Reeves opts to not raise tax on pension contributions in October budget

Reeves had been considering reducing the 40% rate of tax relief that higher earners enjoy on pension contributions, which could have raised 10bn a year.

Vishal Sharma, chair of the pensions committee at the British Medical Association, said: 'Attacking our pensions in this way would completely reverse this progress [on public sector pay deals] by once again taking money away from doctors in a different way.'

Public sector unions warned, however, that doing so would hit almost 1 million of their members, erasing much of the pay increases that the government has just agreed.

One government official stated that it would have been madness to increase taxes on public sector workers in this way.

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