NI Cuts (Spring Budget) – Pensions expert opinion

With National Insurance cuts widely touted to be the headline announcement in Chancellor Jeremy Hunt’s Spring Budget today, Lily Megson comments on why this will be a missed trick where retirement planners are concerned

 
Lily Megson, Policy Director at My Pension Expert, said: “There will be millions of people across the UK celebrating the NI cuts. Around 27 million of them, in fact. However, the savings are modest – the average UK salary is around £28,000, and someone earning that much stands to save less than £350 a year by cutting NI rates by 2p. And we mustn’t forget that the impact of the NI cuts are limited to those in work. Pensioners still fall through the cracks. 
 
“Cutting income tax would have cast a much wider net and ensured that pensioners (who pay income on their pensions in retirement) also benefitted from a savings boost. Once again, we must ask ourselves, why has the government taken a limited approach in a move that sacrifices the potential to help millions more people achieve a financially secure retirement? Given the party is lagging behind in the polls and Hunt needs policies that appeal to as many voters as possible, choosing NI cuts over income tax cuts seems a misstep.”

Lily will be providing further commentary on further policy affecting pensions following the budget.