Dash to retire before Labour reverses pensions lifetime allowance plan

Labour’s pledge to reverse the abolition of the lifetime allowance on pension savings could prompt more doctors and professionals to retire early in a “gold rush” before the next election.

Jeremy Hunt, the chancellor, announced in the budget on Wednesday that he was scrapping the £1.07 million tax-free pensions lifetime allowance to try to encourage professionals back to work. At present some doctors are retiring early to avoid massive tax bills.

Labour described the policy as a “bung to the 1 per cent”. It said Hunt’s pension reforms, which are expected to cost more than £75,000 for every person they encourage back to work, were a “gilded giveaway” and pledged to reintroduce the lifetime allowance if it won the election.

Steve Webb, a former Liberal