Chancellor Alistair Darling is expected to delay the introduction of Personal Accounts for a year as part of spending cuts in the Pre-Budget Report.
The delay would save the Treasury between £1bn and £2bn in tax relief on the pension contributions. The Government had promised to introduce them in 2012.
Delaying Personal Accounts is likely to be one of Darling's "tough choices" on how the Government will maintain "priority" frontline services while halving the £180bn deficit in public finances in four years, The Independent reports.
He is forecast to say making cuts in 2010-11 would be wrong while the world economic outlook is so uncertain. So the squeeze in "non-priority" departments will bite in 2011-12.
The Personal Accounts Delivery Authority (PADA) says the story is pure speculation at present, and refused to comment further.
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