Treasury blames the banks for Isa muddle

SENIOR POLITICAL CORRESPONDENT THE Treasury sought to distance itself from confusion over the Help to Buy Isa yesterday as it tried to blame the banks for any lack of clarity.

Customers reacted angrily after revealed that the small print on the Government’s Isa, designed to get first-time buyers on to the property ladder, means savers cannot get a promised bonus on their money until the purchase of a property is completed.

A Treasury source insisted that the Help to Buy Isa had never been designed as a deposit saving scheme, with sources saying that any of the 500,000 customers who have already signed up and are left unclear should “take it up with their bank”.

But critics said the Treasury’s statement directly contradicted George Osborne, the former chancellor, who launched the scheme in March last year stating: “A 10 per cent deposit on the average first home costs £15,000, so if you put in up to £12,000 we’ll put in up to £3,000 more.”

Chris Leslie, Labour’s former shadow chancellor, said: “Ministers can’t wash their hands of a major design fault … Many thousands of young people have put their life savings into this on the understanding it would help to get a foot on the ladder and it’s a cruel blow that they can’t now use this as promised.”

The scheme had until now been widely heralded as a way for buyers to use government money to boost their deposit.

For example, Halifax’s website says: “If you’re a first-time buyer our Help to Buy Isa could really help you get your foot on the property ladder. It’s designed to take advantage of the Help to Buy scheme, to boost your savings towards a deposit by 25 per cent for your first home.”

But a spokesman said the Treasury has always made it clear that the money could only be used towards equity in the house, not as part of the purchase deposit itself.