The funds can be put into various pots and financial vehicles that range from low risk (building society rates) to high risk more volatile investment vehicles (far-East stock?)
Perhaps seeking a buiding society that offers a 12 month plan, that requires a high level of balance (£100K+), probably a non-withdrawal one would get decent(ish) returns with no risk.
I'd suggest engaging the services of a independant financial advisor,(I know of one in the West Country if it helps) they may not charge any money to you for their services, as they make their money from the companies that the money gets invested in.
Premium bonds work for us. as well as getting your money back anytime you stand a good chance of winning . over the last 3 year we have invested £4000 we have won 700 better interest than the banks.
i think you can only buy a certain amount but this is what i would do.
On a serious note I'd be interested to hear if you can find a scheme that brings useful rewards, investment is at a real low at the moment but I suppose at least the mortgage rate is reasonable. How about buying another property and renting it out ? Just a thought.
Dom,IMG Direct have a straight instant acsess savings account paying 4.75%,halifax have one at 5% if you want hassel free savings,but as Tim says your best speaking to an indipendent financial advisor. Butch