Tories Help To Save scheme same as Labour one they scrapped

Op-ed: BBC News is reporting ahead of the Chancellor’s Budget statement Wednesday that he could be offering a bitter sweet pill to encourage low paid workers to save but before we go into the detail let me say this is another idea nabbed from the Labour Party.

In 2010 when the Tory Party came to power with its Lib Dem partners in tow they scrapped a very similar savings scheme; the difference being the Labour one was more generous.

That was called the Saving Gateway and it aimed to give a 50p boost for every pound saved.

It was something that Hubby was offered in its trial stages and helped us through one of those difficult financial times that come along.

But it never got beyond the trial run as the Condems axed it. Here is what the Guardian said in 2010:

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The government has quietly scrapped one of Labour's flagship initiatives to encourage Britain's financially excluded people to save.

The Saving Gateway, a scheme designed to encourage those on a low income to save by boosting every £1 saved by an individual with 50p from the government, was due to launch nationwide on 1 July. But on Tuesday as part of the measures announced in the budget, HM Revenue and Customs told the financial institutions that were going to be operating the scheme on behalf of the government that it would not be going ahead because of monetary constraints.

The decision was announced with one quick mention in the budget speech. But the first many of the institutions involved knew about it was when they received an email from the HMRC, saying: "The government has announced that the Saving Gateway is not affordable given the need to reduce the deficit.

"The launch of the Saving Gateway – which was planned for July 2010 – has therefore been cancelled. HMRC will take no further action to process any application for approval as a Saving Gateway account provider.

The current Tory majority government will no doubt try to blame Labour for scrapping that scheme; you know the economy was so shot because of the outgoing Labour government and the global economic crisis was only real when we use it to explain out fiscal mess.

But all it shows is their priorities.

And silently scrapped.

So what will the new scheme offer? BBC News reports Monday;

Millions of low-paid workers who put aside savings could receive a top-up of up to £1,200 over four years, the government has announced. Employees on in-work benefits, such as tax credits, who put aside £50 a month would receive a bonus of 50% after two years - worth up to £600.

That could then be continued for another two years with account holders receiving another £600.

Meanwhile, the national minimum wage is also set to increase from October 2016.
The measures will be detailed in this week's Budget, in which Chancellor George Osborne has already warned of spending cuts.

He said that the UK had to "act now rather than pay later" and that the UK would see cuts "equivalent to 50p in every £100" of public spending by 2020, which was "not a huge amount in the scheme of things".

Sounds good?

Well I hate to use my cracked record saying but as always the devil is in the detail.

The new scheme will be called Help To Save and be open to around 3.5 million adults who received universal credit or tax credit. How many will actually have enough disposable income to use as savings is not clear but my guess is not many. The scheme however will look good on paper.

Changes to tax credits, the minimum wage and more will limit who is eligible. And if your income is rock bottom putting any money aside may be impossible.

The Tory onslaught against the most vulnerable people of the UK continues; that means some people who should be eligible for the saving scheme will not be, plus others will have suffered such a drop in income via Tory legislation such as the Bedroom Tax that saving 1p a day would prove difficult.

For Hubby and I Labour's Savings Gateway helped us through a sticky patch but I worked too and that did not make us ineligible.

The Tories Help to Save scheme is less generous and after six years of Tory cuts and so-called austerity measures for many any kind of 'disposable income' is not attainable.

[It seems ahead of the budget Osborne is playing his usual games and filtering bits and pieces from the budget to his mainstream media allies]

Speaking on Sky News David Cameron used his usual spin in announcing the Help to Save scheme saying;

"I've made it the mission of this government to transform life chances across the country.

"That means giving hard-working people the extra support they need to fulfil their potential.

"And that's what these new measures will achieve - helping someone start a savings fund to get them through difficult times, giving people on low incomes a pay rise and making sure teenagers have the experience and networks to succeed."

Hard-working is a term touted a lot by Cameron and his colleagues though many have never actually done a day's hard work in their lives.

I will leave you to read "David Cameron's father left assets in tax haven" to highlight the irony.