Vol. 542 No. 6
99 Mrs. B. Moynihan-Cronin asked the Minister for Finance if he has received figures from the banks or financial institutions of any indication of the numbers of applications received for the special savings investment schemes; if, on the basis of such figures, his Department has an assessment of the likely cost to the Exchequer of the special savings investment scheme; and if he will make a statement on the matter. [25356/01]
On the basis of the monthly returns to date made by the qualifying savings managers under the new savings scheme, the total tax credits claimed by the institutions so far amount to some £31.9 million or 40.5 million in respect of deposits of £128.7 million or 163.4 million. The number of special savings incentive accounts in operation will not be available until after 28 February 2002, when the first comprehensive annual returns giving details of individual accounts are furnished by the qualified savings managers. As I have indicated before in replying to Parliamentary Questions regarding, inter alia, the likely cost of the scheme, it is difficult to estimate the Exchequer cost of the special savings incentive scheme because of its very nature. It is new and innovative and the size of the Exchequer contribution will depend on take-up by participants in the scheme. When the question was being looked at prior to the publication of the Finance Bill, my Department considered various ranges of costs based on different assumptions. As I said on 20 February in reply to Parliamentary Question No. 36 from Deputy Jim Mitchell, a tentative estimate is for a full year cost of around £100 million – 127 million – for the savings scheme. In so far as the take-up turns out to be very strong, then this figure may have to be revised upward. The more successful the scheme is, the more relief it will entail. Figures to date indicate that the cost to the Exchequer for the first five months of the scheme is some £32 million or 40.6 million.
However, it is not possible to extrapolate reliably from these figures what the 12-month cost to the Exchequer of the SSIA scheme will be. It is likely, however, that the £100 million or 127 million figure that I have already referred to will be reached.
