Thursday 25 July 2013

Fighting the Government for savers and against inflation (5)

In which token action is grudgingly promised:

MP to me, 14 July:

I accept that there are issues about access from time to time. I will write to the minister about this. The table office are very picky about how questions are put to ministers and normally edit them.

Would you please give me a reference to the comments from 1975?

Me to MP, same day:

Mr. Neubert

Does the Minister accept that the opportunity to invest in inflation-proof schemes is an act of belated social justice to millions of people who have seen their savings irreversibly damaged during the recent rapid rise in the rate of inflation? Will he make recompense to many of them by easing up on his vindictive attacks on the principle of savings embodied in the capital transfer tax and the wealth tax?

§Mr. Barnett

The hon. Gentleman has put his supplementary question at the wrong time, because National Savings are rising very well at present. I am sure he will be delighted to hear that. As to what he called "belated social justice", I am sure he will pay due attention to the fact that the scheme was introduced by a Labour Government and not by a Conservative Government.

Mr. Nott

Is the Chief Secretary confident that a further extension of index-linked schemes—which are welcome to savers—will not cause a diversion of funds away from deposits with building societies, leading to a rise in the mortgage interest rate?

§Mr. Barnett

We are, indeed, aware of those problems. That is precisely why we introduced the scheme in this limited way.

Hansard record of House of Lords debate, 4 November 1975:


My Lords, does my noble friend agree that while the index-linked schemes are extremely good value for money, it would be a good idea—as inflation has been rather rampant—to increase the maximum amount that can be invested in them?


My Lords, the Government have two conflicting obligations. One is an obligation to the taxpayer to buy goods and services as economically as possible, and secondly there are certain social obligations. The Government believe that by the action they have taken they have got the right balance.

MP to me, 22 July:

I will ask [my researcher] to put these points to the minister with the suggestion that a small number of index linked bonds should be made available with a limit as to how much any one person can hold.

My comments:

"... small number... limit..." - I don't understand the implicit attitude. Mr Hemming has no Treasury or economic brief in this Coalition; why so reluctant to protect savers against theft by inflation?

Also, no reply from the Telegraph journalist or either of the Treasury ministers, whom I Tweeted in Part 4.

All original material is copyright of its author. Fair use permitted. Contact via comment. Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content, whether incorporated in or linked to this blog; or for unintentional error and inaccuracy. The blog author may have, or intend to change, a personal position in any stock or other kind of investment mentioned.

No comments: