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Personal Savings for Those on Lower Incomes: Towards a New Framework for Assessing the Role of the State in Relation to Savings Schemes

Published online by Cambridge University Press:  21 January 2021

James Gregory ,
Andy Lymer  and
Karen Rowlingson
James Gregory
Affiliation:
CHASM, Department of Social Policy, University of Birmingham, UK E-mail: [email protected]
Andy Lymer
Affiliation:
CHASM, University of Birmingham and Department of Taxation, University of South Africa, Pretoria, South Africa E-mail: [email protected]
Karen Rowlingson
Affiliation:
CHASM, Department of Social Policy, University of Birmingham, UK E-mail: [email protected]
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Abstract

This article explores the role of the state in helping households to save. Using the UK as an example of challenges faced in other developed countries, it develops a framework for comparing saving schemes along two dimensions: apparent normative motivation for the scheme and likely impact on savers of varying income levels. Using this framework, our analysis suggests that there is much greater state support for high-income savers than low-income savers, even after the recent introduction of the ‘Help to Save’ scheme. So, while this scheme has provided some support for this group, we propose ways to expand it through providing initial seed funding to each account and greater marketing and accessibility. We note, however, that an important way to help those on low incomes to save is to increase their incomes so they have more capacity to do so.

Keywords

Personal savingsasset-based welfarecitizenship rightseconomic and social developmentHelp to Save
Type
Article
Information
Social Policy and Society , Volume 21 , Issue 3: THEMED SECTION: Towards a Sustainable Welfare State , July 2022 , pp. 336 - 351
Copyright
© The Author(s), 2021. Published by Cambridge University Press

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