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Saving Gateway Accounts Bill

I am a company director and have declared my interest in the register, but I am not a director of a deposit-taking institution that could be affected by the Bill. I have in the past been a director of a bank, so I have some banking experience to draw on. It is a great pity that the Chief Secretary to the Treasury did not go into the fundamental issue involved with savings, which is what kind of return the saver will be able to make on their savings. My party and I entirely agree with the aim of the legislation. It is an excellent idea to spread a savings culture more widely, and it is good that taxpayers should make a contribution to try to trigger savings interest for those who have little income and manage their daily budgets largely on benefits. However, if the Government want to inculcate the virtues and values of saving, they must demonstrate that the art, and task, of saving is to put aside some money every month to earn a modest return. One reason why there has been so little saving in recent years is that people believe that the returns have not been good, but the Government's answer to the problem, through their monetary authorities, is to depress interest rates more and more so that the returns become ever smaller. The worked examples that the Government have provided show that they are working on the assumption of an interest rate of less than 1 per cent. for saving gateway accounts. Even by the standards of modern accounts, that is a pretty poor return. My hon. Friend the Member for Fareham (Mr. Hoban) may have stumbled across the point when he said that the accounts will be expensive to operate, and that perhaps the Government are assuming that the banks will not be prepared to pay any interest, or will pay only very low interest because the accounts will be complicated to run for the amount of money in them. I hope that that is not so, but now that the Government are such a huge owner of banks, I look to Ministers to come to the House properly briefed with the answers to these issues. They are no longer theoretical, and the Government need not go to the market to obtain the answers. Ministers, on behalf of taxpayers, should be grappling with them daily because they now hold such an important position in banks on our behalf. Everyone in the House and our constituents are involuntary shareholders of the Royal Bank of Scotland, in which taxpayers have a majority share. We are involuntary shareholders in Northern Rock, which is wholly owned by taxpayers. We are substantial minority shareholders in the Lloyds TSB group following the private sector shareholders' decision not to take up the rights issue. In that capacity as shareholder representatives in the House, surely we are entitled to some answers today from the Government on what the attitude of those leading banks will be to such accounts and what rate of interest they would pay if the accounts were up and running today. That is not a difficult question. One would have thought that any sensible, intelligent Minister—the Chief Secretary is clearly intelligent—would ask that question during the preparation of the Bill, which has had a long gestation, and would be able to tell us today. If Ministers want to generate enthusiasm for a savings culture in this country, surely they should come to the House proud of the rate of return that they can offer through their state-sponsored banks and the Post Office and in other ways.