National Savings

HC Deb 31 January 1967 vol 740 cc225-6

11. Mr Edward M. Taylor

asked the Chancellor of the Exchequer what net increase in National Savings took place in the year 1966; and what were the comparable figures for 1965, 1964, and 1963, respectively.

Mr. Callaghan

There was a decrease of £38 million in 1966 compared with increases of £74 million, £357 million, £315 million in 1965, 1964, 1963 respectively. This was owing to the large maturities of defence bonds falling due last year. If undistributed interest and defence bond maturities are excluded there was an increase of £10 million in 1966.

Mr. Taylor

What steps is the Chancellor taking to rectify this alarming situation? Can he say in what previous year there was a net drop in National Savings?

Mr. Callaghan

We are already taking steps which are proving very successful, namely, the return on the National Savings Certificate which is just about the best return anyone can get on an investment at present. This is having a profound effect on the increase in National Savings during the course of the current year.

Mrs. Thatcher

Is the Chancellor satisfied with the present amount being saved through National Savings, bearing in mind that the amount invested at the end of 1966 was less than at the beginning of the year, and that this is the first time for a decade that this has happened?

Mr. Callaghan

As I said, if one excludes undistributed interest and defence bond maturities there was an increase in 1966. Of course I am not satisfied with the level of National Savings. I should like a higher level of saving all round, and that is one reason for the very substantial yield that anyone can now get on the National Savings Certificate.

Mr. Ian Lloyd

Has the Chancellor perchance seen the advertisement for Premium Bonds on many hoardings which says, "Have a flutter in the national interest" to which there is appended the phrase "You cannot lose"? Does he not think that this is a most lamentable bedfellow of the national interest, and would he not agree that in this form of national savings, as in any form of National Savings, the Government would be honest to indicate what the rate of return in real terms would be after depreciation of the citizen's capital has taken place?

Mr. Callaghan

This was introduced by Mr. Harold Macmillan when he was Chancellor and I am sure that he had full regard to all of these moral considerations. I am very happy to profit from this.