§ Wing Commander Bullusasked the Chancellor of the Exchequer if he will raise the interest paid on Post Office savings accounts from 2½ per cent., as an inducement to saving and to bring the rate more into line with present-day interest rates.
§ Mr. H. MacmillanNo. The present rate of 2½ per cent. is fixed by law and has been in force through periods of both cheap and dear money for the Post Office Savings Bank since 1861, and for the Trustee Savings Banks since 1888. Legislation would be required to change it. While I am anxious to encourage savings, I would hesitate to ask Parliament for powers to vary this rate. Two-and-a-half is a fair return, even at present market levels, on deposits repayable on demand or short notice. I must also have regard to the consensus of opinion in the National Savings Movement, which is that in the long term it is in the best interests of the savings banks and their depositors that the rate should remain fixed by law and not fluctuate with changes in market conditions.