Healey sets first Budget for 28 October
Chancellor John Healey has confirmed he will deliver his first Budget on 28 October, pledging a fiscally disciplined package that will provide stability for businesses and households.
In a video message, Healey said the Budget would “move money and power out of Westminster, and into every postcode around Britain”.
He said it would be built on fiscal discipline, meet the government’s fiscal rules and give businesses and families the stability they need to plan for the future.
The announcement prompted renewed calls from the pensions industry for greater certainty over pension taxation ahead of the fiscal event.
AJ Bell public policy director Tom Selby urged Healey to commit to a Pension Tax Lock, arguing that speculation over potential changes to pension tax-free cash had prompted savers to withdraw billions from their pension pots ahead of recent Budgets.
AJ Bell urges chancellor to end pension tax speculation
He pointed to Financial Conduct Authority data showing tax-free cash withdrawals rose to £18.3bn in 2024/25, compared with an average of £7.9bn a year over the previous five tax years.
Selby said the figures suggested around £10bn of additional withdrawals were driven by speculation over possible pension tax changes.
“One policy commitment that would reassure voters without costing a penny in new Treasury spending is a long-lasting commitment to pension tax stability.”
Selby said uncertainty over pension tax incentives had encouraged savers to move money out of long-term investments, potentially harming retirement outcomes and reducing investment in the UK economy.
He also called on Healey to review plans to bring unused pension funds into the scope of inheritance tax from April 2027.
Selby said the government should consider simpler alternatives, such as applying a flat tax or using the income tax system, rather than extending inheritance tax to pension assets.
Earlier this week, AJ Bell wrote to the chancellor calling for a Pension Tax Lock, arguing that a commitment to retain pension tax-free cash and pension tax relief would provide greater certainty for savers ahead of the Budget.
