NS&I Annual Results for the year ending 31 March 2007
- Record £78.90bn total funds invested, up 7.6% from £73.34bn in 2005-06
- £14.17bn sales, up 18.2% on 2005-06
- Net financing (contribution to government) of £5.56bn, up from £4.86bn in 2005-06
- Value added (savings to taxpayer) of £337m delivered, up from £260m in 2005-06
Sales for the year reached £14.17bn, due primarily to major promotional activity introduced to celebrate the 50th anniversary of the launch of Premium Bonds in November 1956, alongside rapid growth in sales of NS&I’s Inflation-beating Savings and Direct ISA.
Highlights of the year
Financial NS&I grew by £5.56bn, exceeding its net financing target for the year due to the exceptional success of the 50th anniversary of Premium Bonds. NS&I met its 5 year net financing target of £15bn and closed Direction 2007, its previous five year strategy a year early NS&I saved the taxpayer £336.7m by reducing the cost of government borrowing (Value Added – see notes) Gross sales of all NS&I products increased from £11.9bn to £14.1bn this year.
| Year of results | Growth (Net Financing)* | Savings for the taxpayer (Value Added) (£ million) |
|---|---|---|
| 2006-07 | 5.560 | 336.7 |
| 2005-06 | 4.857 | 259.9 |
| 2004-05 | 1.973 | 306.0 |
| 2003-04 | 3.435 | 285.3 |
Online sales almost doubled from £1.25bn in 2005/06 to £2.43bn last year, and telephone sales increased from £1.68bn to £2.16bn.
| Sales channel | 2005-06* | 2006-07* |
|---|---|---|
| Internet sales | 1.25 | 2.43 |
| Telephone sales | 1.68 | 2.16 |
| Post Office counter sales | 4.49 | 4.43 |
| Post Office postal sales | 2.45 | 2.77 |
| Direct postal sales | 0.91 | 0.56 |
*Numbers in £ billion
The growth in sales can also be attributed to:
- The introduction of five £1 million premium bond anniversary jackpots in 2006
- NS&I’s TV advertising campaign promotion featuring Sir Alan Sugar. The campaign was a huge success in raising the profile of NS&I, building relationships with new customers and strengthening brand image
- Joint advertising with the Post Office
- The launch of NS&I’s Direct ISA
- Increased profile through sponsorship of a display at the Chelsea Flower Show, the Classic FM morning show, Classical BRIT Awards and BBC Proms in the Park.
The higher profile and various improvements for customers means the total amount now invested in NS&I has risen from £73.34bn in the last financial year to nearly £79 billion in 2006/07. NS&I is one of the UK’s largest savings and investments providers, with 27 million customers, offering retail savings and investments that are 100% secure, backed by HM Treasury. Its total balance of funds now represents about 16% of the national debt.
Direct channels sales growth
- The NS&I website had seen rapid growth, and internet sales continued to rise in 2006/07, going from £1.25bn in 2005/06 to £2.43bn at year end
- £4.43billion of sales came through Post Office counters in 2006-07 contributing to an overall total of more than £7 billion for Post Offic sales of NS&I products
NS&I’s people focused approach was recognised with the following awards:
- NS&I attained one star status from the 2007 Best Companies Accreditation scheme
- NS&I’s 100% Charter Mark accreditation recognises its commitment to delivering excellent customer service through their partners, Siemens.
Jane Platt, NS&I’s chief executive, said:
“In the past year we reached some major milestones, achieving our Net Financing goals in four years, rather than five, and very nearly attaining our five-year target for Value Add, demonstrating the robustness and appeal of our products.
“The combined efforts of NS&I, Siemens and the Post Office have helped make this a very successful year. We aim to build on this success in the coming years by delivering sustainable long-term value to stakeholders and customers by simplifying, modernising, and diversifying the business.”
Notes to Editors
- National Savings and Investments Annual Report and Accounts 2006/07 was presented to the House of Commons pursuant to section 7 of the Government Resources and Accounts Act 2000.
- NS&I was formed in 1861 and is a government department and an executive agency of the Chancellor of the Exchequer, reporting to Rt Hon Alistair Darling MP. It offers 100% security on all its products as they backed by HM Treasury.
- NS&I’s performance is measured by net financing, which is the balance of sales, repayments and costs and is the amount of money it gives to the government to help it manage the national debt once interest, Premium Bonds prizes, matured investments and other repayments are made to customers. The government raises money in two main ways: through the sale of gilts and Treasury bills and through NS&I.
- Value Added is the way NS&I measures how cost-effective it is at raising finance for the government and the difference between the cost of running NS&I and the cost of raising finance through the sale of gilts and Treasury bills. The Value Added figure is important because it represents cost savings to the UK taxpayer.