Around 3.5 million Britons on low incomes are likely to qualify for support of up to £1,200 over four years in a new plan.

Under the Help to Save initiative, approximately 3.5 million workers on universal credit or working tax credits will be able to save up to £50 a month and receive a bonus of 50{06aeb1921e0b802d2bd9c766bc98fb11cc6a46c2b0593ed9c88a0e29cf417a34} This could be a maximum of £600 – after two years.

For a further two years, savers can carry on using the scheme and earn up to another £600.

Research suggests nearly half of Britain’s adults have less than £500 set aside for emergencies.

The Prime Minister also declared an increase to the national minimum wage for young workers.

From October, the rate will go up by 25p an hour for 21- to 24-year-olds, taking the rate to £6.95, and by the same amount for 18- to 20-year-olds. This puts their pay at £5.55 an hour.

The rate will increase from £3.87 to £4.00 an hour for under-18s and apprentices will be given a 10p hourly rise taking them to £3.40.

The Government has already announced plans for a national living wage of £7.20 for workers over 25. This will start from April.

Mr Cameron said of today’s announcements: “I’ve made it the mission of this government to transform life chances across the country.

“That means giving hard-working people the extra support they need to fulfill their potential.

“And that’s what these new measures will achieve – helping someone start a savings fund to get them through difficult times, giving people on low incomes a pay rise and making sure teenagers have the experience and networks to succeed.”

In the meantime, George Osborne has warned of a further £4bn spending cuts in Wednesday’s Budget, saying “that the world is a more uncertain place than at any time since the financial crisis and we need to act now so we don’t pay later”.

Savings equivalent to 50p in every £100 the Government spends needed to be found by 2020, the Chancellor said.

Jonathan Isaby, chief executive of the TaxPayers’ Alliance, has criticised the Chancellor for not doing more to cut spending.

He said: “While the Chancellor deserves some credit for steering the economy through difficult times, much of the action which was urgently needed to bring spending down and sort out the nation’s finances sadly never took place.”

Source: Sky news