Rachel Reeves's cash ISA shake-up in chaos as uncertainty grows for millions of savers

The source said: "[The Treasury] has done three months of meetings, round tables, and emails [it] still can't decide what to do. It doesn't sound like it's going well."

Uncertainty now surrounds major rule changes scheduled to take effect in April 2027, with key aspects of the policy still unresolved.

Ms Reeves first announced plans to reduce the cash ISA allowance in last year's Budget, cutting the annual limit from £20,000 to £12,000 for savers under 65.

Under the proposals, stocks and shares ISAs would retain the full £20,000 allowance in an effort to encourage greater investment in UK markets.

HM Revenue and Customs (HMRC) later confirmed it would introduce measures to prevent savers from bypassing the new limits by holding cash within investment accounts.