Credit Action News Round-up (30 November 2011)

Chancellor makes Autumn Budget Statement: Chancellor George Osborne yesterday (29 November) set out the details of Government plans for the economy in his Autumn Statement. Some of the key headlines from the announcement include:

- Parents: Around 40% of two-year-olds are to benefit from free nursery education. The Government has said it will invest a further £380 million a year by 2014-15 to extend its new offer of 15 hours free education and care a week for disadvantaged two year olds to cover an extra 130,000 children.

- Pensioners: The state pension age will be raised to 67 between April 2026 and April 2028. Meanwhile, in April 2012 the basic state pension will rise by £5.30 to £107.45 (due to the “triple lock” measure introduced by the Coalition, which means state pension rises each year in line with either earnings or prices, or by 2.5%, depending on which is the highest).

- Commuters: Rises to rail fares will be capped at RPI + 1% for one year from 2012 (this applies to regulated rail fares and travel on the London Tube and buses).

- Motorists: The 3.02 pence per litre (ppl) fuel duty increase set to take force in January has been postponed until 1 August 2012. The inflation increase that was planned for 1 August 2012, currently expected to be worth 1.92 ppl, has been cancelled.

- Council tax: The Government is providing funding to Local Authorities in England to enable them to freeze council tax for another year.

- First-time buyers: The government will introduce a new build indemnity scheme which will allow 100,000 home buyers to purchase new build houses and flats with a 5% deposit.

- Public sector workers: Public sector pay awards will be set at an average of 1% for each of the two years after the current pay freeze comes to an end. Departmental budgets will be adjusted in line with this policy, except for the Health and Schools budgets, where the money saved will be recycled.

 You can view the Autumn Statement in full by clicking here.

Largest public sector strike in a generation takes place: However, the Chancellor’s announcement took place against the backdrop of plans for a huge public sector strike, which is underway today (30 November). At least two million workers are due to walk out in protest at proposed reforms to pension arrangements. The changes would see public sector workers being required to pay more into their pensions, work for longer, and accept pensions on a “career average” basis rather than the “final salary” schemes that many are currently on. More than 1,000 demonstrations are expected to take place across the UK as part of what has been called the largest public sector strike in a generation. A wide range of public sector unions are involved in the action, which is being co-ordinated by the TUC.

CBI report forecasts bleak Christmas period for retailers: A survey by the Confederation of British Industry (CBI) has shown that stores are cutting jobs at the fastest rate in two years. The run up to Christmas is usually a period that sees an increased number of staff employed in retail. The survey showed that four in every ten retailers have reduced their staff numbers. This is compared with just 13% of employers who are increasing the number of staff they employ. The CBI also reported that 26% of retailers said they saw sales rise over the 12 months to the end of November, whilst 44% recorded a fall in their sales. This represents a balance of -19, which is the lowest recorded since March 2009.

House price falls accelerated in October: According to the Land Registry, house price falls in England and Wales accelerated in October, down 3.2% on a year ago. The average house price fell £2,020 to £160,000 in the month. The report, which looks at 16 million transactions, said prices fell 0.9% in October compared with the previous month, faster than the 0.3% rate decline seen in September. The Land Registry records completed property sales and features the end of buying process when a transaction is registered. 

Recent Posts

Archives