Pensions system unfit for purpose, says expert

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Pensions system unfit for purpose, says expert

Tue 23rd Mar 2010

Robin Ellison, pensions expert and partner at Pinsent Masons, said many people could not understand how their pension worked and for this reason it was "unfit for its purpose".

He added: "The Treasury have completely misunderstood how tax works on pensions and are virtually taxing pensions out of existence. The system is completely wrong."

According to the Daily Telegraph, pensioners will be £200 worse off this year because of a new 'stealth tax' which will freeze parts of their pension.

However, in the pre-Budget report given last December, Alistair Darling announced that the basic state pension would not be frozen but rise by 2.5 per cent from April, representing a real terms increase of nearly four per cent.

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