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Saving Gateway Accounts Bill

We believe that 8 million households will be eligible to set up a saving gateway account. The Bill provides for that eligibility to be widened, narrowed or otherwise changed in accordance with circumstances, but we think it right to begin by making the accounts available to the 8 million people who are on the lowest incomes who need and could depend on such support. Some of the pilots set up to examine different ways of widening eligibility found that those on higher incomes were more likely simply to recycle existing savings into the accounts. The purpose of this programme is to help those without savings to start saving for the first time, and to give them additional support and incentives. We have wider programmes that support savings more generally. For example, 18 million people—one in three adults—have individual savings accounts, which provide tax-free savings. More than 4 million children have child trust funds, which the Government introduced to encourage and help families to build up assets for the youngest in our society as they grow, and to provide for their future. However, we believe that there is a case for a new incentive for people on lower incomes in addition to those schemes, and that is what the saving gateway is designed to provide.