LISA0025

Written evidence submitted by Anonymous

As a person on Universal Credit, recently transferred from ESA, I would have liked the opportunity to have a Lifetime ISA.

What stopped me was the benefits savings limit of £6,000 where the lifetime ISA was treated as capital, unlike a long-term pension which is exempt.

So, let’s give my personal experience as an example:

I received £11,000 as a back payment from the DWP for underpaid benefits.

Had Lifetime ISA been exempt from capital, I could have put the lot into the Lifetime ISA.

Why would i do this?

To purchase a property in the future closer to my retirement age.

Being able to save money into an account that isn’t a pension for the purposes of owning property later in life should be benefits exempt from being treated as capital.

This gives poor people like myself the hope one day of purchasing a property.

Obviously, withdrawal from the account would need to be blocked as a conditionality of benefits, or it would make a mockery of the capital requirements of universal credit.

I have had to invest all the money into a pension instead, which i cannot use until 67 because of DWP benefits capital requirements.

Thus cannot purchase a house even though my pension has the funds to go out and buy one tomorrow.

A lifetime ISA would have made that possible were it capital exempt from DWP benefits. Its a small change but a necessary one.

This is not difficult to understand, or implement, and has no negative complications for non-benefits people, and would give millions at the bottom end of society hope for the future of owning a home.

January 2025