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(From Government News Network (Was Hermes-Government Press Releases))
] HM TREASURY 81/06 1 November 2006 Remarks by Ed Balls MP, Economic Secretary to the Treasury, at the 2006 PIMA Annual Conference, Plaisterers Hall, London, EC2
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It is a pleasure to be here today - and can I thank PIMA for inviting me to address this conference.
As a leading representative of the financial services sector, your expertise has been invaluable to HM Treasury, both in the past, working for example on the introduction of the Child Trust Fund, and on pensions regulations, and more recently with your input into the ISA Review.
As the Economic Secretary to the Treasury, it is my responsibility to take an overview of Government policy towards savings and assets. And when I met with Tony Vine-Lott and John Brasington back in July following my appointment, I agreed I would use my speech today to stand back and review the progress we have made in savings policy since 1997 and look ahead to the future.
Since 1997, our approach has been to promote savings and asset ownership for all across the life-cycle - from childhood, through working life and beyond into retirement, so that individuals can have security for the future - setting aside funds for a rainy day, but also having the chance to build a long-term future stake in our prosperity.
And we have made progress. Household wealth in Britain is now higher than it has ever been before. Net wealth, adjusting for rising personal debt, has risen by around 65% in real terms since 1997.
And what does that mean in practice? We have added 1.8 million more homeowners than in 1997. Over 16 million people now have an ISA. Over 2.2 million children now have a Child Trust Fund account. Today around 10 million people are contributing to an occupational pension scheme and around 5 million are contributing to a personal or stakeholder pension.
But we are now at an important moment: we have our response to Lord Turner's Pensions Commission - the Pensions White Paper - that we are taking forward at present and where we have this week announced general agreement in consultation over the proposed reforms; we will soon publish the 10-year Financial Capability strategy; our ISA review has come to an end; and we will soon have more evidence from our Saving Gateway pilots.
So today I want to set out some of our next steps.
Since 1997 our savings strategy has focused on:
* Improving the environment for saving - so that people can plan ahead and make saving decisions with confidence; * Developing a range of savings opportunities suitable for each stage in a person's lifecycle; * Providing adequate incentives for saving - through the tax and benefit system; and * Empowering individuals with the capability to make the right saving choices.
I will take each of these in turn.
First, to make optimal saving decisions, people need a stable macroeconomic environment conducive to long-term planning.
They need to be able to save without the fear that the value of their savings will be eroded through rapidly rising prices. Today, because of the stability we have seen in our economy, and with low inflation delivered by our independent Bank of England, people can save for the long-term with greater …