The Pensions and Lifetime Savings Association (PLSA) has commented on the Government’s plans for health and social care.
Nigel Peaple, Director of Policy and Advocacy, PLSA, said: “The cost of social care can be a very substantial burden for people in retirement. Therefore, it is positive that today, after several decades of discussion by different administrations, the Government has come forward with proposals.
“The PLSA set out four principles for the reform of social care funding in its 2018 Hitting the Target proposals on retirement income. These were: the proposals should not reduce pension income needed to support normal living costs (adequacy); the proposals should cover all or most of those in need of social care (universality); the cost should fall on those who can afford to pay and protect those who cannot do so (fairness); they should be sustainable for the Exchequer (affordable).
“We will examine the details of the proposals when they become available later today. The measures announced, so far, appear to go a long way to satisfying our four principles, although it is clear that the debate about the fairness of the proposals will continue for some time to come.
“The application of the Health and Social Care levy to workers over retirement age will require some costs to employer payroll systems. Some pension savings might be affected by the change to the taxation of the dividends. However, HMT have confirmed that it is their intent that dividends earned within pensions will be exempted from this measure.
“With an aging population it is important that we have a national conversation about retirement income. The Government’s proposals today for the funding of social care are a key element of this discussion. With millions of people not saving enough for retirement it is also important that the Government tackles the question of pension adequacy.”
Mark Smith, Senior PR Manager
020 7601 1726 | [email protected]
Steven Kennedy, Senior PR Manager
020 7601 1737 | 07713 073024 | [email protected]