Help to Save Reform

Help to Save is a savings scheme aimed at low-income working people, providing two tax-free bonus of up to 50% on savings balances over a 4 year period.

The scheme was due to close to new savers in September 2023, but in the 2023 Spring Statement, this was extended to April 2025. HM Treasury recently launched a consultation exploring how Help to Save might be improved and reformed with a view to its continuation beyond April 2025.

LITRG has responded to the consultation setting out:

• Though we are supportive of the scheme and its generous incentives, its success may well be currently hindered by a lack of effective promotion of the scheme.

• Many eligible workers may simply not have money to set aside month to month, particularly with the current increase in the cost of living. To that end, any reform to the scheme ought to take a more generous approach to the monthly contribution limits, perhaps allowing savers to ‘rollover’ unused saving limit from one month to the next or allowing savers to make short-term withdrawals which can be replaced within a certain timeframe without affecting their bonus.

• The scheme might benefit from a more general review of the calculation of bonuses, which are complicated and can be quite restrictive, particularly the second bonus where withdrawals from the account have been made.

• At the end of the 4 year account term, it may be preferable if some sort of legacy savings account could be set up automatically to encourage continued saving.

You can read LITRG’s response here.