March’s top debt and money news stories

posted by in Debt news

Debt news

March 2015 debt news

It’s been a busy month for debt news, not least the staggering 372% jump in council tax arrears our clients have seen over the last five years.

And in other news, unions have warned that wages have plummeted in Scotland over the last six years, at a rate not seen since the 19th century.

It’s not all doom and gloom, however. Her Majesty’s Revenue and Customs (HMRC) plans to scrap automatic fines of £100 for late tax returns, which will come as a relief for many self-employed people.

Read more in this month’s round up…

Bills are soaking up over half of our income

The Express recently reported that more than half of the average person’s monthly income goes directly to bills. Impressively, 41% of the money left over after bills is being saved, but not as effectively as it could be, experts warn.

The survey of 2,100 workers covered in the report examined the financial health of the nation.

Council tax arrears cases up by 372% in recent years

The number of people contacting us needing help with council tax arrears has increased 372% over the last five years, as we reported in our recent press release. This was part of a larger report on council tax debt (PDF) and what we feel is a larger crisis that is steadily tipping many families into further problem debt.

The research indicates that councils are more likely to engage in aggressive enforcement action through bailiffs and threats of court enforcement, rather than explore affordable payment options for people in arrears.

People in council tax arrears are likely to be more vulnerable, yet councils are not covered by rules and codes of conduct which many other creditors are expected to follow. The charity is calling on government to ensure consistent incentives and messages are given to councils to reinforce the need for affordable payment solutions.

Read more if you have council tax arrears.

Pension freedoms to be ‘open season’ for fraudsters

Upcoming changes to pension rules will mean an ‘open season’ for fraudsters hoping to steal people’s savings, according to industry experts in an article from the BBC.

From April 6 anyone over 55 will be able to withdraw their pension savings, and use them how they like. Tom McPhail, pensions expert from Hargreaves Lansdown, warns that due to these new freedoms “(fraudsters) can target the over 55s, and some unwary investors are going to get drawn into these schemes.”

Read more about this on the BBC website.

Scottish wages “plummet at rate not seen since 19th century”

The rate at which Scottish real wages have shrunk over the past six years hasn’t been seen since the mid-19th century, the Scottish Trades Union Congress (STUC) claims.

In this article from the Scottish Herald the STUC says that the collapse in real wages in Scotland since 2009 is “without precedent” in modern times.

The worst hit are part-time female Scottish workers, who earned 11.6% less over that period than if wages had kept pace with inflation. In contrast, the real wages of financial sector directors and managers rose by 23% over the last year, according to the union body.

General secretary Grahame Smith said: “Benefit cuts have meant society’s most vulnerable have suffered most.”

80% of us are lazy about energy efficiency   

This article from The Express claims that 80% of householders in the UK are “all talk and no action” when it comes to energy efficiency.

Half of us admit to not studying our gas or electricity bills, and eight out of 10 homeowners have no clue of the energy efficiency rating of their doors and windows.

Ian Blackhurst, CEO and founder of the Entu group who sponsored the research, said that “With many (people) struggling to pay bills, this is an area where further education would be beneficial”.

Millions in private parking penalties may have been charged illegally

Penalties for overstays in car parks on private land in England and Wales could in some cases be unenforceable in court, according to a report from the RAC Foundation.

The report, compiled by barrister John de Waal QC, claims that the penalties of up to £100 were much more expensive than the compensation level would be for any genuine loss incurred by landowners.

But the Independent Parking Committee argues that penalties are a landowner’s sole protection against losses incurred by vehicles parked without permission on their land.

The charity estimates that private parking penalty overcharges may have reached as much as £100m in 2013, and millions of drivers could be due a refund.

Read more on the BBC website.

HMRC plan to scrap £100 fines for late tax returns

Radical plans could mean that hundreds of thousands of people will no longer be hit with £100 fines should they be late in handing in their tax return, according to The Telegraph.

HM Revenue & Customs admits that its current system may be too rigid, and is drawing up proposals to end fines for taxpayers who miss the deadline “by a day or two”.

Options for a new system include charging higher interest rates on debts to encourage those who owe the tax to pay sooner, instead of being hit with automatic fines.

A system of penalty points may also be introduced so that financial sanctions apply only to people who persistently fall behind on their tax bills.

And finally… 

When Australian Reg Spiers had his wallet robbed during his visit to London, he was left completely broke. The money he was planning to spend on a plane ticket home for his daughter’s birthday was in that wallet. 

With no means of buying a ticket, Reg decided to post himself back to Australia, as reported by The Daily Record. Building himself a custom-made crate with straps to keep him in place, Reg was put in cargo with the rest of the ‘luggage’ and actually made it back home.

As considerably cheaper as this mode of ‘transport’ may be, we certainly don’t recommend it, readers!

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Rachel Connor has been with the charity for over 8 years, starting in Helpline before joining the MoneyAware team in 2012. Rach enjoys travelling, video games, watching anime, reading and creative writing in her spare time (currently writing a Young Adult fantasy series). She had a previous life as head writer on Cartoon Network's Ed Edd n Eddy and as a copywriter for LivingSocial. She's also written comics and graphic novels for the animated series Regular Show.

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  • David Fleeter

    Wow, stories like these really make my blood boil! Especially when I have had problems with debt in the past! I had to to get some external advice to help me out from a great company called the Chiltern Citezens Advice Bureau Ltd (http://www.canhelp.org.uk/debt) and they managed to help me in a big way. I now no longer struggle with debt. However, I feel sorry for the people who fall victim to stories like these, especially the private parking penalties!