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Lib Dems call for early access to tax-free pension cash

The Liberal Democrats have called for rules that prevent people from taking a tax-free lump sum from their pension until they hit retirement to be relaxed.

Launching a report titled ‘Setting Pensions Free’ for think tank CentreForum, Shadow Work and Pensions Secretary Steve Webb said: “It is crazy to be repossessing the homes of people who are perhaps £5,000 in arrears when they already have more than this as a lump sum in their pension fund which they cannot touch.

“Allowing individuals to access this cash could help existing homeowners prevent repossessions and help first-time buyers find cash for a deposit, both of which would support the housing market.

“The Chancellor needs to overcome the Treasury’s natural caution and think creatively about how pension assets can be used to benefit individuals and the wider economy.”

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There are 2 comments at the moment, we would love to hear your opinion too.

  1. Pensions are for providing pensions?
    Logical on the surface, however, are pensions not designed to provide pension income to support people in retirement?

    All well and good recommending a 50 year old to pay down the mortgage with their PCLS before they get “trapped” by the age 55 rules (assuming all other conditions merit this approach) but for a 35, 40 year old to do this??? How about the ability to (properly) assign a pension to a mortgage to use the PCLS as the repayment vehicle? Sounds very 1980s but more of a logical concept?

  2. First Time Buyer Pensions?
    How many people of first time buyer age have pension savings let alone sufficient savings for a deposit on a property?

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