Hand over YOUR pension, Lib Dems tell Chancellor

The under-pressure Chancellor already qualifies for a taxpayer-funded pension worth £1.9 million after spending ten years at the helm of the Treasury.

This would more than double to £4.3 million as soon as he walks through the doors of 10 Downing Street.

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On Wednesday night Mr Brown was urged to turn down the extra money and give it to members of pension schemes that collapsed since his controversial decision to make a £5 billion-a-year pensions tax grab.

Some 20 million people have lost money since he announced plans to scrap tax relief on share dividends in his first Budget - despite being warned it could leave a damaging "hole" in pensions.

Since the change, many pension funds have been wound up - leaving more than 125,000 people without the money they set aside for their retirement.

But the Government's Financial Assistance Scheme has come under fire for only paying out £2.6 million.

Critics warned that he was in danger of leaving pensioners to "sink or swim".

Lord Oakeshott, the Liberal Democrats pensions spokesman, has written to Mr Brown urging him to reject the "indefensible" £4.3 million pension pot.

He said: "Given the Chancellor's miserly treatment of private pensioners, it is only fair if he takes a more affordable pension himself from the taxpayer."

In the letter, Lord Oakeshott wrote that if the Chancellor grabbed bigger pension deal he would "look like the captain of the Titanic grabbing the best lifeboat and leaving far less privileged pensioners to sink or swim."

Only three people in Britain are entitled to an index-linked life pension - the Prime Minister, the Speaker, and the Lord Chancellor. For the Prime Minister, this is worth £4.3 million.

Lord Oakeshott urged Mr Brown to "share a fraction of the pensioners' pain" and follow the example of the Lord Chancellor, Lord Falconer, who refused to accept the taxpayer-funded life pension.

Pressure on Mr Brown mounted as it emerged that he railroaded through his damaging raid on pension funds without consulting other Cabinet or other government departments.

The row has been raging since last week when documents were released showing officials warned the move could wipe £75 billion from pension fund values.

Pensions firm said the controversial decision had actually knocked about £100 billion off their value.

At least four Cabinet ministers at the time of Labour's first Budget, former Department of Social Services ministers and ex-Treasury officials said they were not consulted.

One Cabinet minister, who wanted to remain anonymous, said they were given only a "sketchy brief" of the 1997 Budget.

He said: "It was clearly a set-up - the Chancellor would make a statement, the winners were briefed in advance and the Prime Minister said, 'That's it then'. There was never any informed debate or agreement."

Frank Field, who was Welfare Reform Minister at the time, said: "Ministers in the department certainly didn't discuss it. I learnt about it when the Budget was actually given."

The accusations throw up questions about how Mr Brown would run the Government just months before he is set to replace Tony Blair at Number 10.

However, Mr Brown defended himself earlier this week - insisting he would repeat abolishing tax breaks for pension funds.

He said he would "take the same decision again" no matter how "inconvenient or difficult" it proved.

He argued that making the tax grab had allowed companies to invest more in their businesses which was right for the economy.

Yesterday, the Mail revealed that the insurance industry warned Mr Brown that his pension tax raid could damage funds and increase the volatility of the stock market.

The Association of British Insurers told the Chancellor that such a measure would lead to a "drop in income" of at least £2 billion a year for pension funds.

The imposition of the tax is seen in the City as Mr Brown's biggest blunder as it contributed to the retreat from final-salary pensions schemes - once a gold-standard of the industry.