Skip to main content

Landscape Review

Volume 463: debated on Thursday 19 July 2007

HM Treasury is today publishing a summary of the findings of a Landscape Review of National Savings and Investments (NS&I), commissioned by HM Treasury Ministers in 2005, copies of which are available in the Libraries of both Houses. This statement sets out the findings of this review. Broadly speaking, the Landscape Review of NS&I concluded that:

Since its last review in 2000 NS&I had performed well. Between 2000 and 2005 it raised £7.8 billion of net finance (contribution to the Government’s stock of debt) and £1.22 billion of value added (savings to Government made by raising debt through the retail market at a lower cost than through wholesale borrowing).

NS&I should therefore retain as its single strategic objective the reduction of the cost to the tax-payer of Government borrowing.

NS&I should prioritise cost-effectiveness to Government over the pursuit of market share. HM Treasury will reflect this when setting NS&I’s net finance and value added targets. As a result, NS&I will not be growing and can be expected to bring in a steady rather than increasing amount of net finance going forward.

Although there are a number of constraints which prevent other savings providers from competing with NS&I on a level playing field, NS&I is not having a significant competitive impact at its current size relative to market. However, the Treasury should take into account the market impact of NS&I’s activities when setting its financing targets.

Although NS&I will not move to being FSA regulated, it should comply fully with FSA requirements where applicable, on a voluntary basis. NS&I has agreed with the FSA that it will update the FSA biannually on progress against its plans, will monitor and respond to relevant changes in FSA regulations, and will report on progress in its annual report.

The review also recommended that NS&I should develop a revised corporate strategy incorporating the conclusions of this review. This process has been completed, and NS&I’s new five-year strategy “NS&I Adding Value” was launched on 1 April 2007. Further information on the new strategy can be found in NS&I’s 2006-07 annual report and accounts which are also being laid before the House today.