NS&I to launch 2.2% savings bond

Hammond said that further details will be announced at the Budget, but expects the new Investment Bond will have an interest rate of around 2.2% gross and a term of 3 years.

Savers will be able to deposit up to £3,000, and the government expects around 2 million people to benefit.

Hammond said that "low interest rates have helped our economy recover, but they’ve significantly reduced the interest people can earn on their cash savings".

However Calum Bennie, savings expert at Scottish Friendly, said: "For savers the forthcoming savings bond is better than nothing but an interest rate of 2.2% is hardly likely to set the heather alight at a time of increasing inflation."

The Chancellor also announced "continued support" for the Help to Buy ISA but made no mention of the Lifetime ISA.

Tom Barton, partner and pensions expert at law firm Pinsent Masons commented: "Lifetime ISA seems to have just jumped the last fence en route to the finish line of April 2017. Consumers and product providers will now dictate whether it will be a success. And, of course, there are different ways of looking at success.

"The introduction of LISA will also raise questions about whether there remains a policy intention to switch pensions to a TEE tax system at some point too. We can probably infer that the present Government does not want to rule it out."