As the dust settles following Boris Johnson’s resounding December election victory, the attention now turns to whether the Prime Minister can implement his vision for the UK.
This week, parliament returned to the House of Commons with Brexit dominating the early agenda, a topic that has monopolised headlines for several years now and is set to continue to be the PM’s main priority until the end of January 2020. However, the focus will also be on the new budget and other domestic policies that formed part of the Conservative Party election manifesto.
People’s attention will also switch to how any changes in policy will impact their personal finances, both today and their future pension plans.
Here is a summary of the key points impacting pension policy;
- The new state pension amount could rise from £168.60 a week to about £175.20 in April, with the amount rising in line with inflation, earnings or 2.5% (the highest of the three), this has been dubbed as a “triple-lock system”
- A commitment to raise the national insurance threshold, a change which is likely to be included in February’s budget.
- A promise to investigate a pension shortfall that has seen some workers, disproportionately women, who earn between £10,000 and £12,500 missing out on pension benefits.
- New protection for those with workplace pensions, and reforms to allow a new type of shared-risk DC pension scheme to be made available.
- A pledge to solve the impact of the tapered annual allowance on the NHS
- Continued support for the creation of new online pension dashboard(s).
On Thursday 19th December, the Queen addressed the House of Lords at the official state opening of parliament. Her speech outlined her new government’s legislative programme including an update to the Pensions bill outlined on the 14th October. The bill itself remained broadly unchanged, with legislation to establish collective defined contribution (CDC) schemes, enhancing The Pensions Regulator's powers and providing the framework for the pensions dashboard all confirmed.
So, we must now wait to see how quickly some of these proposed changes to pension policies can be passed. In typical Boris Johnson fashion, the re-elected PM made no bones about his intention to carry out a swift plan of action.
But what actions can you take to prepare for the prevailing pensions landscape? It is imperative that you unravel the complexities of financial planning.
Check out our recent blog that outlines how our planning tools can assist both advised and non-advised individuals with their pension planning needs.