[juaristi22]

The savings follow-up to #1418, part 1: fix the low savings base at its source instead of making the solve stretch weights. This branch starts from PR C's last commit (0b276e571, merged as #1420).

Draft. The national built from b441bb5a0 (on f3cb3ddd3's spine) is certified and shippable, staged locally. The other-income fixes below (4a6dc728f to b82247443), the small traders' pay (d563f4fbc), the tax on savings rows (5c0137fb4) and the take-up pools (6485af4af) need a new spine and national. A spine and national are building from 0c2f5314f, which carries all of them except the tax on savings rows, reverted (below). The spine from f9676fed9 stopped in the new receipts stage, which hadn't declared its source-household read; 0c2f5314f declares it. Staging reaches its repository, so the cut can publish. The spine from d563f4fbc stopped at the UC take-up gate. The spine from 6485af4af passed every gate, but its national stopped at the fit gate on the tax on savings rows. The measurements will come in a comment before review.

The problem

PR C binds SPI Table 3.7's interest and other income by total-income band. Interest moves to the OBR's savings path from 2023-24.

• The frame's base is low. At design weights it carries about 70 percent of those rows. The solve meets them by stretching the weights of the few households that carry savings, so the totals hit but the column's distribution doesn't.
• The SPI donors are under-aged. They come from the 2022-23 tape and reach the 2024 frame by each column's engine index:
  • other income by GDP per head, ×1.09 from 2022 to 2024, where SPI's own other income grew ×1.65 in the single year to 2023-24;
  • interest by ONS household interest, ×2.27, where SPI's grew ×2.69 in that year.
• The top band's split is flipped. On the tape, the £1m-and-over band's other income outweighs its interest, as in the published table. Ageing the two columns on such different indices flips that split.

The PR C national built from 5aba83cd2 stopped at certification on that band. Its figures stay out of this thread, because the band rests on the SPI tape.

The change

• spi_income.rebase_spi_donor_savings runs before any draw. It scales each donor's interest and other income to HMRC's published 2023-24 Table 3.7 amounts:

  • the factor in each band is the published amount over the tape's FACT-weighted amount, with the tape banded by its own total income;
  • a donor below the first band takes the factor of all bands together;
  • a band the tape carries none of is left as it is and named in the receipt (the production tape carries every band).

  The stage-1 forest and the band-donor resample both read the rebased tape. The receipt records factors only, never counts.

• _spi_income_uprating_factors then grows the two columns from 2023-24 to the frame's year on the OBR's savings-income growth (October 2026 EFO, Table 4.5), through the new hmrc_uprating.uk_obr_savings_income_level. This is the path the Table 3.7 band targets already take. From the frame's year on, the engine projects both at GDP per head, so both columns are now listed in SPI_HISTORY_INDEX_DIFFERS_FROM_PROJECTION.

• uk/hmrc_spi_table_3_7_savings_rows.json vendors the 26 published rows (13 bands × 2 columns) from the feed pin. It is declared in the vendoring register and the country package.

• Docs and changelog: docs/uk-income-anchors-280.md and changelog.d/1418-spi-donor-savings-rebase.changed.md.

The UC take-up gate: 0.055 to 0.06 (second commit)

The first spine built from 667fe532a stopped at uk_stage_uc_take_up. After the take-up redraw, single people's caseload ended 0.0568 of DWP's count further from it than before. PR C's spine was at 0.0523, and the tolerance is 0.055. The cause:

• The rebased SPI savings feed the UC reporter redraw's investment-income predictor, so a few SPI benefit units change report.
• That moves the take-up stage's pool merging, which joins adjacent award bands until each pool rests on enough sources.
• As a result, single people's £1,000–£1,100 band moved from a reachable pool into one whose DWP target exceeds the entitled units.

The reachable pools still realize DWP's counts within 0.005. The tolerance goes to 0.06 (María's ruling of 2026-10-30), as PR A took it from 0.05 to 0.055 for the gilt reshuffle. Pool boundaries that jump with small upstream changes are a follow-up on #1334. The gate's note, the committed-parameter test and the data contract's mirrored digests are updated.

Superseded by 6485af4af, which fixes the pools and returns the gate to 0.055 (below).

The national from f3cb3ddd3: what moved

The spine passed every gate. The national's fit gate blocked on one row. Below £1m, every Table 3.7 interest and other-income band fits within 1% after the solve, and the £1m-and-over other-income row that blocked PR C's national now passes the fit gate.

The share of each group's solved mass sitting on households stretched beyond 3× their design weight, PR C's blocked national against this one:

Group	PR C	This national
Interest carriers below £100k	54%	41%
Other-income carriers from £100k	29%	10%
Other-income carriers below £100k	66%	63%

The last row is the FRS under-reporting part 2 would address.

At design weights, the rebased frame carries more savings than SPI in the £200k–£1m bands, where its top earners are already over-represented, so the solve now cuts those savers' weights instead. The figures for the £1m-and-over band stay out of this thread, because it rests on the SPI tape.

The £1m-and-over interest hold (third commit)

The one row the fit gate blocked on, Table 3.7's £1m-and-over interest amount, is held as a measured distortion, as the ten HMRC £1m-and-over cells are (María's ruling of 2026-10-30), and is still measured on every evaluation. How the rebase sits in the top bands at design weights is a follow-up.

Why other income is short below £100k, and the fixes (fourth to sixth commits)

A read-only investigation of the national from f3cb3ddd3 found that below £100k the frame carries 0.40 of Table 3.7's other income at design weights. It ranked three causes:

1. FRS rows carry a different concept (46% of the gap).
2. SPI copies draw thin, incoherent other income (34%).
3. Taxpayer coverage (18%), which the solve's taxpayer rows already fix.

By María's choice (2026-10-30), three changes address the first two, plus a fix to part 1's rebase:

• 4a6dc728f, the rebase on taxpayers (F). Table 3.7 counts taxpayers only, so each band's factor is now computed over the tape's taxpayers (TAXPAYER 1), and non-taxpayers take the all-bands factor. Over all records, the two lowest bands' taxpayers fell short of the published amounts.
• 092de13b9, FRS savings income on SPI's definitions (A1, A2).
  • NS&I Direct Saver and the other NS&I and bank products move to savings_interest_income, since SPI has counted gross-paid interest as bank interest since 2016-17 (note 4). Gilts stay in other income.
  • Income from an annuity not bought with pension funds or from a trust or covenant (FRS PENTYPE 4 and 5) moves from private pension to other income (note 6). The whole annuity payment is booked, of which only the income element is taxable.
  • Both columns are taxable savings income, so the tax on these rows doesn't move.
• b82247443, a coherent other-income draw on SPI copies (C). The stage-1 transport locates each copy's draw at its twin's own other income (gilts, trust and annuity income) rather than at an identity uniform that ignored it. The stage spec's analogue map and the coverage manifest follow.

The investigation's frame arithmetic puts other income below £100k at design weights at about 0.66 of its target with these changes, against 0.40 before. The next build measures it.

FRS rows keep their own reported incomes: the investigation's larger lever, an SPI fill of other income on FRS-row taxpayers, is not taken.

The small traders' pay: SPI Table 3.10's employment-income counts (d563f4fbc)

The national from b441bb5a0 costs the Budget's trading allowance measures (Table 6.1 line 15) below PR A's, and both sit below the costing. A read-only investigation found two things:

• The fall from PR A is PR C's Table 3.10 counts correcting an overshoot in PR A's £2,000–£3,000 band, so it isn't a regression.
• The frame's small traders have the wrong mix. In Table 3.10, more than half of the traders below £3,000 also have employment income; the frame's mix leans to traders without pay. An employee's side profit is taxed at their marginal rate, so the mix decides what the measures cost.

By María's choice (2026-10-30), hmrc.spi.employment_income.count_by_self_employment_income_band binds Table 3.10's individuals with employment income over the same eight bands from £1 to £10,000 as the self-employment counts:

• Each person with pay over the year (employment_income_annual, the variable Table 3.6's employment rows read) counts in their own self-employment band, taxpayer or not.
• Table 3.10's column is wider: income assessed under ITEPA 2003 plus other miscellaneous income (its note 4). Like Table 3.6's employment rows, the binding leaves out miscellaneous income, benefits in kind and the contributory benefits.
• The counts grow to 2025 as the self-employment counts do. The zero band and the bands from £10,000 are signed out row by row in target_reference_signed_exclusions.json.
• The target is declared signature-incomplete beside the other Table 3.10 rows. The national references and membership and the national compile-parity receipt are regenerated on the pinned feed (53815b2), with eight new rows.
• The membership's 13 SPI dividend rows and 8 Table 3.10 self-employment amount rows also take the October EFO engine pins that main's policyengine-uk 2.164.2 lock brought (b89d3aab8). The merge had left them on the 2.162.14 pins. The parity receipt doesn't move for them, and builds compile live from the pins.

The tax on savings rows: the OBR path (5c0137fb4, reverted in f9676fed9)

The three ITL Table 2.6 rows bound HMRC's own 2024-25 and 2025-26 projections as a calendar-2025 window: £8.40bn of tax on savings, ×1.52 on the 2023-24 outturn. Table 3.7's savings income grows only ×1.36 on the OBR's path. Bound together, the rows pinned the tax on savings, and so the savings rates' static yield, about 12% above the base the Budget's costing grows.

By María's choice (2026-10-31, option A):

• The rows read the 2023-24 outturn alone and grow it by the OBR's savings income growth, the index Table 3.7's savings rows take: £1.61bn, £2.24bn and £3.66bn, £7.51bn in all.
• This leaves out the leverage that HMRC's projection carries from the frozen Personal Savings Allowance and thresholds.
• hmrc_itl_savings_rate leaves the source-projection families. Only the three rows move in the references, the membership and the parity receipt.

Reverted (f9676fed9, María's ruling of 2026-10-31). The national from 6485af4af stopped at uk_target_fit, as the leverage caveat predicted:

• Under the engine's rules, tax on savings grows faster than savings income, because the allowance and thresholds are frozen.
• So the tax rows grown on the income's path asked for less tax than Table 3.7's savings income gives.
• The solve cut the interest rows in the basic-rate bands to meet them: the £30,000 band ended 30.7% under target and the £20,000 band 12.0% under.

HMRC's own projection carries that leverage, and b441bb5a0's national met it beside the interest rows. So the savings rates' yield stays pinned to the projection. Its distance from the costing is a difference of basis and of behaviour (ISA shifting), not a fault in the base.

UC take-up pools that cannot meet DWP's count (6485af4af)

The spine from d563f4fbc stopped at uk_stage_uc_take_up. Single people's caseload ended 0.0674 of DWP's count further from it than before the redraw (0.0568 on f3cb3ddd3's spine).

• The pools whose counts the draw can reach met them.
• The gap is the pools that cannot meet their count: either DWP's count exceeds every entitled unit, or the reporters alone already exceed it. Those pools kept a clipped rate, and which bands fall there moves with small upstream changes.

By María's ruling (2026-10-31), the stage is fixed instead of the gate widened again:

• The join. After the source-support pooling, a pool that cannot meet its count joins the adjacent pool with more room for its gap, lowest first and the lower neighbour on a tie. Joining stops when every pool can meet its count or the family type is one pool. So a family type's caseload lands on DWP's wherever its entitled units allow, with claimants drawn across neighbouring award bands where one band falls short. UC results move in later builds.
• The gate returns to main's 0.055.
• What follows: the stage spec, the coverage manifest, the H2 fixture and the data contract's digests. New stage tests cover the join.

The trading allowance's base: the self-employed's gross receipts (f3540cbc6)

policyengine-uk applies the trading allowance against self_employment_gross_receipts, and neither the FRS nor the SPI tape records turnover. Without receipts, the engine relieved profits up to the allowance in full and nothing above. So the Budget's raise to £3,000 missed its main base: traders who already claim the £1,000 allowance against larger receipts and gain the larger deduction. No published source gives turnover beside profit. But under current law a claimant's receipts are their profit plus £1,000 exactly, so only who claims is missing.

By María's choice (2026-10-31), a new last spine stage, trading_allowance_receipts, sets each trader's receipts:

• Who claims. Each trader with a positive profit is flagged as a claimant, drawn on their own person_id: 0.64 for profits up to £4,500, 0.32 from £4,500 to £9,000, none above.
• Receipts. A claimant's receipts are their profit plus £1,000. Any other trader's are their profit plus £3,000, expenses at the raised allowance; the costing books traders who switch to the allowance as behaviour. A person with no positive profit keeps zero, which the engine reads as unknown.
• The rates are calibrated to HMRC's policy paper (about 400,000 taxpayers with a lower bill, by about £380 on average) until HMRC publishes claimant counts. An HMRC table of claimants by profit band would replace them.
• Filing. Every trader with a positive profit is treated as filing, as the bound Table 3.10 counts are of filers. So a profit of £1,000 or less is now taxed where the engine used to relieve it in full.
• Uprating. The engine uprates receipts with profit, so a claimant's £1,000 grows with the mixed income index, and the raise relieves slightly less than £2,000 more in later years.
• Wiring:
  • the operation kind in the stage schema;
  • the stage spec, with its mass receipt;
  • the graph, kernel and spine-build wiring;
  • the coverage manifest family and the H2 fixture (51 stages).
  • self_employment_gross_receipts also leaves the register of engine inputs left at their default and joins the export surface's allowed columns, so the data contract's gate digests follow.

Up to date with main, and CI (30 Oct)

• 9ee6fbde0 merges main into the branch. The main change it brings is PR B (Budget 2026 ISA data, PR B of #1418: ISA subscriptions per adult, the Lifetime ISA anchor, additive ISA income, policyengine-uk 2.164.2 #1421: ISA subscriptions, policyengine-uk 2.164.2). Conflicts resolved:
  • the FRS account routing, keeping main's ISA interest column and this branch's NS&I routing;
  • the FRS spine and SPI engine tests;
  • the vendoring register, keeping both new resources;
  • the data contract's gate digests, recomputed for the merged gates.json;
  • the coverage manifest, regenerated.
• 995969f02 leaves the savings rebase off any tape whose weights don't gross to the population.
  • The band factors assume they do. On the H2 fixture's synthetic tape they ran to millions and broke the band donors.
  • A column whose tape holds under a tenth of the published amount is now left as it is, and the receipt says so.
  • The production tape holds about 0.37 of the published interest and 0.6 of the other income.
• e5ac7a5d8 regenerates the H2 spine fixture for the other-income analogue (C). CI's engine-uk graph test and the integration-uk smoke test refused its stale stage-spec snapshot.
• 53ad29934 starts a missing self-analogue output at zero before the SPI transport. Since C, the transport reads other_investment_income as each twin's own analogue before the stage-1 draw, so CI's engine test of a frame whose FRS rows carry no other income was refused. That column now gets the stage's zero before the transport, as it did after the draw, and the final values are unchanged. Production FRS frames always write it.
• 45c2888fa regenerates the H2 spine fixture on policyengine-uk 2.164.2, the lock's pin since the merge of main. e5ac7a5d8 had built it in a local environment still on 2.162.14, which CI's engine-uk graph test caught.

Not in this PR

• Measured claimant counts for the trading allowance. The claimant rates are calibrated to HMRC's published gainers, not measured. Miscellaneous income's allowance is the engine's (policyengine-uk#2726).
• FRS under-reporting of savings below £100k (part 2) is not addressed here. The build shows how much of that gap remains.

Checks run locally

All pass. Engine-free tests:

• the new test_uk_spi_savings_rebase.py;
• the SPI income, spine, dependency and acceptance-receipt tests;
• FRS spine, graph, property components, stage health and the HMRC source manifest;
• Carer's Allowance take-up, ledger-fact vendoring, country spec and donor uprating;
• the spine parity instrument and the WAS tests that read the H2 fixture;
• UC take-up and stage health, the population targets and target references, the source stages, the coverage manifest and the data contract;
• the new test_uk_trading_allowance_receipts.py, the stage rosters, the country spec, the graph and the terminal gates.

The updated engine tests (engine/uk/test_uk_spi_income.py, engine/uk/test_uk_hmrc_uprating.py, engine/uk/test_uk_itl_savings_tax_rates.py, engine/uk/test_uk_release_input_coverage.py) and the H2 acceptance test run in CI.

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