Wednesday, 27 February 2013

Gas - 54% imported

Where did your gas come from this week?

32% UK production
14% UK gas from storage
Total 46%

31% by pipeline from Norway
21% by pipeline from Holland and Belgium
2% imported Liquified Natural Gas
Total imports 54%

Tuesday, 12 February 2013

Pancake price barely moved

Pancake inflation very subdued - time to get frying!

Official stats say prices rose by an average of 2.7% over the last year and that food prices have been a major factor.

But the good news is that my own pancake index (following the Delia pancake recipe) shows the cost of a pancake rising by less than 1% - a mere 0.76% in fact.

And each pancake costs just 8.8p.

Here's her ingredients list for 12 pancakes...

110g/4oz plain flour, sifted
Price: 8.21p (9.24p a year ago)

Pinch of salt
Not charging for this

2 eggs
Price: 53.33p(51.5p)

200ml/7fl oz milk mixed with 75ml/3fl oz water
Price: 16.1p(16.1p)

50g/2oz butter
Price: 28.4p(28.8p)

Total: 106p compared with 105p a year ago.

Source: Office for National Statistics

Friday, 8 February 2013

Crackdown on 250 PPI claim firms

The Ministry of Justice says it has shut down or warned 252 claims companies dealing with compensation for Payment Protection Insurance mis-selling in the past year.

 A specialist team created to crackdown on bad practice has banned 103 PPI firms from business and warned 149 for poor practices.

The the main causes for consumer concern were: misleading marketing, high-pressure selling, poor complaints systems and unclear fees.

The firms contact PPI victims using texts, phone calls and advertising in newspapers and online. They encourage people to claims and then take 30% of any compensation as a fee.

The majority of complaints the Ministry receives about claims management companies are related to PPI  – 2,405 between 2011-12.

In a drive to further improve the industry, the team will be revisiting the companies who have received official warnings - those that haven’t addressed poor practice will face being banned from business. 

Mortgage rates dive

The cost of mortgages for many borrowers has hit a new low, the result of a government move to make cheap money available to banks and building societies.

First Direct has launched a five year fixed rate at 2.69% and Chelsea Building Society is offering a fixed rate for two years at 1.89%, the latest in a succession of lenders trying to outdo each other with the cheapest offers.

Both require substantial up front fees and are only available to borrowers who can put up a substantial deposit: First Direct is charging nearly £2,000 and requires the borrower to lay down 35% of the price.

The government's Funding for Lending Scheme is channelling billions of pounds to lenders at very low interest rates. Critics have pointed out that the initiative has largely bypassed first time buyers with small deposits.

Instead, most of the cheap offers are taken up by homeowners re-mortgaging or moving house.

And the Scheme has resulted in a sharp downward lurch in interest rates for savers. The financial information firm, Moneyfacts, said this week that the average interest rate for a new tax-free Individual Savings Account, or ISA, had fallen to 1.74% from 2.55% a year ago.

Bolstered by Funding for Lending, banks don't need to compete for savings to raise funds.

Thursday, 7 February 2013

Compulsory money lessons

Department for Education statement on introducing compulsory personal finance education in schools:

"For the first time every pupil will learn the skills to manage their money well and make sound financial decisions.

"We want to make this a statutory part of the citizenship curriculum so every pupil learns the importance of budgeting and sound management of money, credit, debt, and about different financial services and products.

"We have also changed the mathematics curriculum so that they will also be taught about loan repayments and interest rates."

How much time do schools have to spend teaching each subject?

Schools are free to decide how much time to spend on different subjects within the curriculum to meet the needs of their pupils. However, schools must take in to account the range of subjects which must be taught. 

How are school inspected on their use of the curriculum?

Ofsted inspects the schools' curriculum offers.

Kids will learn about money

School children will start learning about tax, debt and money management in school from September, 2014.

Compulsory education about personal finance issues has been included in the draft National Curriculum for England for the first time.

The topics, including wages, budgeting, credit and financial risk will form part of Citizenship classes for 11 to 16 year-olds.

They will also learn about interest rates and other financial issues in their maths lessons.

The change comes after a campaign by money experts and MPs who argued that children were leaving school ill-equipped to deal with financial problems and debt.

It will be up to schools to decide how long they will spend teaching children about money, but the quality of the instruction will be checked by OFSTED inspectors.

So when personal finance hits the National Curriculum - what young people will learn in Maths and Citizenship classes.

Citizenship for Key Stage 3 and 4

The National Curriculum for citizenship aims to ensure that all pupils:
*are equipped with the financial skills to enable them to manage their money on a day-to-day basis as well as to plan for future financial needs.
(that’s as well as learning about government, law, volunteering)

Key stage 3, age 11-14 years
*the functions and uses of money, the importance of personal budgeting, money management and a range of financial products and services.

Key stage 4, age 14-16 years
*wages, taxes, credit, debt, financial risk and a range of more sophisticated financial products and services.

Mathematics Key stage 3

Solve problems
*develop their use of formal mathematical knowledge to solve and devise problems within and outside mathematics, including financial mathematics
*solve problems involving percentage change, including: percentage increase and decrease and original value problems, simple interest in financial mathematics and repeated growth 

Campaigners including the Personal Finance Education Group are celebrating the fact that learning about everyday money will be "embedded" in the school curriculum.

Wednesday, 6 February 2013

2p on income tax?

OK brace yourselves for the tax rises of 2015...

Will it be income tax, will it be VAT? Will it be a combination of different taxes, including more on house sales, inheritance or National Insurance?

Today's Green Budget from the respected Institute for Fiscal Studies points out that by the 2014-15 financial year the Chancellor will be borrowing £64bn more than originally planned to cover his spending.

And that's factoring in all the spending cuts, welfare reductions and tax changes which the government has brought in since 2010.

The borrowing is continuing while the government tries to heave the economy out of its rut and stagger towards the next election.

The point is, what then?

The IFS says:

Over the last 30 years tax rises announced in the year after a general election have averaged £7.5bn.

Considering this trend, and in the context of the current fiscal situation, further tax rises following the next election would not be surprising.

So, maybe an emergency budget after the June, 2015 election, and tuppence on income tax - raising £10bn a year.

Friday, 1 February 2013

Barclays boss gives up bonus

Antony Jenkins, new chief executive of Barclays and Bob Diamond's replacement, is giving up his bonus for 2012.

He says it's because the year was "a very difficult one" after the Libor scandal and the mis-selling of PPI and interest rate swaps.

What will he lose?

His package consisted of:
£1.1m basic pay
Up to £2.75m bonus, paid in shares over 3 years (it’s up to 250% of salary)
Up to £4.4m long term incentive, in shares (up to 400% of salary)
£363,000 cash in lieu of pension (33% of salary)
Taking the package to a potential £8.6m

So not taking the bonus reduces the potential total to just under £6m, effectively, a 32% pay cut – in theory, anyway.

However he was only appointed at the end of August, so while he is giving up his bonus for the whole year, some of it is an amount applicable to his previous job as head of the retail bank.