The pensions black hole

Updated 23.43 Mon Apr 02 2007

Keywords: Treasury, politics, Confederation of British Industry, Gordon Brown, pensions, money, business

The row between Gordon Brown and business bosses over the pensions black hole has become increasingly bitter.

The Confederation of British Industry (CBI) said it was completely untrue that they wanted him to tax pension contributions back in 1997.

"At no time whatsoever did the CBI support the policy of removing the dividend tax credit" - Lord Turner

Meanwhile, the Treasury denied claims the Chancellor had intended to take a much larger bite out of pensions funds but backed down after a row with Prime Minister Tony Blair.

They dismissed claims Mr Brown wanted, before his 1997 Budget, to raise £8 billion every year but was forced to settle for £5 billion.

Lord Turner, who was director general of the CBI from 1995 to 1999, said: "As the CBI has already made clear, at no time whatsoever did the CBI support the policy of removing the dividend tax credit.

"And when the change was introduced in the 1997 Budget, I wrote to the Chancellor expressing our disagreement."