Select committee: Treasury Committee
Conclusion 2
8th Report - Lifetime Individual Savings Account
Published 30 Jun 2025
Addressed to HM Treasury
Treasury Committee Lifetime ISA All items in this report Report on parliament.uk ↗ Inquiry on parliament.uk ↗
Conclusion (the committee's words)
Some Lifetime ISA providers only offer the cash Lifetime ISA. Retirement savings held within cash Lifetime ISAs may not achieve the best outcome for a Lifetime ISA holder over the long term, compared with investing in higher risk but higher return assets such as bonds and equities. (Conclusion, Paragraph 25)
From: Treasury Committee, 8th Report - Lifetime Individual Savings Account (HC 607), 30 June 2025
Government response
The government responded to the whole report on 11 September 2025 (deadline 30 August 2025).
Summary written by Accountability Index from the government's response. It is not the government's own words.The government's response does not commit to changing the Lifetime ISA, saying it "will consider" the Committee's recommendation in future policy development and "keeps all aspects of the Lifetime ISA policy under review".
- On messaging, the government says it has "no direct contact or interaction with individuals" but "will work with industry to consider ways in which it could improve its messaging", with no date given.
- On targeting, it points to the £450,000 property price cap and the withdrawal charge as ensuring the product is well targeted, and cites 227,600 first-time buyers helped since 2017. It does not commit to a future review of the product's form.
- On Universal Credit, it describes the Lifetime ISA as "a savings product" that counts towards the calculation like other savings, using its realisable value after the withdrawal charge. It sets out reasons for the £16,000 capital limit and does not say it will change the treatment.
- On warnings about Universal Credit, it says it "will consider the recommendation in the future development of the policy", points to MaPS guidance, and "will work with industry and other Government Departments to consider ways to improve the messaging".