Isa limit increase 'not enough'

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Isa limit increase 'not enough'

Thu 25th Mar 2010

Andrew Hagger of Moneynet.co.uk said the proposal by Alistair Darling would create an added cost to account providers rather than bring any discernable benefits to customers.

He said: "It is a token gesture that is likely to cost providers more to administer than it will actually deliver to beleaguered savers."

Mr Hagger added that the allowance increase will confuse consumers, who may not understand the rolling extensions and be put off by what seem to be arbitrary figures.

However, the financial research organisation Defaqto has welcomed the measure and Brian Brown, head of research, stated the proposal will "future proof" allowances, preventing savings from being diminished by the introduction of stealth taxes.

According to the Daily Telegraph, if the two per cent rate of inflation continues throughout next year the allowance could rise above £10,400 in 2011 and 2012.

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