A tale of two departments

Theresa May’s instalment seems to have reassured many, although she was not elected (a fact that may come back to haunt her); the FTSE 100 and FTSE 250 moved up in the days after the news. 

There is now at least some point of orientation and certainty amid the sea of uncertainty that is called Brexit. And hopes always run high when a new leader takes over; but as always, the proof of the pudding is in the eating. 

Senior cabinet positions have now been filled, many with supporters of the leave camp, but of course for the pensions industry there are two posts that matter more than others.

Philip Hammond, the previous foreign secretary, is taking over as chancellor while George Osborne no longer forms part of the government (read our article about the cabinet changes affecting pensions). 

Again, some might have breathed a sigh of relief, notably in the pensions industry; it looks like for May it was an easy choice. “Mr Osborne was sacked by Theresa May, in almost her first act as prime minister,” the Financial Times wrote. 

However, it is yet to be seen what Hammond’s stance on pensions is. Described by the FT as a ‘low-key fiscal hawk’, he might choose to continue what has been started.

On the other hand, Hammond has already indicated that he will scale back austerity, so he might be less eager to change pension taxation.  

Some in the pensions industry are hoping the Department for Work and Pensions, where Damian Green is replacing Stephen Crabb, might be able to take greater control over pen sions policy now, after Osborne had taken over the field with his large-scale reforms, although they said it is unlikely to include anything touching on tax matters.

But everything is up in the air at the moment. It is not unthinkable that some things will be pushed back, or even dropped altogether, as other issues take precedence.

Sandra Wolf is editor at Pensions Expert. You can follow her on Twitter @SandraCWK and the team @pensions_expert.