Thursday, 11 May 2017

What is a Flexible State Pension Age?

Anyone seeking to understand what Labour means by a "Flexible Pension Age" needs to look back at what Jeremy Corbyn wrote in the Telegraph in 2015.

It was on plans in train to increase state pension age to 66, 67 and eventually 68. (And now there's talk of 69 and 70...)

"Some people will be happy to work longer, others not. But living longer doesn’t mean we are able to work longer in physically demanding jobs like that of the firefighter, police officer or paramedic. And it’s not just in the emergency services: construction workers, care workers and prison officers cannot be expected to work into their late 60s.
So we need a flexible pension age that allows people to work for as long as they want to, while also recognising that for many people the nature of their work, their health, or their disability may not allow that.
Increasing the state pension age to 68 does not recognise this reality. It will mean that those who have worked in well-paid jobs with good pensions will continue to take early retirement, while lower-paid workers with the least savings will have to work until they drop. It will create a two-tier system in which the fortunate few can retire into long contentment, while increasing numbers retire later in poor health and poverty."

Friday, 5 May 2017

Outrage over shops already rejecting old fivers

Can a shop reject your old paper fiver before it ceases to be legal tender at midnight tonight?
I just heard from an irate shopper who had been given an old fiver as change in a supermarket, then had it rejected in a coffee shop and then rejected again in an organic grocer's.
It looks like there are a few cases of traders not wanting the hassle of dealing with defunct £5 notes now they're on the way out.

Can a traders reject your old fiver already?

The answer is yes! It's up to the shop what they can accept.
They can reject £50 notes if they don't like the look of them.
Equally, they can accept magic beans for currency if they want, or chocolates, or gig tickets - whatever you agree with them.
The acceptability of notes is entirely between the two people involved in the transaction.

So what's the point of saying it's no longer legal tender?

Legal tender is a tricky concept. It means that the money being offered is good for paying a debt.
Someone to whom you owed money could reject magic beans as a payment, but not legal tender.
And a court would back you if you paid with legal tender.
Tonight the old Elizabeth Fry fiver stops having that unassailable legal status.

The Bank of England says, “It means that if you are in debt to someone then you can’t be sued for non-payment if you offer full payment of your debts in legal tender.” Here's the Bank's brief.

Can stores carry on accepting old £5 notes if they want to?

They certainly can.
Any supermarket, High Street shop or market stall can take an old note from you next week and for the forseeable future, if they are feeling nice.
First of all, it's up to them what they accept.
Second, they are likely to be able to deposit an outdated paper fiver at their bank for months, if not longer.
And the Bank of England will accept old fivers "for all time". Here's how you take them back.


Wednesday, 26 April 2017

Pension cashing in tops £6bn

Nearly 400,000 people took out £6.45bn of their pension cash in year to April, taking advantage of the new pension freedoms, HM Revenue and Customs said.

The figure covers both cash withdrawals and income drawdown, through which pensioners maintain an investment fund and take a regular income.

On average people pulled out more than £16,400 each between April 2016 and March 2017.

It's the second year that pension savers have been able to use their retirement nest eggs as they like, from the age of 55, subject to paying some tax.

It's hard to gauge from the HMRC figure how much more "cashing in" has been going on. The first year saw at least £4.35bn withdrawn - but pension providers weren't forced to submit full records.

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/610451/Pensions_Flexibility_April_2017.pdf

Tuesday, 25 April 2017

Energy price hikes disguised as savings

Canny consumers who are coming to the end of year-long fixed rate gas and electricity fixed rate deals are in for a shock.

When you look at the price comparison sites to see what you'll be paying next, it's likely to be £100s more.

But that won't be the only surprise.

The switching services will promise you huge savings, like this:



How is there a saving of nearly £400?

Well, it's compared with what you would be paying if you didn't switch deals and you ended up on your current supplier's Standard Rate (the expensive one).

In fact, in this example your best option would be a near £200 increase in your annual bill.

Of course, if (like most people) you're on the Standard Rate already or have never switched before you are likely to make a substantial saving anyway.

For the rest, make sure you click "What will I pay?" and avoid disappointment...



Friday, 17 March 2017

Mind the gap on house prices

Least and most affordable areas in England and Wales, from ONS, comparing now with 17 years ago...



Thursday, 16 March 2017

ABTA cyber attack

The travel agents organisation ABTA says 43,000 members and travellers may have had their personal information stolen in a cyber attack.

It says the attack was perpetrated by an external infiltrator on its web server on 27th February.

ABTA says most of the information taken is what it calls "low risk", including email addresses and encrypted passwords.

But up to 1,000 holidaymakers who uploaded documents to do with holiday complaints may have been more seriously affected.

In their cases photographs, addresses and phone numbers could have been accessed, although ABTA says banking details would not have been available.

Also, more detailed information about 650 travel agents could have been hacked, along with documents supporting their membership applications.

They are being told to monitor their bank accounts and to be vigilant about online fraud.

ABTA says the vulnerability in its server has been identified and dealt with. It wasn't able to identify the infiltrator was, saying that was now a matter for the police.

Mark Tanzer, ABTA's chief executive, apologised for the anxiety and concern the incident had caused.

Wednesday, 15 March 2017

Self-employed underpaying by £5bn? Really?

What did the Chancellor mean when he said in his Budget speech that...

"The lower National Insurance paid by the self-employed is forecast to cost our public finances over £5 billion this year alone"?

Some might have though he was implying that if only the self-employed paid what employed people pay then the Exchequer would be £5bn a year to the good.

But it's not quite like that.

Yes, Mr Hammond is simply totting up what he would get if all the self-employed were employed - and subtracting what he receives from them at the moment.

He reckons he would be £5.1bn a year better off.

Yet most of that large sum would come from the National Insurance paid by employers, the so-called tax on jobs.

Employer NICs are a substantial 13.8% of pay.

That's not money deducted from wage packets, even if employers see it as part of the cost of taking on staff.

The self-employed do contribute less, £2.80 a week and 9% of pay over £8,060, compared with the straight 12% contributed by employees.

But not £5bn less.

In fact some would argue that they are pushed into self-employment by companies who want to avoid having to pay employer NICs.

Even so, it was individuals whom the Chancellor targeted in his short-lived National Insurance hike, not companies trying to trim their tax bills.