Pensions could boost home ownership

Hillingdon Times: Nick Clegg has revealed plans for a 'pension from property scheme' Nick Clegg has revealed plans for a 'pension from property scheme'

Parents and grandparents will be allowed to draw on their pension pots to secure deposits for young family members in a bid to boost home ownership, Nick Clegg said.

The Deputy Prime Minister said detailed proposals were being drawn up by Liberal Democrat ministers as part of efforts to make the economy "fairer".

But he also declined to commit to pushing for any specific wealth tax despite promising activists at the party conference that he would play hardball with the Tories on the issue.

Speaking on BBC1's Andrew Marr Show from the Brighton gathering, he said: "This is part and parcel of something which I think most people agree with which is that as we fill in the black hole in the public finances we have also got to make sure that we do not put Humpty Dumpty back together again and make the same mistakes, that we re-wire the British economy and make it fairer and give people more opportunities.

"Let me give you one very good example: we have thousands of young people who are desperate to get their feet on the first rung of the property ladder but deposits have doubled and the number of young people asking for help from family members has doubled.

"So I can announce today that the Government is going to do something that hasn't happened before: we are going to work out ways in which parents and grandparents who want to help their children and grandchildren buy a property of their own, we are going to allow those parents and grandparents to act as a guarantee if you like so their youngsters ... can take out a deposit and buy a home. It is a pension from property scheme."

Mr Clegg sought to rally his party on Saturday night by promising to claw back more money from people who "sit on a fortune" amid rumblings about his leadership and consistently dire opinion poll ratings. Aides said he would insist on fresh taxes for the wealthy as the price for accepting billions of pounds of extra spending cuts when the coalition sets budgets for 2015-16. As part of that agenda, Treasury Chief Secretary Danny Alexander revealed that a crackdown on tax dodgers was being extended to all those worth £1 million or more.

But Mr Clegg appeared to signal that he did not expect the promised fairness to come in the form of a specific extra levy such as the mansion tax on £2 million-plus properties favoured by the party. Asked if he believed he could persuade his Tory coalition partners to accept a form of wealth tax, he said: "I think there is a very considerable chance, because we have already done a lot of it, to make sure that the top pay more tax." Pressed to provide a single example of a new measure that could be introduced.during this parliament, he conceded that "so far I have failed" to persuade Prime Minister David Cameron and Chancellor George Osborne to accept a mansion tax.

Mr Alexander spelt out more details of the policy announcement in an interview with the BBC's Sunday Politics. Under the pension scheme, people due a lump sum on retirement would be allowed to use that to underwrite mortgages for younger relatives, he said. He also sought to reassure owners of homes worth more than £1 million, saying: "It is targeted very much at those people whose affairs are risky. It is not going to mean that anyone who has got a home over £1 million gets a knock on the door from the taxman. If your net worth is more than £1 million you will be within the population that the affluent unit is able to look at. But of course HMRC have a lot of information, they can identify particular groups, particular individuals where there are particular tax risks for example those with properties overseas. They won't be going to every single person in that group."

Shadow chief secretary to the Treasury Rachel Reeves said: "Nobody will be fooled by Nick Clegg's empty words on tax. This is the man who backed a £3 billion tax cut for millionaires in the Budget while asking millions of pensioners and families to pay more. There's nothing fair about a family with children paying an average £511 extra from changes the Government has brought in this year, while millionaires will get a £40,000 tax cut next year. Nick Clegg is the Deputy Prime Minister of this Government and he must take responsibility for its actions. After so many broken promises, people will judge the Liberal Democrats on what they do, not what they say."

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