Warning not to lessen appeal of pensions

STANDARD Life has warned the Government against lessening the appeal of pension products by reducing tax reliefs, after a survey showed only a quarter of respondents think it’s a good time to invest in pensions.

The Standard Life survey of 1,000 people found that only 25% of those questioned saw the current financial climate as a good time to invest in a pension. Two years ago, the same survey returned an 80% approval rate for pension products from respondents.

“At times like these, the Government needs to encourage, not discourage, long-term savings.

“Reducing attractive income tax reliefs might be the last straw for savers in an already hard-hit market,” said Jim Connolly, head of pensions at Standard Life Ireland.

In the recent emergency budget, the Government increased, from 47% to 49%, tax relief on pension contributions for higher rate taxpayers, owing to the increased employee health levy.

The Standard Life survey also showed that 50% of respondents think it’s a bad time to buy shares, the same percentage think it’s a bad time to buy a holiday home, 58% feel similarly regarding Irish buy-to-let property and 59% are currently against the idea of buying overseas buy-to-let property.