Mmmm… improves solvency of defined benefit pension schemes, but if you were a pension trustee would you fill your boots?
They are advocating kicking the can a long way down the road.
Maybe Lenny will only grant tax relief on pension funds if the pension fund invests in Sovereigns.
Tax relief is on contributions paid in and on the investment income earned by the funds.
Make it voluntary, so if you don’t opt to move your pension funds assets to a sovereign fund you lose tax relief.
There is approx €70bn in DB and DC schemes.
Hey you could even restrict the pension funds from buying bonds in the secondary market and make the pension funds invest in newly issued sovereigns issued at a yield of 5% (tax free).
The Govt could then go out into secondary market and buy back some outstanding debt which is yielding 8%