The Treasury has brought down bonus rates for the Save As You Earn scheme in line with other interest rates.
The scheme is a savings vehicle for employees of companies that operate savings schemes approved by HM Revenue and Customs.
From 1st September, the new bonus rates will be 1.4 times monthly payments for three year contracts, down from 1.9. For five year contracts, it will be 4.4 times monthly payments, down from 6.1, and 8.4 times monthly payments for seven year contracts, down from 11.5.
The early leaver rate, for those who leave the scheme before the minimum three years has changes from 1.5% to 2%.
Our view
We thought that Government need to stimulate the economy. This will not encourage employees to invest in their employers.