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Spring Budget 2023 – GAD’s analysis

GAD's analysis of the Spring Budget 2023 focuses on pensions taxation, pension fund investment and retirement planning.

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Experts at the Government Actuary’s Department (GAD) have focused on pensions taxation, pension fund investment and retirement planning in their analysis of the Spring Budget.

The Chancellor set out plans to deliver on 3 of the Prime Minister’s 5 key priorities: to halve inflation, grow the economy and get debt falling.

Pensions tax reform

GAD’s latest Technical Bulletin examines the government’s announcements on pensions tax reform. The Spring Budget aims to increase the labour supply and support people to move into employment. There is a particular emphasis on encouraging workers aged over 50 to extend their working lives. The proposed reforms will help ensure that high skilled individuals, such as NHS clinicians, are not disincentivised from remaining in the workforce.

Reforms were announced to the total tax-relieved pension savings an individual can make each year and over their lifetime. These affect the lifetime allowance (LTA), annual allowance (AA) and money purchase annual allowance (MPAA), as well as other tax limits.

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Pension fund investment

GAD’s Technical Bulletin also looks at the government’s plans to support high growth sectors of the economy. This will include encouraging investment and smarter regulation.

The Spring Budget set out some initial measures, while the government will work closely with industry and regulators to bring forward a package of measures by the autumn.

Retirement planning

There will be more focus on retirement planning. People in their 40s, 50s and 60s will be encouraged to make more active planning in key areas of work, wellbeing and money. In the Spring Budget 2023, the government announced it will work with employers and pension providers to encourage people to undertake midlife MOTs.

Published 17 March 2023