Premium Bonds go on Sale
Britain in the decade or so after WWII had too few goods – these were years of rationing and austerity - chased by too much money, the classic recipe for inflation. Much of that money was in the hands of those with no history of saving, their only previous investments made on the football pools or the 3:30 at Kempton Park . Harold Macmillan ’s government came up with an innovative way to channel some of that inflationary cash into savings and give the thrill of gambling – Premium Bonds. Of course the money invested was also usefully in that same government’s hands.
No interest in the ordinary sense would be paid on the investment in the bonds, instead such money going into a fund from which those whose numbers were drawn by ERNIE would be given prize money. ERNIE (Electronic Random Number Indicator Equipment) in those days was a machine the size of a truck.
Introduced in the budget earlier that year, the bonds went on sale on November 1 1956, launched in a ceremony symbolically held outside the Royal Exchange in London . The first investor handing over his £1 to purchase a bond was Sir Cuthbert Ackroyd, a future Lord Mayor; the second William Crook, already mayor of Lytham St Annes where the organisation processing the investments and subsequent distribution of prizes was based.
To say the scheme was an instant success is no exaggeration: on the first day £5 million worth were sold; sales continued steadily until the first prize draw (the government as ever in no rush to part with money) took place on June 1 1957 in St Anne’s, the largest prize at that time £1000.
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