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Budget 2014: Chancellor announces £10bn in pensioner bonds

Jenna Towler
Written By:
Jenna Towler

Pensioners will be able to buy bonds from the government with ‘market leading rates’ to a maximum investment of £10,000, the chancellor has announced.

The National Savings and Investments bonds are projected to offer 2.8% for a one year bond and 4% for a three year bond.

George Osborne told the House of Commons: “Many pensioners have seen their incomes fall as a consequence of the low interest rates that Britain has deliberately pursued to support the economy.

“It’s time Britain helped them out in return. So we will launch the new pensioner bond paying market leading rates.”

The exact rates will be set in the autumn. Osborne said up to £10bn of these bonds will be issued and a maximum of £10,000 can be saved in each bond.

He added: “That’s at least a million pensioner bonds.”

Osborne also announced the cap on premium bonds would be lifted for the first time in ten years – from £30,000 to £40,000 in June. It will rise again to £50,000 next year. He also said the number of million pound winners would double.