If you are quiet you will hear the whoosh of kites being flown! It is that time of the year – with the Autumn Statement on the horizon, everyone wants their ideas to be considered. Some of those kites are a new age-related bonus system, a call for a ‘pensions bonfire’ (to get rid of complexity), and various suggestions of periods of no change and independent pension commissions.

This year seems a bit special – a radical and forced change of personnel, a perceived change of direction and the big shadow of Brexit looming over us!

In the Budget in March George Osborne confirmed that there was no consensus on his reform to pension tax relief – he would do some further work and look at it again in the Autumn (the perceived subtext being; we do not want to upset the backbenchers with the referendum imminent – let’s get that out of the way in the short term).

So, to recap we got a short list of:

• No change
• Flat rate tax relief (the level to be discussed)
• Further moves from EET to TEE (the LISA being the start - a precursor to a full pension ISA?)
• Something else

In July 2015 the then Chancellor launched “Strengthening the incentive to save: a consultation on pensions tax relief”.

The feeling was that a change was long overdue; this was a combination of the perceived need to address the fact that higher earners get the highest incentive and the possibility of an immediate boost to the Exchequer.

The idea of an ISA-based pension was not widely accepted and indeed the introduction to the consultation was at odds with such a change:

“At the heart of the current system is a simple principle: the contributions you make to a pension during your working life are tax-free, and you pay tax on them when you come to take your pension.”

The ISA has long been seen as a simple product although the variations on the basic ISA have latterly changed some of that perception.

I am not sure that in reality we should be selling the concept of the ISA as good because it is simple, as opposed to pensions being bad due to their complexity.

It is the financial benefits that are the most important and to turn down an employer auto enrolment contribution in favour of a personal payment into a LISA would seem to be an example of perceived simplicity (and house purchase!) versus wider financial benefits.

So everything seems up for grabs – do we continue the work already started or (as the new Government seems to have done in other areas) is it a chance to start afresh?

Whatever we do must be with a view to the long term. Demographics continue to change and people get more and more frustrated about saving.

Back to George Osborne’s consultation:

“If people are to take responsibility for their retirement, it is important that the support on offer from the Government is simple and transparent, and that complexity does not undermine the incentive for individuals to save.”