THE LABOUR PARTY has set out two measures which, according to a new analysis, could have a “serious impact” on those saving into a pension. Where in the UK would be affected for the longest, and how much would Labour’s “Pension Tax” cost?
The retirements of more than 10 million people in the UK could potentially be put at risk by the Labour Party’s plans on people’s pension savings, a new report by the Conservative Research Department, which is part of the central organisation of the Conservative party in the UK, has claimed. It has suggested that, on average, savers could lose more than £11,000 and be forced to delay their retirement by more than three and a half years.
The analysis looks at just two measures set out by the Labour Party – the Inclusive Ownership Fund and a Financial Transactions Tax – that would have a serious impact on those saving into a pension.
In the report, the effects of the “Pension Tax” is considered in different regions of the UK.
The analysis does not take into account the effect of Labour’s policies on wages or other savings, nor does it attempt to cost the impact of Labour’s denationalisation plans for Water, Energy, Rail, the Post Office, and parts of BT.
Therese Coffey, Secretary of State for the Department of Work and Pensions, said: “Corbyn’s pension tax will see ten million savers facing a huge bill forcing them to delay their retirement for almost three and a half years.
“This is just one of the ways a Corbyn government would hammer hardworking people on top of his plans to hike up taxes by £2,400 a year, as well as the cost of his plan for unlimited immigration and the chaos of 2020 being dominated by two more referendums – one on Brexit and another on Scottish independence.”
A Labour spokesman said: “It is no surprise big finance interests are batting for the Tories in this election – Boris Johnson’s Conservatives are backed by billionaires and bad bosses.
“The truth is that everyone will benefit from Labour’s plans to broaden ownership and make the UK a home for long-term, patient capital.”
According to the Conservative Party research, in England, the expected average cost would come in at £11,167, which works out as an additional 44 extra months to work.
In Scotland, the figures is £10,653, equating to an extra 41 months to work, while it is £11,691 (36 months) in Wales.
The effects could cost £13,718 on average to those in Northern Ireland, the analysis suggested, working out at an extra 35 months to work.
Topping the list when it comes to the amount of extra time required to work under the Labour’s Pension Tax analysis was in the East Midlands, at 50 months – or four years and two months.
The impact is estimated to cost £6,150 in this region.
Worst hit in terms of the estimated cost of the Pension Tax is the South East region.
Here, it could come in at £14,270. This works out at 40 extra months to work.
In Greater London, the figure is £12,871, while in the North East, the plans are predicted to cost savers £9,758, equating to an additional 38 months before they can die.
In the West Midlands, the analysis suggests the tax would cost £10,729 – equating to 41 months of extra work.
In the South West, the estimated cost is £7,407 – working out at 45 months.
Meanwhile, in the North West the figure is an average of £6,835 – with 47 extra months to work.
Elsewhere in pension news, the Labour Party has expressed support for women born in the 1950s affected by the state pension age changes.
The manifesto reads: “Labour recognises this injustice, and will work with these women to design a system of recompense for the losses and insecurity they have suffered.”