Home Money I fear the Labor Party will break the rules and plunder our pensions – and this explosive revelation from the party’s new henchman gives the game away, reveals JEFF PRESTRIDGE.

I fear the Labor Party will break the rules and plunder our pensions – and this explosive revelation from the party’s new henchman gives the game away, reveals JEFF PRESTRIDGE.

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Torsten Bell, new Pensions Minister

When inflation unexpectedly dropped a fraction, make no mistake: Rachel Reeves remains under acute pressure.

In the coming weeks, it will face enormous challenges to convince the markets that its economic growth plan, in a context of financial integrity, is on track. Last November, as confirmed four days ago, the economy grew a paltry 0.1 percent.

Despite the recent dramatic rise in the government’s borrowing costs, Ms. Reeves (at least for the moment) is sticking to a script that says more painful tax hikes – on top of the which will occur in April of this year. Maybe she’ll be right when a combination of moderate 2.5 percent inflation and lower interest rates (starting with a cut next month) come to her rescue.

But of course, Rachel from Accounts could be wrong. If inflation rises again in response to looming rises in business National Insurance costs and rising energy bills, we may have no choice but to turn to taxpayers (personal and business) for more of our income. , wealth and profits.

What is irrefutable is that sharp cuts in public spending (outside of the protected NHS and the crucial defense budget) are coming. Some of them – for example, a reduction in the public administration workforce – would be widely welcomed. Others, such as cutting the entitlement bill, would be more controversial.

Torsten Bell, new Pensions Minister

However, if a cut were implemented it would provoke greater outrage than that which followed last year’s removal of the universal right to winter fuel payment when someone reaches state pension age.

I am referring to the removal of the triple lock, which in theory ensures that state pensions rise each year by the greater of inflation, average earnings or 2.5 per cent.

The first indication that the triple lock could be threatened was last Tuesday when the Financial Times weighed in on Ms Reeves’ problems. He said that while he is right to rule out further tax rises (for the moment), Labor “must be prepared to save in high-cost but politically sensitive areas such as welfare benefits, public administration and the triple lock.” . ‘. The Financial Times concluded by saying: “It is time for the Government to promptly explain and detail its strategy for generating growth and cutting costs.”

A breakage of the triple closure cannot be ruled out. Although Sir Keir Starmer has repeatedly said he is committed to maintaining it, the Labor Party has shown nothing but contempt for pensioners, as evidenced by its cruel and hasty decision to restrict winter fuel payments to all but the impoverished. Therefore, a move to weaken the triple lock on the basis of “needs must” would not surprise anyone.

The recent reshuffling of Treasury chairs to accommodate the resignation of former Finance Secretary Tulip Siddiq makes his overhaul more likely. While Pensions Minister Emma Reynolds has stepped into Siddiq’s shoes, her role has in turn been taken over by Torsten Bell, former director of the left-wing think tank Resolution Foundation.

Bell loves to disrupt the pension system. Within days of taking up her new role, she has already angered millions of women born in the 1950s (called Waspis after the Women Against Inequality in State Pensions campaign) by defending the Government’s decision to deny them compensation for not having given enough time to prepare for a pension increase. your state pension age.

At the think tank, Bell had a lot to say about pensions, most of it controversial and disturbing. He has argued for the introduction of a flat rate of tax relief on contributions to workplace pensions, and for limiting the tax-free amount that can be obtained from drawing a pension of £40,000. To put this in context, the current limit is usually 25 per cent of a person’s pension pot, subject to a maximum of £268,275. Before last year’s election (and certainly after Bell left the think tank to seek election as a Labor MP), the Resolution Foundation also called on employers to start paying into National Insurance the pension contributions they make of the workers.

Bell also has strong opinions on triple blocking. In 2020, he described it as a “dumb system” because of its link to unpredictable measures of profit growth and inflation. He also said pensioners had fared much better financially as a result of the triple lockdown compared to the “poverty-increasing policies” imposed on struggling families.

I doubt Bell would lose any sleep if the triple lock was dissolved. She might get her wish if Reeves’ fiscal arithmetic doesn’t improve, or if she gets fired or falls on her sword. Torsten Bell, without a doubt, is a chancellor in waiting.

If the triple blockade were eliminated, the reaction of older people would be enormous. But, as the Labor Party has shown over winter fuel, it doesn’t care much about the nation’s army of pensioners, just train drivers and striking young doctors.

Obtaining a power of attorney “is a nightmare”

Having a Lasting Power of Attorney (LPA) to ensure that your financial or health matters are taken care of by a loved one if you become ill later in life is an absolute necessity.

1737289956 788 I fear the Labor Party will break the rules and

However, putting an LPA in place can be complicated, as I learned a little over three years ago when I took charge of my mother’s finances after she was admitted to the hospital and began her long goodbye (she died just over a year ago ).

Their bank always challenged me to confirm that withdrawals made on their behalf were genuine. But the problems I encountered pale into insignificance compared to those experienced by Heather Cunliffe, who lives near Bedford.

Heather, 61, obtained an LPA in 2022 when her mother, Maureen, now 89, was diagnosed with Alzheimer’s and placed in a nursing home. With monthly care costs of £6,200, Heather was keen to get Maureen’s finances in order. But she says dealing with financial institutions has been a nightmare.

Identification requests were impossible to fulfill because her mother no longer had photo identification, such as a driver’s license or passport, and institutions delayed opening savings accounts. You have received compensation from Kent Reliance, NS&I and Santander for poor service. “I don’t think some companies have invested enough in dealing quickly and satisfactorily with the people who take care of their loved ones’ finances,” he says. Heather is absolutely right.

  • Have you had problems as a lawyer? Email jeff.prestridge@mailonsunday.co.uk.

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