Workplace ISA plan to supplement pensions

A right-leaning think tank published a proposal for a ‘workplace ISA’ as an alternative to pensions, while the Financial Times reported that the new pensions minister had commented favourably on the idea before her appointment to government.

While some Conservatives seem to believe pension tax reliefs are too costly, the real case for ISAs is that young people often feel they may need access to their cash, and age 55 (the earliest age for access to pension fund cash) is simply too long a wait.

The argument that young people might save more of their own cash in ISAs than pensions has merit, but after the huge recent changes to pension rules, we would not expect any radical changes any time soon.