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Labour MP Adrian Bailey, Chairman of the powerful Business Innovation & Skills Select Committee has tabled an Early Day Motion (EDM) calling on the Government to increase the amount of money employees can save in the popular all-employee share plans known as Save-As-You-Earn (SAYE) and the Share Incentive Plan (SIP).
The move comes just days after both Nick Clegg and David Cameron made reference to their desire to see greater levels of employee share ownership in the UK economy.
The EDM has already been signed by other political heavyweights including Conservative MP Graham Brady (Chairman of the influential 1922 Backbench Committee) and Liberal Democrat MP John Thurso (a member of the Treasury Select Committee).
This issue affects employee savers and investors from across the UK and is reflected by support from MPs representing the Scottish National Party, Plaid Cymru and the Democratic Unionist Party.
An EDM is a formal motion submitted in the House of Commons to demonstrate the extent of parliamentary support for a particular cause or point of view.
John Collison, Head of Employee Share Ownership at ifs ProShare, the voice of the employee share ownership industry in the UK, said:
"All-employee share plans have proved very successful over the past 30 years but the savings limits have been an artificial barrier that has effectively eroded the amount employees can save each month. We have long called for these savings limits to be increased in line with inflation in the same way that the current ISA saving limits rise every year. Employees who want to save a bit more each month should not be prevented from doing so, especially as we try to encourage a greater savings culture in the UK.
Securing this powerful cross-party support is a great start and we hope that many more MPs will follow this lead and sign this motion. The current limits are out of date and the time for Government to act is overdue."
The text of the motion reads:
That this House welcomes the fact that over two million UK workers are making monthly saving contributions into either Save As You Earn (SAYE) or Share Incentive Plan (SIP) all-employee share plans; notes that SAYE all-employee share plans have enjoyed cross party support since their introduction in 1980 as have SIPs since their introduction in 2000; that the monthly maximum SAYE savings limit of £250 per employee has not been increased since 1991 and that the annual SIP savings limit of £1,500 per employee has not been increased since 2000; further notes that had these savings limits been increased in line with inflation they would stand at £450 a month and £2,000 a year respectively and agrees with ifs ProShare, the not-for-profit voice of the UK employee share ownership industry in the UK, that the Government should therefore raise the monthly savings limits to £450 a month for SAYE plans and £2,000 a year for SIPs as well as ensuring they are both increased in line with inflation on an annual basis.