John Cregan (Limerick West, Fianna Fail)
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Question 248: To ask the Minister for Finance the requirements which SSIA holders must satisfy prior to the cashing in of their investment accounts in the short term and at the end of the maximum investment period; when the first SSIAs will mature; if the holders will be written to; if they must initiate repayment; if they will be offered further investment terms; and if he will make a statement on the matter. [23581/05]

Brian Cowen (Laois-Offaly, Fianna Fail)
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I am informed by the Revenue Commissioners that on commencement of an SSIA account, the account holder had to certify that the following conditions would be satisfied for the duration of the scheme: the holder was over 18 years of age and resident in the State at commencement; the holder would operate only one SSIA; subscriptions to the account would only be made by the holder or his-her spouse and from his-her own resources; subscriptions to the account would not be funded by borrowing or the deferral of repayment, whether in respect of capital or interest, of amounts already borrowed; and subscriptions to the account in each of the first 12 months would be of an amount, not less than €12.50 and not more than €254, agreed between the holder and the qualifying savings manager, financial institution, at the commencement of the account. For the remainder of the scheme, the only statutory restriction is that the maximum subscription in any month must not exceed €254; funds held in an SSIA would not be used as security for a loan.

Prior to the maturity of the SSIA, the account holder must complete a declaration confirming that for the duration of the scheme, s/he held only one SSIA; he or she is the person who beneficially owns the qualifying funds held in the account; he or she was resident or ordinarily resident in the State since commencement of the account; the account was funded from resources available him-her, or spouse, without recourse to borrowing or by the deferral of repayment, whether in respect of capital or interest, of sums already borrowed; and he or she did not sign or pledge funds held in the account as security for a loan.

The first accounts are due to mature at the end of May 2006. Each financial institution will, at the appropriate time, circa 14 weeks prior to the maturity date, supply a maturity declaration to each SSIA holder for completion and return to the institution. The financial institution will mature the account at the appropriate time and pay over to Revenue the appropriate tax on the income earned by the account. The account holder can then either maintain and continue the account, without the benefit of the Exchequer top up, or withdraw funds as he or she wishes.

In regard to further investment terms, the specific goal of the SSIA scheme was to encourage people to save over a period of at least five years. Its effect has been to stimulate such savings over varying income ranges which is evident in the extensive take-up by many low income earners. The scheme has been a success in those terms. The scheme has a specific duration. Any proposals for tax-based incentives for the continuation of savings would be considered as part of the normal annual budgetary process taking account of public policy objectives and Exchequer cost implications. The use to which the monies arising on maturity of the SSIAs are put is ultimately a matter for the individual account holder.