18 March 2023 , 22:30
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Ministers are expected to raise the pension age for low paid workers just weeks after handing the super-rich a pension tax giveaway.
Chancellor Jeremy Hunt scrapped the tax-free ceiling on pension savings, allowing pension millionaires to stash away £60,000 a year without paying a penny in tax.
He claimed the handout, announced in this week's Budget, was to encourage fewer doctors to take early retirement when they hit the million pound tax-free limit on savings.
But Britain’s highest earners - including longstanding MPs and Ministers, who benefit from extremely generous pensions - could also benefit from the move.
They include Mr Hunt himself and former Attorney General Geoffrey Cox, who pockets hundreds of thousands on top of his MP’s salary as a high flying barrister.
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“I did 15 years in parliament and that used up 75% of my allowance,” Helen Goodman, Labour ’s former Work and Pensions minister told the Sunday Mirror.
“If I'd been a high paid minister for a long time, within that time period, my contribution would have been higher.”
Longstanding MPs and ministers - including Jeremy Hunt - could stand to benefit from the pension tax giveaway (PA)Angela Rayner, Labour’s Deputy Leader said: “While families across the country face rising bills, higher costs and frozen wages, it appears that Tory politicians, including the Chancellor himself, will be laughing all the way to the bank courtesy of their own billion-pound handout to the richest one per cent.
“This gilded giveaway is the wrong priority, at the wrong time, for the wrong people and a Labour government will reverse it.”
Labour’s analysis of the plans found just 11 out of every 90,000 people in the UK will benefit from the tax giveaway - the equivalent of one football team in a packed Wembley Stadium.
Shadow Chief Secretary to the Treasury Pat McFadden said: “The vast majority of pension won’t benefit from the Government’s proposals because they will never get near a pension pot of more than £1 million.
“The Government should rethink this giveaway and instead focus on a scheme to deal with the early retirement problems facing the NHS.”
Ministers have a deadline of May 7 to review the pension age - and it's thought a decision to speed up the increase of the pension age could come even sooner.
Work and Pensions Secretary Mel Stride has refused to reveal the Government's thinking on pension plans.
But speaking to a Commons committee earlier this month, he acknowledged life expectancy, the regional impact and finances are among the metrics being considered when making a decision.
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A phased increase in state pension age from 66 to 67 by 2028, and eventually 68, are already planned.
But it's thought the increase to 68 could be brought forward.
French President Emmanuel Macron’s plan to raise the retirement age from 62 to 64 sparked a wave of strike and violent protests across the channel last week.
On Friday night, furious protesters tossed an effigy of Mr Macron into a bonfire in Paris’ Place de la Concorde, prompting cheers from the crowd.
A government spokesperson said: “With too many people on NHS waiting lists, we need to move quickly - that's why we're implementing pension reforms in a matter of weeks to help keep experienced doctors and consultants in our NHS.
“We are helping families with £94 billion of cost of living support, freezing fuel duty, protecting pints and sticking to the plan to halve inflation this year to ease the pressure on everyone.
“We are also protecting the Triple Lock which increases the state pension by over 10 per cent next month, and providing direct £300 direct cash payments to pensioners this year.”