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The Chancellor has hinted at the next area of support: help for savers. Government figures from 2006-07 suggested that over £12 billion in interest income was received by 24.5 million people with total income up to £30,000 i.e. basic rate taxpayers. For just over 1 million basic rate taxpayers (most likely pensioners), investment income was their single largest source of income. Giving up basic rate tax on savings income earned by basic rate taxpayers isn't going to solve the problems of pensioners, especially hard-hit by the drop in interest rates. However, it could provide some help and should be done for a time-limited period, whilst interest rates are abnormally low. Whilst interest rates are about 1% on average, the relief would cost about £600 million annually.

Offering a bigger cash ISA limit is likely to be one of those measures that sound better than will work in practice. Many people would simply not take advantage of the incentive and some of the benefit would undoubtedly go to higher rate taxpayers. Offering a special 'Pensioners Gilt' paying a decent minimum rate would also sound interesting but, again, would not be taken up by a sufficiently large group and would have all sorts of practical difficulties.