I have just looked at NS&I's website and found that Index-Linked Savings Certificates (and some other products) are no longer on sale. I've spoken to a rep and she confirms that they've been withdrawn as of today (19 July 2010). NS&I cite the extreme popularity of the products, evidenced in unexpectedly high sales volumes that have led to the Treasury's sales targets being fulfilled.
This product was introduced at the beginning of the high inflation in the 1970s. The point of it is to preserve the value of your hard-earned savings against the surreptitious theft of devaluation.
As I pointed out last month, anyone invested in it for the 12 months ending in May would have an effective 6.5% tax-free gain, 100% securely. Find that on the High Street.
This is a government that was going to sort out the system for the benefit of the citizens. It's started with a big fat failure. If my hunch about future inflation is correct, you are about to be stuffed by the financial system.
Protest! You can call 0500 007 007 and ask to make a complaint. They'll take brief details, give you a complaints reference number and have a member of their complaints team contact you.
Please pass this on. Know anyone in the news industry?
UPDATE (3 p.m.): BBC News has caught up with this story:
"Building societies are likely to welcome the move as it removes a strand of competition from the market... NS&I, which is backed by the government, works under rules that state that it must not dominate the savings and investments market." So when artificially low interest rates rob the saver, the government must follow suit.
"It has withdrawn both products from the market for new customers and has not set a date for when they might be offered again." I can't remember when this last happened - if it ever did.
FURTHER UPDATE (Weds 8 a.m.): Indeed this hasn't happened before, as The Guardian reports. Hit quote: "Rival banks and building societies have lobbied intensively to make sure the rates offered by NS&I and other government-owned banks are not so competitive that they restrict the flow of funds into other banks."
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