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Tories offer top-up deal on lifetime savings plan

The Conservatives waded into the savings arena this week, unveiling a key policy proposal aimed at encouraging people to start making provision for their shortand long-term financial needs.

Speaking at the Tories&#39 annual conference in Bournemouth, Shadow Work and Pensions Secretary David Willetts outlined a new long-term savings scheme which would see individual provision topped up by Government contributions.

The lifetime savings acc-ount would allow people to withdraw their savings in times of need while safeguarding Government contributions until retirement.

The accounts would be available to everyone but Willetts did not say how much the Government would contribute. The scheme would act as a wrapper, in which any number of existing or potentially new products could sit.

On death, individuals would be able to pass any remaining savings to the next generations&#39 account tax-free.

Speaking at a fringe meeting, Willetts also said he hoped in the upcoming Parliamentary session that a Conservative backbencher would table a Private Members&#39 Bill aimed at relaxing the annuity regime similar to David Curry&#39s Bill in the last Parliament.

Willetts reiterated the party&#39s determination to add-ress the annuity question, saying a Tory Government would not compel pensioners to buy an annuity as long as they could demonstrate they would not fall back on state support.

Willetts said: “This lifetime savings account is different from any other savings products currently available because of its flexibility. People will have access to the fund whenever they need it and they can access the money without losing the Government&#39s contributions.”

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