High earners would face a £1bn ‘tax grab' on their pension contributions to fund return-to-work schemes for the long-term unemployed should Labour return to power.
The FT reports the plan would target the pensions of the rich to pay for the programme to tackle the "scarring" effect of long-term unemployment.
The initiative, from shadow chancellor Ed Balls, would operate by limiting tax relief on pension contributions for people earning more than £150,000 to 20% from the new top rate of 45p, the FT reports. It said the policy would raise £1bn.
It said as contributors can only claim a maximum of £40,000 tax free per year, they could face an additional tax bill of £10,000.
Shadow work and pensions secretary Liam Byrne told the BBC's Today Programme the policy was "best way to bring the benefits bill down".
He added: "Welfare to work needs jobs if it is to work properly. So we'd invest in creating jobs but it has got to have a tough edge."
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