Paid bereavement leave
From April, The Parental Bereavement (Pay and Leave) Bill (“Jack’s Law”) will come into force and allow parents who lose a child under the age of 18 to take leave as either a single block of two weeks, or as two separate blocks of one week each. Under the new rules, people who have been employed for at least 26 weeks will be entitled to a minimum payment of up to £148 a week during their bereavement leave, depending on the level of their salary.
End to benefits freeze
From April 2020, many working-age benefits will rise by 1.7%, in line with inflation.
Benefits affected by the increase include:
Employment and Support Allowance
Housing Benefit (Local Housing Allowance)
Child Tax Credits
Working Tax Credit
Lloyds and TSB announce new overdraft rates
Lloyds has announced a 40% overdraft rate with effect from 6 April in response to new rules by the Financial Conduct Authority.
TSB will charge a 40% overdraft rate and scrap its £5 daily charge for unarranged overdrafts. It is will also scrap its £6 monthly charge for arranged overdrafts. The monthly maximum charge will be cut from £80 to £30. All changes are effective from 6 April.
FCA querying new overdraft rates
New rules by the Financial Conduct Authority require providers to charge a simple annual interest rate on all overdrafts and to get rid of fixed fees. It hoped that a clear, simple overdraft interest rate would allow customers to compare and move current accounts. However, most banks and building societies have announced expensive 40% overdraft rates. The FCA is now asking for a explanation of how they decided upon their 40% rates, and so creating little competition.
Door-step energy sales increase
According to research by Cornwall Insight, which provides research, analysis, consultancy and training across the energy and water sectors, an increasing number of households are being sold new energy tariffs on their doorstep. However, concern has been raised that this does not allow the customer to compare the tariff against others and door to door sales can be more expensive than online deals.
Guarantor loan company Amigo for sale
Amigo lends money to people with a poor credit rating, but they provide a guarantor. This means if the borrower fails to repay the debt, the guarantor will be asked to. Amigo has received complaints from people who feel they should never have been given a loan, because they were not able to repay it.
Increase in number of County Court Judgements
Official data by the Registry Trust, which collects information on behalf of the Ministry of Justice, shows a record number of county court judgments were issued last year against individuals who fell into debt. This is double the level of eight years ago. The average size of the judgements though has fallen.
Concern about the rapid rise of ‘Buy now, pay later’ services online
Debt charities have raised concerns about the use of “buy now, pay later” services when shopping online. These services allow customers to either delay the whole bill, or split the cost into equal instalments, interest-free. It is not store credit, it is a form of consumer credit offered by a third party company.
“Buy now, pay later” companies are not regulated because they do not charge interest, but the FCA is monitoring the situation and whether it is encouraging consumers into debt.