Category: Economy

The UK Government’s Cuts and Reforms due in April

Apr. 01 Economy, Political News no comments

The UK government under the leadership of Prime Minister David Cameron will be introducing cuts and reforms in the first week of April. It was describe to be a day wherein Britain will face a lot of changes. These changes will affect areas of health, tax, justice and welfare.

The following changes that were introduced included the Universal Credit or called the in and out of work credit.  Due to start with the implementation this April, the change is aiming to increase the incentives of for the unemployed to be able to give them a chance to work. It was also announced that the benefit up rating will start. The tax credits and welfare benefits would not increase and can only rise after three years by only 1 percent. The welfare benefit cap will also start on the 15th of April in some parts of the United Kingdom like Croydon, Bromley and some London boroughs. When this will be implemented, welfare claimants would no longer receive an amount more than the average annual working household income.

There will also be a change in the commissioning of the NHS. The board will already be in charge of controlling the budget for the services of patients. In addition, there will also be a change in the regulation of financial industry. The FSA will be replaced by the Financial Conduct Authority and the Prudential Regulation Authority. The scrapping of the disability living allowance will be replaced by the Personal Independence Payment. The people who earn big will have a tax cut amounting to £100,000.

Prime Minister would ban EU Nationals claiming Benefits

Mar. 25 Economy, Political News no comments

A tough immigration plan for the British Prime Minister. Mr. David Cameron has a lot of plans to toughen Britain’s immigration policy. He has promised to ban EU Nationals from claiming their benefits if they can no longer provide evidence that they are working or in the quest of looking for work.  In addition, Mr. Cameron had plans on restricting the migrants in the UK to have social housing if they weren’t able to stay in the UK for 5 years.

During the weekend the said plans were released. According to some critics the proposal would create problems between the UK Government and the European Union. The job seeker’s allowance coming from the government will only be utilized by the migrants who were seeking work. Mr. Cameron said immigration has already benefited Britain. The statement of the Prime Minister was published in the newspaper The Sun. It is well know that immigration in Britain wasn’t controlled well by the Labour government: figures show that there an estimated 2.2 Million people got in and (and some out) of the country while they were in power.

The Prime Minister wanted the migrants to come to Britain and work. He added that in the case of migrants nowadays in Britain, they come to the UK and work but only for a short time but they have full access of the benefits that the government gives out. When a migrant wants to work in Britain for a short period of time, he or she can only access the benefits after six months.

Millions of Britons not Saving for the Future

Feb. 25 Economy, Finance no comments

Saving should be encouraged among others who often work hard and spends more but does not leave any amount to spare for future needs. People nowadays are having a hard time doing all the budgeting because everything seems to be increasing but jobs are not that stable and the salary is not even increasing. It is a challenge to those who have spent most of their lives at work. Devoting their time to their profession to earn more money and to live and pay for their daily needs. A lot may have been affected by the recession and most of the time people have debts that they can’t even handle.

A new study has revealed and alarming result among the Britons. It was found out that there is fifteen million Britons who do not save or even thinking of saving for their future. The study also included that there were more and more Britons borrowing money in the form of loan and this are big amount of money to be able to sustain their needs on a daily basis. In the United Kingdom’s population there are 31% who fail to save last year. The study has shown that families fail to save because they loan money to give to their children. It would turn out that the burden is placed on the parents.

The finances of the parents would probably fall and they could no longer have the chance to save. Same research has found that many grandparents would offer help to their grandchildren. Most of the Britons often cut their savings since they need to prioritize the cost of living which has been drastically rising. The annual living cost that has increased was caused by many factors that include lifestyle, education, and the increase of life expectancy.

PM David Cameron Threatened by Starbucks

Jan. 28 Business, Economy no comments

The company of Starbucks that is based in Seattle, Washington who is known to be providing Britons their morning lattes and mochas has threatened Prime Minister David Cameron on issues regarding tax. Starbucks Coffee, known to be the largest coffeehouse chain in the world, that serves both hot and cold quality beverages and pastries have more than 20,000 branches around the world. The company first entered the United Kingdom in the year 1998 having a lot of chains in different cities.

The threat of the company was said to be suspending some of its investments in Britain due to a negative attack on matters of tax that was brought about by the Prime Minister and its government.

During the World Economic Forum 2013 in Davos, Switzerland the Prime Minister has released a statement that read, “Wake up and smell the coffee”, thus reported by telegraph that was referring to the company who has been avoiding their tax obligations. Kamal Ahmed, Business Editor of the telegraph.co.uk, on his article said that the statement of the Mr. Cameron was used to attack Starbucks in Britain for failing to pay the corporation tax.

In every country, no one can escape from paying taxes. Even individual citizen contributes taxes to the government for its general use in the country’s improvement. Most of the countries in the world really impose the so called corporate tax or company tax but on a case to case basis there are others who are exempted to pay such taxes. The issue on tax evasion is common already. Big corporations and establishments are often involved in this kind of situation.

Inflation and the Difference in Salary and Benefit Rises

Jan. 08 Economy no comments

A high rate of inflation is not good news for any economy. It means that in real terms the same £1 in your pocket will buy you less than it would have previously. Salaries often rise year on year taking a worker’s productiveness or years of loyalty into account, especially if there is steady inflation in the cost of living. However this is not the case in a recession, where many workers see their salaries capped at a low rate, frozen and for some even cut. Workers in the public sector have generally seen pay freezes although salary changes in the private sector vary greatly.

Official figures state that since 2007 there has been a rise of 12% in private sector pay. They also declare that at the same time the value of benefits for the unemployed have increased 20% comparatively. The Work and Pensions Secretary Iain Duncan Smith claims these figures show unfairness towards working people, emphasising the government’s aim to make it ‘pay’ to work. These are the reasons behind the coalition led vote in Parliament to cap the rise in benefits (notably not a cap for disability or pensioner benefits) to just a 1% rise instead of being exactly in line with inflation – which is higher at 2.7% as of early January 2013.

Labour are against the proposal, criticising the cap as being unfair and unrealistic. They have offered their own statistics that state that for the past ten years benefits for the unemployed have not risen at the same level as wages have. Critics from charities have also spoken up at the potential rise in poverty and how it will affect the poorest in society the most.

The plans to cap the rise in out of work benefits at 1% are controversial. The vote will take place in Parliament today to determine if the cap will go ahead.

EU’s Seven Year Budget: Bargaining Proceeds Until Friday

Oct. 10 Economy no comments

The 17 nation Euro zone countries are to begin discussion about their seven-year budget. Deep in debt and recession, the nations are divided into two; those calling for cuts and those calling for more spending with quality investments to proliferate EU-funded economies.

Poland called for the maintenance or the increase in the spending levels of EU-funded countries. The United Kingdom along with other contributors to the EU funding stated that cuts are needed because €987 billion are at stake in the seven year plan. France objects to any cuts in agriculture and infrastracture development in poorer regions.

Currently, the 2014-2020 Multi-Annual Financial Framework made by European Council President Herman Van Rompuy had €309.5 billion for cohesion and €364.5 billion for agriculture, which makes 32% and 37.5% of the budget respectively.

EU Commission President Jose Manuel Barroso exclaimed that others did not consider the quality of investments and instead focused on cuts and austerities. German Chancellor Angela Merkel states that if no deal between the nations can be achieved this week as it extends to Friday, another summit might be needed in 2013.

UK Prime Minister David Cameron said that it spending rises, UK may have to use its veto power. Netherlands and Sweden backed up the call for a freeze in spending.