The tax incentives offered to pensions are one of the more emotive topics in UK taxation. Everyone rolls out the usual reference to the need for stability in long-term savings. We have seen constant change since the basis of the current system took effect in 2006.

Most of the changes have been to rein in the immediate cost of tax deductions for contributions to pension schemes, although this has been accompanied by greater liberalism in investment management, limits on costs and now access to the total fund.

In 1988, retirement annuity policies (RAPs) were replaced by personal pensions. The 1988 reform was all about limiting the tax cost, since