Budget pension plan was ‘10,000-1’ shock says Worthing financial adviser

PENSIONERS and savers were the major winners as chancellor George Osborne delivered his plans for the year ahead in last week’s Budget.

Allowing older people more flexibility in accessing pensions was a surprise, with the announcement labelled a ‘10,000-1’ shock addition by Worthing financial adviser Ivan Lyons.

“It is essentially treating the public more like grown-ups.

Sign up to our daily SussexWorld Today newsletter

“It is making saving more attractive for everyone and it will hopefully encourage more people to save for their retirement,” said Mr Lyons.

“It gives people more flexibility. There has definitely been a call for it.”

For savers, who have taken a hit in recent years, during the recession, a new ISA, with limits of £15,000, will come into force from July 1.

And for those with premium bonds, the limit previously capped at £30,000 will be raised to £40,000 in June, with further rises planned in 2015.

Another positive step was raising the personal tax free allowance – the amount of money an employee can earn before being charged income tax – has also been increased, to £10,500 from April, 2015.

Worthing Liberal Democrat leader Alan Rice said this was a key part of his party’s manifesto, and the coalition had actually over-delivered on its pledge.

He said: “The £10,000 mark was a Lib Dem manifesto commitment before the 2010 general election which has been over-delivered.

“It shows the influence Lib Dems have on the Government as in the TV debates before the 2010 election, David Cameron said ‘I would love to take everyone out of their first £10,000 of income tax, Nick. It’s a beautiful idea, lovely idea – we cannot afford it’.”

There were also welcome savings on petrol, with the planned September fuel duty rise scrapped.

Beer duty was also cut by 1p a pint for the second year running, and duty frozen on wines and spirits, but smokers were dealt a blow with a two per cent above inflation rise in taxes.

Mike Shiel, landlord of the George and Dragon, in High Street, Tarring, said the 1p cut would not make a difference.

He said: “A penny is not going to make a difference to anyone. If I put it down a penny, people would just have extra change, which they don’t want. It is nice to see it going down, not up, like it has been, though.”

He added: “A good thing is the personal tax allowance rise, which will help those in the pub trade on lower incomes.”

The chancellor also declared a £200 million pot to tackle potholes.

West Sussex County Council said it was ‘too early to say’ whether they would bid for a share of the funds.

A spokesman said: “Our roads have suffered over the last few years and we have responded with our £30 million repairs programme.”