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PRE BUDGET REPORT

November 27, 2001

PIMA Welcomes Proposals for Individual Savings Gateway Accounts and ‘Baby Bonds’

The PEP & ISA Managers’ Association (PIMA) today welcomed the Chancellor’s Pre-Budget Announcement which confirmed a pilot programme for the Savings Gateway for low income families – but wants to see the existing ISA structure usedto maintain simplicity.

PIMA welcomes the concept of ‘cradle to grave’ investing and believes the Child Trust Fund (the ‘Baby Bond’) is a siginficant stepin the right direction by creating an additional savings opportunity.

Tony Vine-Lott, Director-General of PIMA, said:

‘We very much welcome the Chancellor’s announcement to pilot Individual Savings Gateway accounts and the Child Trust Fund but believe consumers would like to see more simplicity in fianancial services. As the ISA structure is now firmly established and understood it would be preferable to create a Gateway ISA and a Baby ISA rather than introduce a further new and potentially confusing product.’