The FT is seldom wrong about these things. What changes in pension taxation there will be , will be targeted.
Hunt will try to tackle the NHS staffing crisis by changing pension rules that are blamed for dissuading senior doctors from working into their fifties. The annual pension saving limit will rise from £40,000 to £60,000 before tax charges are incurred, and the lifetime allowance will increase from its current level of £1mn.
Pension allowance changes are not being targeted at the mass-affluent, malingering in the hope of the money purchase annual allowance being extended. Neither the FT nor I expect to see the MPAA recycling limit being raised to get the over 55s working again.
Where the Chancellor has his gimlet eye is on the not so hard-working families.
A big focus of the Budget will be on tackling workplace inactivity, including making childcare more affordable for less well-off families and increasing incentives for the sick and disabled to gain employment.
Hunt will increase the amount parents on universal credit can claim for childcare but admitted it would be “expensive” to extend the help to working families not in receipt of the flagship welfare benefit.
He will also announce that the number of children that each carer can look after in nurseries in England will be increased from four to five, bringing them into line with their counterparts in Scotland.
People on universal credit will be encouraged to move into work or increase their hours through changes to the welfare benefit.
An element of coercion will be used, with claimants being asked to attend more regular meetings with work coaches and attend skills boot camps.
This back to work stuff sounds a lot tougher than anticipated. I have seen the re-purposing of Guy Opperman’s Mid-life MOT as part of the back to work boot camp for some months, and warn you again – it is now no cuddly pension engagement concept.
I suspect the prospect of spending time in such camps will not be high on agenda of those currently enjoying the fruits of their workplace retirement saving. With the prospect of an announcement on changes to the state pension age imminent, you should not be sitting easy through Wednesday lunchtime, if you are spending a fast diminishing pot.
The message looks to be that work rather than pensions is the economic panacea for the 800,000 over 50s who are missing from the UK workforce.
That could mean that it’s back to school for many who had thought they had embarked upon the longest holiday of their lives.