13 March 2008
A Government scheme to encourage people on low incomes to save more will be rolled out nationwide, it has been announced.
It is believed that eight million people will be eligible for the Saving Gateway, under which the Government will make a contribution for every pound people save.
The accounts, which will be available via banks and building societies from 2010, will run for two years. At the end of this period the Government will add its contribution.
Delivering his debut Budget, Chancellor Alistair Darling stopped short of saying what this contribution would be, but it is likely to be capped at £25 of the amount saved every month.
Two pilot schemes have already been trialled in which the Government matched every pound saved with 20p, 50p and £1.
Some 22,000 people took part in the trials and collectively saved £15m.
The accounts will be available to people receiving certain benefits and tax credits, such as Working Tax Credits, Income Support, Jobseeker's Allowance and Incapacity Benefit. A consultation on the scheme has now been launched.
Elsewhere, the Chancellor made further efforts to encourage people to put money aside for a rainy day, and increased the Isa investment limit from £4,000 to £7,200 from April, with the amount that can be held in cash rising £600 to £3,600.
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