PRESS RELEASE
3 April 2007

Brown’s Betrayal of British Pensioners

Gordon Brown’s election pledge in 1996 claimed fairness to pensioners under New Labour. However the Treasury’s policy papers, released only last week (no doubt withheld on his orders), tell a different story.

Brown’s biggest con trick of all has been a multi billion pound stealth tax on pension funds that has robbed people of their security in retirement. In 1997, Gordon Brown imposed the ultimate stealth tax on pension funds by abolishing tax credits on dividends, costing occupational pension schemes billions of pounds and undermining the retirement dreams of thousands of people. The raid has cost pension funds an estimated £5 billion a year, and all to fund his spending boom.

Malcolm Moss MP says:

“Brown was warned of the consequences of his tax raid. Treasury officials advised the Chancellor that the tax change would cause a massive shortfall in pension funds and that poorer pensioners would be hit hardest. The change would lead to a reduction in pension benefits to the lower paid. Quite clearly any loss of pension could be difficult for someone with a small income to cope with”

The Chancellor must also take responsibility for our rising council tax bills which have increased disproportionately as a result of the need to compensate for the dwindling local authority pension funds. It has been said that one quarter of our council tax is now going towards the local authority pension fund deficits.

Malcolm Moss MP says:

“Thanks to the Chancellor people who work in the private sector whose pensions have been ruined by him are now having to fund the pension deficits of those who work in the public sector through their ever increasing council tax bills.”

The pension fund raid has been reported as being one of the worst decisions that Gordon Brown has made and that it has done irreparable damage to pensioners, not just their pension funds. Over the long term, actuaries have predicted that Brown’s abolition of tax relief will reduce the value of pension funds by at least £100 billion.

These pension fund raids spell bad news for those about to retire in North East Cambridgeshire but my warnings back in the late 90’s seem to fall on deaf ears. Only now with the release of Government Papers can we see clearly that Gordon Brown ignored professional advice from both his civil servants and pension experts. Officials have claimed that those about to retire, or those who have just retired would be worst affected.

Malcolm Moss MP says:

“When the Conservatives were in office we received representations to abolish the tax credit – but refused to do so because of the damage it would do to pension schemes. The Conservatives are to hold a special debate in the House of Commons after the recess to ensure Gordon Brown personally explains his actions and subsequent denials surrounding his decision in 1997. Today, people want an apology, not a cover-up. And they must be wondering, ‘How can we trust Mr Brown to be Prime Minister?’”