First-time Buyer  

Minister eyes pension shake up to fund house deposits

Mr Webb went on to say that saving for a pension was a different type of saving than short-term saving for a deposit.

"The reason you get tax relief and the employer contributes is because it is a long-term saving scheme.

"If this went ahead, years down the line people may not be able to retire."

Steven Cameron, pensions director at Aegon, agreed that young people could face long term regrets in retirement if they dipped into their pot now to get on the ladder.

He said: "There is merit in looking at how to make housing and pension policy work together, and the previous chancellor attempted this with the Lifetime Isa which offers a tax incentivised vehicle to save for either a first house deposit or for retirement. 

"But the same money can’t be used twice and there’s a huge risk that offering early access to pensions to pay house deposits will be a far too tempting ‘bird in the hand’ offer."

Mr Cameron suggested another way of looking at housing and retirement policies together would be to waive stamp duty on retirees who want to downsize, stating this would free up family homes for younger generations and tackle the supply side issues.

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