Savers’ Black Tuesday

Today is the first day of the new financial year – a day of changes in the tax system and a day to think about what might have been.

What might have been is a radical change in the tax system in the interests of savers. You might have thought that this was inevitable – after all, our economic leaders from Mervyn King to David Cameron to Gordon Brown to Vince Cable have all said that the economy would function better if we saved more. What could have happened today is the beginning of a new regime of incentives and stability, to give savers confidence. Such a regime would include a reduction in the means-testing of benefits for pensioners, as Frank Field MP has long argued. It would mean looking again at the all-but-compulsory personal pensions which are due to be introduced in the next few years.  It would almost certainly mean a new kind of tax relief on the income from savings (which the Save Our Savers campaign has made one of its key pledges). … Continue Reading

An ethos of saving not borrowing must be at the heart of our economic & political life

At its root the Greek economic tragedy is about the very simple idea of living beyond your means. You can borrow to fill the gap but at some point the credit runs out. It’s easy to say with hindsight but what Greece should have been doing is saving, not borrowing. And the difference for the UK is only the urgency of the crisis, not its basic nature. We should have been saving more as a country too, both in our private lives and in the workings of our Government.

As Mervyn King, the Governor of the Bank of England, has been warning, the amount that we save has fallen by about a third over the past decade. He wants our economy to be driven by exports and investment – funded by saving – rather than just extra spending by consumers and governments alone.

Speaking in Westminster earlier this month Frank Field MP, another far-sighted and independent-minded person in our public life, gave his blessing to a new campaign group which aims to be the first affinity group for all of the 25 million savers in Britain.

… Continue Reading