Industry chiefs urge Chancellor to rule out pension tax changes ahead of November Budget

The chief executive of Britain’s largest pensions firm has urged Chancellor Rachel Reeves to rule out changes to pension tax rules, warning that continued speculation about a possible “raid” on retirement savings is undermining saver confidence and could prompt harmful short-term behaviour.

Andy Briggs, chief executive of Phoenix Group, told the Daily Mail on Monday that consumers need certainty that pension rules will not be repeatedly altered. "Pensions are a very long-term business and if you leave consumers with a sense that it can chop and change on a regular basis, then you will undermine consumer confidence," he said.

The intervention comes as the Chancellor prepares for a Budget on Nov. 26 amid efforts to close a fiscal shortfall variously estimated at around £50 billion. Pensions measures have repeatedly been flagged in public debate as a potential source of savings, including proposals to reduce the amount that savers can withdraw tax-free from their pension pots.

Under current rules, individuals can withdraw up to 25% of their pension tax-free from age 55, subject to a cap that has been reported as £268,275. Suggestions last year that the threshold could be reduced prompted a wave of withdrawals as some savers moved funds pre-emptively; industry figures say those who pulled money out early were generally worse off as a result.

Briggs said regulators and ministers should avoid creating a cycle in which speculation fuels pre-emptive withdrawals that leave savers worse off. "We need to avoid a huge amount of speculation that leads customers to making what turn out to be sub-optimal decisions," he said.

Calls for greater clarity have also come from other figures in the financial sector and policy community. Michael Summersgill, chief executive of broker AJ Bell, and Paul Johnson, the former director of the Institute for Fiscal Studies, have urged the Chancellor to provide formal reassurance to pension savers. A Whitehall source recently said pensions were not being actively considered as part of the Budget plans, but ministers have not issued an explicit public guarantee.

Consultants LCP, in a report co-authored by former pensions minister Steve Webb, cautioned against slashing tax relief for higher earners. The report said such reforms could raise less revenue than expected, breach manifesto commitments to workers, and impose extra burdens on employers. It warned the political backlash could prompt disruptive reversals reminiscent of the 2012 "omnishambles" Budget, when the government abruptly U-turned on some measures.

Industry statistics underscore the scale of the issue. Phoenix Group, which manages more than £295 billion of assets and serves about 12 million customers, reported a 25% rise in profits, to £451 million, in the six months to June 30. The insurer said it will adopt the Standard Life name next March after having acquired the brand in previous years.

The debate highlights a tension for the Treasury: the need to find credible, durable fiscal savings while avoiding policy shifts that could harm long-term retirement outcomes or trigger market and consumer reactions that offset any short-term benefit. Pensions policy changes are politically sensitive because they directly affect households' long-term security and because sudden moves can distort saver behaviour.

Officials are expected to weigh options across the public finances in the coming weeks. Any proposal affecting tax reliefs, withdrawal thresholds or age-related rules would require careful design and consultation to assess potential behavioural responses and administrative impacts. Industry groups say that, beyond the immediate fiscal arithmetic, preserving confidence in pension rules is important for sustaining private saving and ensuring future retirement adequacy.

Ministers have faced similar pressures over pensions in the past. Speculation and rapid reversals in policy have previously prompted sharp market and consumer reactions, which industry leaders say should inform how Treasury officials approach reforms now.

As the November Budget approaches, industry voices are calling for a clear and early statement from the Chancellor to curb destabilising speculation. If ministers decide to pursue measures affecting pensions, the sector and independent analysts say transparency on timing, scope and transitional arrangements will be essential to limit unintended consequences for savers and employers.