Tagged: credit cards

Iain Duncan Smith Had Expenses Credit Card Suspended

Iain Duncan Smith had his official credit card suspended after racking up more than £1,000 in expenses debt, it has been revealed.

The Work and Pensions Secretary is one of nineteen MPs subjected to action by the Commons watchdog, over potential invalid spending.

The revelation comes after Iain Duncan Smith had previously backed the introduction of prepaid cards for benefit claimants.

Details released in response to a Freedom of Information (FOI) request by the Press Association, reveal that the watchdog has suspended the credit cards of nineteen MPs since the beginning of 2015.

The Independent Parliamentary Standards Authority (Ipsa) issue credit cards to MPs to use for expenses costs, such as travel and accommodation.

Politicians are required to prove that spending on the cards is legitimate within one month. Failure could result in a build-up of debt, which would be recovered by refusing further expenses payments made through the cards.

According to the FOI response, Iain Duncan Smith’s card was blocked after he owed £1,057.28. He is no longer owes any money.

Full story : http://northstar.boards.net/thread/165/duncan-smith-expenses-credit-suspended

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Council Tax Debt Problems Soar 20% In A Year

Council tax debt has overtaken credit cards as the most common form of debt requiring advice and support, says a leading charity.

The Citizens Advice Bureau (CAB) says it expects to help more than 191,000 people struggling to pay Council Tax in 2014/15 – up 20% on the previous year.

And according to a report from the CAB, rising rents could result in up to 122,800 people requiring help with rental debts by the end of March 2015.

The Government abolished Council Tax Benefit at the end of March 2013, meaning that some of the poorest people are having to pay for the very first time.

The move has resulted in a postcode lottery, with benefit claimants and low-income households paying more in some areas than others, depending upon each local authority’s Council Tax Reduction scheme.

A growing proportion of people are approaching the CAB for help and advice on paying rent, council tax, water and fuel debts. Meanwhile, financial issues related to credit cards, mortgages and unsecured personal loans have declined.

While more households are struggling with Council Tax and housing costs, debts resulting from credit cards are expected to fall by 12% in 2014/15 – exposing the ‘changing face of household debt’.

The mainstream credit problems of the post-2008 period have turned into problems with priority debts, says the CAB.

Despite a recent fall in fuel and petrol prices, the CAB also highlights how households have had to endure a 210% rise in energy costs over the last 10 years.

The CAB highlights how the Office for Budget Responsibility expects household debt to soar to a record high of £2.43 trillion by 2019.

There has also been a significant rise in the amount of debt held by self-employed people – up 41% to £20,000. They now represent the highest percentage of people helped by the CAB at 29%.

Citizens Advice is carrying out a separate study about the challenges that self-employed people face.

Behind the self-employed come unemployed people, who have an average debt of £17,500. Pensioners come in a close third, with an average total debt of £17,200.

13% of CAB clients had ten debts or more.

Source – Welfare Weekly,  16 Feb 2015

http://www.welfareweekly.com/council-tax-debt-problems-soar-20-year/

Six North-East areas are in country’s top 20 debt hotspots, report reveals

Six of the country’s biggest “debt hotspots” are in the North-East, a report has revealed.

South Tyneside, Darlington, North Tyneside, Gateshead, Middlesbrough and Northumberland have some of the biggest clusters of people seeking help from Citizens Advice in England and Wales.

The charity dealt with 405 clients in Denbigshire between July and September – or 0.54 per cent of the adult population – making this area of North Wales the top debt hotspot.

South Tyneside was fourth with 607 clients seen (0.5 per cent); Darlington joint fifth with 410 clients (0.49 per cent); North Tyneside joint seventh with 776 (0.48 per cent); Gateshead 748 (0.46 per cent) and Middlesbrough 499 (0.46 per cent) in joint 11th and Northumberland in joint 15th place with 1,166 clients seen or 0.45 per cent of its adult population.

The charity, which has helped almost half a million people with debt over the last year, made the findings after analysing the cries for debt help it received over the three month period.

Citizens Advice said since the economic crisis, problems with consumer debt such as credit cards and personal loans have fallen significantly. By contrast, problems with “priority debts” such as rent arrears and council tax debts are growing.

 It is seeing increasing numbers of people tipped into problem debt by everyday living costs rather than some particular life event such as the loss of a job or divorce.

Gillian Guy, chief executive of Citizens Advice, said:

“Times have changed, and so have people’s debt problems.

“Consumer debts like credit cards and personal loans have traditionally been the most common debt problems. But now priority debts such as council tax arrears are gradually building up as people struggle to cover everyday costs.

“In the past, people were more likely to get help for debt problems triggered by life events such as illness, redundancy or separation.

“But in recent years more people are being pushed into debt as they struggle to stretch their income to cover everyday living costs.”

Here are the biggest debt hotspots across England and Wales, according to Citizens Advice, with the number of people it helped between July and September, and also expressed as a percentage of the local adult population:

1. Denbighshire, 405, 0.54%;
2. Merthyr Tydfil, 248, 0.53%;
3. Stoke-on-Trent, 1,031, 0.52%;
4. South Tyneside, 607, 0.50%;
=5. Darlington, 410, 0.49%;
=5. Salford, 908, 0.49%;
=7. Copeland, 276, 0.48%;
=7. North Tyneside, 776, 0.48%;
=9. Mendip, 411, 0.47%;
=9. Liverpool, 1,793, 0.47%;
=11. Stevenage, 303, 0.46%;
=11. Gateshead, 748, 0.46%;
=11. Middlesbrough, 499, 0.46%;
=11. Torfaen, 330, 0.46%;
=15. Northumberland, 1,166, 0.45%;
=15. Lincoln, 348, 0.45%;
=17. Cannock Chase, 336, 0.43%;
=17. Barrow-in-Furness, 240, 0.43%;
=17. Hastings, 310, 0.43%;
=17. Sandwell, 1,015, 0.43%

Source –  Northern Echo,  06 Dec 2014

Hartlepool residents rack up £7.5m debt mountain

Hundreds of people in Hartlepool have been forced to plead for help after racking up personal debts worth £7.5m in just a year.

 Shocking new figures reveal Hartlepool Citizens’ Advice Bureau supported 1,500 people with debt and money advice over a 12-month period – with the average debt a staggering £16,000.

Worried officials at the Park Road-based CAB say they are very concerned with the high level of personal debt their clients have, some of which is more than £100,000.

Not everyone in money trouble seeks help or advice from the CAB either so the £7.5m figure – which is similar to previous years – is likely to be even higher.

Personal debt includes everything from credit cards, personal loans, pay-day loans, mortgage and rent arrears, council tax arrears, catalogue debts and bank overdrafts.

The figures relate to the period between April 1, 2013 and March 31, 2014. In 2012, the figure was around £8m and worried officials say there has been no “let-up”.

Joe Michna, CAB manager, said: “There has been no let up or reduction in the number of people contacting us with debt related problems.

“The debt levels, given that they are average figures, are concerning.

“While the average debt may be £16,000 excluding mortgages, some clients have debts of well over £50,000 when they contact us.

“We deal with clients who have personal debts of everything from a few thousand through to £100,000.”

Officials say the golden rule for those experiencing money trouble is to seek help or advice early.

The CAB offers two services, a Debt Advice Service and a Money Advice Service, which offers help and support from everything from financial planning to budgeting.

CAB staff aim to re-arrange and improve debt-ridden clients’ financial affairs by gathering information on a client’s indebtedness, confirming household income, alerting clients to other potential sources of income, and identifying priority debts.

Once a full and complete picture of a client’s financial situation has been established, the CAB team can help to identify the most appropriate option for dealing with the particular client circumstances which include self-help support packages, negotiations with client creditors and bankruptcy applications.

The debt and money advice services gave advice and assistance to a combined 1,500 clients.

Mr Michna added: “The golden rule for people who have gotten themselves into debt is to seek advice early.

“We are fortunate in that we can offer two services to local people – a full debt advice service and also a money advice service.

“The money advice service can offer advice on budgeting, financial planning and income maximisation.

“We then have our full debt advice service which offers advice and assistance with debt relief orders, bankruptcy and individual voluntary arrangements as well arranging repayment plans with creditors.”

 

Source –  Hartlepool Mail,  16 July 2014

 

Council Tax Arrears Become Most Common Debt Case At Citizens Advice

This article  was written by Hilary Osborne, for The Guardian on Sunday 25th May 2014

 Council tax arrears are driving more people to seek help than any other form of debt following changes to the way struggling families are supported, the charity Citizens Advice said on Monday.

In the first three months of this year, the charity helped 27,000 people who had fallen behind with council tax bills, a 17% increase on the same period of 2013, and one in five of those reporting debt problems had an arrears issue. The charity said the increase had come in the wake of the abolition of council tax benefit in April 2013, and its replacement with new support from local councils. Levels of help vary from council to council, and as of March this year, 244 out of 325 councils in England required all working-age households to make some contribution, regardless of income.

The first wave of changes drove up the number of council tax arrears cases Citizens Advice dealt with to the point that they overtook problems with credit cards and unsecured personal loans for the first time.

Of those contacting the charity about council tax arrears, 42% were employed and 28% unemployed. The rest were full-time carers, or similar.

Of those seeking help with debt generally, one in five had problems with an unsecured loan and the same proportion had a fuel debt issue. One in six had problems with a credit or store card and 5% were behind on a mortgage or secured loan.

Gillian Guy, chief executive of Citizens Advice, said: “Consumer debts like credit cards and personal loans have traditionally been the most common debt problems that come through our doors, but since the end of council tax benefit we’ve seen council tax arrears problems go through the roof.”

Guy said that for some households, council tax bills were the tipping point that plunged them into debt.

“Last year, more than 90,000 people came to Citizens Advice looking for help with council tax arrears as they struggle in the face of low incomes, rising prices and reduced financial support,”

“As their budgets shrink, local authorities are increasingly stretched, but they must ensure that the resources available for their local council tax support scheme are focused on those who are most in need.”

The areas with the largest proportion of clients with council tax arrears were all outside London, and include Salford near Manchester, Stoke on Trent, Rutland and Redcar & Cleveland.

Local authorities can instruct bailiffs to recover unpaid bills or apply to have payments deducted from wages.

Source – Welfare News Service,  26 May 2014

http://welfarenewsservice.com/council-tax-arrears-become-common-debt-case-citizens-advice/

Britons Travelling Or Studying Abroad Forced To Sit Jobcentre Residency Test

This article  was written by Leah Green, for theguardian.com on Wednesday 21st May 2014

 British citizens travelling or studying abroad for more than three months are being refused benefits on their return under new rules designed to crackdown on benefit tourism from eastern Europe.

Changes to the habitual residence test, designed to make it harder for European Union migrants to claim benefits, mean UK citizens who have been abroad for an extended period cannot claim jobseeker’s allowance (JSA) for the first three months after their return.

It means that people who travel for more than three months – including gap-year students, graduates and people taking career breaks – are being denied JSA to help them while they find a new job.

The new rule came in on 1 January, the same day it became legal for migrants from Romania and Bulgaria to enter the UK on work visas. In a government-issued statement on the new rules, the work and pensions secretary Iain Duncan Smith said: “The British public are rightly concerned that migrants should contribute to this country, and not be drawn here by the attractiveness of our benefits system.”

However, in attempting to combat predicted “benefit tourism” from eastern Europe, the government has made it impossible for UK citizens returning from abroad to claim as well.

Yvette Cooper, shadow home secretary, said:, “British-born citizens who have been travelling, doing internships or living abroad temporarily shouldn’t be treated in the same way as those coming into our country for the first time.

“Habitual residency rules should be about making sure people who are new arrivals to the UK, and have not yet made any contribution or commitment to this country, do not claim benefits they are not entitled to. British citizens are in a completely different situation, and the government should recognise that.”

Rosie Smith, 24, and her boyfriend Alexi Dimond, 29, are both from Sheffield and returned to the country in March after almost six months living and doing voluntary work in Thailand. Smith had been in the same city since she was born. She wanted “a bit of a change”, she said: “I had been in Sheffield my whole life. I just wanted six months not in Sheffield.”

Smith saved money from her job as a nursery nurse, while Dimond worked in administration at an NHS dental hospital. When they got back, they wanted to look for work immediately and registered with the Jobcentre the next day. Dimond claims the person asking him questions for the habitual residence test was “very apologetic” for even making him undergo it.

He was told he was not, under the new benefits rules, considered habitually resident in the UK and would have to wait three months before claiming JSA. “I thought it was outrageous really,” he says, “I’ve contributed tax for the last six years working for the NHS. I think it’s ridiculous I’m not entitled to anything.” He now had no money at all, he said, and was relying on friends for food. Smith has moved back in with her parents.

Alongside his job, Dimond had done voluntary work with asylum seekers for five years before leaving the UK. When enquiring at the Jobcentre how he was supposed to survive, he was handed a leaflet entitled Emergency Help in Sheffield. It is the same leaflet he was issuing to asylum seekers before he went away. “It’s basically the help you get when there is literally nothing else,” he explained.

British citizens have always had to take a habitual residence test before being granted benefits, but only since the rules changed on 1 January have people been told they automatically fail for spending time out of the country.

Sam, 25, is back living with his parents in Manchester for the first time in seven years after being refused JSA on his return from a year in the Netherlands where he was doing a master’s in psychological research.

Sam had hoped he would get a job as soon as he got back “but that’s not the case,” he said, “so I applied for jobseeker’s soon after I got back.

He was taken aback to have his application for benefits turned down. “I think if you’re looking for work you should get jobseeker’s allowance. That’s what makes sense,” he said.

Sam’s parents are providing his food and shelter, and he is dipping into savings to travel to job interviews in London. He realises he is lucky to be cared for, claiming it is unfair on others “who don’t have that support. You would think then that support should come from the government.”

However, he is sympathetic to a tougherstance on immigration, agreeing that migrants “shouldn’t be able to claim [straight away] if they come from abroad.”

Emma Birks, 36, was a volunteer co-ordinator at a worker’s co-operative in Birmingham before deciding to go travelling in south-east Asia. “I’d been putting it off and putting it off,” she explained, “and then sometimes you think ‘life’s too short’.”

Since she got back in March, Birks has had no home and has been living between the houses of “three or four” charitable friends. She has been surviving by taking handouts and using credit cards. Because of her work, she knew about the habitual residence test and never dreamed she would fail it. She describes her situation now as “a bit demoralising and humiliating.

“The whole point of jobseeker’s allowance is to help you in that interim period where you’re looking for work, trying to find a new start or whatever. To me, that’s the whole point of jobseeker’s and it’s just failed me basically,” she said.

Dimond agrees. When we speak, he and Smith are at the beginning of five days of agency work, stopping people in a Doncaster shopping centre and collecting surveys about the facilities. He has had to borrow the money to get to work, and estimates he already needs “about six months” to catch up on his debt, assuming he gets a job soon. “It’s seriously affected my job search,” he said. “I don’t have money to get to interviews.

Smith thinks they are victims of statistics. The Department for Work and Pensions (DWP) “are just trying to get as many people off their system so they can make their numbers look better … so they can say hardly anyone’s signing on anymore. But they’re just disqualifying everyone,” she said.

A DWP spokesman said: “It has always been the case that any UK national who chooses to live or work in another country for an extended period must, if they return to the UK and want to claim benefits, satisfy the habitual residence test by proving they have strong ties to the country and want to remain here.

“People who have paid enough national insurance in the UK do not have to wait for three months before claiming jobseeker’s allowance.”

The spokesman did not respond when asked how much national insurance was enough, but none of the people interviewed were exempt from waiting three months.

The announcement of the changes in December confirmed the the introduction of the new three-month period in which people cannot claim benefits.

Source – Welfare News Service,  21 May 2014

http://welfarenewsservice.com/britons-travelling-studying-abroad-forced-sit-jobcentre-residency-test/