U-turn: Osborne will, after all, cap the cost of payday loans. What’s made him change his mind?

Fee and Chris explain it all to KJ...

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Rip-off News round-up. Our pick of the last week's media (Thu 28th November)

Energy row erupts as winter deaths spiral 29% to a four year high of 31,000

Campaigners say Government should be "ashamed" as official figures reveal thousands of over 75 year-olds perished in Britain during the coldest winter for nearly 50 years. Dot Gibson, national secretary of the National Pensioners Convention, said "How can colder Scandinavian countries avoid this annual toll while we simply wring our hands?” Ed Matthew of the Energy Bill Revolution campaign group said it was mystifying that Germany could "retro fit" a quarter of a million homes a year while in the UK only 219 homes had been insulated under the Government's 'Green Deal'. The figures came a day after Ofgem, the energy industry regulator, said profits at residential supply arms of the Big Six energy suppliers leapt 75% last year after a near 20% increase in gas and electricity prices. TELEGRAPH

Hospital A&Es swamped by 500,000 elderly diverted from failing community care services

Half a million elderly people a year are being unnecessarily admitted to hospital as emergency patients because of stark failings in community care, an official Government report has warned. Almost one in 10 over 75s had been taken to hospital with avoidable conditions – a rise of over 20 per cent in just five years. The conditions include malnutrition, pressure sores and urinary tract infections. The findings suggested that some GPs, care homes and community health services were failing to treat vulnerable people “in the way they deserve”. Inspectors found safety concerns in one in five nursing homes. Problems included failing to give out medicines safely, not carrying out risk assessments and understaffing. The report also identified a link between high staff turnover and number of reported deaths of residents. INDEPENDENT

U-turn: cap on Payday loans unveiled by George Osborne

Announcing a major and politically significant U-turn, George Osborne said the cap on the overall cost of credit was the next logical step as the coalition sought to regulate what had been a wholly unregulated market. The timing of the U-turn led observers to conclude that politics as much as policy had driven the decision. Both the government and the regulator the Financial Conduct Authority (FCA) had been resisting the move despite strong pressure from Labour and individual Tory MPs eager for their party to be doing more to be seen on the side of hardworking people. Only last month, the FCA said there was no need for a cap and the issue had been referred to the Competition Commission for further discussion. GUARDIAN

Half-blind woman crippled with back pain killed herself after benefits bosses stopped her disability payments - following a TWO MINUTE assessment

Despite being in almost constant agony, Jacqueline Harris, 53, was told she was told fit for work in November 2012 following a Government health assessment. Widow Ms Harris was only able to walk with the aid of sticks after she suffered slipped discs in her back and neck. Her sister Christine Norman says arthritic Ms Harris was asked just one question in the 'lightning-speed assessment', carried out by private firm Atos Healthcare. Mrs Norman said they asked her one question: "Did you get here by bus?" Jacqueline replied with one fateful word - "yes". Her assessment lasted just two minutes. In January her benefits were stopped. But Ms Harris had contested the ruling and her first appeal against the decision failed.  A second Department for Work and Pensions tribunal hearing in Cardiff was due to take place on November 15. However, Ms Harris was found dead at her home on November 2, having taken a suspected overdose. DAILY MAIL

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Graphs at a glance: the regional impact of excessive debt

In November 2013 The Money Advice Service, set up by the UK government, released a report on the debt burden. The report states:

Across the UK approximately 8.8 million people are over-indebted. These are individuals who have been at least three months behind with their bills in the last six months or have said that they feel their debts are a heavy burden. This large and diverse group represents 18% of the UK adult population

Most startling is the concentration of debt stress in certain cities and certain regions. In areas more than 4 in 10 people (more than 40% of the local population) are over-indebted.

Money Advice Service

It may also be surprising that only 1 in 5 (20%) of over-indebted people are those dependent on benefits. The great majority are working people earning salaries.

Money Advice Service

It is said that a drowning man will grab at any straw. "Austerity" is the straw our government enthusiastically waves like a cheer-leader's baton because it is not their own voters who are drowning.

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RBS accused of making money by forcing small and medium-sized businesses into bankruptcy

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Graphs at a glance - Who do MPs represent? What did they do before becoming MPs?

In an earlier post we published graphs showing the unrepresentative number of private school and Oxbridge types among our MPs. One could argue that going to private school and Oxbridge is largely an accident of birth. Your parents need to be able to afford the fees to get into private school, and that gives you a great advantage getting into Oxbridge (UK students from private schools (6% of all students) make up 42.5% of undergraduates at Oxford and 36.7% at Cambridge). 

On the other hand, what you choose to do for a living is down to you.

According to a Parliamentary report, there has been a great leap forward in the number of "political organisers" (local politicians and other political creatures) becoming MPs. At the same time there has been precisely equivalent collapse in the number of people the report classes as 'manual workers'. 

Former "political organisers" now outnumber those coming from other professions as follows:

• 10 times more political organisers than doctors
• 3.7 times more political organisers than school teachers
• 2.8 times more political organisers than manual workers

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Liebrary: Does Government "Help To Buy" help house buyers on modest incomes get 95% mortgages? Shelter, the housing charity, reveals that people on average incomes can't actually afford repayments on 95% mortgages

UPDATE JAN 2017: One of the government's flagship home ownership programmes, the Help-to-Buy Mortgage Guarantee scheme, ended on 31st December 2016. It has helped more than 100,000 individuals or couples onto the property ladder. The Council of Mortgage Lenders said it had worked "exceptionally well", making mortgages more available when it started in October 2013.

However Shelter argued that the scheme helped to push up house prices, and only helped those who needed little or no help. They said: “Drawing on official statistics and analysis, this research finds that Help to Buy has added around £8,250 to the average house price. In other words, it has helped a small number of people to buy, at the expense of worsening the overall affordability crisis for everyone else.”

Meanwhile, the Tory’s more recent 'affordable' starter homes programme kicks off in 2017. But Shelter points out that these “affordable homes” will cost up to £450,000! No doubt the perverse results will be the same. READ ON...


The Conservative led government's "Help To Buy" provides £12 billion of guarantees allowing people to buy houses with just a 5% deposit. This government guarantee enables them to take out a 95% mortgage. 

We pointed out in an earlier post that this subsidy is available to people buying homes for up to £600,000 - i.e. not aimed at those on modest incomes, nor at first-time-buyers.

We were scolded by some, who said that while £600,000 was the upper limit the subsidy was also available for those on modest and low incomes aspiring to less than a 4 bedroom detached house in Surrey. 

Shelter's "Homes for Forgotten Families" report

A report by the housing charity "Shelter", released in August 2013 shows this is actually not the case.

Their report shows that in almost three quarters of England families on an average (median) income could not afford the repayments on a 90% mortgage (let alone a 95% "Help To Buy" mortgage) for an average 3 bedroom home in their area.

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Tory leak says the prime minister is going round Number 10 saying: 'We have got to get rid of all this green crap!'

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Rip-off News round-up. Our pick of the last week's media (Thu 21st November)

Government admits fiddling figures to hide failings of fit for work test

Work and Pensions Select Committee member Sheila Gilmore MP has today revealed that the number of sick and disabled people wrongly declared ‘Fit for Work’ by a Government benefits test could be far higher than previously thought. This followed a letter from Tory Work and Pensions Minister Esther McVey in which she admitted figures are ‘not clear’ and promised to ‘ensure greater clarity in future’. Gilmore said: “Up to now we thought that the assessment was getting about one in ten fit for work decisions wrong – far too many in most people’s eyes – but now we know the Government have been fiddling the figures, the reality could be much much worse.” SHEILA GILMORE MP

Top Executive pay rises by 14% as awards linked to shares soar

FTSE 100 executive pay increased by 14% last year to £2.1m.  Companies are accused deflecting public scrutiny of directors' spiralling pay by moderating rises in the well known and more widely quoted salary and bonus figures, but quietly increasing share-based awards. While basic salaries rose 4.1% and annual bonuses fell by 8.8%, the total pay package for an average FTSE 100 director rose sharply by 14% through a 58% surge in the value of long-term incentive plan (LTIP) awards being cashed in. Latest labour market statistics show average UK annual wage increases of 0.7%. Frances O'Grady, TUC general secretary, responded: "The time has come for legislation to put ordinary workers on the pay committees of companies. This is the only way to bring some sanity to the way in which directors are paid." GUARDIAN

Boris Johnson says super-rich are ‘put-upon minority’ like homeless people and Irish travellers

Mr Johnson accused “everyone from the Archbishop of Canterbury to Nick Clegg” of bullying the group he defined as “zillionaires” – and said the most rich of all should receive “automatic knighthoods”. INDEPENDENT TELEGRAPH

JP Morgan Chase agrees record $13bn settlement in the US over toxic mortgages, and opens door to criminal prosecutions

The fine in the US, the biggest civil settlement with any single company, ends several investigations and lawsuits brought by the US authorities related to the sale of home loan bonds between 2005 and 2008. Crucially, and unlike settlements and fines in the UK, the bank’s admission of wrongdoing is a major victory for the US Justice Department. Banks have fought shy of such statements fearing yet more legal actions from investors. The settlement leaves open the possibility of potential criminal charges. While this agreement ends a troubled chapter for the bank, other issues remain. A criminal investigation of the bank over mortgages will continue. The bank is also under scrutiny for its hiring practices in China, its massive “London Whale” trading losses and its relationship with Bernie Madoff, the Ponzi scheme fraudster. GUARDIAN

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At the lavish annual Lord Mayor's Banquet, Cameron says Britain needs cuts. Permanently

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Graphs at a glance - Who does Parliament actually represent?

As we watch the government make our lives harder with cuts in pay, pensions, benefits, the creation of 'two tier' services and generally soaring inequality we tend to forget that it is we who put them there. They are not our rulers, they are our representatives.

Rulers rule in their own interests. They hold their power and wealth by force of law and arms. The spoon belongs to them, and they ladle out goodies to whom they wish.

Representatives in a democracy rule in the interests of those they represent. They hold their power because we give it to them in elections. The spoon belongs to us, and we trust them to ladle out goodies in all our interests.

Inevitably, whether it is Ruler or Representative holding the ladle, it is the closest people who get served most generously and those furthest away who get the dregs.

We provide some graphs using data from a House of Commons report to show who is closest to our representatives in Parliament. Perhaps they provide a clue why successive Tory and Labour governments have steered Britain back to Victorian levels of inequality:

a) According to Department of Education data, just 1% of England's school leavers in 2009/10 went to Oxbridge, compared to a quarter of MPs. 48% of England's school leavers did not go to university at all.

b) 6% of children are privately educated. In contrast, over half the Tory MPs and over a third of all MPs from the three main parties went to private schools.

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