Bank of England announce no change to the quantitative easing programme

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The Bank of England’s policy-setting committee has unanimously decided in a recent meeting to keep interest rates on hold for another month and keep the quantitative easing (QE) programme unchanged at £375 billion.

Despite the unanimous decision, the minutes of the meeting suggest that some think a change would be necessary in the near future. The minutes suggested that output will be flat for the remainder of the year and the economy will pick up later than anticipated. The committee said, ...

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Pension experts warn about the dangers of auto-enrolment

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Pension experts have warned that the landmark auto-enrolment may be a bad idea for some workers. By 2018 almost nine people will be automatically enlisted into company-backed pension schemes.

The Pensions Institute has commented that those joining an existing defined-contribution scheme could face a poor investment return and high charges. In a report by the Pensions Institute called Caveat Venditor it calls for a removal of high charges on, “legacy,” schemes.

The report states, “Charges for default funds in large new auto-enrolment ...

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Mayor of London calls for further top rate tax cuts

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Mayor of London, Boris Johnson has ended his tour of the Conservative conference by declaring that he would like to see the top rate of tax cut to 40%.

Boris Johnson has said that he wants to go further than George Osborne who lowered the top rate from 50p to 45p in the budget. He said, “In so far as it is significantly higher than other areas, then, yes, I would be in favour of moving towards lower tax rates.”

Boris Johnson ...

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Is global economic recovery slowing?

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The International Monetary Fund (IMF) has stated that the global economic recovery is weakening as government policies have failed to restore confidence. It described the change in economic outlook as, “considerable,” with a further risk of deterioration in the coming months.

The IMF has predicted that the UK economy will shrink by a further 0.4% this year. However the IMF’s long range forecast is positive as it has predicted that the UK economy should grow by 1.1% next year. The UK ...

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Would you like to own the company you work for?

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In a Conservative conference speech, Chancellor George Osborne shared plans that would allow employees to be able to forfeit some employment rights in exchange for a stake in the firm they work for.

George Osborne described that the proposed owner-employee contract would be ideal for staff at fast-growing firms. He said, “This idea is particularly suited to new businesses starting up and small and medium-sized firms.”

“Get shares and become owners of the company you work for. Owners, workers and the taxman, ...

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A change to inflation may hurt pensioners

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Experts have revealed that private sector pensioners, some savers and investors could face changes to the way an inflation measure is calculated.

The Office for National Statistics (ONS) has started a consultation on changes to the calculation of the retail prices index (RPI). As the ONS are independent of the government they want to analyse whether there is any need to make a change. They will investigate whether there is a need for any change, a partial change which could reduce ...

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Liberal Democrat's house deposit plan fails to make an impact on the industry

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Nick Clegg’s Liberal Democrat party has unveiled new plans that will enable pension savers to fund a relative’s house deposit.

Nick Clegg has stated that the government is looking at ways to allow parents and grandparents to help struggling first-time buyers by using a lump sum from their fund as security for a mortgage. This new option would allow the saver to effectively provide a deposit for the property, with the money only called on if the borrower defaulted on repayments.

Chief ...

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Have we seen a change in consumer attitude towards reducing debt?

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Figures published by the British Bankers’ Association (BBA) has revealed that the volume of outstanding loan amounts has almost halved from its peak in 2008.

The data shows that unsecured borrowing from the banks contracted by 3.1% since 2008. The BBA has suggested that this is due to consumers acting, “conservatively,” by repaying loans and shopping around for the savings accounts with the highest interest rates.

The report has also shown that net mortgage lending grew by 0.6% in the year to ...

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Universal credit scheme is heading for disaster

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The governments former welfare reform minister Frank Field has described the proposed programme as, “’practically unachievable” and heading for disaster.

Iain Duncan Smith’s flagship welfare reform programme, under which most benefits will be rolled into one universal credit has come under fire by critics. It is suggested that universal credit is, “practically unachievable” and will, “rot the soul” of low-paid workers by encouraging dependency. MPs will prepare to vote on the reforms in the Commons this week. 

Frank Field has stated that ...

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Bank of England maintain the current rate of interest

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The Bank of England’s Monetary Policy Committee (MPC) has announced that it will keep interest rates at 0.5% and will currently hold off from any further stimulus measures.

This news comes just a day after the Organisation for Economic Co-operation and Development (OECD) has cut its forecast for the UK sharply. In addition to the UK the OECD has also cut its figures for the rest of the Eurozone which includes Germany. The European Central Bank in Frankfurt has also decided ...

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