As the Conservative Party Conference in Birmingham gets underway this weekend, a new poll shows that policies aimed at savers should form a key election battleground in 2015.
More than 2,000 people across the UK were asked whether the way they vote at the next general election would be influenced by the parties’ policies aimed at savers. Over half of those surveyed (54 per cent) said it would influence their decision, with 70 per cent of first-time voters and young people saying that it will be a factor as they decide which party to vote for.
The poll was carried out as part of the ‘Tackling the Savings Gap’ investigation by technology and financial services firm True Potential. Research carried out in September as part of the investigation has found that:
- 40% of Britons are saving nothing for their retirement;
- 39% of savers say the Conservatives are most on the side of savers, with Labour at 40 per cent, UKIP at 10 per cent and the Lib Dems at 6 per cent; and
- Conservatives are clearly seen as the party of savers among voters aged 35 and over, following a number of policies to support savers, most notably those announced at this year’s Budget.
The personal ISA allowance (amount that can be invested in each tax year) was raised from £11,880 to £15,000. Greater flexibility was also offered to savers who can now split their total allowance between a cash NISA and a stocks and shares NISA however they wish, whereas previous rules meant that only half of an ISA allowance could be invested in cash.
From April next year savers will also be given more freedom in how they can use their pensions.
Currently savers can only take 25 per cent of their pension pot tax-free when they retire but from next year the tax on withdrawing the cash will be cut, making it easier for savers to use their funds however they wish. These policies have proved popular with those who are already retired, with 58 per cent of over 65s believing that the Conservatives are the party most on the side of savers.
The effects of the financial crisis, coupled with low interest rates and easily accessible pay day loans has led to the creation of a Savings Gap – the difference between what people need to live comfortably in retirement and the amount they are actually on course to receive.
True Potential managing partner David Harrison, said: “These results give a clear message to all politicians that they need to be producing policies that support savers who have been hit hard since 2007. The introduction of NISAs and pension reforms are great steps in the right direction and savers recognise that. Though the economy has continued to grow, savers are yet to feel the real benefit as even relatively low inflation is still eroding savings.
“There needs to be a renewed effort to create a culture of saving, which can be achieved by greater financial education, simpler products and making saving and investing easier by harnessing the power of technology.
“With thousands of voters saying they will be influenced by the parties’ policies towards savers, it will be interesting to see what else George Osborne can do to build on the excellent measures announced at the Budget. ISAs are simple, increasingly popular and I think this is where the Chancellor can find favour with savers.”
True Potential has partnered with the Open University to launch the True Potential Centre for the Public Understanding of Finance (PUFin).
PUFin is a pioneering Centre of Excellence for research in the development of personal financial capabilities. PUFin is working to improve public understanding of personal finance through its research and the delivery of free modules providing individuals with the tools to make sound financial decisions.