The loss of dividend tax credit on pension funds is extremely trivial and is a very unconvincing argument.because big Gordy had raided the pension funds and played havoc with eventual monies due on retirement.
Let me work you through an example:
Suppose you have a pension fund worth £100,000. It is invested 60% in equities (shares) with the rest in fixed interest, property REITs, corporate bonds, gilts, cash deposits, whatever. In a typical year it grows by 8% plus inflation. In a good year it grows by 20%. In a bad year it goes down by 20%. That's ups and downs of £8,000 or £20,000. Your fund manager fleeces you by 1.5% in expenses and charges. That's another £1500. If you've been trapped in a with profits fund he can take whatever he likes, maybe £5,00 or £10,000. To invest £100,000 in a pension fund costs between about £80,000 and £48,000 out of your pocket depending on the amount of tax and NI you pay. Thats £20,000 or £52,000 you've gained. the more prosperous you are, and the more you can afford to contribute, the more you get back in rebates.
The All-share has a yield of 3%. Your pension fund "loses" 10% tax on that. So £100,000 x 60% (shares) x 3% (yield) x 10% (tax) is £180
Do you really think that £180 over a year makes a big difference, compared to the size of all the other ups and downs? No, it's just an excuse to whinge because nobody likes paying taxes.