A secure income in old age is at the centre of the Liberal Democrats election manifesto released ...
A secure income in old age is at the centre of the Liberal Democrats election manifesto released yesterday, as are a number of other financial services reforms.
According to figures released by the LibDems, increased taxation, a variety of tax increases and changes to financial and economic policy could generate an additional £8bn per year, which they say is sufficient to finance its election policy propsoals.
In a manifesto tailored around the theme of "Freedom, Justice, Honesty", the Liberal Democrats outlined the establishment of an Independent Pensions Authority to report on the state pension.
At a more fundamental level, those with private pensions would be allowed a greater say in the use of their pension fund and the basic state pension would be increased, in particular for those over the age of 75.
Picking up on the dissatisfaction with current compulsory annuity purchase rules, the Liberal Democrats are also proposing a relaxation, as the Conservative Party also pledged last week.
State pensions would face significant change with the introduction of an Owned Second Pension Account, designed to top up people's basic state pension. State pension entitlement would be extended to all citizens, according to the manifesto document, however those aged over 75 will receive a higher amount.
To pay for this obviously more expensive pension system - as well as fund greater investment in the NHS - the Liberal Democrats propose to create higher rate of tax set 50p for those with income of over £100,000.
Another revenue gathering tactic would be to close loopholes in the Capital Gains Tax system. For instance it has been suggested that Capital Gains Tax may well be paid on inheritance.
Taxation for the lowest paid would also come under reform, with the 10p tax rate being slashed to zero.
Personal investment would again come under review with the mutual ownership of building societies and cooperatives to promote them as forms of ownership, and while it is not clear what it signals, the Liberal Democrats also say the life insurance sector would come under review.
In other sectors, the Liberal Democrats propose to freeze duty on ever-increasing petrol prices and aim to double the amount of freight carried on rail by 2010, as well as expect local authorities to raise bonds and use congestion charging to invest in local transport schemes.
In health, the Liberal Democrats would pay for all long-term personal care costs and create a pharmaceutical agency to dirve down the cost of prescription drugs.
First time in history
Hymans Robertson’ Guided Outcomes
Our weekly heads-up for advisers
More than £167,000 raised
Beware ‘temporary’ vulnerability