Brian Byrnes, Head of Personal Finance at Moneybox comments: “As the country wakes to the reality of a new Government, our attention is now firmly focused on when Labour will deliver the detail behind the promises outlined in its manifesto to reignite our economy, and deliver much-needed change.

“The manifesto included many exciting pledges to reform the pensions landscape and help deliver better outcomes for UK savers, alongside a commitment to support first-time buyers and help them realise their dream of home ownership”

“As part of the policy rollout, we believe there is an urgent need for our new Government to prioritise measures that will help the nation build financial resilience and drive a shift towards enabling long-term wealth generation. Three initiatives Labour could deliver to ensure measurable impact against these goals, include:
 

  1. Make the pensions dashboard available as soon as possible

 
“Recent Moneybox research found that just 13% of people aged between 35-54 know how much they need to save to achieve their desired income in retirement and nearly half (47%) do not believe they are on track for a comfortable retirement.”

“With so many people uncertain about their future retirement, a great way to boost awareness and engagement with their pension planning is through making it easier for them to keep track of all the money they have already saved towards their retirement.

“We know that there is between £25bn and £50bn today sitting in lost or forgotten pensions pots, and an immediate commitment to allocating the necessary resources to make the pensions dashboard available as soon as possible could be the change needed to encourage more people to take control of the retirement savings earlier in life.”
 

  1. Increase the Lifetime ISA price cap by House Price Inflation (HPI) from 2024/25

 
“The Lifetime ISA is a fantastic product that has enabled a whole generation of first-time buyers to buy their home far sooner than would have otherwise been possible. Launched in 2017,  more than 1 million people are currently saving with the Lifetime ISA to help boost their deposit savings and navigate some of the most challenging marketing conditions in the last 70 years.  To enable the next generation of homebuyers in the UK the government must futureproof the LISA product rules which have not been reviewed since the product first launched.

“Moneybox analysis, which explores the potential of increasing the LISA price cap in-line with House Price Inflation and introducing a £1,000 emergency allowance for savers, estimates this would cost an additional £95m a year over the course of the next parliament.”

“While the current pressures on the public finances at the moment are high, this potential cost is a fraction of the cost of The Triple Lock commitment (£9bn a year), Pension Tax Relief (£50bn a year) and ISA Tax Relief (£4.3bn a year).”
 

  1. Prioritise a decision on the Advice Guidance Boundary Review

 
“Financial advice continues to be inaccessible to the vast majority and so more needs to be done to guide and support people as they learn how to manage their finances and plan their finances for the future with greater confidence. Moneybox research recently found that approximately 35 million people in the UK are £65k worse off on average because of low levels of financial confidence and knowledge which is part of an enduring legacy of poor financial education across the country.

“The advice guidance boundary review has the potential to transform consumer finances and help people make financial decisions with greater confidence throughout life. Though some proposals are more complex and will take time to implement, measures like targeted support could be expedited and would enable pension providers to better meet their customers’ needs.

“By focusing on these areas in the first two years of Parliament, Labour could significantly improve retirement provisions for millions of workers, allowing the industry to then tackle more complex issues, such as drawdown support.”



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