The latest figures show that pension income tax and National Insurance contributions (NICs) relief in 2020 to 2021 was estimated to be £67.3bn, up from £63.1bn in 2019-20, although this was a lower figure when tax on pensions was taken into account.

The net cost of pension tax relief rose to £48.2bn, up 8% from £44.5bn in 2019-20. Income tax paid on payments from registered private pensions hit a record £19.1bn in 2020-21, up from £18.6bn the previous year.

More worryingly, HMRC data showed the number of members of private pension schemes making individual contributions to a personal pension fell dramatically to 6.8m in 2020-2021, from 9.5m the previous year.