Rip-off News round-up. Our pick of the last week's media (Thu 19th September)

Quarter of MPs give jobs to family: Taxpayers' bill for politicians who employ wives and children soars to £4m a year

Despite fury over parliamentary expenses, 155 MPs – nearly one in four – now have wives, children and even parents on the public payroll. The relatives enjoy salaries as high as £50,000 for office duties – costing taxpayers £4million last year. Hypocritical MPs dishing out taxpayers’ money to relatives while arguing for a freeze on public sector pay include Cabinet minister Michael Moore, health minister Dan Poulter and foreign minister Alistair Burt. MIRROR DAILY MAIL

MPs' expenses rise to record high

The bill for politicians is higher than it was before the 2009 MPs' expenses scandal, with claims of almost £100m last year, official figures show. The total cost of travel, accommodation and running the offices of MPs rose by 10%, which is thought to be a record for claims by politicians in a single year. After the scandal broke, MP's claims fell to £90.7m as parliament brought in an independent watchdog to keep down the bill. The independent parliamentary standards authority said the cost to taxpayers was higher this year because MPs were allowed higher staffing budgets. GUARDIAN

Benefit fraud could lead to 10-year jail terms, says DPP

The Director of Public Prosecutions, Keir Starmer QC, said it was time for a "tough stance" on the £1.9bn annual cost of the crime. Suspects can now be charged under the Fraud Act, which carries a maximum sentence of 10 years. In the past, benefits cheats were commonly charged under social security legislation with a maximum sentence of seven years. In 2012 the number of offenders jailed for benefit fraud was 262 and the average sentence length was six months and one week. Last year the CPS saw more than 8,600 such prosecutions. The changes mean welfare cheating would now be classed alongside offences such as money laundering and banking fraud. BBC NEWS

Barclays to refund £100m to at least 300,000 borrowers

Barclays Bank is to refund at least 300,000 personal loan customers because it made mistakes on their paperwork. If mistakes are made in loan paperwork, all interest paid must be returned. The errors date back to October 2008. It is now investigating whether similar mistakes had been made in other parts of the business such as Barclaycard. This is the latest in a catalogue of problems for the bank including: a £290m fine for attempting to manipulate Libor; £2.6bn to compensate customers who were mis-sold payment protection insurance; setting aside £850m to compensate businesses that were mis-sold products to insure them against interest rate rises. BBC NEWS

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New “tough stance” means all benefit fraudsters face increased sentences of up to 10 years in jail

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Graphs at a glance: The poorest fifth of Britons pay a higher rate of tax than the richest fifth says the Office for National Statistics

The wealthy and their pals in government and in the media whine that they are over taxed. The fact according to the UK government's Office for National Statistics is the wealthiest fifth of Britons pay a lower rate of tax than the poorest fifth. ONS figures reveal:

• For every hundred pounds of a rich man's income £35.50 is paid in tax.
• For every hundred pounds of a poor man's income £36.60 is paid in tax.

How is this possible? Because these figures include both direct taxes (e.g. income tax) as well as indirect taxes (e.g. VAT). 

Each Quintile is 20% (a fifth) of all households, from poorest to richest.

When hunting for a tax cut the rich lobby only talks about Direct Taxes (income tax, national insurance etc). They conveniently ignore Indirect Taxes (VAT, excise duties etc). Indirect taxes are taxes on spending. The poor spend all they have, while the rich don't - resulting in spending taxes hitting the poor harder.

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The Royal Mail is to be privatised to stop it “competing for funds with our schools, our hospitals.”

...or will it, wonder Fee, KJ and Chris...

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Rip-off News round-up. Our pick of the last week's media (Thu 12th September)

Poor forced to use food banks? They've only got themselves to blame for making bad decisions, says Michael Gove

The Education Secretary argued that people who find themselves unable to buy essentials, including food and school uniforms have themselves to blame for being unable ‘to manage their finances’. More than half a million people across Britain have turned to food banks to stave off hunger, according to charities. Cuts to benefits, frozen or falling wages and rising living costs have been blamed in part for some people struggling to make ends meet. DAILY MAIL

British Social Attitudes Report finds softening attitudes to benefits

The annual British Social Attitudes Report found 51% said benefits were too high in 2012, down from 62% in 2011. According to the NatCen Social Research survey, sympathy for those without jobs has increased, and support for benefit cuts has fallen. In February last year the Welfare Secretary Iain Duncan Smith strongly condemned those who appear to have manipulated the system to gain as many benefits as possible. But the survey suggests that British people no longer have as much sympathy with this view. The proportion of people found to be supportive of extra spending on benefits rose to 34% in 2012, compared with 28% in 2011. BBC NEWS

Vince Cable criticises Osborne's controversial Help To Buy scheme that boosts mortgages with taxpayer money

The Help to Buy mortgage scheme has proved controversial since the moment the plans were unveiled in Chancellor George Osborne's March budget. The list of critics is long, growing and varied, ranging from the Institute of Directors to the Organisation of Economic Co-operation and Development. Now Business Secretary Vince Cable has contributed the most damaging criticsm so far. He called for a rethink. "We should certainly think about how it should come into effect, indeed whether it should come into effect, in the light of changing market conditions. We don't want a new housing bubble". TELEGRAPH

UK unemployment rate falls from 7.8% to 7.7% in the last 3 months, but youth unemployment rises

Despite the improving picture, there was also evidence in the detail of the figures that conditions in the labour market remain tough for many. Average pay rose at an annual rate of just 1%, or 1.1% including bonuses – well below the 2.8% rate of inflation – suggesting that living standards are still being squeezed. The ONS also highlighted the fact that much of the increase in employment – almost all of it, for women – has been in part-time work, in many cases taken up by employees who would prefer a full-time job if they could find one. Young people are also failing to feel the benefit of the upturn, with youth unemployment 9,000 higher in May to July than three months earlier, at 960,000. GUARDIAN

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MPs can claim up to £2,425 in travel expenses to pay for their childrens' visits

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Graphs at a glance: How re-mortgaging covered up the theft of Britain's growing wealth in the boom, and helped cause the bust.

In Douglas Adams’ excellent Hitchhiker’s Guide To The Galaxy series there is a scene where an animal, the Ameglian Major cow, has been bred to want to be eaten. It meanders around the restaurant and persuades diners to partake of pieces of itself:

'Good evening', it lowed and sat back heavily on its haunches, 'I am the main Dish of the Day. May I interest you in the parts of my body?'

'Something off the shoulder perhaps?' suggested the animal, 'Braised in a white wine sauce?'

The Ameglian cow had been persuaded to feel good about being eaten. Once the diners had decided to feed on its rare steaks the animal

staggered to its feet. It gave a mellow gurgle. 'A very wise choice, sir, if I may say so. Very good,' it said, 'I'll just nip off and shoot myself.'

An equivalent scam was pulled off on us ripped-off Britons in the years leading to the Credit Crisis that kicked off in 2008. Britons were persuaded to turn their assets into spending money, consuming themselves. Banks offered cash and other companies selling anything from cars to cupboards offered easy credit. Whatever was necessary was provided to get Britons to consume more.

A favourite path into debt was “Housing Equity Withdrawal” (HEW): the process of converting housing assets into spending money. Frequently done by increasing the mortgage on your house.

Data from the Bank of England shows how HEW boomed in the years of the Labour government leading up to the Credit Crisis:

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One in five British workers now earn below the living wage

Chris is with one of our top CEOs...

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Rip-off News round-up. Our pick of the last week's media (Thu 5th September)

20% of British Workers earning 'Below Living Wage'

The think tank The Resolution Foundation said it meant that a total of 4.8 million Britons, 20% of all UK employees, were paid at a level below the rate deemed necessary for a basic standard of living, an increase from 3.4 million in 2009. They said: "Britain has a sorry story to tell on low pay. Only a handful of our close competitors do worse and the large majority have much lower rates of low pay - sometimes half as much." SKY NEWS

Bank of England: consumers turn to loans, credit cards and overdrafts

Data from the Bank of England, released on Friday, show that the 3.5% annual increase in consumer credit, which includes borrowing on overdrafts, credit cards and unsecured loans, was the most rapid increase in four-and-a-half years. The fresh evidence of consumers' willingness to turn to costly borrowing on personal loans – which charge average rates of more than 7%, compared with the Bank's base rate of 0.5% – will increase fears that the UK is experiencing an unsustainable, "Alice in Wongaland" recovery, a phrase coined recently by the economist Ann Pettifor. GUARDIAN

Wonga profits leap 35% as demand for loans increases

Wonga, the short-term loans provider, has reported pre-tax profits of £84.5m for 2012, an increase of 35% on the previous year. In its annual statement, Wonga reported £1.2bn in lending, an increase of 68%. Wonga has also opened a business lending arm, and expanded abroad. So called "payday loan" firms, which often lend to those who cannot get a loan from a High Street bank, are currently the subject of a Competition Commission review. BBC NEWS

G20 summit: states chase tax evaders with plan to swap data globally

World leaders attending the annual G20 summit are expected to promise to develop powerful tools to help the authorities combat international tax evaders, with a deadline of next June. New treaties will require financial institutions to automatically disclose customer assets to overseas tax bodies. This bold approach has been pioneered by the US and has attracted accusations from tax havens of human rights abuses and economic imperialism. But the G20 nations will all sign up to the measures. Meanwhile, the G20 heads of state are also expected to give their formal backing to an unprecedented programme of tax reform designed to curb widespread tax avoidance strategies pursued by multinational corporations. GUARDIAN

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Vodafone to pay no UK tax on £84bn Verizon sale

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