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Webb may join critic Loney at mutual

Former pensions minister in line for job with Royal London

Steve WebbFormer pensions minister Steve Webb is believed to be joining Royal London, whose boss has been an outspoken critic of some of the coalition’s reforms.

Mr Webb, who lost his Liberal Democrat seat in May, was credited with introducing the biggest shake up in the industry for a generation.

Sources say he is being lined up for a senior role at Royal London, Britain’s biggest mutual life assurer which owns the former Scottish Life and Scottish Provident businesses.

He would be the second senior politician to take up a role in business following former shadow pensions minister Gregg McClymont’s appointment to Aberdeen Asset Management.

Companies are keen to employ top politicians who can help them tackle recent government reforms including new pensions freedoms and automatic enrolment of workers into workplace schemes.

Further change cannot be ruled out, particularly after the appointment of pensions campaigner Ros Altmann as Mr Webb’s successor.

Phil LoneyPhil Loney (left), Royal London’s chief executive, last year described Mr Webb’s plans to cap charges for workers automatically signed up to pension schemes at 0.75 per cent as a “headline grabbing” policy.

In an interview with Daily Business in May, MrLoney said the new minister’s biggest test could be convincing her new bosses in government that some of their current thinking “is a little wrong-headed”, including an election commitment to curtail tax relief for higher rate taxpayers.

“We are hoping this will not happen as it is not a smart thing to do,” he said. “People imagine tax relief on pensions is a subsidy, but if you do not give people the relief then they are being taxed twice, and this disincentivises them to save just when they are at their peak earnings powers.”

He’s also got an issue with the £1 million cap on pension pots. “It sounds like a lot, but buys a pension of only £27,000 a year. That’s hardly a life of luxury,” he said.

 

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