an independent commission to look at options for long term care with a view to gaining cross-party support |
Worthy of note
- The only real surprise in here is the Liberal Democrats' pledge to allow only basic rate tax relief on pension contributions. They estimate that this would generate some £5,455 million in projected 2011/2012 terms.
- There is an obvious consensus around automatic enrolment into workplace pension schemes although the dates may change (possibly brought forward) and there may still be some doubts about NEST.
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