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The Actuary The magazine of the Institute & Faculty of Actuaries

Actuaries criticise lack of pension policies in party manifestos

The Association of Consulting Actuaries (ACA) has criticised a lack of pension policies put forward by UK political parties in their recently published manifestos.

Politicians failing to address pension challenges ©iStock

The ACA announced policy proposals that it wanted to see from political parties last month, but said that incentives to save seem to have taken a “decidedly background role”.

It found no clear commitments from parties to increase automatic enrolment minimum pension contributions, which could boost the savings of millions of employees.

There has been no mention of extending pension freedoms to help younger people with house deposits either, and no plans to simplify the defined benefits pensions regime.

“We need our politicians to seek some greater stability and long-term thinking over the various pensions, savings, social care and tax regimes," said ACA chair, Jenny Condron.

"Ideally, with a desire to identify some consensus across the parties akin to that enjoyed in respect of the pensions auto-enrolment policy over the last decade."

On social care, the ACA said it welcomes extra investment promised, and agrees with the views expressed that cross-party discussions would be useful in trying to find a package of policies.

The Labour Party has announced a huge £58bn post-manifesto compensation package for the WASPI women given insufficient notice to changes to the state pension age.

However, the ACA said Labour’s plans to freeze the state pension age could become unsustainable, and that increases might have to be linked to improvements in longevity.

On taxation, the ACA said it was disappointed that the Conservatives give no commitment to sort out challenges presented by the taper beyond addressing the problem in the NHS.

However, it added that the Green Party’s alternative of much reduced reliefs would be less attractive to most people affected by the taper at the moment.

All the main political parties have announced their support for the continuance of the pensions triple-lock.

However, the ACA said it is disappointed to see a continued commitment to the policy, and that it increases the intergenerational income growth differences by dint of the pensions system.

“It’s simply not right if changes of approach and tough decisions are hidden away in the long grass,” Condron said.

“This just leads to the public growing ever more disillusioned when the policy rabbits appear out of the hat post-general election.”

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