sick - you are splitting hairs. True that the Govt don't 'give' it to you but if it does not go into an AVC, they sure as hell will take it!
dumiel - The AVC money can be used to purchase further pension from your main pension scheme and then you can cash in up to 150% of your last years salary from your pension as a tax free lump sum - better than the equivalent of AVC money used to purchase an annuity. The concept of using a large lump sum on Premium Bonds is the height of stupidity !