Rachel Reeves has appointed Torsten Bell as Pensions Minister, raising concerns for pensioners as he aims to change key benefits and tax rules.
London: Last week, Labour appointed Torsten Bell as Pensions Minister. This move has many pensioners worried. Bell has a history of proposals that could hurt their savings.
He’s young and far from retirement, so he doesn’t have to stress about his own finances. Bell used to lead the Resolution Foundation, and now he’s an MP with a secure pension. But ordinary folks? They should be concerned.
Bell has been vocal against the state pension triple lock, calling it a “silly system.” For millions, it’s anything but silly. This system has helped lift many out of poverty over the last decade. If Bell gets his way, they might struggle again.
His appointment signals a growing push against the triple lock. While some want it gone, Bell has bigger plans. Last year, I said his ideas felt like a nationalization of personal wealth, and I still believe that.
He’s got four main targets for pensions, and he’s already made a move. Before the autumn Budget, he pushed for inheritance tax on unused pension pots. Rachel Reeves took his advice, and this change will kick in by March 2027.
Now, families could face both inheritance tax and income tax on inherited pensions. That’s a double whammy, and it could get even worse with Bell in charge.
But he’s not stopping there. He’s eyeing our tax-free cash next. Right now, you can take out 25% of your pension tax-free, up to £268,275. Bell has suggested cutting that to £100,000 or even £40,000.
Then there’s tax relief on contributions. Currently, it’s set at 20%, 40%, or 45%, depending on your income. Bell thinks this favors higher earners and wants a flat rate, maybe around 25%. This could save the Treasury a lot but would discourage saving.
He’s also a fan of the lifetime allowance, a complicated rule that taxed excess savings at a hefty 55%. While Reeves seems to have ruled out bringing it back, Bell might push to lower the annual allowance from £60,000 to £40,000 or less.
It’s already tough to encourage saving for retirement. If Bell gets his way, it’ll be even harder. The message is clear: act fast. Take advantage of your pension tax breaks while you can.
Reeves’ new pensions hitman is ready to make cuts, and he’ll go as deep as she lets him. Heaven help pensioners if he becomes the next Chancellor.
READ: Meet the man who’ll replace Rachel Reeves – and his fanatical plan to hike your taxes.
