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State Savings Scheme

Dáil Éireann Debate, Thursday - 26 April 2012

Thursday, 26 April 2012

Ceisteanna (58)

Michael McGrath

Ceist:

58 Deputy Michael McGrath asked the Minister for Finance if he is satisfied with the operation of the State savings scheme; his plans to make the schemes more attractive to savers; and if he will make a statement on the matter. [21058/12]

Amharc ar fhreagra

Freagraí scríofa

The National Treasury Management Agency is responsible for State savings schemes. An Post and the Prize Bond Company act as agents of the National Treasury Management Agency for the sale of these products. There is an attractive range of products available to the public from the ordinary deposit account to fixed saving products with maturities from 3 to 10 years. The rates on offer are appropriate so as to give the investor an attractive return while balancing the cost of the funding to the Exchequer. The schemes have been very successful. In 2011 they raised funding of €1.36 billion for the Exchequer and in the first Quarter of this year €0.44 billion was raised from that source. The amount outstanding under the State savings schemes at 31 March 2012 was €14.5 billion or 12% of the National Debt. The following are the current rates on the State savings schemes:

Product

Gross AER

%

3 year Savings Bonds

3.23

4 year National Solidarity Bond

3.56

5.5 year Savings Certificates

3.53

6 year Instalment Savings

3.37

10 year National Solidarity Bond

4.14

Deposit Account Plus (30 day notice Account)

3.00

Ordinary Deposit Account

1.00

The annual coupon of 1% on the National Solidarity Bonds and the interest on the Deposit Account Plus and the Ordinary Deposit Account are subject to DIRT. Otherwise the returns on State savings schemes are not subject to tax.

The NTMA keeps the suite of State Savings products and the interest rates paid on them under constant review to ensure that the products remain competitive and attractive to retail investors.

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