Lord Adair Turner has squared up to UK chancellor Gordon Brown in his last report as head of the government-appointed Pensions Commission by slamming the exchequer's preference for means testing.
Ever since first publishing the report at the end of November, Lord Turner and Mr Brown have appeared to be at loggerheads over the course of reform.
Widespread speculation suggested that Mr Brown had rejected the majority of the proposals suggested by the commission’s report as unaffordable before it was even published, with rumors hinting that the Treasury fears the proposals would create a GBP20 billion black hole in public finances by 2020. The issue is also believed to have widened the divide between the prime minister and his chancellor.
Now, in his final official address as the pension commission head, Lord Turner has reiterated the need to remove means testing in order to provide incentive for the young to save. Lord Turner has also advocated increasing the pension age to 68 and putting in a link to earnings rather than retail prices, which is also believed to have irked the chancellor.
The government now faces the difficult challenge of deciding how far and how fast it can move towards the reform of the state pension system we proposed, Lord Turner says.
The government is now preparing its own proposals for pension reform.