NS&I confirm Index-linked Savings Certificates to move from RPI to CPI

• Customers will continue to benefit from inflation beating returns, tax-free interest and the 100% security that comes with NS&I products.

From 1 May 2019, existing holders of Index-linked Savings Certificates who renew into a new term will receive index-linking based on the Consumer Prices Index (CPI) measure of inflation, rather than the Retail Prices Index (RPI). This change recognises the reduced use of RPI by successive governments and is in line with NS&I’s need to balance the interests of its savers, the cost to the taxpayer, and the stability of the broader financial services sector.

The change will be applied to all Certificates that mature on and after 1 May 2019 and where customers choose to renew into a new Certificate. Current holdings will be unchanged until they mature and customers do not need to take action now. NS&I will write to all holders of Index-linked Savings Certificates at least 30 days before their Certificates reach the end of their term. Index-linked Saving Certificates have not been on sale since 2011, but existing savers are able to renew them when they mature.

By indexing new investments to the Consumer Prices Index, savers who hold this product will still have protection from inflation, while at the same time the cost to the taxpayer is forecast to reduce by £610 million over the next five years.

Ian Ackerley, NS&I Chief Executive, said:

“Index-linked Savings Certificates are inflation beating and tax-free. Savers will still have the peace of mind that their money is protected.

“Index-linked Savings Certificates holders will continue to benefit from a unique and attractive product, which remains an important part of our product range.”

John Glen, Economic Secretary to the Treasury, said:

“We know that savers who hold these products really value the inflation protection they give. The transition to CPI for new investments over the next five years retains this, while balancing the needs of the taxpayer.”

Notes to Editors

1. Index-linked Savings Certificates are tax-free, meaning that interest and index-linking are exempt from UK Income Tax and Capital Gains Tax.
2. Further information on Savings Certificates can be found here
3. The change from RPI to CPI will only affect NS&I Index-linked Savings Certificates. Index-linked gilt payments will continue to be linked to the RPI.
4. NS&I is one of the largest savings organisations in the UK, offering a range of savings and investments to 25 million customers. All products offer 100% capital security, because NS&I is backed by HM Treasury.
5. For further information, please contact the NS&I media team.