LISA0048

Written evidence submitted by Anonymous

1 The LISA is not currently fit for purpose.

2  Consumers may put in the maximum amount as they approach a house purchase then, if this does not come about, adjust to a modest monthly amount towards pension.

3  The government should assist people into responsible home ownership by optimising their loan to value (LTV) ratio which is the gateway to cheaper mortgage borrowing.  Most people have inadequate pension provision so this is also important.

4  The LISA can be invested in line with the individual’s risk profile/attitude and so is suitable as a product.  It does not have to be amalgamated with other arrangements until later in life.

5  The LISA should be changed but does not need to be abolished.

6  The withdrawal penalty of 25% is insane!  At first it appeared that the LISA structure had been drawn up by someone who just didn’t understand the arithmetic.  Surely it would be corrected at the next budget?  But no, it still persists.  My view is that a 20% penalty should be capped at the amount of the government contribution.  Withdrawals are likely to occur when couples split up and the present rules are a huge disincentive to setting up a LISA – I have not helped my children to start LISAs for that reason.

7  No restrictions on LISA please.

8  The house price cap should be removed.

9  The LISA investment limit should certainly be changed, maybe to £500 a month, then adjusted upwards per triple lock on pensions, etc. so the product remains relevant.

10  Further incentives when people invest their LISA in green infrastructure?  The government still shows a lack of ambition in fighting climate change and should not ignore ways in which it can nudge investment behaviour.

January 2025