James Brokenshire has attracted criticism for his suggestion that millennials could dip into the pension pots to cover the deposit for their first home.
The Community Secretary, who is one of the few cabinet members and senior Conservatives not to be running for party leadership after Theresa May bows out later this week, floated the idea during a speech at the Policy Exchange yesterday.
During his address, he praised the success of the auto-enrolment scheme, which came in back in 2012 to ask people to opt-out of making contributions to their state pension.
"The average 35 to 44-year-old has a pension wealth of approximately 35 thousand pounds. 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." –@JBrokenshire pic.twitter.com/AU5VIQ1VBJ
— Policy Exchange (@Policy_Exchange) June 3, 2019
He called for a further change of regulations, noting that it is “obtuse that we would deny the opportunity to do this”.
Brokenshire said: “The average 35 to 44-year-old has a pension wealth of approximately 35 thousand pounds. 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.
“It is, after all, their money. Not the fund’s, not the state’s, it’s YOURS and the next Conservative government should free that capital up, and trust the individual to make the choice for themselves.”
— Jake James #FBPE #RevokeA50 #PeoplesVote (@MFIJake) June 3, 2019
However, the reaction to that suggestion has been overwhelmingly negative with Brokenshire being blasted for being “out of touch” to expect that people had the cash to spare in their pension to get on the housing ladder.
Especially when Britain’s ageing population is putting more and more strain on pensions post-retirement.
People in their 20s should be able to use part of their pension pot as a deposit on their first house. What pension pot? Tories totally out of touch with the real world.
BBC News – Brokenshire: Tory leadership candidates should drop outhttps://t.co/JK3cIeXA96
— Jon W (@JonW_67) June 3, 2019
A spokesperson for Mr Brokenshire added that the idea is about choice and people would not be required to take part.
“James Brokenshire’s idea is quite simply about economic freedom,” the spokesperson 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.”