Swift Change in Debt Advise Funding for 2011

Things changed rapidly in the United Kingdom this week as yet another change has come down the pipe: the Government has changed its mind on the funding of debt advice centres. A large number of debt advice specialists have had their jobs saved at the last minute thanks to the fact that £27 million in Government funding was budgeted for their services at the last minute. However, not all of the debt management centres will be staying open because many continue to rely on local funding in addition to national. That means that choices will still be limited despite the change.

The change in the budget means that the Financial Inclusion Fund’s £27 million needs have been met, but only for this coming year. Debt advisers were about to be made redundant, but the funding will allow approximately 500 of them in both Wales and England, to continue offering their services. Now that they can disregard their redundancy notices they received only a short time ago, these advisers will be able to carry on as usual, trying to help people during one of the worst debt crises the UK has seen in many years. According to some, this could actually be a historic peak of consumer debt and the removal of these services could have pushed that bar even higher.

More than 100,000 people are helped annually who face complex debt cases and many of these people are in debt due to ill health, a serious injury they suffered or other situations beyond their control. Lack of access to quality debt advise could put them at serious risk. These particular specialist whose jobs have been saved posses skills that go beyond what the Citizens Advise Bureau can offer in their free advise. They are able to go to lenders on behalf of the debtor to seek a resolution to a situation.

Still, even with funding these centres have only so many free advisers who can only deal with so many people at a given time. If you are seeking help from reputable debt advice providers then you are certainly encouraged to explore the links to your left which have been accrued here as a resource for those seeking debt help. Since there is always a way out of even the most complex debt situations, it is certainly worth exploring those options.

Consumers Worry Over Debt Advice Funding Cut by UK Government

Borrowers in the United Kingdom that are struggling with debts are now going to find it quite a bit harder to get proper help, say many experts, when it comes to dealing with their debts. Those seeking quality debt management help will now need to find impartial companies to help them. This is due to the Government deciding to remove funding for services offering debt advisory to the public.

The Financial Inclusion Fund was confirmed in parliament during January 2011 to be be getting major cuts by financial secretary to the Treasury, Mark Hoban. More than 500 debt specialist advisors have been trained by the FIF project and that training will come to an end as of March 2011, as will the support for those individuals. This means that England and Wales charities are going to have many fewer spots to take on clients and some of these services will be shut down entirely.

The previous Government had provided £130 million to fund face to face debt help, especially gearing the programmes to help those in the economy who are suffering the most from lack of valid advice on how to handle debts. Now, reputable companies will be expected to fill in the gap.

The figures for how much good has been done by the FIF funded advice providers since 2006 are quite remarkable. Those providers that the former Department of Trade and Industry selected all shared funding to help £6 billion in debt be managed among nearly 380,000 Britons and allowed 3,000 families to remain in their homes. By allowing families to stay in their homes more than £150 million in costs were cut for both lenders of mortgages and the courts that would otherwise have been wasted on repossessions. This does not even count the costs of mental health services not needed due to reduced stress from debt for those the advice providers were able to help.

Even creditors were able to fare well thanks to the service as £300 million more in debts were able to be recovered that would have been impossible without borrowers having help to find ways to repay that did not deteriorate their lives and ability to pay.

Sadly, while the funding of this network of services was only £30 million annually to continue, it has been brought to an end even as demand is predicted to increase for such advice. The combination of cuts to public sector employment opportunities, rising interest rates and general inflation are combining to create a need that some predict will mean 2 million people could be seeking debt help in 2011 alone.

With this infrastructure gone, many are looking to find debt advice from reputable companies like those listed to the right of this article. If you are seeking a way to get your life back on track and get advice on how to handle debts from an impartial source, this is a sound way to go. Each company can offer valid, confidential help and advice to those struggling with debts.

PM Cameron Speech Raises Concerns for Some

At speech during the World Economics Forum which took place recently in Switzerland, UK Prime Minister David Cameron brought up British debt management in a move that caused some in his home country to raise their eyebrows. The reason for noticing this particular topic in the PM’s speech is due to the fact that the Government has indicated it has plans to do away with the Financial Inclusion Fund. According to Cameron, the UK needs to focus on savings and investments as opposed to consumption and debt, at the economic level.

Some watch dogs for consumers believe that this could be indicative of a coalition government attempt to, at least in gesture, bring up the tremendous debt burdens being faced by huge numbers of British citizens today. With insolvency on the rise towards record breaking levels and more than £1.5 trillion in personal debt in the UK today, many believe this would be a timely and relevant topic for the PM to address.

At the same time, any real hope of Cameron advocating assistance to UK citizens facing struggles with debt was nullified by the report released from the Legal Action Group a short time later. In that report, it was made known that the Financial Inclusion Fund is set to end this March since legal and and local government grants are taking sharp cuts. This means that the approximately 500 advisors whom the Financial Inclusion Fund previously employed to help nearly a hundred thousand Britons with their debt problems as part of the Citizen’s Advice Bureau and similar centres in the not for profit sphere will now be unavailable to counsel. Instead widespread redundancy will affect the majority of these advisors.

Some experts who work for charities have expressed dismay at the situation, pointing out that there is an increased demand today for debt advice due to rising unemployment and such a difficult economy. With the advisors lost, it will be far more difficult for those in the UK who are struggling with debt to know where to turn.

If you face debt struggles yourself, you should investigate the options to the right of this article. This site has been created as a neutral voice for fairness in debt issues and a resource for those who struggle with debt. The organizations featured here are presented for your convenience so you can take control over your situation by arming yourself with sound debt advice from trusted sources to find solutions that work for your life.

UK Government Shutting Down Unsavory Debt Management Companies

In the United Kingdom, the Office of Fair Trading has come out swinging against predatory debt management companies that have been deemed unscrupulous due to their practices of taking advantage of those who are facing rough financial times. Consumers with nowhere to turn had put their trust in these companies, nearly 130 of which were sent warnings by the OFT in September of 2010. Now, close to three dozen of those firms have been forced to hand over their licences for handling consumer credit.

A probe the OFT has taken into this particular market has meant that 15 such companies actually warrant criminal investigations for their activities that some in the British media have called ’shameful’ and ‘confounding’. More firms are being thoroughly sniffed out by the OFT in regards to their business practices and adherence to UK business ethics. This checking into the market that is supposed to be helping cash strapped consumers reorganise their debts was done as a way to find out if the companies were complying with UK regulations and sadly, many have not been.

Financial experts say that the best debt management firms will still be in business, unlike those which had resorted to targeting consumers with phone calls from sales people trying to get them to sign up for services. Those with debts might have at first recoiled from the high pressure sales tactics, but the burden of debt often puts people in a vulnerable position and having the phone ring for something other than a collections agency can even be a bit of respite that offers hope. These tactics are certainly frowned upon by most in the UK as less than savory at best or down right predatory at worst.

Banks have been vocal in their criticism of these unscrupulous firms, particularly the way the firms would attempt to persuade UK consumers to neglect paying off loans without a proper warning of what the results of that route could be. Proper debt management firms, none of which have been found in violation by the OFT, have strict guidelines on keeping their clients fully informed of the results that any action can bring because their business is based on improving lives, not grabbing up money at the expense of clients and lenders alike.

Overall, debt management firms continue to provide valuable service to those with debts in the UK, however, experts are quick to point out. Now that the schemers are being driven from the market, it will be far safer for British debtors to choose a firm they know they can depend upon for help resolving their personal debt issues.

UK to Use Debt Collectors to Force Taxes to Be Paid

In a move that has shocked many in the United Kingdom, HM Revenue and Customs has decided to turn to debt collection agencies in order to go after those who have unpaid taxes or owe other money to the Government. More than £1.5 billion in unpaid taxes are expected to be collected and the debt collectors involved are said to be profiting by £70 million from this arrangement. Even Britons who owe very small amounts are sat to be in the sights of the collectors, the same debt collectors who have previously brought in more than £1.3 billion yearly for the Government. This may well signal a massive move towards Debt Management Plans for those who owe and do not wish to deal with such tactics, consumer advocates say. Those who can use this alternative may be able to escape the uncomfortable process the Government has planned for those who have missed paying debts.

Already, HMRC has tested this approach, sending some tax payers’ debts to debt collection firms such as those who owed over £10,000 or those who owed £700 or more on their national insurance. These firms go far further than HMRC officials would, upping the techniques used to try and collect payments. They will make phone calls, send notices by post and eventually send a bailiff to attempt collection. This is certainly not catching favor with tax experts who have voiced their anger over the situation. They have pointed out that HMRC has failed to collect on its own and is now using tax money to pay debt collectors to do its work for it. This, combined with the fact that it has blundered, they say, on many occasions with errors, make the hiring of outside firms a ‘travesty’ and ‘unacceptable’.

Many are concerned that those targeted could be elderly or persons living on benefits who would be frightened of being pursued by debt collection firms that often use intensive tactics to try and elicit payments. Those who have received errors in their tax code could also be forced to pay, via less than gentle methods, taxes which they do not actually owe. This situation is particularly likely among Britons who can not afford to seek help in verifying the accuracy of their tax code this year. In 2010 alone, tax collection errors ended up sending many UK citizens the wrong tax codes – multiple times. Nearly 6 million in the UK were told in September that they had paid too much tax for two consecutive years.

Some with debts to HMRC that were caused by faulty tax codes will be able to have those written off, but experts still insist that sending in debt collection firms to collect tax debts is not the UK way.

Baby Boomer Generation Struggling with Heavy Debts in UK

The year 2009 had proven to be a tough one for those entering the retirement age in the United Kingdom with a recent report showing that over 134,000 Britons had sought either an IVA, a Debt Relief Order or even bankruptcy. However, 2010 has been shown to have even more dispiriting statistics with that number rising to more than 135,000 people facing the same types of insolvency. That means, over the course of 2010 around 15 people sought such options each hour throughout the course of the year. While those considered pensioners have made up less than 5% of this group, they are the fastest growing segment. Nearly 15% more Baby Boomers are now reaching this point, having to face retirement with heavy debts they are simply unable to pay down.

According to experts, this makes the Baby Boomers the very first generation that is accustomed to carrying debts throughout the course of their life, in recent times. Loan after loan, say experts, and constant reliance on credit cards, are what has led this generation to its current state. With well over 2 decades of credit under their belts, the debts have just kept on mounting for many of them. A fixed income is now making it even tougher for them to be able to pay down these debts and that is certainly something they are having trouble with. Along with the upward trend of the VAT, interest rates are said to be guaranteed to rise and, along with that, rates for insolvencies. 2011 is not looking to be a good year for insolvencies, with many predicting more than 140,000 for the upcoming year.

Economic upheaval, rising taxes and much more have all come together at the worst possible time for the Baby Boomers, along with plenty of other generations, and the situation is definitely expected to continue well on into 2012. In the North, the rates of debt have been higher for personal insolvency while in the South East and London, things are mildly better.

Over all, economists and personal financial advisers alike insist that it is going to be smart and difficult financial decisions that clear the way for a brighter financial future.

Welsh Students May End Up with Varying Debts Due to Merging Universities

Universities in Wales are being given financial incentives to merge, says the NUS Wales President, and this could mean students will have ‘varying levels’ of debt as a result. Some say graduates could end up with lower debt, but students in Wales will also be protected from fees of up to £9,000 that would be part of the changes in the rest of the United Kingdom, according to Education Minister Leighton Andrews.

Andrews has insisted that those universities which do not ‘adapt’ to present changes will ‘die’ and that higher fees will go to those universities which are willing to make adaptations. Critics of the mergers say that the disparity in debt levels, with those students who are in universities that do not merge paying far more than those in merged universities, creates intense financial unfairness that jeopardizes the pursuit of higher education. This leads to increased levels of debt not just for students, but also for families and those caring for students as they pursue their degrees.

According to Ken Richards, a UK economist and also a former advisor on higher education, the merger could mean more money directed to educating students and improving the experience students have while in university. Examples of Welsh universities which would be merged include: University of Glamorgan, Newport University and University of Wales Institute Cardiff.

Part of the impetus for these mergers is that students not only in Wales, but across much of the UK today, are coming out of school so heavily indebted that it could take them years to achieve enough income to be free of that debt. This is seen as discouraging in many respects since, paired with excessive spending during university years, mounting debt could slow a graduate’s full participation in the UK economy.

Hike in Tuition Prices Would Push UK Students Into Deeper Debt

Students in the United Kingdom have already been facing severe costs in terms of pursing their higher education goals, but it appears that the cost could go up sharply soon. A controversial vote is about to take place among Ministers of Parliament wherein they consider a plan which would create tuition increases across Britain. The current coalition has been met with extremely hostile critique and social outrage from students in the UK who have organised extensive mass protests to get the government and media’s attention to the issue.

The planned hike in tuition would nearly double the amount students pay for courses, with fees going to £6,000 in many cases, but upwards of £9,000 for others. With so many current and graduating students racking up debt so rapidly, even before these hikes many are opting for debt management plans simply to stay afloat and avoid even more dire financial straits before they have had a chance to begin their working life.

Liberal Democrats have been facing tremendous opposition from students due to a pre election pledge to fight any fee increase in tuitions. For their part, the MPs have stated that the proposed fee increases will be more fair to students than the system which is currently in place.

Protesting students point out that the plans, based on a Browne independent review of student finance, could dissuade those of lower economic classes from pursuing a university education. Before the Commons vote to take place on December 9th takes place, students are planning to take ‘massive action’, according to the National Union of Students.

Currently, fees are not allowed to exceed £3,290 and a number of MPs remain opposed to raising it with only a few MPs coming out to say they will vote against it.

Those pushing the proposals say students will not pay anything up front and that they do not need to begin paying back their degrees until they earn £21,000 – a figure that many believe will seem smaller around 2016 when the first wave of graduates would be coming out after the proposals passed, if they did. Already, students face a high cost of living and if inflation comes into play as many economic experts expect, the £21,000 could be a dramatically small amount in terms of its real world value and thus leave students struggling with heavy debt.

Conservatives continue to argue that low income students will have to put in less than the current system asks of them, under the new proposals, and that the fees must be raised to keep universities in Britain competitive at the global level.

Alternative plans such as graduate tax that takes only a portion of a graduate’s income, has not gained enough momentum to see popular support by the MPs.

Irish Take to Streets Enraged Over Debt Situation

In what is one of the largest public demonstrations in the history for the Irish Republic, the streets of Dublin churned with more than 100,000 protesters upset about Ireland’s economic future. It turns out that the country is facing 4 years of harsh austerity thanks to an international bailout.

The European Union now controls much of the country’s fate, a scary notion for many here who face incredible debt after many parts of Ireland’s economy are now in shambles. More than 85 billion euros will be delivered as part of a bailout package to Ireland, but as the details are beginning to get finalized, many in the country are now upset to discover that it is the banks, not the people, who will be receiving the help.

Despite bitter cold, an organized march took place to O’Connell Street and once there, a portion of the demonstrators had a stand off with the Garda Siochana just outside the Dail. Many were upset with Brian Cowen, the taoiseach, and a photo of him was burned during the proceedings.

While the situation was tense between some of the protesters, younger people who were particularly angered by the politics involved, it remained mostly well organized. Young and old alike united in their opposition to the European Union and International Monetary Fund bailing out Ireland’s banks and, in so doing, trying to adjust public policy in the process. This ‘puppeteering’ as some referred to it, led to the Irish banks getting help while the Irish people continue to suffer.

What many find most disturbing about the loan is that where Greece’s bailout featured 5.2% interest, Ireland’s loans from some sources will include interest as high as 6.7% which many find to be ‘punishing’ to a nation that is struggling to make an economic come back with many citizens still deeply in debt.

Among those hardest hit will be those earning minimum wage, as part of the package for the bailout requires that the minimum wage be lowered. Those who run companies, particularly in hard hit industries such as construction, are upset over what they view as initiatives in the bailout that are hostile to Ireland’s most vulnerable workers.

The UK, also, is set to extend £10 billion of credit to Ireland.

Gas Prices Set to Rise in UK Making Life More Expensive

British citizens are getting some rather confused messages via the media these days, ill set against a backdrop of heavy consumer debt. It turns out, there is a gas glut that leading experts predict will be in place for quite some time to come. According to the Energy Networks Association and the International Energy Agency, the next decade will see vast amounts of gas available for consumption. However, a brief look at the bills of the Scottish and Southern Energy or British Gas customer bills shows that the cost of this gas has actually risen by between 7 and 9 percent, confusing a great number of customers.

With many suffering debts from past credit splurges, or simply due to the economy’s rising prices, and looking to debt management as a way to get by, this could set those trying to regain financial ground back even further. Advocates say forging ahead is crucial in the elimination of debts, but these rising basic costs are certainly a puzzling and disappointing revelation for many.

What folks in the United Kingdom are struggling with understanding is due to the way the news about excess gas supplies is presented to them. Tighter supply originating from Europe is being combined with an abundance of the substance being brought over from the United States. Since Britain continues to turn to the North Sea for approximately thirty percent of its gas supply and nearly fifty percent from the European pipeline, that leaves only fifteen percent to come in via cargo ships from the US.

This, combined with the fact that liquefied natural gas, or LNG, being shipped from Middle Eastern nations like Qatar has experienced problems compounds the issue. In addition, a great deal of LNG ends up heading to Asia because customers there are willing to pay more than those in the UK. Demand has spiked following the global recession, as well. All of these factors have lead to an upswing in UK gas prices that has surged by more than 25 percent in 2010 alone.

This week, the station at Isle of Grain will receive the very first shipment of LNG from the US and that puts the National Grid in good shape, say economists. Even with the issues, the prices of wholesale gas should be falling, but energy suppliers have proven loathe to lower their prices, despite the fact that they are quick to raise them whenever possible. However, even wholesale prices are lower so the rise in what consumers pay is troubling to analysts who say that they should not need to pay as much as during far more severe price increases.

A lack of transparency in how gas suppliers get their gas and what they pay for those supplies is considered to be part of the reason the companies seemingly are able to raise consumer prices when many are hurting as they continue to lower their own prices. More word is expected to come on this issue as journalists continue to investigate a real crunch on British citizens from the gas utilities.