Very enlightening article from the FT ADVISOR on Labour’s plans for the State pension

Pension providers have criticised the Labour party for making “gargantuan” promises on the state pension that could have “enormous ramifications” on government spending.

Many pension providers have called out the party after it failed to mention the impact this policy would have on taxpayers in its costings document.

Comment from AJ Bell by Tom Selby a senior analyst.

” freezing the state pension age at 66 was a “gargantuan promise” from Labour which would have “enormous ramifications” for those affected, society as a whole and long-term government spending. It is incredible that the impact this will have on taxpayers doesn’t appear in the policy costings . This may simply be because planned increases in the state pension age run beyond the next Parliament.  But such a short-term approach to something as vital to the long-term future of the UK as state pension reform is hardly encouraging.”

Comment from AEGON by Steven Cameron, pensions director at Aegon who agreed the changes would come at a heavy cost to taxpayers.

 “Labour is currently leading the charge in terms of the generosity of state pension commitments. There is no ‘fund’ to pay state pensions. With today’s state pensions being ‘paid as you go’ from National Insurance contributions from today’s workers who will face an increasing burden.”

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