Pensions are among the many things that worry us about the future. Somewhere around 320,000 people retire each year with defined contribution pension savings, but when they die their beneficiaries face the prospect of a whopping 55 per cent tax on the remaining savings. The Chancellor has announced that this 55 per cent tax will be abolished completely.
From April 2015 onwards, when the deceased is 75 or over, any beneficiary will only have to pay the normal marginal tax rate when they drawdown the pension. Beneficiaries will be able to access the pension money at any age, and there will be no restriction on how much can be withdrawn at any one time. If an individual dies before
the age of 75, he or she will be able to pass on his or her pension pot completely tax free.
We fundamentally believe in giving people greater freedom to manage their pensions in retirement. People can no longer be forced to buy an annuity, and we believe 18 million people overall will benefit from our pension reforms.
The rapid worsening of the situation in Iraq was called to our attention with the recent recall of Parliament. Readers will be well aware that I am one of the most anti-war Members of Parliament, and that I have repeatedly called governments – whether Conservative-led or Labour – to task for too easily going to war.
With regard to the Middle East, we in the West have done almost everything wrong up to this point. We never should have invaded Iraq – an invasion I voted against in 2003 – and last year we were invited to launch air strikes against the Syrian government repeating the very same mistakes of a decade ago.
As the British government is indirectly responsible for creating the conditions in which violent jihadism has thrived in Iraq, it likewise must take part in putting this right. I’m against repeating the errors of the 2003 invasion, but our participation in the air strikes against ISIS-held targets will help Iraqi forces to consolidate their gains against the jihadists.
As the parties gather for their annual conferences, it’s a good moment to take stock of what has been achieved since this parliament was elected in 2010. The Chancellor has announced that the 55% tax on pension pots will be abolished completely, so that hard-working people will be able to pass on their pension savings to their beneficiary. Income tax has been cut for over twenty-five million people, and 1.8 million more people are in employment. The state pension has been increased by £800, and immigration is down from its peak under Labour. An IMF report says we have the fastest growing of the world’s major advanced economies.
It’s well known that I’m not shy in voicing criticisms of the Prime Minister or the Chancellor when I think they’ve done wrong, but experience is showing that their long-term economic plan is working both for Lincolnshire and for the country as a whole.
Sir Edward Leigh
MP for Gainsborough