Budget plans for cash ISAs
Chancellor John Healey is expected to use his first budget to abandon plans set by Rachel Reeves to lower the annual cash ISA allowance to £12,000 from April. Instead of restricting savings to encourage equity investments, the chancellor is reportedly favouring educational measures to promote stocks and shares. The move is anticipated to be welcomed by retail banks and building societies, which rely on cash deposits to fund household and business lending.
Industry reaction
Finance sector figures offered mixed responses to the expected reversal. Quilter chief customer and operations officer Jo Harris welcomed the retention of the straightforward £20,000 limit, while suggesting that an additional investment-only allowance could also encourage share ownership. Conversely, IG Group consumer division chief executive Michael Healy criticised the decision, arguing that maintaining the current cash ISA structure misses an opportunity to direct capital into domestic businesses and increase long-term household wealth.