Labour is seeking to protect top public sector workers from its planned raid on pensions if they win the next election.
The Conservative Party will abolish the lifetime cap on pension savings from April, as part of an attempt to encourage more over-50s to return to work. But Labour has promised to reverse the change immediately if it is elected.
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Labour said the reforms only benefit the "top one per cent" of workers, pledging to reimpose the £1.073m maximum cap on the amount that can be saved into pensions free of tax.
But as part of an attempt to prevent an exodus from the public sector, Sir Keir Starmer and Shadow Chancellor Rachel Reeves are said to be planning to reintroduce the cap "in a way that ensures we retain public sector leaders".
Labour is seeking to protect top public sector workers from its planned raid on pensions if they win the next election
PA
Senior Labour figures such as Starmer himself, chief of staff Sue Gray, and Rachel Reeves' husband all have large public sector pensions.
A Labour spokesperson would not specify whether the change in rules would impact Starmer. But GB News understands the Labour leader is planning to ensure he receives no tax advantage that others do not get.
The spokesperson told GB News: “Labour is committed to reintroducing a Lifetime Allowance and we are looking at different options for how to do this in a fair way.
"Given the absolute mess that the Tories have left our NHS and public services in after 14 years of chaos, we need to ensure that we retain senior NHS doctors and other public service leaders.
“A key consideration will be ensuring we retain public service leaders - who will be crucial for delivering Labour's programme of reforms set out in our missions for government."
The reintroduction of the pensions lifetime allowance is expected to affect as many as 250,000 people, an analysis by consultancy LCP said.
In October, after the Tories announced their plan to scrap the lifetime allowance, Labour promised to reimpose the cap. But the party said NHS doctors would be shielded from the changes in order to avoid an exodus from the health service.
The party has since admitted it is considering plans to ensure the retention of NHS workers, alongside "other public service leaders" who are "crucial".
Senior Labour figures such as Starmer himself, chief of staff Sue Gray, and Rachel Reeves' husband all have large public sector pensions
PA
Gray, one of Starmer's most senior advisers, had a pension worth £1.9m as of March 31 2023, government accounts showed.
Reeves' husband Nick Joicey, a senior civil servant, had a pension approaching the previous limit at £967,000, as of March 31 2022.
A Treasury source told the Telegraph: “This proposal is nothing more than a hefty tax on private pensions to fund a special carve out that could well benefit key Labour officials.
“We removed the pensions tax to help keep our top doctors, police officers, military top brass and entrepreneurs in work. Labour will take us back to square one and tax millions into early retirement.”
The Labour Party has been contacted for comment.
