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Lord Higgins: My Lords, I apologise if I appear to be politically motivated in any way. Does the Minister believe that the move as regards ISAs will be favourably or unfavourably affected by the withdrawal of the tax credit proposal by the Chancellor?

Lord McIntosh of Haringey: My Lords, the tax credit proposal is the 10 per cent tax credit, which is the last vestige of payable tax credits that were dealt with in 1997. It is a transitional measure until April 2004 and it gives investors an opportunity to adjust their portfolios. The amounts of money are very small indeed. The average tax credit per investor is only 25. That is the amount that we are talking about. I do not believe that there is a significant effect on the viability of ISAs.

I turn to the Child Trust Fund. That will provide an initial government endowment of 250—500 for the poorest families. We are now engaged in detailed discussions including with the friendly societies. We expect the Child Trust Fund accounts to be available by 2005. We acknowledge that the Tunbridge Wells society and Children's Mutual gazumped us with the

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words "Baby Bond". I believe that it has the copyright. That will be respected. We certainly welcome the fact that it is involved. I was asked whether the bonds were not likely to be too complex. We are consulting on that, too, of course, but if we are to work towards saving by less-well-off people, it is essential that they should be targeted, which means a means test.

The savings gateway also has potential for friendly societies, because it will support saving by low-income groups. We shall conduct pilots to get the detail right, but there will be an opportunity for low-income individuals to save up to 375, which the Government will match pound for pound. When I hear my noble friend Lord Graham talking about the "divi" and the Co-op and when I hear about the history of the friendly society movement, it all has a familiar ring, does it not?

I thank the noble Lord, Lord Naseby, and all those who have taken part in the debate, for the opportunity to discuss the friendly society movement. I hope that

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the noble Lord will agree that the Government's response has been constructive. The friendly society movement has always—well, for more than 200 years—played an important part in the spectrum of savings offerings to people in this country. It has already played an important part in the establishment of the Child Trust Fund.

The noble Baroness, Lady Maddock, asked me, in the terms of the Question, how we see the future of friendly societies. We hope that the movement continues its strong tradition, demonstrated over two centuries, of successfully adapting to changing environments and offering new or valued products to maintain its appeal to existing members and to attract new ones. The point is: they have been around for a very long time and they are still here. Long may that continue.

        House adjourned at eighteen minutes before nine o'clock.

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