LISA: is George Osborne’s new savings initiative worth flirting with?

Chancellors of the Exchequer love to play God. But the hardest lesson they have to learn is that the most imaginative financial innovations usually have the most surprising unintended consequences.

In his latest Budget, George Osborne, torn over whether to peck at the UK pensions regime or completely overhaul it, has tried to have it both ways: he has left pensions alone but created the Lifetime ISA – immediately nicknamed LISA – that might have replaced them entirely.

As Spectator Money adroitly pointed out last week, pensions had become a farce worthy of Alan Ayckbourn, in which the desire to tinker was hard to resist. And, like Oscar Wilde, Osborne has discovered that he can resist everything – except temptation.

But LISA will enrich the young savers who need it least, while leaving most as far from a decent retirement pot as ever. A LISA holder can save up to £4,000 a year and receive a 25 per cent government bonus on anything put into the account before they reach 50.