His decision to walk away from reform of the pension tax relief system — at least for now — marks a decision to play it safe at a time of huge political turbulence for the Conservative party as it squabbles over EU membership ahead of the June referendum.
The prime minister was not enthusiastic about the idea of a huge pension shake-up that would anger scores of his own MPs.
The chancellor had considered the case for the reform of pension tax relief highly compelling, and meetings were going on in the Treasury until very recently to discuss the proposals.
At present, most of the £31bn of relief goes to higher-rate or top-rate income taxpayers rather than the majority of people paying the lower rate.
A flat rate of relief would be a hugely progressive move, hitting the pockets of the well-off but offering a higher incentive to low-paid workers to save towards their retirement.
That would have been in line with other recent “One Nation” reforms, such as the rise in the living wage, designed to show that the party was in touch with low-income workers.
It is not as if Mr Osborne has been afraid to carry out radical changes to the pension system in the past: his annuity reforms, which came out of the blue in March 2014, was a major shake-up.
It also represented a chance for Mr Osborne — so long associated with public spending cuts — to demonstrate reforming instincts elsewhere.
But the risks on this occasion were judged to be too great, as many Tory MPs told their chancellor.
While bringing in immediate tax savings for the Exchequer, the Association of British Insurers warned the Pension Isa was “superficially attractive” but would be a “reckless move”.
It was concerned that adding a new system to sit alongside the old pension system would create too much complexity for the industry and confusion and added costs for savers.
Age UK, the charity that campaigns on issues for older people, was equally concerned that a shift to a Pension Isa could undermine the system, putting the future retirement of millions of savers at risk.