Whatever pious comments George Osborne, UK finance minister, or David Cameron might make about encouraging savings for the long term and less reliance on borrowing, blah, blah, blah, this sort of policy, assuming it is true, shows that this government does not give a rat’s arse about encouraging savings. Coupled with the new top tax rate of 50 per cent, reduced tax-free allowances and other adjustments, the enterprising class of those who work to build up pension pots for themselves just got a serious setback.
At a time when there is so much talk about a pensions “time-bomb”, this sort of announcement is also disheartening since it sends out the message that pension schemes are a contrick. My own managing director at the firm at which I am now a small partner does not bother with pensions and intends to rely on his own business/properties to pay for his old age. When announcements like this come out, who is to say he is really wrong?