UK government moves to cut cash ISA limit and reassesses state pension spending

Chancellor Rachel Reeves announced that the cash ISA allowance for savers under 65 will be reduced from £20,000 to £12,000 a year starting 6 April 2027, a cut of £8,000 aimed at encouraging investment but criticised for its impact on household liquidity.

A Resolution Foundation report warned that the state pension triple‑lock formula could cost the Treasury an extra £10 billion annually and that pension payments are set to consume nearly half of the Department for Work and Pensions’ benefit budget, reviving calls to scrap the lock.

The Department for Work and Pensions also highlighted that thousands of pensioners may be missing out on up to £6,000 a year from the Attendance Allowance, a non‑means‑tested benefit for those over state‑pension age with health or disability needs.

Separately, DWP confirmed that pensioners aged 75 and over who receive Pension Credit can obtain a free TV licence, removing the £180 annual charge for eligible low‑income seniors.

Research by Almond Financial placed the UK’s state pension just 26 % above the cost‑of‑living breakeven point, lagging behind most European counterparts where pension income often exceeds living costs by well over 100 %.