The IoM Government has been considering adopting pension freedoms since the UK first introduced them in April 2015.
In September 2017, the IoM Treasury finished a consultation called Proposed New Pension Scheme to Provide Greater Pension Freedoms.
Multiple sources, most of whom declined to be named, have now told International Adviser that pension freedom provisions are likely to be included in the 2018-19 budget.
IA asked the IoM Treasury department to confirm the rumours, but a spokesperson said everything included in the budget remains confidential until it is released.
Proposal expected
Dougie Elliott, chairman of the IoM Association of Pension Scheme Providers (APSP), said he thought there was some truth to the rumours and expected to see some pension freedoms proposals in the budget.
Despite the lack of information from the government, Elliott said the association believes pension freedoms would not be introduced without parliament, the Tynwald, first carrying out research to identify the long-term effects it could have.
“We will be keen to be a part of any such investigations,” he said.
Tynwald keeps quiet
Elliott added that the association had been involved in a pension freedoms working party in 2015, along with several other industry leaders and government officials, that resulted in a report being issued in July 2016.
“We are not aware whether or not the concerns raised in this report have been addressed in the proposals that are rumoured to be in the budget,” he said.
The association supports pension freedoms but said they should not be introduced without the government first carrying out an extensive impact study. Elliott said this study should look at the effect any changes might have to the island’s social security system or any other aspects of the economy.
“Both industry and government are aware that the differences in the local tax structures of the island could lead to a very different outcome from the one seen in the UK, particularly with regard to take-up.
“We are lobbying all members of Tynwald to ensure that they are well informed but we have no reason to believe that they are not,” he said.
The UK introduced pension freedoms in April 2015, giving people unrestricted access to their pension savings, subject to a tax charge, from the age of 55.
