Return of pensioner bonds: Theresa May could introduce accounts with high interest rates to help savers
- High-interest fixed-term bonds issued from Jan-May last year for over-65s
- They were considered the most successful financial product for years
- Other plans to help savers may include tax breaks, such as ripping up savings limits on Isas
Theresa May could bring back pensioner bonds for all ages to help long-suffering savers, it emerged last night
Theresa May could bring back pensioner bonds for all ages to help long-suffering savers, it emerged last night.
Former pensions minister Baroness Altmann suggested government-backed bonds with higher interest rates would be a boost to those who have endured rock-bottom returns for years.
It is understood other plans to help savers may include tax breaks, such as ripping up savings limits on Isas.
A source told the Mail that industry experts have been asked to present their ideas to the Treasury before the end of the month.
Mrs May hinted in her conference speech on Wednesday that she would introduce policies to help savers after quantitative easing and the interest-rate cut had 'bad side effects'.
Yesterday, Baroness Altmann agreed the 'dangerous' policy of printing money had 'turned the world of savings upside down'.
She said: 'There are negative returns on some company and government bonds at the moment, which is bonkers. It's clearly unsustainable and makes no sense from a long-term perspective.'
On ways to help savers, she added: 'What the Government could think of doing is bringing back special savings bonds which were for the over-65s but for everybody. All savers have been hit, not just the over-65s.'
High-interest fixed-term bonds were issued from January to May last year for the over-65s and were considered the most successful financial product for years.
The bonds offered 2.8 per cent interest for one year and 4 per cent for three years – almost double the rates typically offered on the high street.
In the first few months more than 610,000 savers invested £7.5billion.
David Dalton-Brown, of the Tax Incentivised Savings Association, which is frequently involved in Treasury discussions of new policies, suggested a range of options could be on the table.
He said: 'We believe the key areas the Government should be focusing on are increasing the amount younger savers are putting into workplace pensions, making the new Lifetime Isa work better for self-employed workers and helping savers make more use of the capital tied up in their houses in retirement.'
Mrs May hinted in her conference speech on Wednesday that she would introduce policies to help savers after quantitative easing and the interest-rate cut had 'bad side effects'
Iain Anderson, a government policy expert and co-founder of business consultancy Cicero, said a 'flurry of new savings deals' would help fund new projects.
He said: 'In order to fund three years of big infrastructure projects such as building more houses, the Chancellor could well find it attractive to launch a flurry of new savings deals for saver, such as 'granny bonds' with sweetened interest rates or NS&I products.
'The bigger picture for savers in next month's Autumn Statement might be that Philip Hammond says he won't sign off any more money-printing through quantitative easing, which might help keep savings rates from falling further.'
In her speech on Wednesday, Mrs May said: 'People with assets have got richer. People without them have suffered. People with mortgages have found their debts cheaper. People with savings have found themselves poorer. A change has got to come. And we are going to deliver it.'
Most watched News videos
- CCTV captures final tragic moments of Mirna Salihin's life
- Mother shaves daughters hair after she 'bullies cancer girl'
- GRAPHIC CONTENT: 'Ghost' rises from body after fatal crash
- Bulls head butt each other then die instantly from brutal blow
- Shocking moment girl gets viciously beaten after starting fight
- Mother releases devastating footage of son's final moments
- Lorry smashes into car leaving driver with severe injuries
- Is this the creepy moment the corpse of a girl OPENS her eyes?
- 'Big fat gypsy wedding' in Romania goes on for FOUR days
- Groom ALREADY tired of marriage life just after 15 minutes
- 'Pascal's a G!' Kim Kardashian speaks well of her bodyguard
- GoPro captures the moment a croc swims amongst swimmers