September 2013

New financial advice fee structure puts older people at risk of mis-selling and fraud, say researchers

Research carried out by two UK universities suggests that elderly people may be reluctant to pay flat fees for professional financial advice under the new charging regulations.  And the result is that they are taking advice from family and social services staff instead.

The research, by the University of Hull and Bournemouth University and sponsored by the Institute of Chartered Accountants of Scotland, is said to be the first major study conducted since the payment of commission to financial advisers selling investment products was banned at the beginning of the year.

Housing benefit changes forcing many into rent arrears “for the first time ever”

Two significant pieces of research produced during the party conference season have concluded that a high percentage of people are being pushed into debt by recent changes to the way housing benefit is calculated.

Widely dubbed the “bedroom tax”, the policy was introduced on 1 April this year. It was designed to reduce the cost of housing benefit payments and persuade people to move out of homes where they had a spare room into smaller accommodation, thus freeing up larger homes for families.

Running for Joining Jack

A rather different take on money for this piece of news... and a success story for Debt Advice Foundation’s intrepid team of runners who took part in the recent Wigan 10k.

The run, which was being held for the first time, was in support of Joining Jack, a charity which raises money for research into Duchenne Muscular Dystrophy.  Four-year-old Jack, for whom the charity is named, is the son of former rugby league star Andy Johnson and his wife Alex.

Financial Education finally makes it to the National Curriculum

To much applause from all of us who have been campaigning for financial education in schools, the Government has published the new National Curriculum which finally recognises that young people need to be taught money skills.

Finance will be taught in mathematics at all key stages and in citizenship n Key Stages 3 and 4, where pupils will learn money management, plan for future financial decisions and understand the links between personal and public money, such as income tax.

MPs add their voices to calls for controls on the marketing of payday loans

There were calls for controls on the marketing of payday loans as well as more support for credit unions when MPs debated high-cost credit.

The debate, which came during a backbench business session, saw MPs express concern about the number of payday loan businesses opening in High Street premises and the lack of credit checks on potential borrowers.

Tonty Baldry, MP for North Oxfordshire, told the House that while £38million was being invested in credit unions by the Government, a similar sum was being spent on advertising in a year by the big name payday lenders.

Facing up to the payday lenders

Much has been made in the media of the announcement of the latest results of short-term, high-interest lender Wonga, which has reported a 68% increase in lending – up to £1.2 billion – and a 35% increase in net profits.

The company, which describes itself as “one of Britain’s most successful technology companies”, made four million loans to more than a million customers in 2012, with net profits of £62.5 million.