Concern over RBS job losses

Royal Bank of Scotland (RBS) is to cut a further 1,400 jobs from its retail banking head office over the next two years, it announced yesterday. The Bank said that up to half of the losses will be at the bank’s offices in Edinburgh, where the ‘back room’ jobs under threat include marketing, communications and other support functions.

The latest round of redundancies follow the loss of more than 35,000 job cuts since public money was used to bail out RBS following the financial crisis – the government still owns more than 80% of the bank.

Ross McEwan, the chief executive of RBS’s UK retail operations, said: “To serve our customers well, we have to ensure that our resources are focused on the things that matter most to them. Regrettably, we can only do that by restructuring the way we work in head office, so that every effort is concentrated on supporting our customers and the frontline staff that serve them. This is clearly difficult news for our staff and we will do everything we can to support them, including seeking redeployment opportunities wherever possible to ensure compulsory redundancies are a last resort.”

The Unite union described the cuts as “brutal and irresponsible”. Warning of the impact that the cuts will have on local economies and customer service, Unite national officer Dominic Hook said: “This is brutal and irresponsible behaviour from RBS which is almost entirely owned by the taxpayer. It is high time that the banks took its social responsibilities seriously. Since the beginning of the year RBS, HSBC, Barclays and Lloyds have announced plans to slash around 6,900 jobs. The industry almost caused the economy to implode in 2008 and now it is contributing to a jobs crisis.

“RBS made £826 million in the first quarter of this year, the bank is returning to profit. Unite does not believe there is a business case for cutting jobs so drastically. RBS argues that the restructure will make the bank more customer focused but a bank can’t be more customer focused with 1,400 fewer staff. Unite is demanding no compulsory redundancies and we expect this state-owned bank to do everything to ensure this is the case.”

There will be a significant impact on RBS staff in head office functions in Edinburgh with the rest of the cuts spread across the country. Two departments providing support to front line staff are being cut by 80 per cent. Since 2008 the bank has cut over 30,000 staff.

Local politicians have also expressed concern over the job losses. Speaking after yesterday’s announcement, Edinburgh Western MSP Colin Keir said: “This is devastating news and I understand that the bank have spoken to the Scottish Government who are acting as quickly is as possible to ensure that appropriate support can be brought in to minimise the impact and soften the blow for the people concerned. The staff facing this terrible news are not the ones who caused the crisis at RBS but members of staff with mortgages and everyday budgets and expenses – and many of them are my constituents. I met RBS this afternoon and have discussed how they will support staff through this difficult time.

“Whilst this news is deeply disappointing the long term investment being announced for Gogarburn, highlights the strength of business locating in Scotland, and I hope this will increase long term security for RBS employees. My thoughts are with the people who are experiencing losses today.”

North and Leith MP Mark Lazarowicz said: “This is a body blow to staff at RBS at what is a difficult time for anyone looking for work. I have been in touch with union officials in support of the staff and I will be seeking a meeting with senior management to discuss the redundancies. At the meeting I will be asking for a clear indication of future employment plans for the bank’s Edinburgh operations and assurances that these job losses are not part of a policy of outsourcing.

“The Chairman and Chief Executive of RBS claimed recently that the financial restructuring of the bank was largely over and that the Government could start preparing to return RBS to the private sector. That should not be at the expense of hard working employees, many of whose colleagues have already paid the price of the failure of management at the bank in the years prior to the financial crisis through losing their jobs.”

Councillor Frank Ross, the city council’s Economic Convener, said: “While this is disappointing news, Edinburgh remains an important player in the world financial markets. We were always aware that the financial crisis would result in a degree of restructuring in the finance sector and that, unfortunately, this would impact on levels of unemployment in the city. Obviously we recognise that this brings great uncertainty and worry for those affected. For this reason, we will seek to work with the Government, their agencies and our partners to ensure the workforce are supported as much as possible and I will be pulling together a task force to coordinate this activity.”

Hugh Rutherford, Chair of the Edinburgh Business Forum, said: “Although disappointing news we need to remember the financial institutions who have recently opened centres here including Tesco Bank, Sainsbury’s Bank and the Green Investment Bank thanks to our talented and skilled workforce. This continued investment from the financial sector in Edinburgh will help keep the City economy growing. The diversity and strength of the Edinburgh financial services sector, which has been growing through the downturn, and the skilled financial services workforce, will hopefully be absorbed by the new growth sectors in the financial areas of the capital.”

Earlier this month, RBS reported a return to profit the bank hopes to return to the private sector next year.

Meet the Funders event in April

Meet The Funders 18 April

Is your community group looking for funding? Daft question, really – things have never been tougher for the voluntary sector. There are still some funding opportunities out there, however, and next month at the Assembly Rooms there’s a chance to meet potential sponsors.

The city council-organised Neighbourhood Partnership ‘Meet the Funders’ event takes place on Thursday 18 April from 1 – 4pm at the Assembly Rooms on George Street. An impressive group of funding providers will be exhibiting on the day, so if you’re a group looking for support this is an opportunity not to be missed. It’s completely informal and you can drop in any time – put the date in your diary now!

Swinney calls for welfare cuts U-turn

The Chancellor should use next week’s UK Budget to revisit welfare reforms which stand to place real strain and hardship on Scottish families, Finance Secretary John Swinney said today. Writing to the Chancellor ahead of Wednesday’s Budget, the Finance Secretary has highlighted the impacts in Scotland of the UK Government’s welfare reform programmes.

The letter sets out Scottish Government analysis which shows, for example, that whilst the bedroom tax will save the UKG money, this will be outweighed by the costs imposed on the Scottish economy. Over time the policy will remove £110m from the economy, through its impact in Scotland alone. This does not capture the wider social costs of the policy nor the distress and disruption that it will cause.

The letter also highlights that the full package of welfare reforms will present significant financial and operational challenges for all layers of government in Scotland. In his letter to the Chancellor Mr Swinney urges the UK Government to:

Provide immediate support for investment and jobs
Withdraw its bedroom tax policy
Take action on the distribution of European Structural Funds (ESF)
Improve access to finance for small and medium sized enterprises
Devolve responsibility for Air Passenger Duty to the Scottish Parliament

Commenting on his letter Mr Swinney (pictured below) said: “Since 2010 the UK Governments fiscal policy has been premised on the need to maintain market confidence and the UK’s AAA credit rating. The Chancellor has chosen austerity over investment in growth and jobs and the cost has been the continuing deterioration in the public finances, prolonged recession and the downgrade of the UK’s credit rating.

“That cost is increasingly borne by the most vulnerable in our society and public services in Scotland urgently seeking to mitigate the worst impacts of the UK’s disastrous welfare reform programme. Scottish Government analysis shows that based on reasonable assumptions the projected UK Government savings from the bedroom tax are significantly outstripped by the net loss to the UK of over £100 million over the long-term. This policy is unfair, is unlikely to deliver savings in real-terms and cuts across devolved policies. The Chancellor should use his forthcoming Budget to withdraw it.

“While we welcomed the Chancellor’s partial recognition of the need for urgent investment to boost growth in the Autumn Statement. we again call on the Chancellor to use this Budget to provide a real stimulus and greatly expand capital investment With colleagues from Wales and Northern Ireland, I have also called on the Chief Secretary to the Treasury to invest in growth.

“Small and medium sized businesses are the lifeblood of Scotland’s economy. Growth will be led by the private sector yet it continues to be choked by half-hearted Coalition measures. Figures released last week on bank lending again confirm that the UK Government’s action to improve access to finance for the country’s small and medium sized businesses is failing to deliver. We continue to press the Coalition Government to go further and faster in improving access to finance.

“With the powers of independence Scotland would have the economic levers and the scope to tailor welfare policies in line with Scotland’s interests, to ensure that Scotland’s businesses and people no longer have to fund the failures of a UK Government.”

Credit Unions – a local alternative to payday loans

A couple of news items caught my attention last week. One was about the number of empty shops on high streets and in shopping centres across the country. The economy is still in the doldrums, and people are just not spending. Apparently one in five retail units currently lies empty. It’s not all doom and gloom, however – recessions and depressions bring business opportunities for some, and it’s boom time for pawnbrokers and ‘pay-day loan’ companies. It seems these enterprises are springing up all over the place – perhaps our only growth industry, even.

The other piece of news was the Westminster government’s crackdown on these very same companies – the top fifty have been ordered to get their house in order or face closure by the summer.

The Office of Fair Trading said that the £2 billion a year industry has got to clean up it’s act. OFT Chief Executive Clive Maxwell said: “We have found fundamental problems with the way the payday market works and widespread breaches of the law and regulations, causing misery and hardship for many borrowers”.

He added: “Payday lenders are earning up to half their revenue not from ‘one-off’ loans, but from rolled-over or refinanced deals, where unexpected costs can rapidly mount up. This irresponsible lending is not confined to a few rogue payday lenders – it’s a problem across the sector. If we do not see rapid, significant improvements by the fifty lenders we inspected, they risk their licences being removed.”

For most, payday loans are something to avoid – everyone knows about the eye-watering interest rates being charged. Pay day loan companies often only quote what a loan will cost you in pounds and pennies, but take out a typical payday loan and you could find yourself being charged at a rate of anything between 1,600 % and 2,700%.

And that’s all the more shocking at a time when personal loans from ordinary high street banks have never been cheaper, available for as little as 9% APR – assuming, of course, that you can get one. But for those that can’t – an increasing number of desperate people –payday loans are the only option, the last resort. And these same people then often find themselves mired in a nightmare spiral of ever-growing debt, sometimes facing the distinct possibility of losing their homes – local advice organisation like Granton Information Centre have reported a significant increase of people tackling serious debt issues.

So a crackdown on payday loan companies – however welcome – won’t help the thousands of people who are currently tied in to horrific loan arrangements. What can they do?

Firstly, seek independent advice, from an organisation like Granton Information Centre or your local Citizens Advice Bureau. DON’T take on another loan to cover your last one.

And think about going a Credit Union. Credit Unions were set up to help people just like you, offering mutual and ethical savings and affordable loans. Credit Unions are regulated ‘Not for Profit’, Member-Owned (mutual), Financial Service Co-operatives and can best be described as organisations that encourage their members to save together and lend to each other responsibly. This allows these members the opportunity to gain greater control over their finances.

Community-based, community owned and community operated, two Credit Unions operate in the local area – North Edinburgh Credit Union in Wardieburn Drive and Capital Credit Union in Stockbridge.

Association of British Credit Unions Ltd (ABCUL) Chief Executive Mark Lyonette said last week: “Given the anecdotal evidence we hear from credit unions that help payday loan customers pick up the pieces, we are not surprised that the OFT has found evidence of such large scale poor practice in the payday lending industry.

“Loans repayable in full within a few weeks are rarely appropriate or affordable because this only stores up problems for later. If a loan is needed, spreading repayments over a few months will usually make more sense. Credit unions are a great source of affordable credit and many have helped people get out of the expensive habit of using payday loans. They can also help people to look at their finances and get into a savings habit so that they do not have to rely on a short-term loan next time they are short of money.”

North Edinburgh Credit Union’s Annual General Meeting

will be held on Thursday 21 March at 6pm at the NECU office on Wardieburn Drive.

Go along and support your local credit union

Don’t fall for early pension cash scam

Have you reached an email or letter recently offering you the opportunity to make some quick cash by surrendering your pension plans early? In these cash-strapped times the offer of ready money may sound tempting, but the chances are the deal really is too good to be true.

A hard-hitting information campaign for consumers and pensions professionals has just been launched as part of an ongoing multi-agency crackdown on predators claiming to be able to release pensions cash as a loan or lump sum before the law allows.

According to The Pensions Regulator, the perpetrators often work alongside ‘introducers’ or ‘advisers’ who try to entice the public with spam text messages, cold calls or website promotions into transferring their existing workplace or private pension with the promise of being able to release a portion as cash before the age of 55.

People may be misled or not properly informed that tax charges and fees can erode their pension pot by more than half, leaving them with little to live on in retirement.
The remainder of their funds are likely to be invested in highly dubious and risky, unregulated investment structures, often based overseas.

The amount that has been ‘liberated’ from pension schemes in this way is known to be in the hundreds of millions of pounds, with thousands of members affected.
To combat this, The Pensions Regulator has worked with other agencies to produce information, carrying distinctive scorpion imagery, illustrating the threat to people’s pensions if they are taken in by such offers.

The new information includes:
A warning insert that administrators and pension providers will be asked to include in the information they provide to members who request a transfer of their pension.
A more detailed information leaflet for members looking to understand the consequences of these offers, which will be hosted on The Pensions Advisory Service website.
An action pack for pension professionals, including a checklist and examples of what to look out for.

Where administrators receive a transfer request and detect the warning signs of liberation, such as pension money being passed back to the member before age 55, they may wish to consider whether to make the transfer, and report their concerns to Action Fraud. The action pack includes more information to help them with this decision.

If you think you may have been a victim, or if you have information regarding pension liberation fraud, contact Action Fraud on 0300 123 2040.

Mixed views on Scottish budget

A budget to create jobs and kickstart the economy or a timid budget that slavishly follows George Osborne’s spending cuts agenda? There were mixed reactions to John Swinney’s budget statement yesterday …

The Draft Budget for 2013-14 and the actions the Scottish Government will take this Autumn will provide further investment in construction, skills and the green economy, John Swinney told Holyrood yesterday. Setting out the budget to Parliament, Finance Secretary John Swinney pledged £180 million over two years for construction, skills and employment and a green economic stimulus. He also confirmed more rapid delivery of the Schools for the Future programme worth £80 million. Reinforcing the Government’s commitment to young people Mr Swinney announced an initiative to create up to 10,000 job opportunities for young Scots.

The Budget maintains the Government’s commitments to a council tax freeze, police numbers, no tuition fees, free prescriptions and concessionary travel, with protection for the NHS budget.

Announcements include:

£40 million for affordable housing, starting this year
£80 million Schools for the Future programme through NPD
Creation of an Energy Skills Academy
Employer recruitment initiative for young people
£17 million for college education and student support
Commitment to the Living Wage
£6 million for cycling
£1 million for Elite athletes
£2.5 million for hybrid buses
£1.5 million for VisitScotland
£1 million for historic buildings

The Finance Secretary also confirmed a modest 1% increase for most Government and NHS employees, with additional support for the low paid, continued implementation of the Scottish Living Wage and no compulsory redundancies.

Addressing the Parliament Finance Secretary John Swinney said:

“Today I am announcing a Scottish budget for jobs and growth. In difficult economic times this Government is doing everything within its limited power to stimulate Scotland’s economy, to invest in our young people, protect households, and support front line services.

“To support the construction industry and inject growth into the economy we will provide an immediate stimulus to the construction industry of £40 million through investment in affordable housing.

“I am also determined to ensure our young people get the best education in the best possible schools. So to further assist the construction sector we will increase the number of schools being built from 55 to 67 bringing forward £80 million investment through NPD.

“A Green Investment Package of £30m over the next three years will help home owners improve energy efficiency, cutting bills and tackling fuel poverty whilst along with investment in low-carbon transport supporting our growth industries and helping to meet our climate change targets. We will also establish the Renewable Energy Investment Fund continuing our support for Scotland’s growing energy sector.

“I am also investing in the future of our young people with support for a national employer recruitment initiative that will create up to 10,000 opportunities for small and medium-sized enterprises to recruit young people, the establishment of an Energy Skills Academy to support the creation of skills in oil and gas, renewables, thermal generation and carbon capture and storage industries and additional funding for colleges to maintain student numbers and support.

“I have used every option available to draw down resources to fund a further economic stimulus to the Scottish economy of over £180 million. Through use of budget exchange mechanisms, early repayment of loans and careful managing of the capital budget I have drawn down funds to invest in Scotland’s economy. We are also reaping the benefits of the public ownership of Scottish Water which, as well as allowing Scottish customers enjoy the benefit of water bills on average £52 lower than in England also enabled us to reduce our lending to the company by £45 million allowing that money to be invested in the economy.

“We are doing everything we can to support growth, public services and opportunities for the future but the UK Government needs to realise that more needs to be done. Only with the full levers of independence can Scotland properly capture economic opportunity and tackle inequality and poverty and we can do so more efficiently and effectively than currently happens in the UK.”

Predictably, the reaction of opposition parties, local authorities and the trades unions to the budget statement was less than enthusiastic. The STUC said a one per cent pay increase for government staff was, in reality, a pay cut and councils are concerned about implementing another tax freeze while having much less cash to provide services.

Labour’s finance spokesman, Ken Macintosh, said: “This is yet again another pass-the-buck budget from John Swinney. According to him, it is all either Westminster’s fault or the responsibility of councils. The unfortunate result of this Budget is likely to be the loss of more public sector jobs, but with little to kick-start the economy.”

Conservative finance spokesman Gavin Brown agreed, saying: “The Scottish Government promised much, but delivered precious little. It has failed miserably to kick-start the economy.”

And Willie Rennie, leader of the Scottish Liberal Democrats, added: “Mr Swinney said he wanted a ‘relentless pursuit of economic growth’ but this is a timid budget proposed by a government more focused on independence than economic
growth.”

The Scottish Trades Union Congress claim that Mr Swinney has ‘followed George Osborne’s public sector pay policy almost to the letter’. STUC General secretary Grahame Smith said: “A third year of significant real terms wage cuts for hundreds of thousands of workers puts Mr Swinney’s attempts at stimulus into perspective.”

Kevin Keenan, finance spokesman for council umbrella group Cosla, said: “There are no surprises in what the Cabinet secretary presented to parliament, but it has to be accepted that there are challenges in there, challenges that will need to be faced by all 32 councils in Scotland.”

Not all sectors of society have condemned the budget, however, and Scotland’s business leaders have given Swinney’s budget a cautious welcome. David Watt, of the Institute of Directors Scotland (IoD), said: “Scotland needs a budget that supports growth. The Finance Secretary has announced a number of commendable initiatives, but we need to see more of the detail of the Budget to understand where the cuts have been made in order to fund these.”

The Scottish Federation of Housing Associations (SFHA) welcomed the announcement of an additional £40m investment in affordable housing. Chief executive Mary Taylor said: “We are extremely pleased that it recognises the immediate economic and social benefits for Scotland in building more affordable homes and we also welcome the government’s recognition of the benefits of focusing on construction investment.”

The Scottish Building Federation also backed the budget.

How will the budget affect you? Let us know!

Spring clean your finances on Dosh Day!

Lottery-funded Money Matters is offering a free opportunity to get your finances in order on Dosh Day – 21 March – at North Edinburgh Arts Centre.

Come and talk to representatives from:

Citizens Advice Bureau,Edinburgh.

Castle Rock Edinvar H.A. financial inclusion team.

Specialist Energy Advisor – advice on reducing your gas and electric bills.

North EdinburghCredit Union

LGBT – promote health of lesbian, gay, bisexual and transgender people. Also information and advocacy.

Healthy Living – help with stop smoking, healthy eating and drink awareness.

Adult Education – help with reading and writing.

JobCentrePlus – help in finding a job.

Volunteering and work information.

PLUS MANY MORE!!

Money saving ideas and a day of free advice from a range of organisations, plus free giveaways, free prizes, free things to do in Edinburgh, and more.

on Wednesday 21 March 2012, from 10.30am till 3pm,

at North EdinburghArt Centre, 15A Pennywell Court.

(next to Muirhouse library, walk through Muirhouse Shopping Centre)

Lothian Buses – 27, 32 and 37