Jobseeker’s Allowance

Lord Flight Excerpts

Monday 21st July 2014 Lords Chamber

[Lord Freud]

Apprenticeships are a cornerstone of this Government. Overall, we have had more than 1.1 million extra apprenticeships for youngsters since the election—a 40% increase on the equivalent period before the election, although I acknowledge that the previous Government were also pushing up the apprenticeship rate.

[Lord Flight (Con)]

My Lords, the figures on employment are extremely good news but the data on productivity, so far, are not quite such good news. Does the Minister have any views on why productivity has been so slow to increase? Might it have anything to do with Labour’s tax credits subsidising wages?

Housing: Discretionary Housing Payment

Lord Flight Excerpts

Wednesday 9th April 2014 Lords Chamber

[Lord Freud]

My Lords, I am not sure of the exact number of evictions, but I do not think that there are very many at all, if any. Clearly it is a matter of great concern. I can let the noble Baroness know that the data from the Homes and Communities Agency, which are based on the 266 largest housing associations with more than 1,000 homes, show that the average arrears in the final quarter of last year—the third quarter of the financial year—fell to 3.9% from 4.1% in the previous quarter and that rent collection rates for the year stood at 99%.

[Lord Flight (Con)]

The Minister will be aware that in central London and, in particular, the borough of Westminster—and I declare an interest as my wife is a councillor—there have been cases where very substantial housing benefit amounts have had to be paid particularly to house those categories that the local authority is obliged to house. Is there any system or intent to limit the amount of housing benefit that can be paid on an individual property?

[Lord Freud]

My Lords, my noble friend draws attention to the point that we have introduced a cap on the amount of housing benefit to stop the very large amounts that were paid on local housing allowance.

Pensions Bill

Lord Flight Excerpts

Wednesday 26th February 2014 Lords Chamber

Of course, we still need to see the regulation standards that will be set. We will need an economic and practical transfer system. We will need to cope with consumers leaving employment and going off into self-employment. We also need to deal with the current backlog of stranded pots. However, above all, we need to move forward on this before the problem gets greater and the advances of auto-enrolment are undermined by a vast number of lost and unaccountable pension pots.

[Lord Flight (Con)]

My Lords, the noble Lord, Lord Stoneham, has made some very good arguments in favour of pot follows member, but I want to start—and I want to be sure that there is absolute clarity here—on the question of individuals having a choice about where they consolidate their pension savings. We are talking about the default option in discussing pot follows member versus aggregator and no more than that. When an individual joins a company scheme on moving jobs, it is quite important that he is able to choose where to consolidate his pension.

In terms of the default option, first, I have always felt strongly that the argument against the aggregator arrangements is: who chooses? That point was made by the noble Lord, Lord Stoneham. I cannot really see who is in an appropriate position to choose if we go to aggregators. Secondly, aside from the cartel point, the larger the amounts of money, the more difficult it becomes to manage that money. A whole lot of potential investments almost get ruled out because the market capitalisation of firms is not sufficiently large. Therefore, I do not see there being a huge virtue in having a limited number of colossal managers. I might add that NEST’s charges do not seem to be particularly competitive, particularly for the earlier years of membership.

To a certain extent, I believe that there are arguments for keeping all doors open but I do not feel that the case for the aggregator has by any means been won. On balance, I think that pot follows member is a better solution, essentially for the reasons given by the noble Lord, Lord Stoneham, although I shall not repeat them.

[Lord German (LD)]

My Lords, I shall try not to repeat the remarks of my noble friends Lord Stoneham or Lord Flight, but my noble friend Lord Flight makes a very important point about the default choice which is before people. That is what this amendment must seek to address but I think that it fails to do so. Noble Lords will recognise that what we have before us is a debate about either pot follows member or the aggregator; it is not a debate about choice. Except for the noble Lord, Lord Turner, who said that under certain conditions, the balance might be right, it is clear that those on the Labour Benches want to see an aggregator policy.

I accept that that is the purpose behind the amendment but that is why it is important to examine these issues. I shall say a few words about why we must have some form of automatic transfers of pensions. The main beneficiaries of automatic transfers are those people who, for the first time, are saving for their retirement, following automatic enrolment into a workplace pension, and then move jobs, leaving behind a small pension pot. A system of automatic transfers is necessary to stop the proliferation of small pots that will ensue as a by-product of automatic enrolment. The average worker in this country will have 11 jobs in the course of their working life. Automatic enrolment by 2018 will probably have 9 million people within it, and maybe even 10 million by 2020 who are new savers, saving more for their retirement than their work-based pensions. These are people who are being automatically enrolled. If we took no action the projection is that there will be around 50 million dormant workplace defined contribution pension pots within the system by 2050.

A successful system must focus on the interests of the member, allowing them to consolidate their pension savings. I notice that the noble Lord, Lord Monks, is not in his place but he is a trustee of the NOW: Pensions fund. His fund conducted research of more than 2,000 21 year-old plus people with at least one workplace pension. The result was quite clear: 39% of the individuals surveyed said that pot follows member was their preferred option compared to just 6% for the aggregator model. It was suggested that the aggregator model is so difficult to understand that people chose the easier one because they recognised its simplicity. Is it not the case that we are looking for simplicity? People were asked, “Do you want your pension to follow you, or do you want it placed somewhere else, which will be some distance from you both in employment terms and in being able to influence what it does?” People in that survey, which is probably one of the most comprehensive that we have had, said, given the choice, they preferred to have their pot following them when they changed jobs.

That suggests that explaining an aggregator model to the public, who do not understand the pensions market well anyway, would be much more of a challenge. People will not understand what is being made of their pension, seeing it going away to a distant aggregator, compared to the idea that their pension moves with them to their new employer. I do not believe that there is evidence that the interests of individuals would be best served by the undefined aggregator system. It will be difficult to administer, as my noble friend Lord Stoneham said, and will lead to the market being dominated by a few large schemes and providers, and where everyone will be guaranteed to have two pensions rather than one.

The issue raised by the noble Lord, Lord Turner, and by the noble Baroness, Lady Drake, about quality is crucial. I recognise, as we all do, that the OFT in its report on DC pension schemes said clearly that competition was not driving good value for money for all savers. That is precisely why the Government intend to legislate, and we are seeing some of that today at Clause 43 and Schedule 18, which the Government are dealing with. The whole process of raising the standard is crucial—most importantly, perhaps on charges. Perhaps my noble friend can confirm that it is the Government’s intention to introduce matters in relation to charging before the end of this Parliament.

I believe, too, that we have to consider the choices that people will have to make. Who will decide where an aggregator policy for them will be placed? How would the allocation process work? Would it be by a random list, a computer allocation or perhaps names in a hat? These are all unknowns. What happens to people’s pensions which are forced on them when they move jobs under the aggregator system is very unsatisfactory. Far better that they should have a simple system in which they have one contract with one pension which they take through with them.

However, the crucial factor is the standards that each of these pensions schemes have applied to them. That is why I welcome the Government’s initiative. I know that by the end of this year they will introduce proposals to ensure that the standards are right. As my noble friend Lord Stoneham said, we are looking for high standards, not a minimum standard, in this process.

We have before us a choice. We already have 2 million new savers as a result of automatic enrolment, and waiting will mean that many of the people being enrolled will be denied this opportunity as another scheme would have to be worked up and compared with the one proposed. The pension funds are already working with government in order to work the scheme up and to get it ready and in place. Can my noble friend tell me what progress has been made already to ensure that pot follows member is in a fair and fit state to be introduced rapidly?

We have to make a choice. It seems to me that we should choose the pot-follows-member position and thereby give greater power and greater pension outcome to millions of new savers. We should not accept the amendment.

--- Later in debate ---

[Lord Freud]

Various figures have been talked about, but I do not think I can pre-empt the answer to that question, which will be issued very soon.

In contrast to legislating radically to change the market, we see pot follows member as a way of building on the existing automatic enrolment structure quickly to reach a point where transferring pots is an integral part of the industry. Pot follows member does not prevent industry from innovating in future. Indeed, as individuals become more engaged in pension saving, they may want to be more involved in deciding where their pension pot is and in choosing a preferred scheme.

In response to the point made by the noble Lord, Lord Hutton, there is even scope to introduce an aggregator in future if there is demand for it, so we are not closing any doors by pursuing this route now.

[Lord Flight]

I think that the Minister just said it, but can he confirm what I view as a crucial point, which is that the individual is still free to choose where he might wish to place his consolidated pension savings and that we are talking only about the default option? Therefore, as people become more informed, some may choose not to consolidate in their employer’s scheme.

[Lord Freud]

I can confirm my noble friend’s question—or I can give the answer to confirm it.

At this point in time, when we are just starting out with automatic enrolment and successfully getting people saving for the first time, we need to make it as easy as possible for them to build their pension. We need to use inertia in the right way. That means moving a small pension pot to the current live pot where the individual can see it growing, rather than sending it off to a scheme with which the individual has no engagement and in which they have no interest.

Now is not the time to break the link between the individual and his or her employer. Automatic enrolment is going well, with 3 million individuals newly saving and less than 10% opting out. It is reinforcing the workplace pension as a key element of the benefit package that employers offer their staff after decades of decline in occupational pensions.

I have heard the argument that these amendments are designed to give the Government another option, which appears on the surface to be a generous approach. Providing the Government with greater flexibility is one thing, but listening to the debate today, I suspect that few on the Opposition Benches want the Government to have the flexibility to chose anything but the aggregator model.

In practice, the amendments will leave us in limbo and bring back uncertainty at a time when industry is beginning to get behind, and position itself to deliver, pot follows member. As my honourable friend in the other place announced on Monday, officials are currently exploring the feasibility of using HMRC’s PAYE data and system to help us to deliver a secure, efficient and straightforward pot-matching element to implement the process.

In response to the assertion of the noble Baroness, Lady Sherlock, that pot follows member would be hard to set up, we have recently had some very positive workshops with industry representatives and HMRC. The model is already inspiring some exciting and innovative approaches to transferring money with an employee as they move jobs. The cost of the transfer was specifically mentioned by the noble Baroness, Lady Drake. It will be the same for an aggregator as for pot follows member. Altus has challenged the claim that pension transfers are too hard and too expensive by stating that transfers for ISAs and funds cost £1 or less, and that this can be replicated for pension transfers.

After two years of discussion and debate on this issue, even if we cannot agree with the Opposition on the right delivery model, I hope that we can agree that we need to take a positive step forward. On the “pause to reflect” point made by the noble Lord, Lord Hutton, I do not believe that we are rushing into this measure. We first consulted more than two years ago and followed up with two policy papers. We also held extensive discussions with industry and consumer groups within that period. I urge the noble Lords to withdraw their amendment to allow us to work together, and work with industry, to make automatic transfers a reality.

Pensions Bill

Lord Flight Excerpts

Wednesday 18th December 2013 Grand Committee

[Lord Flight (Con)]

My Lords, these amendments raise some issues that relate back to the previous Pensions Bill and, at least as far as I was concerned, some not very clearly answered questions about the potential size that the cash-flow deficit would grow to with regard to pay-as-you-go pensions.

First, my understanding is that, whether it is a pay-as-you-go public sector scheme or a funded public sector scheme, with the ending of contracted-out contributions, the money that the schemes will no longer receive will go towards financing part of the new state pension. Therefore, it has gone off to one box for that purpose. So we are left with pay-as-you-go public sector schemes and the impact that there is on them, and financed public sector schemes, such as local government schemes. My understanding is that, with pay-as-you-go public sector schemes, the money is no longer going to come in from contracting out and therefore the impact will be on the extent of cash-flow deficit going forward relating to public sector schemes. I should be interested to know the aggregate amount that pay-as-you-go public sector schemes will lose per annum as a result of no longer receiving the contracted-out contributions.

I think that there was some discussion during the passage of the Public Service Pensions Bill about the extent of the potential cash-flow deficit. Mr Michael Johnson and I calculated that it could be as large as £25 billion on the basis of including an estimate of the loss of contracted-out contributions. I think that the Government argued that it was not going to be as large as that but I could never quite get my head round the figures.

With regard to contributory public sector schemes, such as local government schemes—which is what these amendments are particularly concerned with—it will automatically become the financial liability of local government to make up the loss of the contracted-out contributions. How is that going to be financed? Not just in terms of what it might mean for a particular local authority, what is the extent of the aggregate cost to public sector schemes which are financed, and what is the average proportion that local government schemes, in particular, will have to make good as a result of the loss of contracting out?

I do not expect the Minister to be able to answer those questions with figures off the cuff, but it is desirable that they should be known and understood. Indeed, the impact on funded local government schemes may be very substantial, implying either significant increases in local council tax or the need for yet further substantial reductions in local government expenditure to finance the loss of contracting out.

[Lord McKenzie of Luton]

My Lords, briefly, I commend my noble friend Lord Whitty and the noble Lord, Lord German, on trying to focus on solutions to deal with what seems to be a major problem, particularly in relation to local authorities. My noble friend Lord Whitty said that the annual cost of losing the 3.4% rebate is in the order of £700 million a year. Today, we had the local government finance settlement, which reinforced what was announced in the spending round: a further real terms cut of 2.3% in overall local government expenditure. Sir Merrick Cockell, who is a Conservative and the chairman of the Local Government Association, said that local authorities will have lost one-third of their budget by 2015. He said,

“This is the calm before the storm. We do not know how big the storm will be or how long it will last”.

The Audit Commission last year found that 29% of councils showed some form of financial stress. Council tax increases to cover this, even if they were contemplated at the level that the noble Lord suggested, simply are not on because of the need to have a referendum to go beyond a very small increase. Do the Government see this as a new burden which central government is placing on local authorities and therefore a burden which it should it meet?

Pensions Bill

Lord Flight Excerpts

Monday 16th December 2013 Grand Committee

[Baroness Greengross (CB)]

My Lords, under my Amendment 2, the deletion of Clause 1(2) would extend the single-tier pension to all pensioners from 2016. My proposed new subsection would require the Government to publish details of measures which would end pensioner poverty. As the noble Baroness said, current pensioners and others due to reach state pension age before 6 April 2016 have been excluded from the single-tier pension. Current pensioners should also benefit from the single tier. A number of options are available to achieve this. For example, the Government could consider extending the single-tier pension to current pensioners. Another approach would see the level of pension credit guarantee increased to the level of the single tier for current pensioners, who will otherwise miss out.

We know that pensioner poverty has fallen over time from 2.9 million in 1998-99 to 1.6 million, of whom nearly 900,000 are in severe poverty, with incomes of less than half median income. Proposed new subsection (2) would make the Government set out a timetable and a strategy for reducing and eventually abolishing pensioner poverty.

[Lord Flight (Con)]

My Lords, I have encountered more upset in relation to this aspect of the Bill than what I would hope was support for having a state pension above the level of income support. Quite simply, we are talking about individuals who have paid their national insurance, who are too old to benefit from the 2016 changes, whose pensions are less than that, and who feel somewhat aggrieved that many people who have not paid their national insurance will qualify for the increased pension after 2016 when they will not. I appreciate that it is all about money, but I wonder whether a full calculation has been done of the net real costs of putting everyone who is entitled to a pension on to the new arrangement in 2016; I suppose that is unless they have qualifications that exceed that. However, I can only think that there would be a significant net-off in terms of other welfare payments if people’s pensions were slightly larger. This is a fundamentally good piece of legislation on which there is relatively cross-party support. However, I slightly warn the Government that this issue—that those who are too old to benefit from the 2016 reforms will often be worse off than those young enough to benefit—is rather spoiling the welcome to these changes.

[Baroness Hollis of Heigham (Lab)]

My Lords, I would like to ask a simple question that relates to one of the hopes that some of us had a year or so back. The greatest proportion of those claiming pension credit tend to be elderly widows—when the husband died, the pension died with him—over the age of 80 or 85. I fully understand that to bring all pensions on to this would be a big-ticket item for any Government to contemplate; that is not in doubt, as the previous speaker mentioned. However, what if we were to introduce the pension not just for people reaching pension age in 2016 but for those over 85, and then for the next decade bring the 85s down by a year, with the 65s going up a year, as they will? They would meet in about a decade for men, perhaps slightly later for women. In about a decade or so, virtually all pensions would be covered on an incremental basis. I have not been able to cost that. I was told, teasingly by the Minister in the other place, that he thought it would probably cost half a billion pounds, but whether that was per year or in total was not made clear to me. Have there been any thoughts about how we might progressively increase the coverage?

--- Later in debate ---

[Lord Freud]

I think that in practice it will be a mean average. However, I will make that absolutely clear.

By withdrawing the facility to build a pension above the flat rate and modernising the system, removing elements such as savings credit and derived entitlement that no longer reflect the needs of the working-age population, we are able to fund the single-tier pension and improve the outcomes of groups such as the self-employed, carers and low earners, who have historically seen lower state pensions. It follows, therefore, that there are two means by which we could apply the new state pension to existing pensioners.

First, we could simply increase the pension of all existing pensioners to the full single-tier rate, if they are currently receiving less. In response to the question asked by my noble friend Lord Flight, we estimate that this would cost around £10 billion.

[Lord Flight]

Per annum?

[Lord Freud]

It would be £10 billion per annum.

--- Later in debate ---

[Baroness Sherlock]

I thank my noble friend. I think that when the Minister comes to read Hansard, he may notice that I asked him to confirm that its value would not change and I am sure that he meant to clarify the level rather than the value. One of the reasons is that, since they came to power, the Government have frozen the maximum level at which savings credit can be obtained. I wonder whether they intend to carry that on, in which case would we find that its value did, in fact, diminish.

[Lord Flight]

I am sorry to bother the Minister but is the £10 billion figure what I call gross or net? The key issue is that many older pensioners who would not otherwise qualify will qualify for various forms of income support in whatever is left of pension tax credits, and there really is a need to net all those projected costs off if they are not covered in the £10 billion to see what the actual net extra cost is. If, in that exercise, the Government discovered that the cost was much less than that, then I think this is something that could be thought about.

[Baroness Hollis of Heigham]

In particular, my Lords, given that the Government are proposing to remove AIPs for those over 75, there is therefore going to be an annual means-testing of pensioners who, if they were 10 or 12 years younger, would have that £144 as of right.

Child Poverty

Lord Flight Excerpts

Tuesday 14th May 2013 Lords Chamber

[Lord Roberts of Llandudno]

My Lords—

[Lord Flight]

My Lords—

[Baroness Massey of Darwen]

My Lords—

--- Later in debate ---

[Lord Freud]

My Lords, I could not agree more. One of the most dismaying things that I have ever read is the 2007 UNICEF report that put us right at the bottom in terms of child well-being. The latest report from 2011 shows us crawling up four places, but we have a long way to go and we need to find the right ways in which to help children genuinely to get out of poverty.

[Lord Flight]

My Lords, is not the related problem of feral children who engage in gang warfare and drug dealing and whose parents are not parenting properly even more serious? The solution to that is shown to be provided increasingly by the new technical colleges which motivate such children and teach them a skill. They then start to want to learn generally. That is the sort of measure that really addresses our problems rather than just giving out money.

[Lord Freud]

My Lords, we are in the middle of a genuine consultation on how to tackle child poverty. Maintaining the income measure so that we know what is happening but getting at the measures that will make a real underlying difference to entrenched poverty is absolutely vital in that exercise.

Women: Board Membership

Lord Flight Excerpts

Thursday 7th March 2013 Lords Chamber

[Baroness Stowell of Beeston]

As the noble Lord knows, the Government very much welcomed the reasoned opinion put forward from this House and the other place. Sadly, I am told that not enough member state Parliaments issued a reasoned opinion for that to be successful in raising what is termed a red card or yellow card in Brussels—I am not sure. As far as we are concerned, we are still actively working with other EU members to make sure that whatever arrives finally from the European Commission supports our own approach to this issue.

[Lord Flight]

My Lords, I believe sincerely that there is a general wish and support for more suitably qualified women on boards. Yet surely the role of directors is to oversee the running of a business and that needs people with the appropriate skills. To the extent that they are representative, they are representative of shareholders and not really in a quantitative context of the nation at large.

[Baroness Stowell of Beeston]

Okay. I say to my noble friend that we need more women on boards because half the people who spend money in the economy are women, as are half the people who have pensions that are part of the investment into those companies that enjoy that benefit. We just bring so much more that I find it astonishing that he does not feel the same way.

Youth Unemployment

Lord Flight Excerpts

Monday 14th May 2012 Lords Chamber

[Lord Freud]

I am sure that the noble Lord will agree that the lump of labour fallacy is not how one should run an unemployment policy and that a competitive employment approach is the right approach. The way that one achieves that is by skilling up the workforce so that people can take jobs. That, in itself, expands the economy by more than it would otherwise expand. I am sorry that the noble Lord does not agree. I know there are noble Lords on the Benches opposite who dislike the lump of labour fallacy as much as I do.

[Lord Flight]

My Lords, the apprenticeship scheme is already achieving a lot and can achieve a lot more, but one of the problems is that when people come off jobseeker’s allowance their pay on an apprenticeship is very modest and they often cannot afford the travel costs. The Mayor of London is happily providing the travel costs for apprenticeships in London. Will the Minister look at expanding this where it is needed elsewhere in the country?

[Lord Freud]

I will look at that because one of the central thrusts of our policy is to ramp up apprenticeships. One of the most encouraging signs I saw when I visited a work programme contractor the other day was the way that having sustained outcomes—long-term jobs—is driving it towards putting youngsters into apprenticeships. That is a very happy fact pulling them together, and I will very happily look at anything we can do to reinforce the drive to apprenticeships.

Retirement Age

Lord Flight Excerpts

Monday 5th September 2011 Lords Chamber

[Lord Freud]

My Lords, as the noble Baroness pointed out, we debated this in some depth when we looked at the Bill. Those concerns, expressed around the House, were taken very seriously. The Secretary of State responded at Second Reading in another place by saying that we needed,

“to implement the change fairly and manage the transition smoothly”.—[Official Report, Commons, 20/6/11; col. 50.]

We are looking at how best to do that. Should there be legislative changes, they will of course come to this House to be considered in due course.

[Lord Flight]

My Lords, I urge the Government to accelerate to a retirement age of 70, not just on grounds of longevity and fitness but on fundamental economic grounds. It is entirely natural, if you have an ageing population and wish to keep economic growth up, that the workforce should remain the same through people working longer. Finally, the highest growth in new jobs now is among people over 65, so this is a reality in the workplace.

[Lord Freud]

Yes, my Lords, it will be extremely expensive if we do nothing. In the past five years we have already seen real expenditure on pensions go up by £20 billion to £81 billion a year. If we do nothing, the projections are that age-related spending will go up to more than 5.5 per cent by the middle of the century. We must do something about it. That is why we have this consultation to look at the best way of moving the pension age upwards to reflect the changes in ageing.

Pensions Bill [HL]

Lord Flight Excerpts

Wednesday 30th March 2011 Lords Chamber

[Lord Boswell of Aynho]

My Lords, the noble Baroness, Lady Hollis, has performed a signal service to the House in bringing this issue to our attention. She was kind enough to refer to work done by David Willetts and Sir Malcolm Rifkind. I was privileged to be part of their Front Bench team at that time, although I cannot claim any real credit for the genesis of the thinking. As the noble Baroness said in referring to the consultation paper, it is now beginning to sink into the mainstream. I am a strong supporter of greater flexibility in this area so I am glad that she has raised it.

I have some slight reservation as to whether the issue is as gender specific as the noble Baroness feels that it is. I think that she is conceding that point and, indeed, she did not say that it was exclusively so. I can imagine situations where men, for example, perhaps have overlapping earnings and have acquired a certain pension capacity or pot. In Committee, we debated some of the difficulties that can arise as regards smaller sums. It might be quite sensible, as well as convenient, for an individual of whatever gender who perhaps is starting a business or otherwise to access that money in order to provide starting capital. It is a wider and general interest. I very much look forward to the Minister’s response to how it is going.

In technical terms—I stress in technical terms, although not in any sense to derogate from it—I have some slight reservations. First, in terms of using this Bill as the vehicle for doing it, it is premature but that is not a reason for not ventilating issues. Secondly, I am not absolutely sure—because it appears annexed to a passage of the Bill which is about auto-enrolment, although I think that the noble Baroness indicated a wider remit—whether it is simply about NEST or more general. I think that it is probably more general and it would be clearly invidious if it was NEST specific.

There is also a technical problem in the wording of the amendment. I understand the point, which was developed during her speech, that there could be some rules which would avoid moral hazard and would get one to the same minimum assured level of pension or pension pot at the end. Nevertheless, the way in which the amendment is worded it seems to me to be at least conceivable that as long as the £10,000 limit were maintained, an individual pensioner could make serial applications to the fund and draw it down to the qualifying level. I know that that is not the noble Baroness’s intention. However, it is right that we should be starting to think about this and I hope that it will be even better when we have brought it to effect.

[Lord Flight]

Perhaps I may add that I think that it is a great advantage that the noble Baroness has raised this issue. I believe that if it were to be taken up it should go across all pensions. In the US, under the 401(k) plan, you can withdraw money only by borrowing it at a fancy rate of interest and you have to repay. Even with that rather unattractive mechanism, as has been pointed out, it still bears fruit. The ISA story illustrates it even more so. Let us remember also that if you take money out of an ISA you cannot put it back and continue with those benefits.

More widely, if we are going to keep the pension structure as a big area for retirement saving, it is a bad brand name which has been damaged by all sorts of things in the past 15 years. Elements need to be added to pensions saving to make it attractive to people, of which this is one of the important ones.