Which? believe that the cost of pension tax relief is an 'unforgivable waste of money' after statistics from the Pensions Policy Institute show that £21 billion of pension tax relief represents 1.8% of GDP (gross domestic product).
They believe that introducing compulsion, and a centrally administered pension scheme could save large amounts of money. The Pensions Policy Institute report also reveals that over five million people do not qualify for state pensions. They believe that the figures undermine the assumption that the pension is universal.
By May this year, only 44% of people entitled to pension credit had claimed it. The PPI consider that there is a long way to go before the take-up of pension credit reaches the number of people who are entitled to it.
Our view
Compulsion is likely to arrive but, without a tax incentive, people will not save the additional amounts above the compulsory level. Without incentive would you? Which?'s suggestion is therefore fundamentally flawed as compulsion only will just lead to higher inflated prices as we all have the same money.
This is Communism in its simplest form - an already proven failed economic model.