An investment dream turns to ashes: Nic Cicutti on how 75p in National Savings blossomed into pounds 5 in 49 years

BERNARD Sims is disappointed with the performance of his investment. Not angry, or even deeply upset, just disappointed.

But also, if the truth be told, slightly amused.

Almost 50 years after investing a large slice of his weekly wages in a National Savings certificate, he has received his payout - just over pounds 5.

Granted, the value of the certificate he bought was 15 shillings, or 75p in today's devalued decimal currency. But that was a small fortune in those days, almost 20 per cent of the average manual worker's weekly wage.

As Mr Sims, a one-time Nottinghamshire miner and retired teacher, put it: 'If I had bought a ton of coal at the time, it would have cost me far less than 15 shillings. I could have sold that coal today for pounds 140.

'Burning the National Savings cheque, as I did, brought me no warmth at all. It was cinder in nine seconds, nothing like as warm as coal.'

An RAF pilot during the war, he remembers buying National Savings certificates, with millions of others, to help bring the conflict to a swift end.

Mr Sims, now 71, said: 'We were told that our money would buy victory by helping to build tanks, warships and Spitfires. After the war, it was a question of winning the peace, so I did my best to respond.'

All in all, he wonders whether it was even worth trying to cash the certificate, discovered at the back of a drawer where it had been forgotten for many years.

Investing it elsewhere would have produced better returns. Hypo Foreign & Colonial's investment trust would have turned that 75p in December 1945 into about pounds 620.

Had he spent the money instead, a pint of Worthington's best bitter in 1945 cost just over a shilling, or 5p, while a packet of John Player's cigarettes would have set him back just 15p.

Had he decided to put his money towards a new car, the latest Ford Anglia model - 0-60mph in 40 seconds - cost about pounds 280. Petrol for the car would have cost two shillings, or 10p, a gallon. An average semi-detached house in Nottinghamshire cost about pounds 1,200.

A slightly red-faced National Savings spokesman said the certificate bought by Mr Sims was part of the Seventh Issue, which repaid 21 shillings and sixpence after 10 years, an annual rate of 3.175 per cent. It remained at roughly that level for 44 years.

'In 1989, the rate became a variable one. It rose to just over 5 per cent in 1992 and fell again to 3.75 per cent this year.

'In many ways, it is just as well that he cashed it in. If anything, this shows that people should cash in their certificates at the time they are meant to,' the spokesman added.

The current general extension rate for certificates that have gone beyond their payment date is 3.51 per cent tax-free.

National Savings, which first issued bonds to help fund the First World War, still has about pounds 147m outstanding in certificates dating between February 1916 and October 1970.

Last year, the National Savings office in Durham issued a cheque to the owner of a set of certificates dating from October 1923. But the extra 22 years did not bring any extra cash. A 15 shilling certificate from that period is still worth only about pounds 5. As for Mr Sims, what is the pounds 5 he received from National Savings worth?

Not much, if a national survey of children's pocket money is any guide. According to the survey, out this week, children aged 5-16 now have an average of pounds 4.30 to spend each week - about the same as his cheque.