Make pension tax relief only available to savers prepared to invest in UK, Andy Haldane says

Pension tax relief worth more than £50bn should only be offered to savers who are prepared to invest in Britain, according to Andy Haldane , the president of the British Chambers of Commerce. There should be a “home bias” that directs retirement savings into UK businesses, closing a funding gap that hampers the growth of small- and medium-sized businesses, he said. Speaking at the annual BCC conference in London, Haldane said radical measures were needed to provide startup companies with the capital they needed to grow. The former Bank of England chief economist, who has been mentioned as an adviser to Andy Burnham, is expected to push for the proposal to be the centrepiece of a new economic plan. Pension tax relief tops up savings into regulated personal and occupational retirement funds at the marginal rate of tax. It is estimated that higher rate (40%) and additional rate (45%) taxpayers are the biggest gainers from the system while those on low incomes and unable to save in a pension are excluded. Haldane said there was a gulf between the needs of companies and the capital available, even though the international financial system was awash with money looking to find a home. He said: “Unfettered free markets have not worked. That is a lesson of the last 30 years.” Andy Haldane has been mentioned as adviser to Andy Burnham, who returned to Westminster after winning the Makerfield byelection. …