United Kingdom

dipsydoodle

(42,239 posts) Mon Feb 11, 2013, 02:42 PM Feb 2013

MPs want no delay to government-backed pension changes

(Reuters) - Restrictions on a government-backed pension plan aimed at helping more Britons save for their retirement should be lifted as a matter of urgency, a parliamentary committee said in a report on Monday.

The Work and Pensions Committee said removing the limitations on the National Employment Savings Trust (NEST), which cap the amount an employee can contribute to their pension pot each year and ban transferring existing pensions in and out of the scheme, should not be delayed until 2017.

The government is trying to cut a soaring pensions bill that is set to reach 120 billion pounds in 20 years. It wants people to pay into their own pension pots rather than rely on the state.

The changes would allow people to save more for their retirement rather than having the amount they can pay into their pension capped by NEST. They would also be able to consolidate their separate pension pots into one place if they move jobs.

The Work and Pensions Committee has called for the changes after the take-up of NEST by Britain's largest employers was lower than expected because of the restrictions.

http://uk.reuters.com/article/2013/02/11/uk-britain-pensions-idUKBRE91A0DJ20130211

3 replies

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Highlight:

MPs want no delay to government-backed pension changes (Original Post) dipsydoodle Feb 2013 OP

Without reading all the details, pennylane100 Feb 2013 #1

We shall see what happens. LeftishBrit Feb 2013 #2

Its a complex subject. dipsydoodle Feb 2013 #3

pennylane100

(3,425 posts)

1. Without reading all the details,

Reply to dipsydoodle (Original post)

Wed Feb 13, 2013, 01:40 AM

Feb 2013

it sounds like a good idea. People will save for their retirement if the plan is a good one. I like the idea of taking it from one place of employment to another. That is what would work well in this country.

LeftishBrit

(41,208 posts)

2. We shall see what happens.

Reply to dipsydoodle (Original post)

Wed Feb 13, 2013, 08:32 AM

Feb 2013

I think your signature line about big and small print may be quite relevant here.

dipsydoodle

(42,239 posts)

3. Its a complex subject.

Reply to LeftishBrit (Reply #2)

Wed Feb 13, 2013, 09:03 AM

Feb 2013

The original £4000 cap may have been to do with limits beyond which , assuming pension contributions to remain subject being exempt from income tax , net tax receipts would fall by too much. With no limit anyone with half a brain would use any available slack to keep themselves within the basic rate tax.

There was another issue recently on the subject or retirement age and pensions within the public sector. Its suddenly dawned on them that by increasing the retirement age the cost of continued employer's contributions, in this case government and presumably local authorities , the additional NH contributions would create an absurdity in certain budgets.

This isn't just Cameron's mob : neither party seem to put enough thought into changes they attempt to bring about and their ultimate effect.

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