UK Treasury Is Giving Older People $90,000 a Year To Keep Working

An anonymous reader quotes a report from Bloomberg: Convincing older British workers to stay in their jobs will cost the UK Treasury 75,000 pounds ($90,000) per person in tax breaks for some of the country's wealthiest savers, analysis of Chancellor of the Exchequer Jeremy Hunt's budget shows. In his budget speech on Wednesday Hunt scrapped the lifetime allowance on pensions -- the total that workers can pile into their retirement pot without incurring tax -- and increased the tax-free annual limit on contributions by 50%, to 60,000 pounds. The shift is designed to reverse a trend in the number of older workers dropping out of jobs since the pandemic, which has contributed to a shortage of staff and is fanning inflation. But the Office for Budget Responsibility, the independent fiscal watchdog, calculated (PDF) that Hunt's pension reforms are likely to add just 15,000 more workers to the labor force by 2027/28. They will cost 1.1 billion pounds, meaning the reforms effectively offer a 75,000 pounds per person boost to those able to save enough in their pensions.

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