THE FT THIS morning says that higher rate tax relief on pension contributions looks set to remain se...
THE FT THIS morning says that higher rate tax relief on pension contributions looks set to remain secure after the Treasury yesterday claimed moves to scrap such relief for higher rate taxpayers would be "political lunacy".
The report comes after a weekend of frenzied speculation over the government's future plans for such relief.
The FT says and increasing number of people are arguing support for Ron Sandler's idea of transparent matching contributions rather than tax relief as an easier to understand and fairer system for encouraging people to save more towards retirement.
The FT says the idea of scrapping relief has been studied by "someone, somewhere", but statements from Downing Street, the Department of Work and Pensions and the Treasury indicate there are no formal moves to make the suggestions policy just yet.
The FT says that when New Zealand scrapped relief in the 1980s, the level of pension savings crashed, and many companies shut down their schemes or significantly reduced the benefits.
THE DAILY TELEGRAPH picks up on the same story, saying that Downing Street is desperately trying to distance itself from the idea that top earners would see their tax benefits cut as part of the reforms to be outlined in the coming pensions Green Paper.
However, it is less sure than the FT that the idea has been completely rejected out of hand, noting that the level of secrecy surrounding the Green Paper remains high, and that it is impossible to completely discount the idea.
THE SCOTSMAN'S COMMENT on relief is to quote former welfare minister Frank Fields as saying the UK pensions system is headed for a crisis "worse than poll tax".
The paper adds that in Fields' view, the ending of final salary schemes will leave an increasing number of people destitute in retirement, something the government will need to fix.
And with Gordon Brown preferring to redistribute wealth through stealth means rather than outright tax increases, The Scotsman says it may be that the rules for tax relief on pensions contributions are changed.
MAN GROUP HAS confirmed it is taking over GNI in a £100m cash bid, the FT today says.
The deal will provide positive earnings in the first year of ownership, Man Group says, because £8m in costs are to be stripped out and GNI has a record of producing profits - in the first half of 2002 it made £5m for existing owner Old Mutual.
UNDERFUNDED PENSION schemes at private schools are going to lead to an average 10% increase in fees during the next year according to The Times, which says the schools involved will have no choice but to meet new government guidelines.
Schools' contributions to the teachers' pension scheme, a state-administered final salary scheme, will be required to go up by 5% - state schools have their fees met by taxpayers, something the private schools say means their contributions amount to another stealth tax.
The private schools say they should not have to pay for the government's poor management of the pension scheme.
GOVERNMENT MANAGEMENT of the economy is also the agenda in The Times' piece on next month's pre-budget statement, which the paper says will be the first time Gordon Brown has to face the music.
After five years of "extraordinary luck", the paper says, he will have to admit that the forecasters got it wrong, and UK economic growth is coming in woefully under target to finance his spending plans.
The Times says some budget deficit forecasts now run up to £18bn to £20bn against the planned £11.2bn.
Even The Times admits, however, that £20bn is only 2% of the national economy, well below the 3% limit of the Maastricht treaty, and well below the near 8% deficit experienced in the early 1990s.
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