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“This is a valuable initiative which will help to encourage low income savers and we look forward to working with the Government to ensure that the scheme is a success.”
The right hon. Member for Wokingham and others mentioned interest rates. It is important that we kick-start a regular savings habit. The hon. Member for East Antrim (Sammy Wilson) put it well when he said that the key point was to stimulate the savings habit, and the point about the match funding is that it will do exactly that. A match rate of 50p in the pound is the equivalent of an interest rate of 44 per cent. The interest rates will be very much a matter for the individual providers, however. We are not planning to see the accounts introduced until 2010, so I would not expect the providers to say now whether they will introduce interest rates or, if they were to do so, what those rates would be.
Some potential providers have suggested that paying interest would result in significant costs and complexities in the design of the systems for these relatively low-level savings accounts. Some respondents to the consultation last year also suggested that the need to understand and compare different types of ratios could put off inexperienced savers. That reinforces the point about promoting financial literacy. This is something that we will continue to show an interest in, but we believe that the deciding factor for people opening a saving gateway account will be the match rate provided by the Government. If possible, we would like to see competitive market and good savings rates offered to those in saving gateway accounts. What happens at the end of the saving gateway is what is important, as both the hon. Member for East Antrim and the hon. Member for South-West Hertfordshire said.
To clarify matters further, savers who have come to the end of a saving gateway account will be free to choose what happens to their money next. The Government believe that an element of choice is very important. We expect providers to treat customers fairly and we anticipate that they will want to help their customers to access the savings option that is most suitable to their needs. We
will hold a dialogue with them to ensure that there are sensible default options for those who fail to express a preference during the two-year period of the saving gateway account. As I said earlier, it is possible for the account to be rolled into an ISA and some providers might set that as the default option. To be clear, if a provider offered a poor rate of return, it would be open to savers to move their money to another type of account or another provider with a better rate of return.
Rob Marris: One of the concerns expressed earlier was about whether sufficient information would be available when people opened these accounts. We received some reassurances about that from my right hon. Friend the Chief Secretary, but can the Economic Secretary provide some further reassurances about what information will be available to individual savers at the conclusion of their two years—or however long it might be—so that people are aware of their options, whether it be to move their money into ISAs, to close the account or to move it somewhere else? It is important that some of the most financially disadvantaged people in our society have full information, so will the Minister provide some examples?
Ian Pearson: My hon. Friend makes a very good point. As I mentioned at the start, the issue of financial inclusion is very important to this Government. As he will be aware, we commissioned Otto Thoresen to produce a report, and we are taking forward its recommendations on financial inclusion. With the Financial Services Authority, we are establishing pilots in the north-west and the north-east and today we announced some of the providers that will help to deliver them. We view the establishment of a pathfinder scheme to improve financial literacy and advice as an important area, to which we continue to pay attention, and the Government are taking other measures as well. My hon. Friend will be aware of our efforts in the education and school system to provide better information from an early age, sometimes as young as seven. We are planning to build further such measures into the curriculum, so that better advice is provided in the future.
The hon. Member for Fareham asked about the automatic rolling over of accounts. As I explained, account providers will have to put in place a default option in cases where savers do not provide instructions about what they want to happen to the account on maturity. They should have choices, as I said.
Finally, let me pick up on a matter raised by the hon. Member for South-West Hertfordshire, who asked why the Bill did not make it clear that a person could have only one account. The requirement that a person may open only one saving gateway account in a lifetime will be contained in regulations. Our approach is that the Bill allows some flexibility so that the Government have the option to offer the saving gateway to eligible individuals again in future. Depending on the scheme’s success and the financial climate, that may be appropriate in the future. In our view that represents sensible contingency planning, but no doubt we shall wish to discuss the technical questions in some detail in Committee.
I am grateful to all Members for the points that they have made, and look forward to pursuing them in Committee in a few weeks’ time. I am also grateful for
the support that we have received today for our objectives for the saving gateway: kick-starting that saving habit, and promoting financial inclusion. The pilots showed that the gateway could achieve those aims by offering a targeted, clear and strong incentive to the group who need it most, in the form of 50p for every £1 saved.
As a result of the Bill, a national saving gateway scheme will be introduced for the first time, offering that incentive to about 8 million people. It will give them a chance to save up to £600 and earn up to £300 from the Government. It will provide an amount that could make a real difference, and, more important, an experience that could help to build a lifetime saving habit. I commend it to the House.
Bill accordingly read a Second time.
Saving Gateway Accounts Bill (programme)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Saving Gateway Accounts Bill:
Committal
1. The Bill shall be committed to a Public Bill Committee.
Proceedings in Public Bill Committee
2. Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Tuesday 10 February 2009.
3. The Public Bill Committee shall have leave to sit twice on the first day on which it meets.
Consideration and Third Reading
4. Proceedings on consideration shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which those proceedings are commenced.
5. Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.
6. Standing Order No. 83B (Programming committees) shall not apply to proceedings on consideration and Third Reading.
Other proceedings
7. Any other proceedings on the Bill (including any proceedings on any message from the Lords) may be programmed.— ( Ms Butler. )
The House proceeded to a Division.
Mr. Deputy Speaker (Sir Michael Lord): I ask the Serjeant at Arms to investigate the delay in the Aye Lobby.
The House having divided: Ayes 276, Noes 172.
AYES
Abbott, Ms Diane
Ainger, Nick
Allen, Mr. Graham
Anderson, Mr. David
Anderson, Janet
Armstrong, rh Hilary
Atkins, Charlotte
Austin, Mr. Ian
Austin, John
Baird, Vera
Balls, rh Ed
Banks, Gordon
Barlow, Ms Celia
Barron, rh Mr. Kevin
Battle, rh John
Bayley, Hugh
Beckett, rh Margaret
Begg, Miss Anne
Bell, Sir Stuart
Benn, rh Hilary
Betts, Mr. Clive
Blackman, Liz
Blackman-Woods, Dr. Roberta
Blears, rh Hazel
Blizzard, Mr. Bob
Borrow, Mr. David S.
Bradshaw, Mr. Ben
Brennan, Kevin
Brown, Lyn
Brown, rh Mr. Nicholas
Brown, Mr. Russell
Browne, rh Des
Bryant, Chris
Buck, Ms Karen
Burden, Richard
Burgon, Colin
Butler, Ms Dawn
Byrne, rh Mr. Liam
Cairns, David
Campbell, Mr. Alan
Caton, Mr. Martin
Cawsey, Mr. Ian
Challen, Colin
Chapman, Ben
Chaytor, Mr. David
Clark, Ms Katy
Clark, Paul
Clarke, rh Mr. Charles
Clelland, Mr. David
Clwyd, rh Ann
Coffey, Ann
Cohen, Harry
Connarty, Michael
Cooper, rh Yvette
Corbyn, Jeremy
Cousins, Jim
Crausby, Mr. David
Creagh, Mary
Cruddas, Jon
Cummings, John
Cunningham, Mr. Jim
Cunningham, Tony
Davidson, Mr. Ian
Davies, Mr. Dai
Dean, Mrs. Janet
Devine, Mr. Jim
Dhanda, Mr. Parmjit
Dismore, Mr. Andrew
Dobbin, Jim
Donohoe, Mr. Brian H.
Doran, Mr. Frank
Dowd, Jim
Drew, Mr. David
Eagle, Angela
Eagle, Maria
Efford, Clive
Ellman, Mrs. Louise
Engel, Natascha
Ennis, Jeff
Etherington, Bill
Field, rh Mr. Frank
Fisher, Mark
Flello, Mr. Robert
Flint, rh Caroline
Flynn, Paul
Foster, Michael Jabez (Hastings and Rye)
Francis, Dr. Hywel
Gapes, Mike
George, rh Mr. Bruce
Gerrard, Mr. Neil
Gibson, Dr. Ian
Gilroy, Linda
Godsiff, Mr. Roger
Goodman, Helen
Griffith, Nia
Griffiths, Nigel
Grogan, Mr. John
Gwynne, Andrew
Hain, rh Mr. Peter
Hall, Mr. Mike
Hamilton, Mr. David
Hanson, rh Mr. David
Harman, rh Ms Harriet
Harris, Mr. Tom
Havard, Mr. Dai
Healey, rh John
Hendrick, Mr. Mark
Hepburn, Mr. Stephen
Heppell, Mr. John
Hesford, Stephen
Hill, rh Keith
Hillier, Meg
Hodgson, Mrs. Sharon
Hoey, Kate
Hoon, rh Mr. Geoffrey
Hope, Phil
Hopkins, Kelvin
Howarth, rh Mr. George
Howells, Dr. Kim
Hoyle, Mr. Lindsay
Hughes, rh Beverley
Humble, Mrs. Joan
Iddon, Dr. Brian
Ingram, rh Mr. Adam
Irranca-Davies, Huw
James, Mrs. Siân C.
Jenkins, Mr. Brian
Johnson, rh Alan
Johnson, Ms Diana R.
Jones, Helen
Jones, Lynne
Jones, Mr. Martyn
Jowell, rh Tessa
Joyce, Mr. Eric
Kaufman, rh Sir Gerald
Keeley, Barbara
Keen, Alan
Kemp, Mr. Fraser
Kidney, Mr. David
Kilfoyle, Mr. Peter
Knight, rh Jim
Kumar, Dr. Ashok
Ladyman, Dr. Stephen
Laxton, Mr. Bob
Lazarowicz, Mark
Lepper, David
Levitt, Tom
Lewis, Mr. Ivan
Linton, Martin
Lloyd, Tony
Love, Mr. Andrew
Lucas, Ian
MacShane, rh Mr. Denis
Mactaggart, Fiona
Mallaber, Judy
Mann, John
Marris, Rob
Marsden, Mr. Gordon
Marshall-Andrews, Mr. Robert
Martlew, Mr. Eric
McAvoy, rh Mr. Thomas
McCafferty, Chris
McCarthy, Kerry
McCarthy-Fry, Sarah
McCartney, rh Mr. Ian
McDonagh, Siobhain
McDonnell, John
McFadden, rh Mr. Pat
McFall, rh John
McGovern, Mr. Jim
McGuire, rh Mrs. Anne
McIsaac, Shona
McKechin, Ann
McKenna, Rosemary
McNulty, rh Mr. Tony
Meacher, rh Mr. Michael
Meale, Mr. Alan
Merron, Gillian
Michael, rh Alun
Milburn, rh Mr. Alan
Miller, Andrew
Mitchell, Mr. Austin
Moffat, Anne
Moffatt, Laura
Mole, Chris
Moon, Mrs. Madeleine
Morgan, Julie
Morley, rh Mr. Elliot
Mullin, Mr. Chris
Munn, Meg
Murphy, Mr. Denis
Murphy, rh Mr. Jim
Murphy, rh Mr. Paul
Naysmith, Dr. Doug
Norris, Dan
O'Hara, Mr. Edward
Olner, Mr. Bill
Owen, Albert
Palmer, Dr. Nick
Pearson, Ian
Plaskitt, Mr. James
Pope, Mr. Greg
Prentice, Bridget
Prentice, Mr. Gordon
Prescott, rh Mr. John
Primarolo, rh Dawn
Prosser, Gwyn
Purnell, rh James
Raynsford, rh Mr. Nick
Reed, Mr. Andy
Reed, Mr. Jamie
Riordan, Mrs. Linda
Robertson, John
Robinson, Mr. Geoffrey
Rooney, Mr. Terry
Roy, Mr. Frank
Roy, Lindsay
Ruane, Chris
Russell, Christine
Ryan, rh Joan
Salter, Martin
Sarwar, Mr. Mohammad
Seabeck, Alison
Sharma, Mr. Virendra
Shaw, Jonathan
Sheerman, Mr. Barry
Sheridan, Jim
Simon, Mr. Siôn
Simpson, Alan
Singh, Mr. Marsha
Skinner, Mr. Dennis
Slaughter, Mr. Andy
Smith, rh Mr. Andrew
Smith, Ms Angela C. (Sheffield, Hillsborough)
Smith, Angela E. (Basildon)
Smith, Geraldine
Smith, rh Jacqui
Smith, John
Snelgrove, Anne
Southworth, Helen
Spellar, rh Mr. John
Starkey, Dr. Phyllis
Stewart, Ian
Stoate, Dr. Howard
Strang, rh Dr. Gavin
Straw, rh Mr. Jack
Sutcliffe, Mr. Gerry
Taylor, Ms Dari
Taylor, David
Taylor, Dr. Richard
Thornberry, Emily
Timms, rh Mr. Stephen
Tipping, Paddy
Todd, Mr. Mark
Touhig, rh Mr. Don
Trickett, Jon
Truswell, Mr. Paul
Twigg, Derek
Ussher, Kitty
Vis, Dr. Rudi
Waltho, Lynda
Watson, Mr. Tom
Whitehead, Dr. Alan
Wicks, rh Malcolm
Williams, rh Mr. Alan
Williams, Mrs. Betty
Wills, rh Mr. Michael
Wilson, Phil
Winnick, Mr. David
Winterton, rh Ms Rosie
Woolas, Mr. Phil
Wright, Mr. Anthony
Wright, David
Wright, Mr. Iain
Wright, Dr. Tony
Wyatt, Derek
Tellers for the Ayes:
Mr. Dave Watts and
Claire Ward
NOES
Afriyie, Adam
Ainsworth, Mr. Peter
Alexander, Danny
Arbuthnot, rh Mr. James
Atkinson, Mr. Peter
Baker, Norman
Baldry, Tony
Barker, Gregory
Barrett, John
Beith, rh Sir Alan
Bellingham, Mr. Henry
Benyon, Mr. Richard
Beresford, Sir Paul
Boswell, Mr. Tim
Bottomley, Peter
Brady, Mr. Graham
Brake, Tom
Brazier, Mr. Julian
Brokenshire, James
Brooke, Annette
Browne, Mr. Jeremy
Browning, Angela
Bruce, rh Malcolm
Burstow, Mr. Paul
Burt, Alistair
Burt, Lorely
Cable, Dr. Vincent
Campbell, rh Sir Menzies
Carmichael, Mr. Alistair
Carswell, Mr. Douglas
Cash, Mr. William
Chope, Mr. Christopher
Clappison, Mr. James
Clifton-Brown, Mr. Geoffrey
Cormack, Sir Patrick
Cox, Mr. Geoffrey
Crabb, Mr. Stephen
Davey, Mr. Edward
Davies, David T.C. (Monmouth)
Davies, Philip
Dorrell, rh Mr. Stephen
Dorries, Mrs. Nadine
Duncan, Alan
Duncan Smith, rh Mr. Iain
Ellwood, Mr. Tobias
Evans, Mr. Nigel
Evennett, Mr. David
Fabricant, Michael
Fallon, Mr. Michael
Farron, Tim
Featherstone, Lynne
Field, Mr. Mark
Foster, Mr. Don
Fox, Dr. Liam
Francois, Mr. Mark
Gale, Mr. Roger
Gauke, Mr. David
George, Andrew
Gidley, Sandra
Gillan, Mrs. Cheryl
Goldsworthy, Julia
Goodman, Mr. Paul
Goodwill, Mr. Robert
Gove, Michael
Green, Damian
Greening, Justine
Greenway, Mr. John
Grieve, Mr. Dominic
Hammond, Mr. Philip
Hammond, Stephen
Hancock, Mr. Mike
Hands, Mr. Greg
Harper, Mr. Mark
Harris, Dr. Evan
Harvey, Nick
Hayes, Mr. John
Heald, Mr. Oliver
Heath, Mr. David
Hemming, John
Hendry, Charles
Herbert, Nick
Hoban, Mr. Mark
Hollobone, Mr. Philip
Holmes, Paul
Horwood, Martin
Hosie, Stewart
Howarth, David
Howarth, Mr. Gerald
Howell, John
Jack, rh Mr. Michael
Jackson, Mr. Stewart
Jenkin, Mr. Bernard
Kawczynski, Daniel
Knight, rh Mr. Greg
Laing, Mrs. Eleanor
Lait, Mrs. Jacqui
Lancaster, Mr. Mark
Laws, Mr. David
Lewis, Dr. Julian
Lidington, Mr. David
Lilley, rh Mr. Peter
Llwyd, Mr. Elfyn
Loughton, Tim
MacNeil, Mr. Angus
Malins, Mr. Humfrey
Maples, Mr. John
Mason, John
Mates, rh Mr. Michael
Maude, rh Mr. Francis
May, rh Mrs. Theresa
McIntosh, Miss Anne
McLoughlin, rh Mr. Patrick
Mitchell, Mr. Andrew
Moore, Mr. Michael
Mundell, David
Murrison, Dr. Andrew
O'Brien, Mr. Stephen
Öpik, Lembit
Osborne, Mr. George
Ottaway, Richard
Paice, Mr. James
Pelling, Mr. Andrew
Penning, Mike
Penrose, John
Price, Adam
Pugh, Dr. John
Randall, Mr. John
Redwood, rh Mr. John
Rennie, Willie
Robathan, Mr. Andrew
Robertson, Angus
Robertson, Hugh
Robertson, Mr. Laurence
Rosindell, Andrew
Rowen, Paul
Russell, Bob
Sanders, Mr. Adrian
Smith, Sir Robert
Soames, Mr. Nicholas
Spelman, Mrs. Caroline
Spink, Bob
Spring, Mr. Richard
Steen, Mr. Anthony
Streeter, Mr. Gary
Swayne, Mr. Desmond
Swinson, Jo
Swire, Mr. Hugo
Taylor, Mr. Ian
Teather, Sarah
Turner, Mr. Andrew
Tyrie, Mr. Andrew
Vara, Mr. Shailesh
Viggers, Sir Peter
Villiers, Mrs. Theresa
Walker, Mr. Charles
Waterson, Mr. Nigel
Watkinson, Angela
Webb, Steve
Wiggin, Bill
Willetts, Mr. David
Williams, Hywel
Williams, Mark
Williams, Mr. Roger
Willis, Mr. Phil
Willott, Jenny
Wilson, Mr. Rob
Wilson, Sammy
Winterton, Ann
Winterton, Sir Nicholas
Wishart, Pete
Young, rh Sir George
Younger-Ross, Richard
Tellers for the Noes:
Mr. Crispin Blunt and
James Duddridge
Question accordingly agreed to.
Saving Gateway Accounts Bill (Money)
Queen’s recommendation signified.
Motion made, and Question put forthwith (Standing Order No. 52(1)(a)).
That, for the purposes of any Act resulting from the Saving Gateway Accounts Bill, it is expedient to authorise the payment out of money provided by Parliament of any expenditure incurred by the Commissioners for Her Majesty’s Revenue and Customs by virtue of the Act.—( Ms Butler .)
Business of the House
6.38 pm
The Leader of the House of Commons (Ms Harriet Harman): With permission, Mr. Deputy Speaker, I should like to make a brief business statement.
In the business statement I made to the House on 18 December, I announced that the business of the House for this Thursday, 15 January, would be a topical debate followed by a general debate on armed forces personnel. On Monday this week, I chose Gaza as the subject of the topical debate. That would have been a one and a half hour debate.
Since then, I have become aware that there are many hon. Members who want to contribute to the debate, and representations have been made to me to make it a full day’s debate. I have therefore decided to put back the debate on armed forces personnel to another day and the business of the House this Thursday will be a full day’s debate on Gaza.
Mrs. Theresa May (Maidenhead) (Con): I welcome the fact that the Leader of the House is giving the House more time in which to debate the important topic of Gaza; that is entirely appropriate. I do, however, have two questions on that debate and one question on the defence debate that has been moved.
In a topical debate, there are rules on the length of time for Front-Bench speeches and there are no winding-up speeches. Is it the right hon. and learned Lady’s intention that the debate on Gaza will be run under the rules for topical debates or conducted as a general debate, where those rules do not apply? Secondly, will she confirm that the debate will be able to cover a wider remit than merely the immediate situation in Gaza? Will hon. Members be able to explore the implications for wider issues in the middle east?
On the defence debate that has been postponed, the right hon. and learned Lady will recall that in business questions before the recess, questions were asked about the extent to which that debate would cover procurement as well as personnel matters. Will she, first, guarantee that that debate will come to the House in good time and will not be postponed ad infinitum; and, secondly, reconsider the topic of that debate and fulfil the undertaking that she gave the House before Christmas to ensure that hon. Members would be able in that debate to discuss not only the important subject of armed forces personnel, but the subject of procurement, which will enable Members to consider the Government’s decision to delay the procurement of two new aircraft carriers?
Ms Harman: I can confirm that the debate on Gaza will be a general debate, not an extended topical debate, and will therefore be run along the usual lines of general debate, with opening and closing speeches from the Front Benches. As for its remit, the topic will be Gaza, but although it is a matter for the Chair, I am sure that it will be possible to raise the wider implications extending beyond Gaza and the region.
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