LPI cut "could slash" pension value by thousands

The government's decision to cut the value of Limited Price Indexation (LPI) by half could significantly shrink future pensions if there would be a return of higher inflation rates, Insurance Marketing Department (IMD) says. This comes as Pensions minister Andrew Smith proposed last month to reduce LPI - introduced in 1997 to provide protection from inflation - from 5% to 2.5% in a bid to ease the cost burden on pension schemes. IMD believes this could have a major impact on the future value of pensions if inflation were to increase. However, this will not only affect peo...