Saving Gateway Accounts Bill

Even at this very moment, a copy is winging its way towards the noble Lord, Lord Newby. I suspect that the G20 summit has rather slowed the performance of my office; I apologise for that. Amendment 1, by removing the provision in the Bill that places the saving gateway under the management of the commissioners for Revenue and Customs, would make it more difficult for the commissioners to exercise general managerial discretion in carrying out the functions conferred upon them by the Bill. At the heart of my answer to the noble Baroness is the observation that this is not a social security benefit. The saving gateway is a savings scheme and therefore constitutionally, properly and correctly falls under the Treasury. The HMRC administers both the individual savings accounts and child trust funds and, consequently, is best placed to administer the saving gateway, building upon its experience and established links with savings providers. The HMRC is of course working closely with DWP as it develops the scheme. The noble Baroness, Lady Noakes, refers to performance shortcomings at the HMRC, particularly the loss of data and the administration of certain benefits. The HMRC is committed to enhanced data security programmes, and is investing over £150 million over the next three years. There are new physical and technical controls on access to and movement of bulk data, on paper and electronically, using removable data. My colleagues have, no doubt, previously expressed disappointment at the performance of the HMRC on the loss of data to which the noble Baroness refers. There is a salutary warning there on the importance of achieving confidence in the customer community by not repeating those shortcomings. The noble Lord, Lord Williamson of Horton, raises a question that even he acknowledges is somewhat tenuous in its linkage to the amendment. However, in the spirit in which we are going to work together to achieve a good outcome here, I am more than happy to answer to the best of my ability his question on whether the match payments should be calculated on the final balance of the account. Our view is that this would unfairly penalise those who, possibly for reasons beyond their control, make a withdrawal from the saving gateway account before the end of the account’s life. That could mean that someone who has saved for 23 months and then had to withdraw the money because of an emergency at home, for example, would get no return at all on their savings if no interest were paid on the account. That would clearly be unfair. The final balance will never be higher than the highest balance, meaning that many account holders could receive a lower return on their savings. The system that we have chosen means that people will not be penalised for making withdrawals. However, such withdrawals will nevertheless be disincentivised as savers will have to put the money they withdrew back into their account before they can earn the additional match. I remember, at Second Reading, the noble Lord, Lord Newby, used the phrase "rough justice", or "rough and ready", or something of that sort. The truth is that the noble Lord was correct in that respect. We have a wish to be as simple and straightforward as possible, so arguments of the sort advanced by the noble Lord, Lord Williamson, which have validity are nevertheless subservient to the better interest of keeping this simple and straightforward. On that basis, I ask the noble Baroness if she will be kind enough to withdraw her amendment.