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The would-be PM who cost us £100bn

By Liam Halligan, Economics Editor
Last Updated: 11:45pm BST 14/10/2006

The chances are that you have never heard of "advance corporation tax relief". And you probably didn't notice when Gordon Brown abolished it, without warning, in his first Budget back in July 1997.

You may, on the other hand, have heard of "Labour's £5bn pension stealth tax". That is because it has since become clear that the Chancellor's policy shift – removing tax relief on income from share dividends – was very harmful to British pension funds.

Gordon Brown and Tony Blair
Blair warned the Chancellor not to tax private pension funds so brutally, but Brown wanted to hit the ‘fat cats’

Announcing the move, Brown told the Commons that this was a "long-needed reform". But most actuaries now agree, if only sotto voce, that it has contributed mightily to the closure, since Labour took office, of thousands of final salary schemes.

The resulting loss of income and dignity – to say nothing of the stress – endured by members who have seen part or all of their "guaranteed" pensions disappear is among the biggest injustices of our time.

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