This is a list of recent news items that may be of interest:
MALG Chair Liz Barclay this morning launched the Finance & Leasing Association and The UK Cards Association’s new publication: ‘Vulnerability; a guide for debt collection – 21 questions, 21 steps’. Both trade associations and a number of other MALG members including the Credit Services Association and the Money Advice Trust, worked in partnership with the University of Bristol’s Personal Finance Research Centre (PFRC) to develop this important work.
The research team, led by Chris Fitch who presented at the MALG Members Meeting in January 2017, captured the experiences of 1,600 frontline collections and specialist staff from 27 UK lenders and debt collection firms, and used them to develop 21 practical and commercially realistic steps that can now be shared across the credit industry for the benefit of customers, but also adapted for use in sectors as diverse as utilities, telecoms, retail and Government.
The guide will help organisations to better identify and support customers in vulnerable circumstances and describes strategies to help staff deal with specific and often challenging vulnerabilities, such as serious or terminal illness, bereavement, addiction, and mental health issues. It also includes guidance on developing training programmes and working with partner agencies.
Download the report.
The Money Advice Liaison Group, a national membership organisation with the aim of ‘working together to improve the lives of people in debt, has an exciting job opportunity for a part time Membership Co-ordinator as part of its re-branding and renewed focus for its 30th anniversary year.
The role will be home-based with regular travel to London and nationwide for two days per week initially.
The successful candidate will be able to work independently and as part of a team in a fast-paced environment and will have a track record of securing and managing relationships with new members and sponsors through external engagement with partners to maximise revenue and achieve sustainable growth.
Candidate requirements include:
- Previous experience in a similar business development/relationship management role, preferably in the financial services or a related sector
- Strong commercial acumen and the ability to influence decision makers
- ‘People person’ who is prepared to ‘go the extra mile’ to meet customer needs
- Excellent verbal and written communication skills
Download the MALG Membership Coordinator Job Description March 2017 (pdf).
If you feel you have the necessary skills and attributes to be successful in this role, please send your CV with covering note to MALG’s Executive Officer Bob Winnington firstname.lastname@example.org. The closing date for receipt of applications is 31 March 2017.
Money Advice Liaison Group members The Money Advice Trust, AdviceUK, Christian’s Against Poverty, Citizens Advice and StepChange have launched a new campaign for bailiff reform called ‘Taking Control’.
Despite the April 2014 reforms, debt advice charities continue to receive reports of widespread problems with the behaviour of bailiffs and bailiff firms.
The ‘Taking Control’ report makes seven key recommendations to the Ministry of Justice in its review of the 2014 reforms, which it is believed will tackle the continued problems. The report also includes recommendations for how local authorities can do more to ensure that bailiffs are only ever used as a last resort.
This is the first time that these seven charities have all worked together in such a coordinated way on a public policy issue.
Visit https://www.bailiffreform.org/ to find out more.
Christians Against Poverty (CAP) has launched a new service, CAP Life Skills. This complements its current debt management work by helping build financial capability through a holistic eight-week course run as a weekly community group meeting.
Statistics show that 57% of British people do not track their spending, only 41% of the population are saving and 65% of CAP clients report that lack of budgeting was a cause of debt. To add to this, cost is often cited as one of the top reasons preventing adults from living a healthier lifestyle and 42% of people suggest they would eat more healthily if they had more money. CAP Life Skills looks at the wider issues surrounding money management to empower and support members to live financially healthy lives through developing the confidence and decision-making skills they need to survive on a low income.
Read more about CAP Life Skills.
The weekly newsletter from Money Advice Scotland features announcements from the Spring Budget, the Money Advice Service webinar on Scottish Financial Education Week, details of a new campaign from The Scottish Government encouraging people to claim the benefits they’re entitled to and more.
Read the full newsletter here.
The Money Advice Service weekly round-up covers what you need to know from the Spring budget 2017, the cost of retirement with a pensions calculator, statistics from the number of first time buyers looking to the bank of Gran and Grandad for a deposit and the best ways to save money with energy and broadband providers.
Read the full round-up here.
R3, the insolvency and restructuring trade body, has published a new briefing showing that 1 in 4 British adults’ mental health is affected by personal finance concerns. The research, carried out in partnership with ComRes, was conducted with over 2,000 adults. Key findings include:
- 24% of British adults say that their personal or household finances are currently having a negative impact on their mental health
- 6% of British adults also say the finances of other family members who do not live in their household are having the same effect
- 41% of British adults say they are worried about their current level of debt
The world of turbulence continues unabated with the Lords vote on Brexit and the latest Budget dominating domestic news. I was in the Houses of Parliament at the time of the Lords debate to celebrate the launch of the Christian’s Against Poverty Life Skills initiative. The focus is on supporting people to develop practical skills and to discover new ways to live for a brighter future. We can all develop these skills no matter what our circumstances. I am developing a flair for cooking meals from scratch; fresh produce which is healthier and saves money too. I’m hardly Jamie Oliver or James Martin, but I’m having a go!
Unveiling the new MALG brand
As I’ve mentioned in recent correspondence, we’ve been working hard at MALG in 2017 on the development of a new look and new focus for our 30thanniversary year.
We can now unveil the new MALG brand, with huge thanks to the Marketing team at Marston Holdings for the weeks of pro bono work that went into helping us develop an updated look and feel:
Within the next few weeks, all existing and new MALG members will be sent a high resolution version of the logo with a ‘member’ strapline along with guidelines for how this can/should be used on your websites, stationery etc. We hope that you are keen to use it as a ‘stamp of approval’ that demonstrates your commitment to our mission of ‘working together to improve the lives of people in debt’.
Our new branding will also feature on our new website and will be updated on our social media channels when the website developments are launched next month.
As part of our renewed focus for 2017, we are in the process of developing MALG’s membership packages. Our new membership strategy is designed to formalise and widen MALG membership to include all of those involved in debt and money advice. The Membership packages available at present are as follows:
- Strategic Membership – for national public/third sector organisations and industry bodies including debt advice organisations, credit reference agencies, trade associations and regulators. This membership formalises the previous membership arrangements with these organisations and bodies and details will be sent to existing members shortly.
- National Business Membership – for companies with a national reach including Banks and specialist companies such as debt collection agencies, enforcement agents, commercial advice providers, creditors and technology providers
- Regional Membership – for local arms of money/debt advice organisations and regional offices of strategic/business members. This Membership is available as previously through the six Regional Forums we have in place.
If you are interested in finding out more about the Membership options, please let me know. Details of our membership benefits/packages and a full list of all our existing members with their logos and web links will feature on our new website.
The new National Business Membership is proving to be a popular addition to our membership options and we are also looking at further additions in the next few months. I will keep you advised on these developments and please don’t hesitate to contact me if you would like any further information.
MALG Members Meeting 6 April 2017
We recently announced a change of date for our next MALG Members meeting from 23 March to Thursday 6 April. A huge thank you to Bond Dickinson LLP for offering to host the meeting at their offices at 4 More London, Riverside, London SE1 2AU. Timings are likely to be 10.30am – 3pm and we have some exciting speakers lined up which we will be announcing soon. Watch this space for full details. I look forward to seeing many of you there and hope it is as well attended, interactive and engaging as January’s meeting!
The Government has published its UK Digital Strategy, which sets out how plans to develop a world-leading digital economy that works for everyone.
It looks at improving connectivity, skills and inclusion, safety and security, and delivery of public services.
This is part of the Government’s ‘Plan for Britain’ to build a stronger, fairer country that works for everyone, not just the privileged few.
The future of money advice in the UK will be shaped by digital inclusion and development and this will be a key topic at the MALG Conference 2017 on Monday 27th November.
Read the full UK Digital Strategy.
The Vulnerability Registration Service (VRS) is the UK’s first central register for helping vulnerable consumers protect themselves against further debt or financial stress. Its dedicated consumer portal is now open and can be used by organisations to share information about the circumstances of vulnerable consumers to help to avoid them having to go through the distressing experience of repeating their personal story.
The VRS provides a platform with a single point of reference as a tool to complement organisations own vulnerability responsibilities and further protect the consumers they serve. Importantly the VRS does not replace an organisation’s responsibilities for identifying and counselling vulnerable consumers, but provides a ‘decision agnostic’ platform for consumers and the organisations they deal with as an additional safeguard for consumers during their period of vulnerability.
We are aware of concerns about the usefulness of the tool and are encouraging the money advice sector to test its appropriateness for their organisations.
Visit the Vulnerability Registration Service website.
MALG Member the Council of Mortgage Lenders has published its 2017 events calendar:
9 March: Treating Customers Fairly: workshop, CML HQ London
10 March: CML Scotland lunch, The Balmoral Edinburgh
28 March: Mortgages and competition law masterclass, TLT London
21 April: CML annual lunch, Lancaster London Hotel
27 April : Current issues in arrears and possessions conference, KPMG, Leeds
11 May: The mortgage market in Northern Ireland seminar, Belfast (venue tbc)
17 May: CML Cymru lunch, The Principality Stadium Cardiff
6 June: Buy to let lending conference, London (venue tbc)
27 June: MortgageTech UK 2017, London (venue tbc)
4 July: Mortgages and competition law masterclass, TLT London
14 September: Action against fraud conference, London (venue tbc)
6 December: CML annual dinner, Supernova Embankment Gardens London
Visit https://www.cml.org.uk/events/ for more info
Following the introduction of the Money Advice Service’s Standard Financial Statement (SFS) for debt advice, creditors and others to use as a single, consistent tool for assessing an individual’s income and expenditure on 1 March 2017, Scotland’s Insolvency Service, Accountant in Bankruptcy (AiB) has confirmed that the Common Financial Tool (CFT) used in Scotland, will continue to be used until Scottish legislation changes, for which there is not yet a fixed date.
AiB will be consulting stakeholders later this year to seek views on whether or when the switch to use the SFS should be made. Therefore, any adviser or insolvency practitioner using the CFT must continue to use the Common Financial Statement in accordance with the legislation for new applications.
AiB will notify the advice community and insolvency practitioners well in advance of any change to this process.
Christian’s Against Poverty (CAP) has published an update to its ‘The Poor Pay More’ report from December 2015, which shows how self-disconnection is still a significant problem and explores new data showing how lack of internet access contributes to pre-payment users being unable to get the best energy deals.
The report update, entitled ‘Where we are: Pre-payment meters, self-disconnection and Internet access’, also highlights initiatives from EON and British gas which make positive steps forward. It is based on findings from a survey of over 900 CAP clients just over a year on from the original report, and indicates that there remains a pressing need for more to be done to help some of the poorest and most vulnerable people in society. Some of those surveyd were only using their heating for a few days a month during winter but falling under the radar of typical self-disconnection monitoring processes. The update also contains new research on the level of digital exclusion amongst pre-payment customers and raises concerns about the implications of increasing digital demands on energy customers.
Read the full update report.
Latest news in the weekly round-up from Money Advice Service includes information on how to get the best deals on car insurance, the importance of saving into a pension, the benefits of using price comparison sites and more. Click here to view the Money Advice Service weekly round-up
The latest weekly review from Money Advice Scotland features a response to FCA’s high credit review, details of the Water Direct, Striking the Balance conference and a review of student support in Scotland. Click here to view the newsletter and subscribe
I think it’s safe to say that the last MALG Members’ Meeting in January was a huge success! Attendees, who heard excellent presentations from academics Professor Sharon Collard and Chris Fitch and GambleAware’s Jane Rigbye, said it felt like a ‘game changer’ in the development of a new and improved MALG. You will be able to download their presentation slides from our website soon.
I’m now very pleased to announce details of our next must-attend Members’ Meeting! Please note that the original date of 23 March has been changed to avoid clashes with other events:
What? MALG Members’ Meeting
Where? Bond Dickinson, 4 More London, Riverside, London SE1 2AU
When? 6th April 2017
|We’re currently finalising the themes and speakers which will address key hot topics and give us all plenty of food for thought. I hope to see many of you there.
Speaking of thought-provoking events, I gained a valuable insight into how Fintech developments can impact our industry by attending a Fintech Fortnight event in London last week. There was a great panel covering topics as wide ranging as the ‘digital divide’, collaboration, protecting customers and Fintech as an enabler. One subject the panel didn’t cover was vulnerability and I asked a question on how those customers who are fearful, incapable or unable to access technology would be able to cope with the future changes. It provoked more debate than a previous discussion on Brexit! There were clear divisions in opinion across the panel and I feel this highlights the true value of the work we are doing.
Introducing the MALG Board and Executive Committee
With all the changes afoot at MALG, we thought now would be a great opportunity to formally introduce our Board and Executive Committee. What makes us so special as an organisation is all the people that are involved in it and we will be making a point of showcasing them on our new website when it launches in April. In the meantime, here they are:
The Money Advice Service has announced that the Standard Financial Statement (SFS) begins operation on 1 March 2017 and thanked the many advice agencies, creditors, trade bodies and others involved in its development, including the MALG members who were part of the governance group.
The first advice providers will begin using the new SFS format on 1 March and until April 2018, a transition period will be in operation while the rest of the sector make their switch to SFS. During this time, the SFS will be in operation alongside Common Financial Statement (CFS), the StepChange method and other current statement formats.
Registration to become a SFS user is now live on the SFS website. Any organisation planning to use the SFS must complete the online application which will also include agreeing to a Code of Conduct outlining best practice usage of the SFS. Once you have a login you will be able to access the approved formats, user guidance, spending guidelines, an Excel tool, links to eLearning material and FAQs.
While creditors will not be required to apply to use SFS simply to receive statements from the advice sector, it will be required to access the spending guidelines and for those intending to use the format in their own collections processes.
For further information, visit sfs.moneyadviceservice.org.uk or contact sfs.support@MoneyAdviceService.org.uk
The Institute of Money Advisers has released details of its forthcoming training sessions. For more information on a specific session, click the course title to link through to further details. Places for non-IMA members cost £175 for voluntary sector organisation or statutory body, £195 otherwise. Sessions can be delivered in-house for groups at an organisation’s premises.
Citizens Advice has published a report entitled ‘Debt on your doorstep’ looking into the doorstep loan market, which is the largest high-cost credit market in the UK used by over 1.3m customers. It identifies common problems experienced by their clients with unmanageable doorstep loans such as high-pressure sales tactics, inadequate affordability checks and aggressive collections practices.
The report calls on the FCA to use its review of high-cost credit to better regulate the market as it has with payday lending.
Read the full doorstep loan report here.
Also read the Money Advice Trust’s response to the FCA consultation on high-cost credit.
This week’s Money Advice Service round-up covers topics such as energy costs, the price of overdrafts and the affect problem debt can have on the mental health of children. Read more here.
This week’s Money Advice Scotland newsletter features the prepayment cap from Ofgem, research from Resolution Foundation and a survey on the quality of financial capability support.
Research published today by Which? has highlighted that customers accessing unauthorised overdrafts can face charges seven times higher than the cost of borrowing from a payday lender. The report also found that it’s often the most vulnerable customers that are hit the hardest. Read Rachel Reeves MP’s summary of the findings here
Following the announcement of our 2017 conference date and venue, we have some sadder news. MALG’s secretary Maria Wadsworth, who has been supporting the organisation in this capacity for the past 12 months, is planning to set sail (quite literally!) and will be leaving us in April. I’m sure all of you who have dealt with her over the years will be as sad to see her go as we are but we wish her all the best on her travels.
This means that we are on the hunt for her replacement and she is leaving some big shoes to fill! But first, I’ll hand over to Maria to bid her farewells…
Bob Winnington, Executive Officer
A farewell message from MALG Secretary Maria Wadsworth…
There’s a lot going on in the world at the start of 2017 and no-one can predict what will happen next. In that spirit, my husband and I have taken the decision to (semi) retire and sail the oceans on our boat, Lady Jane, from June.
We’ll be going from the teeth chattering cold of Portsmouth harbour to a shorts and t-shirt life in the tropics. There’ll be wind in our sails and rum punches in our hands come December when we make landfall in the Caribbean.
‘Sail south until the butter melts’ is the conventional wisdom shared by the old salty sea dogs plying the trade routes in their square riggers – so that’s exactly what we are planning to do. We will be sailing to France, on to Spain, then the Canaries and on to Cape Verde to pick up the north easterly trade winds to blow us towards Barbados. And if we like it we may not return!
The future of MALG
But what of MALG? Casting my mind back to the pre-MALG days of 30 years ago, when this organisation was a mere twinkle in Anthony Sharp’s eye, we see a very different picture of the organisation today. As inconceivable as it sounds, money advisors and creditors were loathe to be in the same room, let alone sit down and agree on what would later become the debt and mental health guidelines in place today.
MALG membership was restricted to associations and organisations, and this was based on a relatively informal structure to allow the organisation to morph according to changing times.
Fast forward to the present and we see the polar opposite in terms of engagement: Not only are the old adversaries speaking with each other, they are engaged in truly constructive dialogue to foster improvements in our industry for the greater benefit of everyone involved.
Many of these changes have been made over the last year, which have seen MALG incorporated as a limited company, the election of a Board of Directors, the formation of the Executive Council – and the creation of clear policy documents. Membership is no longer restricted and through the creation of the National Business Membership, the MALG door has been flung open to individual business members – including solicitors and bailiffs. Who’d have thought it? This is the first step towards widening membership to others to seek broader diversity and representation from all sectors of debt and credit and advice.
It’s been quite a journey and I am very proud that I have been able to play a small part along the way.
The great thing is that the difficult decisions have now been made and the laborious work involved in digging the foundations upon which MALG stands today has been done. And we now have great support from a team of experts in branding and marketing who will be able to help build MALG to even greater heights – shaping things for the next 30 years. I may be back from my travels then!
I’ve thoroughly enjoyed working with Bob Liz, the Board and the Executive Council. They are a great team and I wish them all the best.
MALG Secretary vacancy
Of course, what this means in practical terms is a job opportunity has arisen. If you are interested in the position of MALG secretary then please contact me on 07710 497819 or by email at email@example.com and I will be happy to discuss the role with you.
Follow my sailing adventures
And if you want to follow our sailing adventures, you will be able to see where we are at and what we are up to, at www.untilthebuttermelts.com
Wishing you all the very best, wherever life takes you. Maria
Royal London has published a new report ‘Looking after the pennies’. It is a study of the impact of regular monitoring on household spending and saving, which looks at whether budgeting tools could help people manage their money better.
19 million people in the UK don’t have an approach to budgeting they feel works and many struggle to manage their day-to-day money and 21 million people in the UK have less than £500 in savings to cover unexpected bills like mending a boiler or replacing a fridge.
Royal London asked a selection of customers to use a mobile phone budgeting app or a simple pen and paper method to create and keep a budget for three months. They asked about budgeting habits and management of finances at the start of the study and then again at the end.
Key findings were:
- At the start of the study, 93% recognised the importance of tracking household expenditure and 84% told us they felt in control of their finances.
- While people recognise the importance of budgeting, that doesn’t always mean they do and 31% said they don’t plan their spending closely or at all.
- Although the majority felt in control of their finances, 30% reported struggling to keep up with bills.
- At the end of the trial, 1 in 2 (49%) said that using a budgeting method was helpful in monitoring what they spend.
- More than 1 in 3 (37%) said that since using a budgeting method they have a better understanding of their income and expenditure.
- Around 1 in 4 (26%) said they are now more likely to discuss their household finances with their partner/ family/household.
- Financially vulnerable people seem to have benefitted most from the exercise. We explore this in more detail in the main part of the report.
- After taking part in the trial a slightly higher proportion of our sample:
- more closely planned their spending
- claimed to have a clear idea of how to create a weekly/monthly budget
- were more aware of how much they spend and on what
- could pay an unexpected bill of £300 out of their own money without dipping into savings or cutting back on essentials.
Read the full report here.
This week’s review from Money Advice Scotland features the latest lending data as consumer credit continues to rise, along with the official statement from MAS to the Financial Conduct Authority’s consultation on its future mission.
Top news in this week’s Money Advice Service update includes Valentines day, half-term holidays and emotional spending. Catch up on the main headlines from the past week in the Money Advice Service weekly round-up here.
The National Association of Student Money Advisers is running the National Student Money Week #NSMAW17 on 6th-10th February. This year’s theme is ‘Waste Not Want Not’ and can be utilised for individual campaigns, along with the logo and other resources. For ideas on how to get involved during the week and see other supporters or collaborations, click here to see the resource pack and newsletter.
Last week’s Financial Education Newsletter contains information for teachers, practitioners and young people on ways to make financial education as accessible as possible, including dates for regional teacher training events and links to resources on how to bring FE to life in schools.
The Advice Services Alliance (ASA) launched a new revised Advice Quality Standard, at an important Parliamentary event chaired by Yvonne Fovargue MP today.
The new Advice Quality Standard builds on the increasingly high standards in the sector in advising clients on how to use the law to challenge decisions made against them and to ensure that their rights are protected. The ASA has brought the standard up to date with this brand new version, fully revised and designed for the 21st Century.
Yvonne Fovargue MP said: “The Advice Quality Standard is a quality mark which will help local services to demonstrate the good work they are doing, as well as giving assurance to those who are funding them. In my role as a Members of Parliament Chair of the APPG on debt and personal finance, I am all too aware of how complicated clients’ problem can be. The AQS gives a structure of consistency and continual improvement and will allow advisers to get on with their work of helping clients.”
The Advice Quality Standard is held by 700 advice services across England and Wales and from January 2017, the independent assessment has been against the revised version.
Last week’s Money Advice Scotland Weekly Review includes Mark Carney’s warning on internet-only lenders and the Accountant in Bankruptcy’s (AiB) latest data on personal insolvencies.
The Money Advice Service has published a summary of new findings from its Debt Advice Evaluation annual report (which will be published in full in March 2017) which show that free debt advice gives those in problem debt the helping hand they need to tackle their financial situation, pay off their debts and build money management skills for the future.
Credit: Money Advice Service
Key findings include:
- 65% of those with debts are either repaying them or have repaid in full within three to six months of receiving regulated advice
- 89% check their income and expenses regularly, 85% are more likely to open their post, 86% had a plan to pay their bills in priority order, and 84% keep to a spending plan, after receiving advice
- 73% of people feel less stressed about dealing with their finances, 62% are sleeping better, 63% feel their mental health has improved, 55% report better physical health, and 69% said that relationships improved after advice
- 71% also said that they are now performing better at work as a result of taking advice.
Read more here.
The Money and Mental Health Policy Institute has published a new report entitled Seeing Through the Fog: How mental health problems affect financial capability.
It includes a summary of common ways that those with different mental health diagnoses may be likely to experience affects to their ability to manage their personal finances.
Read this BBC news story on recommendations for banks to assist those struggling with mental health conditions.
We’re pleased to announce the date and venue of our 2017 Annual Conference, which will take place on Monday 27 November at the fantastic 30 Euston Square! You can read more about our plans for this year’s new-look, new-format conference in our executive officer Bob’s latest blog.
Last week’s Money Advice Scotland Weekly Review includes a call for input into a consultation into the replacement of the Money Advice Service and news on a reduction in Local Authority spending on money advice.
Last week’s news round up from the Money Advice Service includes stories on millennials spending habits, work life balance, online shopping, and grandparents missing out on credit.
Citizens Advice has published a good practice guide entitled: How energy suppliers can signpost and refer vulnerable consumers to the right source of help.
It recommends that energy suppliers should:
- Agree a company policy for signposting and referring vulnerable consumers to third parties
- Set up clear signposting and referral options to a range of organisations
- Be consistent in offering additional help
- Allow consumers to access services on their own terms and provide support when needed
- Empower customer facing staff to make good referrals
- Build relationships with referral partners and learn from each other
With research showing that half of us regret online purchases and most never send them back, the Money and Mental Health Policy Institute (MMHPI) and Martin Lewis have launched a new experimental tool to help increase self-control called .
Read MMHPI Director Polly Mackenzie’s guest blog for the Money Advice Service on how stopping impulse shopping can help your mental health and try out the tool here:
On Tuesday 17 January, New City Agenda and Barclays launched new research report, Open Banking: A Consumer Perspective. The report follows key recommendations from the Competition and Markets Authority (CMA) inquiry into retail and SME banking and examines how Open Banking could give rise to new types of financial services and bring benefits to consumers and SMEs.
Open Banking is all about data sharing between banks and third parties (including money advisers) to enable consumers and small businesses to to see all of their finances in one place, better understand their financial circumstances and compare between different providers to find the best deal.
Open Banking provides the opportunity to radically disrupt the current banking system but brings with it a number of key challenges.
Money Advice Liaison Group (MALG) Chair Liz Barclay said: “I think MALG can start the conversation about how Open Banking can revolutionise money advice. We plan on it being a key topic at our annual conference in November 2017.”
Read the full report using the link above and follow #openbanking on Twitter for perspectives from across the sector.
Visit the Creditman website for latest credit news, articles and reviews.
The Money Advice Trust has created a new LinkedIn group for UK Debt and Money Advisers to act as a forum to share knowledge, best practice and advice with each other. If you have a LinkedIn account/profile, you can request to join the group here: https://www.linkedin.com/groups/8578118/profile
Visit the Insolvency Service Website for updated guidance on Bankruptcy, published 13 January 2017.
The Institute for Fiscal Studies (IFS) has published a new report entitled Two decades of income inequality in Britain: the role of wages, household earnings and redistribution.
The synopsis reads: “The paper looks back at changes in income inequality in Great Britain over the past 20 years, with a particular focus on explaining why – contrary to popular perception –income inequality over most of the distribution has actually declined over this period. We focus on inequality in household incomes, net of taxes and inclusive of benefits and tax credits. We explain trends in inequality by breaking this down into the effect of changes in hourly pay and hours worked of men and women, the tax and benefit system, and the incomes of pensioners.”
Comparison website GoCompare have released the findings of a survey of more than 2,000 people which asked how they manage their personal financial accounts.
31% said that having so many passwords and contracts is stressful, 28% compared managing their personal affairs to a full time job, 21% said that they felt they had lost track of contracts and accounts, and 38% stated they had no system for keeping track of their online accounts.
Read more here.
EastEnders has been praised for its recent focus on debt storylines and money worries for characters, with leading debt advice provider PayPlan commending the show for linking financial difficulties with mental health in some of its scenes.
Read more here: http://metro.co.uk/2017/01/11/leading-debt-advisors-praise-eastenders-for-prompting-more-people-to-seek-help-over-mental-health-worries-relating-to-money-6374888/#ixzz4WJXn0dJ7
Please see a comment on today’s speech by the Prime Minister which considered measures to ‘right injustices’ around mental health and debt issues.
Caroline Rookes, CEO of the Money Advice Service comments on Prime Minister’s plans to transform mental health support:
“It is encouraging to see that the impact mental health issues can have is being recognised at the highest level. We know from our own research that mental health problems rarely occur as an isolated issue and that there is a strong link between mental health issues and money issues, such as problem debt. 52% of people who received debt advice from our services have a mental health condition and it is therefore vital that there is closer working between the mental health and debt advice sectors so that people can be supported holistically. The announced review of charges made for completing the “debt and mental health evidence form” should help to improve access to appropriate solutions for people with overlapping debt and mental health issues.
It is also important to remind people who have mental health issues and who are worried about their money issues that debt advisers are here to help and free, non-judgemental help is available across the UK. The Debt Advice Locator Tool will help you to find free advice in your area.”
Update on the Pre-action Protocol for Debt Claims (PAP)
Joint statement by the Credit Services Association (CSA) and the Civil Court Users Association (CCUA)
Further to yesterday’s update, the Civil Procedure Rule Committee (CPRC) meeting was held this morning. The meeting was attended by Leigh Berkley and Rob Thompson as industry representatives, and by the Master of the Rolls.
The outcome was as follows:
- The Pre-Action Protocol (PAP) is likely to be implemented next year
- There will be no requirement for the original agreement to be sent at the Letter Before Action (LBA) stage
- There will be a requirement that creditors make it clear in the LBA itself that the customer has the right to ask for documentation, including the original agreement, although it was accepted that this should not be so prominent as to encourage spurious requests
- It was agreed that the new Standard Financial Statement will be used as part of the protocol
- We requested a sufficient implementation period for the necessary systems and process changes to be made by creditors
- The Committee was mindful of the future impact of the Online Court, and it is hoped that PAP will inform the approach to the introduction of the Online Court
- The Committee also considered whether this PAP was called for at all, as unusually there has not been an agreed position among stakeholders. On balance, it was decided that it would prove helpful.
- The PAP will now be redrafted and sent back to the sub-committee before the Master of the Rolls decides whether and when it will be implemented.
Both Leigh and Rob had ample opportunity to contribute to the discussions, which both felt were balanced and constructive. We considered that the arguments were understood and fully considered.
Due to the confidentiality of the sub-committee, we are still unable to disclose the full details of the latest draft. There will undoubtedly be some provisions with which creditors or the debt advice sector may not fully agree, however we think we have arrived at the best compromise possible in all the circumstances, and a much better solution for all parties than the original draft PAP.
We will update you as soon as further details of the finalised PAP and the implementation period are agreed.
Leigh Berkley (CSA) and Robert Thompson (CCUA)
The impact of Brexit on business and personal finances: Views from R3 members
In November 2016, R3 (the UK’s insolvency and restructuring trade body) surveyed its members for their views on the impact of Brexit on business and personal finances. In general, members believe that businesses are more likely to be adversely affected by Brexit than individuals. The survey found:
Impact on business finances
- 72% of R3 members believe the outcome of the EU referendum will lead to an increase in corporate insolvencies in the next 12 months. 76% think a ‘hard’ Brexit would increase corporate insolvencies – including 35% who think it would lead to a ‘significant’ increase in insolvencies. 39% think a ‘soft’ Brexit would have no impact on insolvency numbers, while 38% think this scenario would see insolvencies rise (only 1% say ‘significantly’).
- 55% feel that the referendum has already had a negative impact on business finances. Just 10% think it has had a positive impact on businesses’ finances.
- 61% of members have seen no change in the number of businesses seeking advice since the referendum, but almost a third (30%) have seen an increase (over three-quarters of this group say the referendum result is a factor in the increase). Overall, 45% of respondents say the referendum result has been mentioned by businesses seeking advice since June.
- Asked to select up to three sectors most likely to be hurt by leaving the EU, most survey respondents picked the manufacturing (44% of respondents), financial services (41%) and retail (33%) sectors.
Impact on personal finances
- 46% believe there will be a post-vote increase in insolvencies; 41% believe there will be no change. 60% think a ‘hard’ Brexit would increase personal insolvencies, whilst 33% believe a ‘soft’ Brexit would.
- 50% feel that the outcome of the vote had no impact on individual’s personal finance; 43% believe there has been a negative impact.
- 85% of members have seen no change in individuals seeking advice since the referendum; 9% have seen an increase.
Comment from R3 President Andrew Tate
“The insolvency and restructuring profession is concerned about the impact leaving the EU will have on the financial health of UK businesses. Even before leaving, the effects of ‘Brexit’ are being felt: a weaker pound and increased business uncertainty are already causing problems.”
“Insolvency practitioners are on the frontline when it comes to supporting struggling businesses, and a significant minority say they have seen an increase in businesses needing help since June. ‘Brexit’ is frequently coming up as an issue when businesses seek advice.”
“The uncertainty around what final form ‘Brexit’ will take makes it difficult for businesses to plan ahead and assess what risks and opportunities they have.”
January 4th, 2017
StepChange Debt Charity response to the Bank of England’s Money and Credit statistics
In response to the Bank of England’s latest Money and Credit statistics, Peter Tutton, Head of Policy at StepChange Debt Charity, said:
“Levels of outstanding borrowing on credit cards, personal loans and other forms of consumer credit are approaching the 2008 peak, and the growth rate of net lending is at its highest since 2005. Alarm bells should be ringing. Previous experience shows how such increases in the levels of borrowing can leave households over-indebted and vulnerable to sudden changes in circumstances and drops in income that can pitch them into hardship.
“Lenders, regulators and the Government need to ensure that the mistakes made in the lead-up to the financial crisis are not repeated and that there are better policies in place to protect those who fall into
Credit Strategy launches new website
Click here for an update from the HCE Group
2nd November 2016
Caroline Siarkiewicz, Head of Debt Advice for the Money Advice Service comments on Money and Mental Health Policy Institute’s The Missing Link report:
“This report demonstrates why a holistic approach to resolving health and debt problems together is vital. Over half of people who use our debt advice services have a diagnosed mental health issue – a figure that has been consistent over a number of years, which reinforces earlier research from the Royal College of Psychiatrists and Mind. The report is right to highlight that mental health issues can make the impact of debt much greater; 39% of our clients with mental health issues have received a court summons and 18% have had a phone service cut off. There are important opportunities for organisations delivering the Government’s Improving Access to Psychological Therapies (IAPT) programme to talk to people about their money and direct them to free debt advice that can really make a difference to their health and wellbeing. Free debt advice can be found across the UK using the Debt Advice Locator Tool.”
“SERIOUS CONCERN” AS CCJS SOAR
Consumers in England and Wales are facing a decade-high level in the number of CCJs, according to figures released today by Registry Trust.
The non-profit Registry Trust collects judgment information from jurisdictions across the British Isles and Ireland. In England and Wales, it operates the Register of Judgments, Orders and Fines on behalf of the Ministry of Justice. A judgment is incontrovertible proof that debt has not been managed.
There was a year on year increase nearing 50 percent in the third quarter of 2016, with more than a quarter of a million (256,847) judgments registered against consumers in England and Wales.
The average value of a CCJ, however, fell 11 percent to £1,642, the lowest third quarter figure in the past decade. By contrast the average value of a judgment in Q3 2008 stood at £3,680.
Over the same period, the number of judgments against consumers in the High Court fell for the third year in a row to 62, the lowest number on record. The total value increased sharply by 90 percent to £68.3m, with the average value rising to a decade high of £1.1m.
The total value of debt judgments against consumers in all courts in England and Wales during the third quarter of 2016 was £490m.
“The rise and rise in the number of judgments is a matter for serious concern,” said Registry Trust chairman Malcolm Hurlston CBE. “One factor may well be that claimants are finding it worthwhile to sue for smaller sums. But people face not only lenders and utilities which use the county courts but also local authorities and HMRC who have their own approaches.
“It becomes ever more important for people who can to satisfy judgments, either within a month, in which case they may be removed, or soon after when the satisfaction record will look good on the credit score.”
Last quarter 14.77 percent of CCJs were registered as satisfied.
In Q3 2016 Registry Trust received 38,831 requests to search the register for England and Wales online at www.trustonline.org.uk
. TrustOnline allows anyone to search for judgments and similar information registered against consumers and businesses in any jurisdiction across the British Isles and Ireland. “It is a unique benefit for consumers to be able to check the debt record of any person or business with which they may be transacting. Our registers cover the British Isles and Ireland,” said Mr Hurlston. “Negative information should at least give pause for thought.”
|Modernised Insolvency Rules published
Modernised and consolidated insolvency rules which will guide insolvency practice from April 2017 have been laid in Parliament and will come into force on 6 April 2017.
The new rules replace the Insolvency Rules 1986 and their 28 subsequent amendments. They have been developed working with the insolvency profession and have been approved by the Insolvency Rules Committee.
The rules have been recast to reflect modern business practice and to make the insolvency process more efficient. Changes include:
- enabling electronic communications with creditors
- removing the automatic requirement to hold physical creditors meetings, although creditors will be able to request meetings
- enabling creditors to opt out of further correspondence and for small dividends to be paid by the office holder without requiring a formal claim from creditors
Further details will be available in the Explanatory Memorandum, which is published alongside the Rules. We have also published a .
The rules will apply in England and Wales. A parallel project to modernise the Scottish insolvency rules is currently underway with the Scottish Government. We are continuing to work on consequential amendments to other related legislation, including the Insolvent Partnerships Order.
Preparing for the introduction of the modernised rules
We will continue to support the insolvency profession to prepare for the introduction of the new rules. Our staff have taken part in a number of roadshows organised by the ICAEW and the Insolvency Practitioners Association, amongst others.
In November we will also launch an online community where you can ask questions of our technical team and share your comments with other insolvency professionals.
StepChange Debt Charity response to the Bank of England’s Money and Credit statistics
In response to the Bank of England’s Money and Credit statistics, Peter Tutton, Head of Policy at StepChange Debt Charity, said:
“These figures show that credit card borrowing is rising at its fastest rate since before the financial crisis. Credit cards are already the most common type of debt we see and we are concerned that increased lending could see even more people fall into problem debt.
“The Financial Conduct Authority’s credit card market study committed to making credit cards work better for consumers and identified clear concerns about persistent debt, but we are still waiting on the details of the action that will be taken.
“Action is needed not only to prevent more people from falling into problem debt, but to provide better help for those already struggling.”
Colin Kinloch, Debt Advice Strategy Manager for the Money Advice Service comments on improving the financial health of low income groups :
“Money Advice Service research confirms that tenants and those with incomes under £10,000 are some of the groups most likely to be over-indebted. We know from evaluation of our funded debt advice projects that after getting advice people go on to reduce or clear at least some of their debts within three to six months. High quality, free debt advice is available face-to-face, over the phone and online across the country and can be found through our debt advice locator tool.
“We encourage employers and large private landlords to publicise this as widely as possible, while being mindful that many people may not realise they are in debt until it becomes a crisis. This means being sensitive and emphasising that advice is non-judgemental is important. We are always happy to provide support to organisations who want to refer those they work with to debt advice.”
October 24 2016
DEBT JUDGMENTS HIT POST CRISIS LOW
The total number and value of debt judgments in Northern Ireland during the third quarter of the year fell to its lowest level since before the financial crisis, according to figures released today by Registry Trust.
Registry Trust is the non-profit organisation which collects judgment information from jurisdictions across the British Isles and Ireland. In Northern Ireland it collects information on defaults and small claims judgments, and high court judgments. A judgment is incontrovertible proof of unmanaged debt.
There were 1,746 small claims judgments in Q3 2016, a year on year decrease of 16 percent. While the total value fell 14 percent to £3.2m, the average value of a small claims judgment rose slightly by 3 percent to £1,834.
Meanwhile, the total number and value of judgments issued by the High Court similarly fell to its lowest third quarter level on record, with only 17 judgments registered and worth a total value of £1.3m. The average value of a High Court judgment was £78,978.
“Pre-Brexit the Northern Ireland economy looks in good shape,” said Registry Trust chairman Malcolm Hurlston CBE. “Debt is being managed well by consumers and businesses alike.”
In Q3 2016 Registry Trust received 7,448 requests to search the register for Northern Ireland online at www.trustonline.org.uk
. Through TrustOnline people in Northern Ireland can search for judgments and similar information registered against businesses and consumers anywhere in the British Isles and the Republic. “It is a unique benefit for consumers to be able to check the debt record of any person or business with which they may be transacting,” said Mr Hurlston. “Negative information would certainly make me think twice.”
Colin Kinloch, Debt Policy Manager for the Money Advice Service comments on the need for breathing space for people in debt:
“It is vital that people in debt have time to get advice and find an appropriate solution without unnecessary pressure from their creditors. We need a consistent process that looks at people’s financial situation as a whole and this bill is a good start. We’ve seen the potential for breathing space in Scotland where the Debt Arrangement Scheme (DAS) provides people with the time and space to get adequate support in dealing with their finances. We acknowledge the importance of statutory breathing space within the UK Financial Capability Strategy and we will continue to work with honourable members, HM Treasury, the Insolvency Service and organisations across the debt sector to ensure people in debt, across the UK, have the support they need.”
CALL FOR FRESH APPROACH TO SATISFACTIONS
Only four percent of decrees and judgments in Scotland were marked as satisfied in the third quarter of 2016, compared with 15 percent in England and Wales, according to figures from Registry Trust released today.
Registry Trust is the non-profit organisation which collects judgment information from jurisdictions across the UK, including small claims and summary causes and ordinary cause decrees in Scotland.
Calling for a fresh approach to satisfactions in Scotland, Trust chairman Malcolm Hurlston CBE said: “Behaviour cannot explain the yawning gap. In Scotland it lies with consumers to notify us if a debt is satisfied and it would seem many are failing to do so.
“It is to their detriment but lenders too would benefit from more accurate information if satisfaction data were kept up to date.
“We are starting discussions with lender organisations to see how we can solve the problem together. Meanwhile, people who pay off debts should remember to register it with us and reap the reward, quite probably in a lower cost of credit. Let’s get Scotland satisfied.”
The Trust’s statistics show that 5,398 judgments were recorded against consumers in Q3 2016, a year on year decrease of 12 percent. The total value fell 12 percent (to £14.8m), and the average value of a judgment remained unchanged at £2,746.
The overall decrease in the number of judgments was almost entirely attributable to a 13 percent fall in small claims and summary causes. There was only one fewer ordinary cause decree in Q3 2016 compared with the same period last year. The average value of a small claims judgment was £1,543, a seven percent rise and the highest on record. Meanwhile, the average value of an ordinary cause decree fell 16 percent to £13,957.
In Q3 2016 Registry Trust received 7,821 requests to search the register for Scotland online at www.trustonline.org.uk
. TrustOnline allows anyone to search for judgments and similar information registered against businesses and consumers in any jurisdiction across the British Isles and Ireland. “It is a unique benefit for consumers to be able to check the debt record of any person or business with which they may be transacting,” said Mr Hurlston. “Negative information would certainly make me think twice.”
14th – 20th November
With just four weeks to go until the first Financial Capability Week we wanted to drop you a line with some of the ways you and your organisation can get involved.
If you want to know more about the Week or you are wondering how you can participate and would like some ideas you can download the participation pack on the Financial Capability Strategy website.
We will soon be releasing information and invitations to the Financial Capability conference on Thursday 17 November so please keep an eye on your inbox. In the meantime, we would be delighted to invite you to the launch of the Children and Young People Financial Capability Survey on Monday 14 November. Details and registration can be found here.
Click here to be taken to further details of whats happening in Financial Capability Week
Energy UK launches improved standards for prepayment customers
Energy UK has launched 10 principles to provide improved safeguards for prepayment customers. These principles update the original prepayment principles in 2011, there are now a total of 12 companies which have signed up to a new and expanded set of principles.
Energy UK response
Energy UK will publish a news release to key media contacts and on the Energy UK website tomorrow morning. This will be supported on social media shortly afterwards.
Energy UK release
Energy UK launches improved standards for prepayment customers
Energy UK has launched 10 principles to provide improved safeguards for prepayment customers. The prepayment principles cover the majority of energy consumers in the UK with small, medium and larger suppliers signed up to them.
The renewed standards will ensure suppliers are monitoring prepayment accounts to identify customers who might be at risk of facing financial difficulties. Suppliers may also provide discretionary credit as well as signposting customers to debt advice and financial support where appropriate. The principles also provide assurances about existing protections for prepayment customers.
Lawrence Slade, chief executive of Energy UK, said:
“The launch of these prepayment principles will bring great benefits to consumers and reflect the increasing importance industry places on supporting the most vulnerable customers.
“The principles coupled with the rollout of smart meters will improve the experience of prepayment customers and give customers more control over their energy usage and bills.
An Announcement from R3 President-Andrew Tate
I write as President of the insolvency and restructuring trade body R3 to highlight our latest guidance on the importance of professional and regulated debt advice. Given your focus in the financial and policy spheres, we hope that these documents will be of interest to you and your own members/stakeholders. Please find copies of the guidance attached – they can also be found on R3’s website here and here.
For individuals facing personal or business debt issues, there will be a wide-range of organisations offering to help with their financial situation. Unfortunately, not all of these organisations are reputable and many are unlicensed and unregulated. As the trade body for insolvency professionals – who are regulated by professional bodies; bound by legal duties and professional rules; and are required to pass a series of exams before being licensed – we are keen to do what we can to promote the importance of professional and regulated debt advice to those in need.
To this end, I would be grateful if you would consider promoting this guidance to any of your members or stakeholders who may have a particular interest in dealing with individuals or businesses facing debt issues. We would be very happy to consider joint branding of the guidance, should that be of interest.
Please do not hesitate to get in touch with R3 Director Emma Hobson, at firstname.lastname@example.org or 020 7566 4227, should you have any queries about the guidance or if you would like to discuss this matter further.
The Insolvency Service is responsible for oversight regulation of the insolvency profession. The Recognised Professional Bodies are required to have in place a process for dealing with complaints about insolvency practitioners. This publication summarises the Insolvency Service’s findings of a review of how complaints about insolvency practitioners are handled carried out during 2015.
Click here to be taken to the document.
StepChange Debt Charity response to £34m payday loan redress scheme
In response to today’s Financial Conduct Authority (FCA) announcement of a £34m consumer redress scheme for more than 97,000 customers of CFO Lending, Mike O’Connor, Chief Executive of StepChange Debt Charity, said:
“This case highlights the importance of a strong regulator prepared to step in and take decisive action against firms that break the rules. We need a powerful FCA to defend consumer interests and look out for vulnerable consumers and it is good to see this in action.
“The regulations on payday loans are making a difference and the amount of people we see with payday loans has been falling, but there is more work to do across all forms of consumer credit to ensure that everyone is protected from the damage that poor practice and harmful products can cause.”
– ends –
Notes to editors
- CFO Lending has been trading as trading as Payday First, Flexible First, Money Resolve, Paycfo, Payday Advance and Payday Credit
About StepChange Debt Charity
- StepChange Debt Charity provides free and independent debt advice by telephone and through its online Debt Remedy tool.
- StepChange Debt Charity’s vision is a society free of problem debt. Our ethos is founded on helping people to repay their debts where they are able to do so. Where they cannot, we provide advice including, where appropriate, supporting them through insolvency processes. Our advice is always based on the best interests of our clients.
- StepChange Debt Charity is majority funded by voluntary donations from lenders who support the work of the charity. All funding goes towards helping people in problem debt – this includes providing impartial advice, promoting the benefits of free debt advice, and managing all the debt repayment and debt relief options we provide.
- StepChange Debt Charity campaigns for changes to public policy that will prevent problem debt and improve the situation of those affected. Details of the charity’s research can be found here.
- Foundation for Credit Counselling Wade House, Merrion Centre, Leeds, LS2 8NG trading as StepChange Debt Charity and StepChange Debt Charity Scotland. A registered charity no.1016630 and SC046263. It is a limited company registered in England and Wales (company no:2757055). Authorised and regulated by the Financial Conduct Authority.
- The StepChange Debt Charity free phone helpline 0800 138 1111 is open 8am to 8pm, Monday to Friday and 8am to 4pm Saturday.
- Online help is available any time from StepChange Debt Charity Debt Remedy at www.stepchange.org
- Follow us on Twitter: @StepChange and @Moneyaware
HM Courts & Tribunals Service sent this bulletin at 15-09-2016 01:29 PM BST
Today the Lord Chancellor, Lord Chief Justice, and the Senior President of Tribunals have published a joint statement, called Transforming Our Justice System, on their shared £1 billion vision for the future of HM Courts & Tribunals Service.
The statement explains how the work we are doing will provide the public with a justice system that is Just, Proportionate and Accessible. In practice, these principles aim to deliver swift and certain justice.
A summary of reforms and consultations to support the joint system are available here. It includes plans to make the system more straightforward by reducing legal jargon and allowing people to plead guilty to some minor offences and pay fines online.
Vulnerable victims and witnesses will no longer have to appear in court under new plans to roll out pre-trial evidence sessions. The move follows 3 successful pilots which showed that victims felt less pressure with pre-trial evidence giving and witnesses were better able to recall events.
A separate consultation has also launched today to seek views on how best to deliver the Lord Chancellor’s commitment to increasing the diversity of our judiciary.
Wednesday 14th September 2016
‘Whole-society’ approach needed to tackle financial exclusion
The Money Advice Trust has today called for a ‘whole-society’ approach to tackling financial exclusion with a stronger leadership role from Government, in evidence to the House of Lords Financial Exclusion Committee. The Committee, chaired by Baroness Tyler of Enfield, is examining financial exclusion and access to mainstream financial services.
The charity, which runs the free National Debtline advice service, pointed to fundamental issues around poverty, low levels of financial capability, products and services that do not always meet the needs of low-income consumers, barriers arising from new technology, vulnerable circumstances and problem debt as among the most significant causes of financial exclusion.
In its written submission to the Committee’s call for evidence, which closes today, the Trust describes financial exclusion as “a significant social problem, the scale of which necessitates a co-ordinated, whole-society strategy in response”, and calls on the Government to a “greater leadership role” in improving financial inclusion in the UK.
The Trust has called for a renewed focus on financial inclusion from the new Government and interventions including;
- Implementing the Financial Inclusion Commission’s recommendationfor a senior governmental lead on the issue – a ‘Minister for Financial Health’ – and departmental champions, working in conjunction with local, regional and devolved government
- Earlier, more co-ordinated financial educationin schools and giving the new money guidance body replacing the Money Advice Service from 2018 a statutory co-ordinating role in financial capability
- A focus on behavioural insightsfrom financial services firms in developing and delivering timely interventions to improve financial capability at key life events, and a new fintech innovation fund to encourage new technologies explicitly aimed at supporting financially excluded group
- Measures to build a more sustainable and modernised credit union sector and drawing lessons from examples of affordable credit initiativesoverseas, including Australia’s Good Shepherd scheme and the Irish Government’s ‘It Makes Sense’ programme
- Action to ensure that free debt advice is fully integrated into Universal Support, with a greater role for phone and online channels, in conjunction with local face-to-face agencies for those who need face-to-face advice
The charity welcomed several recent Government interventions including on Basic Bank Accounts, pension auto-enrolment and the new Help To Save Scheme, but pointed out these policies have emerged in a “piecemeal” fashion and “have not been the product of an overarching strategy” since the end of the previous Financial Inclusion Taskforce in 2011.
Joanna Elson OBE, chief executive of the Money Advice Trust, the charity that runs National Debtline, said:
“The scale and complexity of financial exclusion in the UK is so significant that nothing less than a concerted, whole-society strategy to tackle it will do.
“We believe the new Government now has an ideal opportunity to take on more of a leadership role on this crucial issue. We hope that Ministers will carefully consider the recommendations of the Financial Inclusion Commission in its report last year, in addition to the work of the House of Lords Financial Exclusion Committee, which has given this agenda a welcome new focus in Parliament.
“Crucially, any new strategy must recognise that problem debt is both a cause and consequence of financial exclusion – and reducing the former should be seen as a crucial component of tackling the latter. This should include ensuring that many more people in financial difficulty receive the free debt advice they need to resolve their debt problems and get back on the road to financial health.”
StepChange Debt Charity response to the Law Commission’s recommendations on logbook loans
In response to the Law Commission’s recommendations on protecting consumers from unfair logbook loans, Peter Tutton, Head of Policy at StepChange Debt Charity, said:
“Legislation on logbook loans is over a century old and not fit for purpose, so it is good to see action being taken. Logbook loans can cause significant harm and the current protections are wholly inadequate.
“We need effective, modern consumer protection and these recommendations are a positive step forward. However, in their current form, they will not provide adequate protection and the people who will suffer are the ones that need it the most.
“If people have to actively opt-in to receive protection from the courts against lenders repossessing their car, our evidence suggests it will not work. It requires too much proactivity and understanding from financially vulnerable people who may not even feel able to open their mail. It also requires too little from sub-prime lenders seeking to take away a car that could be essential for work or family life.”
Tuesday 6th September 2016
FCA’s ‘welcome reminder’ on future interest rate changes
Money Advice Trust comments on FCA’s ‘Financially Vulnerable Customers’ thematic review
The Financial Conduct Authority (FCA) has today published the key findings of its ‘Financially Vulnerable Customers’ thematic review, which examined the strategies mortgage lenders have in place to mitigate the impact of future interest rate rises on financially vulnerable customers.
The review began in early 2016, at a time when an interest rate rise was widely anticipated. While interest rates have since been cut in the wake of the EU referendum result, the FCA said that it has “decided to share the results of our review to assist firms and customers to prepare for when interest rates do rise”.
In its findings, the FCA concluded that “most firms have acted followed publication of our previous thematic report and our Occasional Paper No 8: Consumer Vulnerability”, but that firms are at “different stages in developing strategies to mitigate the impact of an interest rate rise on financially vulnerable customers”, with “more work … needed before these strategies will be ready to implement”.
Jane Tully, director of external affairs at the Money Advice Trust, the charity that runs National Debtline,said:
“It is encouraging that the FCA has found that mortgage lenders are responding well to its previous work on vulnerability.
“At the same time the regulator is right to highlight that different firms are at different stages in their specific work around interest rate rises and the impact that these would have. This is perhaps understandable in an economic context that has changed significantly, with interest rates having been cut in the meantime.
“However, we are pleased that the FCA has published this work as a welcome reminder that interest rates will still rise at some point in the future, and that financially vulnerable borrowers will need help with the transition away from the currently low-rate environment.
“Despite the base rate cut, firms should continue their preparations to be ready to support customers who are vulnerable to the impact that future interest rate rises could have.
“The Money Advice Trust has previously worked with the Building Societies Association to support its members in preparing customers for interest rate rises, and we look forward to working with lenders of all kinds to be ready for this in the years ahead.”
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The FCA’s key findings are available at https://www.fca.org.uk/news/news-stories/financially-vulnerable-customers-thematic-review-key-findings
Media enquiries should be directed to Matt Hartley on email@example.com or 0207 653 9741 (07880 384075)
About the Money Advice Trust
- The Money Advice Trust is a charity which helps people across the UK tackle their debts and manage their money with confidence. The Trust’s main activities are providing free advice through National Debtline, Business Debtline and My Money Steps; supporting advisers through Wiseradviser and Innovation Grants; and improving the UK’s money and debt environment through policy, research and awareness raising campaigns.
- National Debtline provides free, impartial debt advice from experts who care. National Debtline is run by the Money Advice Trust and can be contacted at
- The National Debtline twitter handle is @natdebtline
New Common Financial Statement (CFS) trigger figures will be published on 1st October 2016. By updating the trigger figures we are ensuring that the CFS continues to be up-to-date for all users during the transition phase to the Money Advice Service Standard Financial Statement (SFS) which will launch in March 2017.
We are working closely with the Money Advice Service to plan for this transition to ensure that all CFS licence holders have adequate lead-in time to move to the SFS. We will provide further information about this transition shortly.
When do changes need to be made?
There will be a switch-over period of two months starting from 1st October 2016. All licence-holders should ensure they are using the new CFS trigger figures by 1st December 2016 in order to remain CFS-compliant.
How do I access the new trigger figures?
The trigger figures will not be published until 1st October 2016. From 1st October 2016CFS licence holders will be able to access the new trigger figures from the CFS website: www.cfs.moneyadvicetrust.org
Members of the public and non-licence holders
The CFS can only be used by licence-holders working in debt advice, debt recovery and related fields. However, members of the public can complete a CFS-style budget online at www.nationaldebtline.org or www.mymoneysteps.org.
Financial Capability Week 2016 announced
The first ever UK Financial Capability Week will take place from 14 – 20 November 2016.
Organised under the umbrella of the Financial Capability Strategy for the UK and coordinated by the Money Advice Service, Financial Capability Week will bring together a wide variety of organisations and policy makers from the worlds of industry, banking, finance and charities. It will aim to raise awareness about the stubbornly low levels of financial capability across the UK and encourage organisations to work together to address this issue and help people make the most of their money.
The week will launch on 14 November at the Bank of England and will be opened by Money Saving Expert’s Martin Lewis. Throughout the rest of the week there will be a range of events and activities designed to encourage discussion, share best practice and celebrate successes over the last year.
Over 200 organisations are taking part in the week in a number of ways, either by sharing financial capability information, getting involved in social media discussions or hosting events to showcase their work.
Andy Briscoe, Chair of the Financial Capability Board comments:
“We look forward to bringing together the many organisations who work tirelessly to help improve the nation’s financial capability. The Financial Capability Week is an ideal opportunity to share best practice and to discuss how we can further coordinate our efforts. We will also be celebrating the progress made in our first year following the Strategy launch.
“I would like to encourage all organisations who are interested in helping drive up financial capability to get involved in the Week. Share what you know, take part in our social media debates and even arrange events yourselves with our help. More information can be found at
Martin Lewis, founder of MoneySavingExpert.com says:
“The internet boom of the last 15 years has seen great strides made in improving the financial capability for millions of people – providing instant information and tools to help. Yet that means the gap between the information knows and knows nots has grown even wider; and that information gap translates directly to people’s standards of living. Financial Capability Week is crucial to persuade more people that it pays to invest time into understanding money.”
Organisations interested in taking part in Financial Capability week can find more information and download a participation pack at www.fincap.org.uk/fincap-week .Updates can be found on Twitter @FinCapStrategy.
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For more information, contact Joe Cockerline or Joanna Brady at the Money Advice Service press office. Emailpressoffice@moneyadviceservice.org.uk or call 020 7943 0593 during office hours or 07767 438 670 outside of office hours.
NOTES TO EDITORS
Comments from organisations taking part in Financial Capability Week
Michelle Cracknell, Chief Executive of The Pensions Advisory Service comments:
“We are looking forward to supporting MAS during the Financial Capability Week. It is so important to encourage people to get a better understanding of finances. We know from our helpline that people tend to put pensions in the “too hard box” and are therefore missing out on opportunities to save more efficiently for their retirement. This week is a good way to help people save more when they have more knowledge.”
Chief Executive of Citizens Advice Gillian Guy said:
“We know some people don’t feel confident about managing their money, which is why is it really important there are good financial capability programmes on offer to help people get a better grip on their finances. Not only can this help them overcome current financial problems but it also stands them in good stead to avoid any money issues in the future. This week is an opportunity to take stock on the difference financial capability can make.”
Phil Loney, Group Chief Executive of Royal London, said:
“Royal London is proud to support Financial Capability Week. Often managing budgets and making financial decisions can be daunting, which is why financial institutions have an important role to play in tackling low levels of financial capability to help people make their money go further.”
Michael Mercieca, CEO of Young Enterprise comments:
“Financial Capability Week is a great opportunity for different organisations, who have varying insights to offer, to get together to discuss the importance of financial education. Young Enterprise is thrilled to be involved in the initiative and we look forward to sharing our guidance on educating young people in money matters, ensuring that the next generation of school leavers are equipped with the skills, knowledge and experience to be financially proficient.”
James Jones, Head of Consumer Affairs for Experian comments:
“Experian is committed to helping people take control of their finances, get better deals and save money, both through our public education programme and wide range of online tools and services. We’re delighted support the first ever Financial Capability Week and look forward to joining others to share and promote best practice.”
Hannah Maundrell, Editor in Chief of money.co.uk:
“So many people make mistakes with money because they missed out on a financial education; this massive knowledge gap needs to be plugged. Budgeting is a baseline for being good with your cash so we’re supporting Financial Capability Week by helping people learn this simple skill that will really set them up for life.”
Joanna Elson OBE, chief executive of the Money Advice Trust, the charity that runs National Debtline, said:
“Amid renewed economic uncertainty, it has never been more important to focus on improving financial capability in the UK. At the Money Advice Trust we will be using Financial Capability Week to highlight the money management challenges facing young adults, in particular.
“Our new research shows that while many under 25s are trying to budget and actively manage their personal finances, 42 percent are finding money management harder than they had expected – and far too few are seeking advice from charities like National Debtline when they get into difficulty. Financial Capability Week will be a useful forum for organisations to discuss how we can begin to address that gap.”
Guy Rigden, CEO of MyBnk comments:
“Managing money well opens up new opportunities. For a young person leaving care, knowing how to budget for a weekly shop can help them live independently for the first time in their lives. For a Sixth Former, understanding student finance could influence their decision whether or not to go to university. Whatever their background, whatever their goals, being financially capable matters, big time.
“For young people it has become as important as reading, writing and arithmetic as a key, enabling life skill that cannot always be learnt the hard way.
“During the week MyBnk will work with young people, teachers and financial experts to create and deliver workshops that excite and engage young people with money. We will motivate them to act, challenge their attitudes and help them form positive behaviours. A collaborative approach ensures our collective impact is greater than if we all operate in silos.”
Maddie Dinwoodie, Money for Life spokesperson and Director of Programmes at UK Youth, said:
“Being financially capable is key to young people as they become independent and start making important financial decisions. Events like the Financial Capability Week are great at raising awareness, sharing best practices and discovering innovative ways to work collaboratively across the financial and charity sectors. UK Youth’s new national programme, Money for Life, delivered in partnership with The Mix and funded by Lloyds Banking Group as part of its ambition to help Britain prosper, is a great example of one of these collaborative approaches. Through building practical money management skills and encouraging young people to talk about finances; Money for Life empowers 16-25 year olds to make the most of their money.”
Financial Capability Week themes hosted by Money Advice Service
Young people and financial capability
Financial Capability and working age people
Older people and financial capability
Regional partner events
About the Financial Capability Strategy for the UK
The Financial Capability Strategy was established as a ten-year strategy to address the stubbornly low levels of financial capability across the UK. The Strategy aims to bring together individuals and organisations to deliver a collaborative approach to improving levels of financial capability, as well as establishing the interventions that are proven to work and seeing that as many people as possible benefit from them. The strategy can be found at www.fincap.org.uk/uk_strategy
About the Money Advice Service
The Money Advice Service is an independent organisation. It gives free, unbiased money guidance online at moneyadviceservice.org.uk or via free phone on 0800 138 7777. Debt advice is also provided through a variety of partners across the UK. The Service was set up by Government and is paid for by a statutory levy on the financial services industry, raised through the Financial Conduct Authority. Its statutory objectives are to enhance the understanding and knowledge of members of the public about financial matters (including the UK financial system); and to enhance the ability of members of the public to manage their own financial affairs.
Please see details below for the planned November event of the Northern Ireland Discussion Forum.
Subject – Welfare Reform, what is the impact, and are we ready for it ?
Date -Friday 18th November 2016
Time – 9.30-1.30
Venue -NIACRO, Amelia House, Amelia Street, Belfast
Expected Speakers –
Social Security Agency
Housing Executive – challenges and guidance on what legislation is being put in place, is the housing stock available v housing need.
Banking in GB experience
Enforcement of Judgements Office
Please email me your interest/apologises and any special requirements to firstname.lastname@example.org Further details will follow when programme is confirmed.
The Money Advice service have conducted research into young adults and their money habits.The outcomes highlight that young adults who are least confident with money are three times more likely to have problem debt. It also notes that of the 24% of young adults who are over-indebted, only one in ten are seeking advice. This has been generated as part of the Financial Capability Strategy to provide insights for organisations who are considering financial capability interventions for young people, helping them to engage and target them effectively.
MAS – YOUNG ADULTS AND MONEY Thursday 1st September 2016
Press release: 12 years’ disqualification for director whose company sold potentially toxic cancer ‘treatment’
Click here to see the press release
Press release: 14-year bankruptcy restriction for bankrupt who lived the high life at expense of investors
Click here to see the press release
The Insolvency Service have launched the DRO2 and are starting a phased role out, see below for further information.
Click here to be taken to the Insolvency website.
Average debt to friends and family now over £4,000
The number of people seeking debt advice who owe money to friends and family is rising rapidly and the average amount borrowed is now more than £4,000, according to new figures from StepChange Debt Charity.
The charity’s figures from the first half of 2016 show that 28% of the charity’s clients now owe money to friends and family, compared to 20% in the same period in 2014. The total amount they borrowed from friends and family is now almost £200 million, up 72% during the same period.
Research conducted by StepChange Debt Charity shows that debt can damage relationships, with one in three indebted people reporting negative effects caused by their financial problems and one in 20 revealing a break-up as a result. The charity is warning that borrowing from friends and family can make the problem even worse and brings other risks, including possible delays to seeking debt advice.
The figures come from the charity’s Statistics Mid-Yearbook, due to be released next week.
Rapid rise in debts to family and friends
The charity’s latest statistics show that the average debt to friends and family among its clients has risen from £3,176 in the first half of 2014 to £4,046 in the same period this year, an increase of 27%. The total amount owed to friends and family has grown from £115 million to £198 million over the last two years, an increase of 72%. As a proportion, 28% of the charity’s clients owe money to friends and family, up from 20% in 2014.
Total debt to friends and family
% of clients
Amount of people
First half of 2014
First half of 2015
First half of 2016
Borrowing from friends and families can have serious consequences
StepChange Debt Charity is warning that this kind of borrowing can have adverse effects on relationships with family and friends.
In a poll of over 1,000 people in financial difficulty, StepChange Debt Charity found that 31% reported negative effects on their relationship caused by debt, with 5% saying it led to them breaking up. With the added pressure of the friend or family member being their lender, StepChange Debt Charity says it could cause even further damage to someone’s relationships.
The charity is also warning that although borrowing from loved ones might seem like a useful and affordable way to avoid serious financial difficulty, it might not solve the problem long term if the person is already struggling. When people are in problem debt, taking on more borrowing can sometimes mean a delay in tackling the underlying problem and it can make a debt problem more severe and more entrenched.
Mike O’Connor, Chief Executive of StepChange Debt Charity, said:
“It is good that people support their friends and family, but lending them money can bring serious and unexpected problems. If repayments to a family member or friend are then missed, or more money is needed to make ends meet, debt can cause serious damage to their relationships as well.
“Lending money to help someone you care about is understandable, but if they are already in financial difficulty, more borrowing is not necessarily the answer and it can make things worse. People need to take practical action to solve the underlying debt problem and taking debt advice is vital.
“When someone is struggling with problem debt, they should get free, independent debt advice. StepChange Debt Charity exists to provide free, independent advice to anyone who needs it on 0800 138 1111 or www.stepchange.org.”
An update from UKAR on :
Are you prepared for the Standard Financial Statement
Tackling Financial Abuse
Click here to be taken to the UKAR website
FCA publishes Occasional Paper looking at the predictability of financial distress
Click her to be taken to the FCA website
30th August 2016
Sheila Wheeler, Director of Debt Advice for the Money Advice Service comments in response to the Money Advice Trust: Borrowed Years report
“It is great to see that young people have good money management skills, however we are concerned to see that they are still building up significant debts which could have big impact on their financial futures. Our own research has found that only one in ten young adults (aged 16-24) who are over indebted are seeking advice. Young people have a range of financial challenges to face from funding university or college courses to low incomes and high rents. We understand how hard it can be to manage and we want to call on anyone who is feeling the financial strain to seek free advice as soon as possible. The Debt Advice Locator Tool will help you find free, high quality help in your area.
PR and Media Manager
Tuesday 23rd August
Sheila Wheeler, Director of UK Debt Advice for the Money Advice Service comments on TUC’s report: Britain in the Red report
“We are concerned to see the high levels of household debt across the UK, particularly the number of people borrowing money to cover living expenses. Our latest research estimates that 8. 2 million UK adults suffer with problem debt, with younger adults, larger families and single parents noticeably at higher risk. We know that free debt advice works but currently, only one in five people with financial difficulties is seeking advice. We are calling on everyone with problem debt or money worries, no matter how large or small, to access free advice as soon as possible using the Debt Advice Locator Tool to find free, impartial advice in their area.
“We also fully support the TUC’s call to help low income families get access to debt restructuring and insolvency support. People experiencing debt need time and support to get their finances back on track without pressure from their creditors. We acknowledge the value of this Breathing Space within the UK Financial Capability Strategy. Such a scheme already exists in Scotland as part of the Debt Arrangement Scheme (DAS) which provides people with space to get adequate support in dealing with their finances. We will continue to work with HM Treasury, the Insolvency Service and organisations across the debt sector to ensure people in debt, across the UK, have the support they need.”
PR and Media Manager
Money Advice Service
The Money Advice Service will be running a number of conferences in Feb 2017 focussed on sharing best practice, driving innovation and using insight to support debt advice delivery for advice organisations.
The primary audience for conferences will be advice managers and supervisors and is free for attendees.
They plan to host a number of conferences across the UK, all running in February. Dates and locations for info are below:
- 08/02/2017 – Cardiff
- 09/02/2017 – Bristol
- 15/02/2017 – Birmingham
- 16/02/2017 – Manchester
- 22/02/2017 – London
- 23/02/2017 – Leeds
Each conference will cover:
• Sharing best practice findings from the Peer Review Quality Scheme;
• A chance to learn more about the new way to assess client’s income and expenditure, via the Standard Financial Statement which will go live from March 1st 2017;
• The opportunity to engage with insight about delivering advice via a peer support structure.
People can register and find all the details here: https://www.eventbrite.co.uk/e/best-practice-and-innovation-for-debt-advice-tickets-27188293919
As previously advertised on the MALG latest news items, please find attached the Conference booking form for the CCUA.
CCUA Conference booking form
Along with the Conference Flyer
Annual Conference 2016 – Flyer
PANEL CALLS ON FCA TO ACT ON CMA’s ANALYSIS OF CURRENT ACCOUNT WOES
Responding to the CMA’s summary final report into banking markets the panel have released a press release. Click on the link below to see the full press release.
FSCP CMA_final_report_press release
To coincide with the UK Industry event we held recently at the Farnborough Air Show, Arrow Global has launched Debt Britain, a guide to consumer debt in the UK. The report provides a comprehensive overview of the state of personal indebtedness in the UK. It focuses on the problems that over-indebtedness and defaults can cause for the individual, and also considers the broader economic context. You can access the report from the Arrow Global website via this link
Click on the link below to be taken to the ABCUL newsletter.
Sheila Wheeler, Director of UK Debt Advice for the Money Advice Service comments on Citizens Advice A Debt Effect? report:
“We know that mental health issues and debt can go hand in hand. Our own research shows that over half (52%) of clients who have received debt advice from Money Advice Service funded partners also have a mental health condition. We have been working in partnership with the Scottish Legal Aid Board (SLAB) on the Making Advice Work (MAW) programme. This consists of a range of pilot projects designed specifically to target advice at vulnerable groups of people, including those with mental health issues. The programme has enabled us to learn what works to reach vulnerable people who have debt advice needs, and how organisations can work in partnership across mental health and debt advice sectors to achieve this.
“It is important that a person’s situation is looked at as a whole, and that they have access to the different types of support they need, be it mental health or debt advice. Close partnership working between organisations ensures that people with debt problems are provided with timely and appropriate support and advice. We welcome the opportunity to work with organisations who want to encourage vulnerable people to get debt advice. More information about the Making Advice Work programme can be found on the Scottish Legal Aid Board (SLAB) website.”
R3 Personal Debt Snapshot (July edition)
Please find attached a copy of R3’s latest Personal Debt Snapshot. The research, conducted before the EU referendum, looked at levels of indebtedness and how British adults deal with gaps in their finances. The research shows that British adults faced with a gap in their personal finances are most likely to plug it by cutting their spending.
The research also shows that the average in-debt British adult owes £5,778 to their creditors (excluding mortgages and student loans) – equivalent to 11 weeks’ average weekly earnings for a UK worker (£503 per week) and seven months’ average rent in England & Wales (£792 per month). When the survey was conducted at the beginning of June, 37% of British adults were fairly worried about their current level of debt, the lowest level since research began in 2010. Economic pessimism was also down, with just 14% expecting their personal finances to worsen in the next six months.
R3’s latest Personal Debt Snapshot (July 2016)
CSA announces new Code to promote best practice and improve confidence in trace.
CSA Press Release – New Code
Lord Justice Briggs’ Civil Courts Structure Report
Click here to go to the report.
The Money Advice Service have announced the “Go-Live Date” for the Standard Financial Statement.
Click here to see the press release form the Money Advice Service
The FCA carried out a market study on the credit card sector, one of the largest consumer credit markets that they regulate. They have now published their final findings report.
Click here to see the findings of the FCA’s credit card market study
The latest information from the Financial Ombudsman Service for your information
Please click here to be taken to the latest website news.
Please find below a link to the Standards of Lending Practice-Personal Customers launched this month which will take effect on 1st October 2016 and replace the present Lending Code.
Please click here to see the new Lending Practice.
Please click here to see the press release for the launch.
Attached is the newsletter produced by Regulatory Strategies along with their view on how they see Brexit effecting business in the UK.
Click here to view Regulatory Strategies Newsletter
Click here to view Regulatory Strategies opinion on Brexit
Please find details of the Insolvency Service Report and Accounts for 2015-2016
Please click here to go to the report
Please find a link below to the Insolvency Statistics for 2015 for England and Wales
For further information click here
A report recently published by Citizens Advice Scotland based upon four years of data rom the experience of clients living in poverty.
A Interesting report on the impact of Universal Credit in Scotland :
Details of the AdviceUK Conference 13th October in Birmingham are now available, please click the link below for details and booking information.
This month includes an update from UKAR’s new CEO Ian Hares, Christians Against Poverty’s Rachel Gregory discusses key learnings from their annual Client Report and UKAR and One Advice Group examine the importance of CSR. We also look back at a busy conference season.
You can view it here
The fees charged to apply for bankruptcy and company insolvency are changing from 21 July 2016. Further information can be found from the link below.
Changes to insolvency fees