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You can find the current article at its original source at https://www.theguardian.com/society/2019/jun/03/brokenshire-criticised-for-suggesting-first-time-buyers-dip-into-pension
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| Brokenshire criticised for suggesting first-time buyers dip into pension | Brokenshire criticised for suggesting first-time buyers dip into pension |
| (about 2 hours later) | |
| The housing and communities secretary, James Brokenshire, has faced criticism from Whitehall officials after suggesting that people should be allowed to dip into their pension funds to afford the deposit on a first home. | The housing and communities secretary, James Brokenshire, has faced criticism from Whitehall officials after suggesting that people should be allowed to dip into their pension funds to afford the deposit on a first home. |
| Officials at the Department for Work and Pensions (DWP) have written to Downing Street to say the idea was not cleared with them, and could carry risks. | Officials at the Department for Work and Pensions (DWP) have written to Downing Street to say the idea was not cleared with them, and could carry risks. |
| In a speech on Monday morning, in which he confirmed he was not standing to succeed Theresa May and urged some of the crowded field of contestants to drop out, Brokenshire outlined what he said were personal ideas for “a new deal with the British people”. | In a speech on Monday morning, in which he confirmed he was not standing to succeed Theresa May and urged some of the crowded field of contestants to drop out, Brokenshire outlined what he said were personal ideas for “a new deal with the British people”. |
| Part of this was the idea of allowing people to use money in their pensions to fund a deposit on a first-time home purchase. | Part of this was the idea of allowing people to use money in their pensions to fund a deposit on a first-time home purchase. |
| “We should be changing the necessary regulations to allow this to happen, protecting the integrity of pension investments but allowing lenders to innovate and design new products to bring this opportunity to consumers,” Brokenshire said. | “We should be changing the necessary regulations to allow this to happen, protecting the integrity of pension investments but allowing lenders to innovate and design new products to bring this opportunity to consumers,” Brokenshire said. |
| “It seems rather obtuse that we would deny people the opportunity to do this, given that we know those who own their own home by retirement are on average wealthier and do not have the burden of the largest expense in retirement – accommodation. And it is, after all, their money.” | “It seems rather obtuse that we would deny people the opportunity to do this, given that we know those who own their own home by retirement are on average wealthier and do not have the burden of the largest expense in retirement – accommodation. And it is, after all, their money.” |
| The average person aged 35 to 44 has a total pension wealth of about £35,000, Brokenshire said. | The average person aged 35 to 44 has a total pension wealth of about £35,000, Brokenshire said. |
| “If a couple could combine their pension wealth, both potentially using a proportion to support a deposit, this would make a huge difference to millions of lives,” he argued. “It would give people real choice, real opportunity.” | “If a couple could combine their pension wealth, both potentially using a proportion to support a deposit, this would make a huge difference to millions of lives,” he argued. “It would give people real choice, real opportunity.” |
| But a DWP source said the idea had not been discussed with the work and pensions secretary, Amber Rudd, or her department, and that officials had outlined their worries to No 10. | But a DWP source said the idea had not been discussed with the work and pensions secretary, Amber Rudd, or her department, and that officials had outlined their worries to No 10. |
| The source said: “We cannot support this policy because the evidence shows it will be risky and does not help the people it intends to help. The housing market doesn’t need people to dip into their pensions to buy more houses.” | The source said: “We cannot support this policy because the evidence shows it will be risky and does not help the people it intends to help. The housing market doesn’t need people to dip into their pensions to buy more houses.” |
| A spokesman for Brokenshire said the idea was “simply about economic freedom”. | |
| “It is about giving people greater choice over their own money, and no one is forced to take part – people can use their capital in the way they want to,” the spokesman said. | |
| “The Conservative party needs to reconnect people to capitalism, and this is one of many ideas we should be exploring as the leadership race takes place.” | |
| There has been wider concern among some officials about rules allowing people to dip into their pension funds, potentially leaving them short of money in older age. | There has been wider concern among some officials about rules allowing people to dip into their pension funds, potentially leaving them short of money in older age. |
| Rules on dipping into pensions were loosened under the Conservative-Liberal Democrat coalition government when the then pensions minister, Steve Webb, said it was up to people to decide. | |
| “So actually, if people do get a Lamborghini, and end up on the state pension, the state is much less concerned about that, and that is their choice,” he said. | “So actually, if people do get a Lamborghini, and end up on the state pension, the state is much less concerned about that, and that is their choice,” he said. |
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