Pension Schemes Bill

Lord Rooker Excerpts

Thursday 5th February 2015 Lords Chamber

[Lord Newby]

It is not the point at which money goes from ISAs into pensions that is a deprivation of assets. Deprivation of assets may occur if and when money is taken out of one or both of those pots.

[Lord Rooker (Lab)]

I have listened with care to my noble friend, and although I have not participated in the debate, I understand the issue. Surely by moving an ISA into a pension pot, the individual then does not have access to buy, sell or add to the ISA. It is just not available; it is now hidden in the pension pot. Therefore, the individual deprives himself or herself of the choice they had when they had the ISA. It is fairly simple: is it or is it not something that could be penalised? People need to know this. If we are not careful, there will be chaos in this country later in the year as regards people with small pensions and small ISA pots.

[Lord Newby]

My Lords, I thought I had just said that if you move money from your ISA into your pension pot that does not qualify to be treated as a deprivation of assets. You are not taking that asset as income and you are not spending it; you are moving it from one pot to another.