NS&I Annual Report 2022-23: a year of delivery for government and for savers

• NS&I delivered £10.0 billion of Net Financing to the Government in 2022-23.
• Interest rate increases: NS&I supported savers with a series of interest rate increases across its products in 2022-23, including five increases to the Premium Bonds prize fund rate, meaning that by March 2023, 1.6 million more prizes were being paid out each month than a year earlier.
• Transforming NS&I: further progress in the delivery of the transformation programme to help build a modern, accessible, flexible and sustainable business for the future.

In a year of delivery for government and for savers, NS&I’s Annual Report and Accounts 2022-23, published today, shows that the organisation has made another significant contribution to the Government’s debt financing requirements; supported savers with a series of interest rate increases across its products; and continued to lay the foundations for many more years of delivery, by making progress with its transformation programme.

NS&I Chief Executive, Dax Harkins, said:

“2022-23 was a year in which we delivered both for government and for savers. We made a significant contribution to the Government’s debt financing requirements, helping to pay for the essential public services on which we all rely.

“Throughout the year, we supported savers by increasing interest rates across all of our variable products, with the Premium Bonds prize fund rate increasing five times, meaning it has more than tripled. And thanks to the most recent increase earlier this month, the prize fund rate is now at a 15-year high.

“We faced some challenges at points through the year, but we are also looking to the future as we make progress on our transformation programme, which will ensure we continue to deliver for our customers and the nation for many years to come, helping us to become the most trusted savings provider in the UK.”

Net Financing

NS&I delivered £10.0 billion of Net Financing to the Government in 2022-23. However, this exceeded the target for the year, which was £6 billion (+/- £3 billion). At the very end of the financial year, following uncertainty in the US banking sector, NS&I unexpectedly received a number of high-value deposits which took it over the upper end of the target range. In the opening months of 2023-24, NS&I saw deposits return to more normal levels.

Customer satisfaction

Regrettably, NS&I missed its customer satisfaction target for the year, recording 74.56% against a target of 84%. The safety and security of customers’ money is of paramount importance to NS&I, and in July 2022, an additional layer of security was added to transactions. While large numbers of customers are using the new system without issue, a relatively small number experienced problems. This had a negative impact on customer satisfaction levels and it has been busier, at times, in the call centres than customers should expect. These are not the standards NS&I sets itself and it has taken action to improve performance in the coming year.

Service Delivery Measures

In total, NS&I met seven and missed four of its eleven service delivery measures in 2022-23. NS&I met the service delivery measures for: Operational delivery; Government Payment Services delivery performance; Digital-first; Efficient administration of funds; Fraud management; Financial Ombudsman Service (FOS); and Ethnic diversity.

NS&I did not meet its service delivery measures for: Net Financing; Customer satisfaction; Gender balance; and Employee engagement. See pages 17-19 of NS&I’s Annual Report & Accounts for full details.

Interest rate changes

NS&I supported savers with a series of interest rate increases across its products in 2022-23, in response to the succession of base rate rises and changes in the wider savings market during the year. These changes included five increases to the Premium Bonds prize fund rate – meaning that by March 2023, NS&I was paying out 1.6 million more prizes each month than 12 months earlier; bringing one-year Issues of Guaranteed Growth Bonds and Guaranteed Income Bonds back on sale; and increasing rates on other products, including Direct Saver and Income Bonds.

Premium Bonds milestones

Premium Bonds continue to be one of the most popular savings products in the UK and June 2022 was the 65th anniversary of the first Premium Bonds prize draw. In February 2023, ERNIE generated the winning number to create the 500th Premium Bonds £1 million jackpot winner; and March 2023 saw the largest ever Premium Bonds prize fund, of £330 million, alongside the milestone of having paid out over £25 billion in prizes since the first draw in 1957. By March, the prize fund rate had reached 3.30%, the highest for 14 years.

Green Savings Bonds

NS&I released two new Issues of Green Savings Bonds in 2022-23, with Issue 4 paying an interest rate of 4.20%. In total, Green Savings Bonds have achieved sales of circa £900 million as at 31 March 2023. This product gives UK savers the opportunity to support projects that will accelerate the transition to a low carbon economy, create green jobs and participate in the collective effort to tackle climate change.

Transforming NS&I

NS&I has made further progress in the delivery of its transformation programme and has been working closely with the first new delivery partner, IBM, who will deliver the technical integration and security monitoring capabilities of the future multi-supplier business model.

The design for a Service Integration and Management function, to support the multi-supplier model, has been completed, and NS&I awarded Capgemini a two-year contract in December 2022 to help provide services to support in building this capability.

Sopra Steria was selected as the successful bidder for a three-year contract for delivering business-to-business services, while the new multi-supplier model is implemented in the retail business.

During 2022-23, the broader transformation programme faced headwinds and NS&I took action to ensure operational continuity. NS&I has now restarted the final procurement package to deliver a new digital experience for customers, and is making good progress with the rest of its transformation plans.

2022-23 annual results

Year	Gross inflows (including reinvestments) £bn	C&AIP* £bn	Gross outflows £bn	Net Financing £bn	Total stock £bn
2022-23	53.7**	5.5**	48.6**	10.0***	218.3**
2021-22	44.9**	2.5**	42.7**	4.4***	207.6**
2020-21	86.2	2.2	64.6	23.8	203.0
2019-20	38.2	2.6	29.2	11.6	179.2
2018-19	37.3	2.4	28.9	10.8	167.6

 

All figures are in £ billion and are subject to rounding.

*C&AIP is capitalised and accrued interest and prizes earned. All figures are in £ billion and subject to rounding.

**Including Green Savings Bonds.

***Excluding Green Savings Bonds.

Notes to Editors

1. NS&I reports quarterly on gross inflows and outflows, Net Financing and total stock. Each quarter, NS&I releases unaudited figures and has published its audited Annual Report and audited accounts for 2022-23, which can be downloaded here. Net Financing excludes Green Savings Bonds, as they are a policy product.
2. NS&I is one of the largest savings organisations in the UK, offering a range of savings and investments to more than 24 million customers. All products offer 100% capital security, because NS&I is backed by HM Treasury.
3. NS&I’s business strategy, Inspire & Invest, launched on 1 April 2018. It sees continued focus on delivering sustainable cost-effective financing for the Government as NS&I’s core purpose. The strategy will ensure that NS&I continues to resonate with savers in a highly competitive savings market through developing products, services and a customer experience that are simple, straightforward and user-friendly.
4. Net Financing – the measure of the net change of NS&I funds, meaning total inflows from deposits, retention of maturing monies and capitalised and accrued interest, less the total outflows from withdrawals and interest or Premium Bonds prize draw payments. A positive Net Financing figure represents a positive contribution to government financing.