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The Actuary The magazine of the Institute & Faculty of Actuaries

Electoral phony war

As the latest date for a UK election draws near, the annual conferences of the political parties provided the opportunity for ideas for future manifestos to be tested on the public — or at least on the newspapers that the public reads.

It is always difficult for a ruling party to appear radical; the charge of, ‘Why haven’t you done this already if it is such a good idea?’ would be difficult to answer. So this year it seems, at least in the area of pension saving, that the Conservatives have been pushing out many new thoughts.

The state pension age increase, planned by the Labour government to rise to 68 over the next 30 years, would rise to 66 for men as soon as 2016 — in other words, only, at most, a six-year lead-in. For women, the plans were more ambiguous, as the existing programme of increases for women from 60 to 65 — the fact that this was introduced by the last Conservative government did not feature in the party conference speeches — would remain until 2020. Interestingly, back in 1995 the Conservatives felt that 25 years was needed to give fair notice to those affected.

George Osborne, shadow chancellor, made other suggestions in his speech, including an attack on “Gordon Brown’s disastrous tax raid on pensions”. He made a promise to “reverse [its” effects and get our country saving again”. He was short on what this would mean, since restoring advanced corporation tax relief and its recovery by pension funds would create a huge hole in the finances. Watch for the manifesto when it comes out.