HL Deb 04 November 1975 vol 365 cc988-90
Lord BARNBY

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government whether they are now intending to widen the issue of National Savings certificates.

Lord JACQUES

My Lords, since taking Office, the Government have improved the terms of all National Savings securities. The latest examples of this are the introduction of two index-linked savings schemes. The Government have no further plans for indexation, but the position is under continuous review.

Lord BARNBY

My Lords, is the Minister satisfied that, with regard to the invitation to subscribe to National Savings certificates—of which there are now understood to be over 2,000 million in circulation—that invitation contains adequate intimation to would-be subscribers that, during the life of the present Government, the debasement of the currency has resulted in savers losing 25 per cent. of what they put into the certificates? Furthermore, are they satisfied that the warning that is required in most other financial advertisements that the units can go down as well as up is, in the case of the Government securities, adequately given?

Lord JACQUES

My Lords, on 1st January this year the amount contributed to National Savings certificates amounted in total to £1,941 million, excluding accrued interest. At the end of September, it was £2,067 million. I believe that that shows that, as a whole, National Savings are competitive.

Lord REIGATE

My Lords, could the noble Lord elaborate on what exactly is meant by that absolutely original phrase "a continuous review"?

Lord HAWKE

My Lords, could the noble Lord ask the Government to reissue tax reserve certificates as a means whereby people can save for their taxes? These were withdrawn from sale to the general public, I believe by the last Labour Government.

Lord JACQUES

My Lords, that is another question. If the noble Lord cares to put down a Question on that matter I will do my best to answer it.

Lord BARNBY

My Lords, the Minister was good enough to explain that there has recently been that extension, in which it is a matter of age as to who can make use of it. Is it administrative difficulties which prevent the extension being made to other age groups? By comparison with Government undated bonds, on the basis of 15 per cent., the reward seems low and the hazard great.

Lord JACQUES

My Lords, as I said, there are two schemes. First, there is the scheme which applies to people who have reached the age of retirement under the National Insurance scheme. There is also the Save-as-you-Earn scheme which applies to everybody aged 16 years or more.

Lord LEE of NEWTON

My Lords, does my noble friend agree that while the index-linked schemes are extremely good value for money, it would be a good idea—as inflation has been rather rampant—to increase the maximum amount that can be invested in them?

Lord JACQUES

My Lords, the Government have two conflicting obligations. One is an obligation to the taxpayer to buy goods and services as economically as possible, and secondly there are certain social obligations. The Government believe that by the action they have taken they have got the right balance.