UK government to introduce pension fund changes
The UK government is set to introduce changes to the UK pension fund system which could severely impact the value of final salary pension schemes in the UK. Only hours after BP chief executive Tony Hayward left the group with a rumoured £600,000 a year pension the government is set to reduce the maximum amount which can be sheltered in a pension scheme in any one year. Apparently the government is looking towards reducing the current £255,000 limit to around £40,000 which would obviously have a major impact upon those paying in to final salary pension schemes (the limit is actually the total contributions from employees and employers).
The previous Labour government had already introduced new proposals to reduce tax relief available on pension fund contributions to a maximum of £150,000 a year. While the proposals by the current UK government could also see tax relief on pension contributions reduced for high earners from 50% to 40%, it has received a cautious welcome from the National Association of Pension Funds which has been campaigning for simplification of the UK pension system.
While David Cameron and his coalition colleagues have attracted criticism and praise in equal measure since they took office, there is no doubt they have hit the ground running and taken a number of very difficult decisions at a very early stage.
Share this..
Related stories
Royal Bank of Scotland announces changes to final salary pension scheme
The Royal Bank of Scotland has today announced significant changes to the company's final salary pension scheme which will see benefits reduced in the future. This comes at a time when the UK government appears to be placing more pressure upon UK banks to control their cost bases and give taxpayer's better value for money, where taxpayer's money has been used to acquire shares. New chief executive...
Read MoreIs David Cameron right to attack public sector pensions?
Over the last couple of days we have seen some momentous decisions regarding public sector pensions which on the surface appear fairly innocuous but will have major consequences for those working in the public sector. Some doomsday scenarios suggest that by changing the inflation index from the retail price index to the consumer price index some public sector workers could see their pension paymen...
Read MoreSavers 'missing pension payments to pay for education'
People are missing out pensions contributions in order to meet the cost of their children's education, a new YouGov poll shows.According to the survey, 23 per cent of UK adults are diverting funds from their pensions due to the financial burden of school and university fees and extra classes.Overall education costs were found to have increased by 13.2 per cent over the past year.By way of comparis...
Read MoreConservative party plans increase in state pension age
The Conservative party has tonight announced plans to increase the state pension age from 65 to 66 years. If the party gains power at the next general election they would increase the state pension age from 2016 onwards as a way to combat the growing national debt in the UK. The announcement will be officially unveiled by George Osborne at tomorrow's party conference in a move which could save the...
Read MoreExpat pensioners lose court battle
The UK government is this evening breathing a sigh of relief after winning a European Court of Human Rights battle which could have resulted in a £500 million a year additional bill for the UK state pension. The case revolves around a number of expats who have moved overseas to places such as Australia and Canada and are currently only receiving the pension payable upon their retirement in the UK...
Read More