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Saving Gateway Accounts Bill

I am relieved by that clarification, but that was not the position of the hon. Gentleman's party at the time. One of the exciting things about that process was the granting of free shares in companies that people worked for, so that they could get the habit of share ownership and make something on capital account out of the businesses that they worked for. That supplements the scheme proposed in the Bill, which largely targets people who do not have jobs and who therefore do not have the opportunity to get some capital out of working for a company. We hope that people in the scheme will go on to do that and that it will be part of a comprehensive package to address exclusion from wealth ownership. Like most hon. Members, I think that one of the worst features of Britain over the past 50 or 60 years has been that not enough people have enough wealth of their own—they might not own a property in which they live, own shares in the company that they work for or have a savings account. I welcome very strongly anything that can be drawn into legislation or put into operation in the market that can change that. My hon. Friend the Member for Fareham rightly raised the issue of whether there is enough saving in this country and whether the legislation, on its own or with help from one or two other measures that the Government may have in mind, is bold and strong enough to turn that around. I fear that it will not be. The sums are rather small and it appears that the number of eligible people likely to take up the scheme will also be quite constrained, for good reasons as well as bad. One thing that we need to do to get out of the current economic crisis is to encourage and promote more saving. There has been far too much borrowing in recent years. In many cases, individuals' balance sheets are as stretched as bank balance sheets have been and as the Government's balance sheet is becoming. Savings play an important part in trying to put that right. For the groups of people identified in the Bill, we need rather more detail from the Government than we have enjoyed so far about who will be eligible and what the restrictions are, in order to avoid people playing the system in a way that the Government did not intend. As I understand it, under the legislation as drafted it would be perfectly legitimate for someone living on one of the qualifying benefits mentioned in the Bill to have savings somewhere else and to transfer them into an account under the scheme in order to get the bonus element. However, that would not increase savings in the economy in the way that the Government envisage. On the other hand, if the legislation were to introduce a further restriction preventing people who already had savings from taking out one of these accounts, that would knock out a sub-group within the group who were most likely to take up the scheme. It would also encourage people to find ways of hiding, spending or concealing money so that they could qualify for the scheme. It might be an incentive for people to put their money into their mattresses, or to spend inappropriately before starting to save again in order to qualify. That would not be a very clever way to proceed. Perhaps the Government need to make the best of a bad job and accept that their scheme will allow people who have already saved to get a bonus simply because they have done so. That makes it even more important to look at the categories of people who will be eligible, to see how many that might apply to, and to get a feel for what the impact might be. Certainly, some protection against that will be provided if the scheme makes people put money in only up to a modest limit each month, because individuals will have to organise their affairs in such a way that they transfer the money monthly, rather than being able to put in a big lump sum at the beginning. If the detail of the legislation were to allow bigger lump sums, however, that would make it more likely that people who had already partially saved would be able to play the system rather well. As so often happens with legislation from this Government, the Bill feels like work in progress or something that they are making up as they go along. I suspect that those who serve on the Committee will work diligently on it, only to discover that a large number of amendments are suddenly tabled on Report or Third Reading, as people out there, realising that the Bill might apply to them or their client groups, either as potential providers of the accounts or as people who might establish such accounts, and realising the pitfalls and problems in the current drafting, come forward with their proposals. So far, Ministers have not been able to sell the Bill to us in a positive way that makes it really attractive, or in a way that deals with the details that colleagues have already unearthed in this rather general Second Reading debate on the order powers, the eligibility criteria, the interest rates and all the other important issues. I would feel much more confident about the Bill if Ministers intervened a bit more, and if there were rather more substance in what they said to the House about who is to benefit from the scheme, what kind of savings we are talking about, and what other providers might be involved. I want to make one last effort to get the Minister engaged in the debate. Will he intervene and tell me what the Post Office is minded to offer savers in this account, so that we can have a basis of fact on which to make our arguments and discussions today? Once again, I am afraid that he remains seated. The Government have had meetings with the Post Office. Either they forgot to ask the Post Office what kind of a deal the savers were going to be offered, or they are so ashamed of the deal that they and the Post Office have cooked up that they are not prepared to share it with the House and the wider public. This is not a good starting point for a project that is meant to generate good will around the country and that certainly has, in principle, multi-party support in the House because it is trying to do a good thing. I look to Ministers quickly to clarify a number of things. First, who is really going to be eligible? Secondly, what are the Government going to do about the issue of rewarding people who have already saved, as opposed to rewarding people who might start saving because of the scheme? Have they looked into how much dead weight—as the Treasury used to say—might apply to this proposal? Thirdly, have the Government optimised the spending of this amount of taxpayers' money in terms of making the right judgment on how big a bonus element is needed, how that relates to the normal interest rate return, and how much money people should be allowed to put into the accounts and in what time period? I am not sure that the Government have come up with the optimal solution. Can Ministers quickly find out at least what the Post Office, RBS and Lloyds—organisations that the Government either directly own on behalf of taxpayers or have a very big share in—are going to offer? We presume that those three big institutions will be required to offer this kind of package and they must soon be able to tell us what it will look like. Without our being able to go out and tell our constituents who might be eligible that this is a good scheme because of its underlying savings rate as well as its bonus element, it loses a great deal. I am surprised that Ministers are not more full of the joys of this proposal and not more up to speed about how it might work.