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Proposed bill to help Brits out of debt
25/10/2005 14:11:00
The shadow work and pensions secretary Sir Malcolm Rifkind is launching proposals to make it easier for people to save for their retirement.
His private member's bill, Rights for Savers, hopes to encourage more people to put money away by introducing the Savings and Retirement Account (SARA). Similar to an ISA, it will allow individuals to take out cash if needed whilst subject to pension rules.
At retirement, this would be transformed into a Retirement Income Fund if pensioners do not wish to buy an annuity.
Sir Malcolm Rifkind told the Scotsman that the SARA account was designed with young savers in mind, "so it makes sense to permit withdrawals at key stages, such as when you are buying your first home, or to meet the costs of career development. This cash can be reinvested later in life."
The SARA could also reduce the number of pensions held by individuals, as it could be held onto from job to job. "With a SARA these can all be put into a single wrapper and savers can easily see exactly how much is in the pot," he said.
The shadow minister is due to meet with the pensions minister Stephen Timms before the next reading, and hopes to gain support from Labour and the Lib Dems.
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