Treasury Committee probes whether Lifetime Isa is still fit for purpose in 2025
The Treasury Committee is seeking views on whether the Lifetime Isa is still fit for purpose in 2025.
Lifetime Isas (Lisas) help people save for their first home – if the property costs £450,000 or less – or their retirement.
Withdrawing cash for any other reason, unless someone is terminally ill, can trigger a penalty.
Savers face a charge of 25% for making an unauthorised withdrawal.
The account was introduced in 2016, but there have been calls to overhaul its design.
The £450,000 property purchase cap for first-time buyers has attracted criticism, with house prices having surged in recent years.
Gathering views
The Treasury Committee is aiming to gather views from the finance industry, consumers and experts.
MPs want to hear views on questions such as whether the current design of the Lisa is fit for purpose, including as a combined product for house purchase and pension saving.
They also want to know whether, given its policy purposes, the Lisa represents value for money for the Government and whether the withdrawal penalty should be removed.
Other questions MPs are seeking views on is whether the Lisa should be scrapped altogether, or whether it should be restricted to those with no access to a workplace pension.
The committee is also asking whether the Lisa house price cap should be raised in line with inflation, or removed.
The deadline for submitting evidence is February 4.
“Good opportunity”
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Here we go again, chopping and changing for its own sake. If there is an aspect that’s not working then rectify it but don’t chuck the whole thing out. I’d still reckon that buying a house at £450k is at a level well above that which most people can afford.