The long awaited, and shortly to be published, final report of the UK's Pensions Commission has been dealt a potentially serious blow just days prior to its release. Speculation is rife that the chancellor Gordon Brown has already dismissed its findings as unaffordable.
The reports, carried by both the BBC and the influential Financial Times newspaper, suggest that government officials are seriously worried about the likely cost of the commission’s recommendations.
The controversy has been further fuelled by a letter sent by Mr Brown to the commission’s chairman Adair Turner, which has been seen by the Financial Times. Mr Brown apparently tells Mr Turner that he should not assume the government’s pension credit will remain linked to earnings beyond 2008.
The implication from the chancellor is that it will instead be linked to prices – diminishing the value of the pension credit in real terms. This suggestion has prompted a furious reaction from campaign groups representing seniors.
Officials at the UK Treasury are said to have been angered by the draft of Lord Turner’s findings, and publicly ministers are saying only that the commission’s report will prompt a long and ‘grown-up’ debate on UK pension strategy.