Select committee: Work and Pensions Committee
Recommendation 15
Third Report - Protecting pension savers – five years on from the pension freedoms: Saving for later life
Published 30 Sep 2022
Paragraph 108
Addressed to Department for Work and Pensions
Work and Pensions Committee Protecting pension savers – five years on from the pension freedoms: Saving for later life All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Recommendation (the committee's words)
We welcome the Government’s recognition of the importance of addressing the fact that some low earners (disproportionately women) miss out on tax relief because their pension scheme uses the ‘net pay’ arrangement for tax relief. Given this is a long-standing concern, it is disappointing that the first payments will not be made until 2025/26 and that those eligible will have to take action to receive payment. We recommend HM Treasury consider whether payments can be brought forward and, if not, whether arrangements can be put in place for backdating payments, at least to 2021/22, when the plans to equalise outcomes for low earning pension savers were first announced. We urge the Government to set out its strategy for maximising take-up and explain how it will work with stakeholder organisations on this.
From: Work and Pensions Committee, Third Report - Protecting pension savers – five years on from the pension freedoms: Saving for later life (HC 126), paragraph 108, 30 September 2022
Government response
The government responded to the whole report on 23 January 2023 (deadline 30 November 2022).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government "notes" the Committee's report and responds to each recommendation in turn, committing to implement the 2017 Automatic Enrolment Review measures while declining several proposals.
- On the 2017 Review, it remains "committed to the implementation" of its ambitions "in the mid-2020s" and aims to bring forward legislation "at a suitable opportunity and when parliamentary time allows", with a consultation on implementation.
- It declines to consult on a plan for older savers without Defined Benefit pensions, saying "We do not believe now is the right time to consult", and does not support trialling automatic Pension Wise bookings.
- It states that "a new office is necessary" is not its view: the government "does not believe that a new office is necessary" to build the evidence base on retirement adequacy.
- On the gender pensions gap, it is developing a definition and says any target "could only be considered once a suitable definition has been agreed upon".