It could be argued at present that NS&I is failing on all three counts, paying savers too much interest, knocking spots off most savings accounts offered by mainstream banks and building societies, and raising expensive money that ultimately ‘costs’ UK taxpayers.
My view is that NS&I has more bad news to break to savers in the not-too-distant future.
Although its recent focus on attracting younger savers should protect the 1.4 per cent effective annual interest rate underpinning Premium Bonds (more child-friendly than ever) and the 3.25 per cent paid on its Junior Isa, other accounts look vulnerable to a trim here and a snip there.
They include the likes of its monthly income-producing Income Bonds (1.15 per cent and popular with income-searching pensioners), Direct Isa (0.9 per cent) and Direct Saver (1 per cent).
Accounts that in the case of Income Bonds and Direct Saver also have generous maximum savings limits of £1m and £2m respectively, and of course the reassurance that every single penny of customers’ savings is covered from future trouble and strife (another 2008 financial crisis, for example) by the Treasury.
While some savers may be able to find solace in using one of the new style cash management accounts – offered by the likes of Hargreaves Lansdown, Raisin UK, Octopus and Flagstone – the future for savings looks bleaker than it has done for a while.
Indeed, with dividend income under extreme pressure in the UK as a result of a challenged economy and pressurised corporate profits, the lot of investors – as well as savers – could well deteriorate in the months ahead.
Link Group said as much a month or so ago when revealing data showing that UK dividends rose to a record £38bn in the second quarter of this year.
In reporting these eye-catching figures it said that the “UK’s dividend clothes are starting to look a bit threadbare underneath”.
All rather scary – and I have not even mentioned the damage a Jeremy Corbyn-led government could do to the UK stock market. A time, therefore, for financial advisers to rise to the challenge by reassuring clients and nursing them through the difficult days and months ahead, to reinforce the merits of investing for the long term – through thick and thin.
Jeff Prestridge is personal finance editor of the Mail on Sunday