Commentary Section 4 Requirements relating to accounts
29.Section 4 contains requirements relating to accounts, and gives the Treasury power to make regulations imposing requirements with which an account must comply to be a Saving Gateway account.
30.Subsection (1) sets out the requirement that providers of Saving Gateway accounts must be approved by the Commissioners in accordance with regulations. Saving Gateway accounts may only be offered by approved account providers.
31.Subsection (2) specifies conditions that an account must meet in order to be a Saving Gateway account. Subsection (2)(a) provides for regulations to prescribe the maturity period for Saving Gateway accounts, and also provides that an account is not a Saving Gateway account unless, under its terms, the account holder is entitled to a “maturity payment” at the end of this maturity period. The maturity payment is the government contribution paid at the end of the account, and is calculated according to the rules set out in section 8.
32.Subsection (2)(b) provides that an account is not a Saving Gateway account unless, under its terms, the personal representatives of the account holder are entitled to a payment (a “death payment”) in the event of the account holder dying before the end of the account. Regulations made under this section will specify how the death payment is to be calculated and the period within which it is payable by the account provider.
33.Subsection (2)(c) provides that an account is not a Saving Gateway account unless it complies with any additional requirements imposed by regulations.
34.Subsection (3) prevents regulations made under subsection (2)(a) from prescribing a maturity period of less than 12 months. The Government intends to set the maturity period for Saving Gateway accounts at 24 months.
35.Subsection (4) specifies that the Treasury may make regulations under subsection (2)(c) imposing a limit on the amount which may be paid into a Saving Gateway account during a month. This limit does not apply to interest or other sums paid by the approved account provider under the terms of the account. The Government has announced that it intends to set a limit of £25 on the amount which may be paid into a Saving Gateway account during a month.
36.Subsection (5) defines “month” for the purposes of this section. The effect of this subsection is to ensure that the deposit limit set under the regulation-making power in subsection (4), and the maturity period specified in regulations made under subsection (2)(a), relate to calendar months, apart from the first month of the account’s duration. The first month of the account duration runs from the day on which the account is opened to the end of the calendar month in which it is opened, and might therefore be less than a full calendar month.