Reeves eyes smaller cut to cash ISA allowances

CHANCELLOR Rachel Reeves is set to announce a more modest reduction to the cash ISA allowance following intense pressure from building societies, according to reports.

- DAVID BENTLEY and MAURICIO ALENCAR

Speculation has been rife that the current £20,000 limit on cash ISAs could be slashed to as little as £10,000 as part of measures designed to encourage more people to invest in stocks and shares.

Following a backlash from high street savings bosses, the Treasury has been considering a less severe cut to £12,000 annually, according to the Financial Times.

Ms Reeves may also consider adjusting the rules around stocks and shares ISAs in the Budget on November 26.

One potential change under consideration is requiring ISA providers to ensure savers place 25% of their investments in UK equities.