Keir Starmer faces backlash over his 'shocking' pension tax deal

The Labour leader has a special pension deal from his time as Director of Public Prosecutions - Jonathan Brady/PA Wire
The Labour leader has a special pension deal from his time as Director of Public Prosecutions - Jonathan Brady/PA Wire

It is "one law for Sir Keir Starmer" when it comes to pension rules, the Conservative Party chairman has said, after The Telegraph revealed how he can avoid tax on his savings.

The Labour leader has a special arrangement with the Government from his time as Director of Public Prosecutions (DPP), which means he is exempt from the tax rules that he would apply to other workers who save more than £1 million.

This is despite Sir Keir pledging to force other wealthy savers to face a cap on their pension savings.

In response to this newspaper's story, Greg Hands, the Tory chairman, lashed out at the opposition leader on Wednesday morning for alleged double standards.

'One law for Sir Keir'

He tweeted: "When it comes to pensions for the better off, it’s literally one law for Sir Keir and a different law for everyone else.

"Labour and Sir Keir voted last in the Commons for less generous pensions for senior doctors and other workers.

"He must have known that he personally was exempt through his own unique law, the 'Pensions Increase (Pension Scheme for Keir Starmer QC) Regulations'."

The Chancellor Jeremy Hunt is abolishing the lifetime allowance for all pension pots, meaning that pensioners can save more than the current limit of £1.07m without incurring tax charges.

On Tuesday night, Sir Keir led 176 Labour MPs through the Commons lobbies to vote against the change, accusing ministers of “huge giveaway to some of the very wealthiest”.

Tax-unregistered scheme

But The Telegraph understands that despite his opposition to the cap, Sir Keir himself benefits from a one-man “tax-unregistered” pension scheme, which means the lifetime allowance does not apply to his contributions from his time as DPP between 2008 and 2013, when he earned almost £200,000 a year.

He was the only member of the scheme and when he stood down as DPP, the Government passed secondary legislation, titled the Pensions Increase (Pension Scheme for Keir Starmer QC) Regulations 2013, that ensured his pension was increased once a year to keep pace with rising prices.

The arrangement means he can continue to save money from his salary as an MP and any future salary as a Government minister for longer without incurring a tax bill.

'The ultimate hypocrisy'

Other Tory MPs have also rounded on the Labour leader. Mark Jenkinson, the MP for Workington, said "Sir Keir Starmer's hypocrisy knows no bounds" while voting "to deny that same benefit to thousands" of public servants.

Anthony Browne, the MP for South Cambridgeshire, said the "one-rule-for-him pension" was "truly shocking" and "the ultimate hypocrisy", adding: "His class war is just political opportunism."

Shadow justice secretary Steve Reed rejected any suggestion of hypocrisy by Sir Keir, but suggested that Labour would not change the rules.

"It wasn't Keir Starmer as Director of Public Prosecutions who set his own pension," he said on Sky News.

"That was set by the Conservative government at the time so if people have problems with it they really need to speak to David Cameron and George Osborne."

But asked repeatedly if Labour would change the rules, Mr Reed said: "It's part of the judges' scheme and Labour's got no plans to change judges' pension arrangements, because you'd lose judges and then the delays in the courts would get worse."