Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what assessment he has made of the potential effect of increased inflation on low-income households.
Answered by Simon Kirby
The Office for Budget Responsibility (OBR) expect inflation to increase to 2.5 per cent by the end of 2017 and peak at 2.6 per cent in Q2 2018. Their forecast was reflected in the distributional analysis published alongside Autumn Statement 2016. The government is taking steps to support low-income households, including raising the National Living Wage, raising the personal allowance, freezing fuel duty, and providing more affordable homes.
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what assessment he has made of the effect of the quantitative easing programme on defined benefit pension schemes.
Answered by Simon Kirby
Monetary policy is set independently by the Monetary Policy Committee (MPC) of the Bank of England. The minutes to the MPC’s August meeting, in which the Committee expanded its asset purchase programme, noted that ‘lower yields posed potential risks to some aspects of the functioning of the financial system, for example by increasing the deficits of many pension funds’ but concluded that ‘at present, however, those effects appeared to be relatively limited’.
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, pursuant to the Answer of 24 May 2016 to Question 37150, what assessment he has made of the effect of new lifetime ISA on changes in the levels of pension savings amongst young people.
Answered by David Gauke
The new Lifetime ISA is an additional flexible savings product which will complement pensions to give savers greater freedom and choice to save for the long-term in a way that works for them.
With automatic enrolment set to help nine million with their pension, the Government remains committed to supporting people who save in different ways.
The Lifetime ISA supports the Government’s ambition to encourage a regular savings habit amongst young people and to create a culture of long-term saving.
The Lifetime ISA is a voluntary product. For further information on the costing of this policy, please see page 9 of the Budget 2015 Policy Costings document: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/508147/PU1912_Policy_Costings_FINAL3.pdf
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what assessment he has made of the potential effect on levels of pension saving of the introduction of the lifetime ISA.
Answered by David Gauke
The Lifetime ISA is a complement to the existing pension system. It will provide savers with greater choice and flexibility in how they save for retirement.
From April 2017, people aged 18 to 40 will be able to save up to £4,000 each year into a Lifetime ISA and receive a 25% bonus from the Government.
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, if he will make an assessment of the implications for his policies on reducing the Government's stake in the Royal Bank of Scotland (RBS) of the (a) decision to defer the redemption of dividend payment by and (b) recent changes in the share price of that bank.
Answered by Harriett Baldwin
The Government has consistently said that disposing of our stake in RBS is the right thing to do for the taxpayer and the British economy. Returning RBS to private ownership will promote financial stability, a more competitive banking sector, and the interests of the wider economy.
The first sale of government shares in RBS was conducted in August 2015, and raised £2.1 billion for the taxpayer. The government will continue to return RBS to private ownership and conduct further sales of RBS shares, subject to market conditions.
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, if he will make an assessment of the potential merits of expanding Pension Wise to include consideration of housing wealth as a source of retirement income.
Answered by Harriett Baldwin
The Government is committed to ensuring that individuals are equipped and empowered to make informed decisions about how to use their pension savings through the Pension Wise service.
The Financial Conduct Authority’s (FCA) standards for the service state that guidance should provide the consumer with information about long-term care needs, sustainability of income in retirement and life expectancy, to the extent that they are relevant. Pension Wise guidance therefore prompts consumers to think about their retirement objectives and wider financial circumstances when deciding on what to do with their pension pot. As part of this consumers are asked about whether they receive any benefits, other retirement income, outgoings in retirement, and plans to continue working. The guidance is designed to equip consumers to consider questions about their situation as a whole, and directs them to further sources of information as suitable. Where it is clear that consumers need specialist help, they are directed to the appropriate source of guidance and information.
Pension Wise is constantly assessing and evaluating the service to ensure that user needs are met. As such, it is currently actively considering a number of developments, as part of our continuous service improvement, to make Pension Wise even more useful to consumers, including tailoring session content more closely to individual circumstances.
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, how many people making use of new pension freedoms have sought professional, regulated financial advice since April 2015.
Answered by Harriett Baldwin
The Government does not hold the information requested.
However, the Government is committed to ensuring that all consumers can access high quality, affordable advice so they can make informed decisions about their hard-earned money.
That is why the Treasury has launched, jointly with the Financial Conduct Authority (FCA), the Financial Advice Market Review which will examine how consumers can best be provided with the help and advice the need.
The Treasury and the FCA published a Call for Input on 12 October seeking views from all interested parties on how financial advice could work better for consumers. The Call for Input will run until 22 December and the review will report back with proposals ahead of Budget 2016.
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what assessment he has made of the effect of the quantitative easing programme on (a) bank lending generally and (b) M4 lending.
Answered by Harriett Baldwin
The UK’s monetary policy framework, set out in the Bank of England Act 1998, gives operational responsibility for monetary policy to the independent Monetary Policy Committee (MPC).
The MPC’s macroeconomic policy tools, including quantitative easing, are designed to affect the economy as a whole, in order to meet the 2 per cent inflation target over the medium term.
The Bank of England’s paper, “The United Kingdom’s quantitative easing policy: design, operation and impact”, published in 2011, notes that, “Asset purchases may also have a stimulatory impact…by influencing bank lending, though this channel would not be expected to be material during times of financial crisis.”
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, how much tax relief was granted (a) to higher rate taxpayers and (b) in total in respect of (i) defined contribution and (ii) defined benefit pension schemes in 2014-15.
Answered by Damian Hinds - Minister of State (Education)
This information requested is published in HM Revenue and Custom (HMRC) National Statistics table PEN6, available on GOV.UK: https://www.gov.uk/government/statistics/registered-pension-schemes-cost-of-tax-relief
Asked by: Ian Blackford (Scottish National Party - Ross, Skye and Lochaber)
Question to the HM Treasury:
To ask Mr Chancellor of the Exchequer, what the total value of tax relief on pension contributions applicable to higher tax rate taxpayers was in 2014-15; and what the total value of tax relief on all pension contributions for all taxpayers was in that year.
Answered by Damian Hinds - Minister of State (Education)
This information requested is published in HM Revenue and Custom (HMRC) National Statistics table PEN6, available on GOV.UK: https://www.gov.uk/government/statistics/registered-pension-schemes-cost-of-tax-relief