Pension fund tax grab has cost savers £225bn
By Craig Woodhouse, PA
Monday, 3 November 2008
Pension tax grabs in the 1990s have reduced the value of retirement
funds by up to £225 billion, it was claimed today.
A report by the Taxpayers' Alliance said changes made by Tory former
chancellor Norman Lamont and then by Gordon Brown in his first budget
have cost the funds heavily.
And the campaigners claim this has contributed to a decline in the
number of people paying into private sector pensions schemes.
Mr Lamont cut tax credits on share dividends paid into pension funds in
1993 before they were scrapped altogether by Mr Brown in 1997 - a move
which raised vast sums for the Treasury and has been partially blamed
for some firms closing final salary schemes.
Today's report puts the impact of the changes to Advanced Corporation
Tax relief at between £150 billion and £225 billion.
The campaigners say there has been a 41% drop in the numbers of people
paying in to private sector occupational schemes over the past 12 years
while public sector pension arrangements have remained "extremely
generous".
Co-authors Terry Arthur, a fellow of the Institute of Actuaries, and
Corin Taylor argue for an immediate overhaul of the pensions system.
They wrote: "There is a pressing need for major and immediate reforms to
cut the shameful and unsustainable costs of public sector schemes, often
supported by taxpayers who have watched their own schemes disappear or
decline, usually at the hands of government.
Mr Taylor added: "The infamous tax raid on pension funds has been a
major factor in the collapse of occupational pension provision in the
private sector, while gold-plated public sector pensions have remained
immune from necessary changes.
"It is not right for taxpayers to be subsidising million-pound
retirement benefits for the public sector elite while seeing the value
of their own pensions plummet, or in many cases not having a pension at
all."
http://www.independ
cost-savers-
Tuesday, 4 November 2008
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