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41m ago

Reeves Said to Favor Smaller Cash ISA Cut as IG Steps Up Campaign

A Financial Times report points to a £12,000 option with voluntary UK‑equity nudges as the Treasury prepares ISA reforms for the 26 November Budget.

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The Treasury has reportedly been floating the idea of a cut to £12,000, down from £20,000 but higher than the £10,000 suggested befiore (Photo: Justin Tallis/AFP)
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Overview

  • CityAM, citing the Financial Times, reports the Treasury is weighing reducing the cash ISA allowance to about £12,000 rather than the previously mooted £10,000.
  • IG continues to lobby for a halving of the allowance, promoting research that 2.8 million savers exceed £10,000 contributions and could gain £7.2bn in five‑year returns by shifting excess into stocks and shares ISAs.
  • IG’s push has included a mobile advertising van in central London urging Chancellor Rachel Reeves to proceed with a deeper cut.
  • Building societies argue a lower cash ISA cap would squeeze deposits that support mortgage lending, a claim IG disputes by estimating only £1.6bn would shift from building societies, equal to roughly 0.4% of their retail deposits.
  • Broader measures under discussion include tweaks to stocks and shares ISAs such as a voluntary 25% UK‑equity allocation, a nationwide drive to encourage retail investing, and reported work on retail‑investment supports ahead of the 2026 ISA season.