Tag: finance

Financial education for school children at home during lockdown

Yorkshire Building Society has launched six online lessons of its financial education programme Money Minds, to support parents, carers, teachers and all Key Stage 1 and Key Stage 2 primary school pupils as well as Key Stage 3 secondary pupils through the coronavirus pandemic.

Due to new national lockdown measures leading to the closure of schools, the Society has released two Key Stage 1 (aged 5-7) digital Money Minds lessons on the topics of ‘Keeping Money Safe’ and ‘Wants and Needs’ and two Key Stage 2 (aged 8-11) lessons on the topics of ‘Vacation Venture’ and ‘Project Party’ to teach them about the importance of budgeting.

The Society has also launched two new Key Stage 3 (aged 11-14) digital lessons for students on the topics of ‘Bills and Budgets’ and ‘Project Profit’ to teach them about the importance of budgeting and being financially resilient.

The video lessons should take between 25-40 minutes to complete and are presented by colleagues from the Society.

Money Minds is a free programme consisting of a series of activities and projects designed to promote discussion and learning amongst children and young people and is usually delivered in schools by colleagues from the Society as part of its volunteering programme.

Society colleagues working in branches are key workers and are supporting customers with essential financial services through the Covid-19 outbreak and new lockdowns.

Sharon Stirling, manager at Yorkshire Building Society’s Edinburgh branch filmed the ‘Keeping Money Safe’ and ‘Project Party’ lesson which teaches children how to budget whilst planning a party.

She said: “We know that there have been really hard times over the last nine months for children, teachers, parents and guardians. Now with schools closing again I hope that our digital Money Minds lessons will help in any small way in making their lives a little easier by providing some quality ‘go to’ content available to use for home-schooling or in classrooms for vulnerable children and those of key workers.

“I’ve delivered numerous face-to-face Money Minds lessons for the Society to pupils in the past and know from experience how impactful they are. The feedback we have received so far on our online sessions has been really positive so we are really pleased they are being well received.”

Louise Neill, Community Manager at Yorkshire Building Society has developed the financial education lessons. She said: “We’re committed to supporting children and young people in teaching financial education through our Money Minds programme. As we usually have our colleagues volunteering in schools we have had to adapt the way we deliver these.

“It’s incredible that our branch colleagues, classed as key workers supporting customers with essential financial services through the lockdowns, have been able to extend the help they can offer by providing these lessons which will continue to improve financial capability in the next generation in the UK.”

More than 25,000 pupils across the UK have now received a Money Minds lesson since the programme launched in 2015.

When children have completed the lesson their parents or guardians can e-mail the Society and they will be emailed a certificate.

Parents, teachers, guardians and children can view all available online Money Minds lessons at www.ybs.co.uk/media-centre/money-minds-home-school

More information about Money Minds can be found at www.ybs.co.uk/your-society/money-minds.    

Pay: The Great Divide

The High Pay Centre’s ‘High Pay Day’ research, published this week, is evidence that the government must rebalance the economy after Covid-19 to make it fair, says the TUC.

High Pay Day is the day in 2021 on which the typical FTSE 100 chief executive has already earned the same as the average wage for a whole year. 

The research finds that top bosses earn around 120 times the annual pay of the average worker. 

High Pay Centre’s research suggests that the median FTSE 100 CEOs earnings for 2021 surpassed the median annual wage for a full-time worker in the UK at around 5:30 pm on Wednesday 6 January.

The calculations are based on our previous analysis of CEO pay disclosures in companies annual reports, combined with government statistics showing pay levels across the UK economy.

HPC estimate that with CEO pay levels remaining essentially flat in their analysis, while pay for UK workers had increased slightly, it means that CEOs have to work 34 hours of the year to surpass median earnings, rather than just 33 hours in 2020.

However, the most recent figures on CEO pay and UK full time workers’ annual earnings is still too dated to fully account for the impact of the coronavirus – therefore it remains to be seen how this has affected pay gaps across the UK, both over the duration of the pandemic and in the longer term.

Pay for top CEOs today is about 120 times that of the typical UK worker. Estimates suggest it was around 50 times at the turn of the millennium or 20 times in the early 1980s.

Factors such as the increasing role played by the finance industry in the economy, the outsourcing of low-paid work and the decline of trade union membership have widened the gaps between those at the top and everybody else over recent decades.

These figures will raise concern about the governance of big businesses and whether major employers are distributing pay in a way that rewards the contribution of different workers fairly. They should also prompt debate about the effects that high levels of inequality can have on social cohesion, crime, and public health and wellbeing.

TUC General Secretary Frances O’Grady said: “This tells you everything you need to know about how unfair our economy is. 

“Our army of minimum wage workers – carers, shop assistants and delivery drivers – have kept the country going through the pandemic. Not these CEO’s at the top raking in far more than their share. 

“We must make the economy fair. If the government is serious about levelling up Britain, it needs to start by levelling up pay and conditions for those we most rely on, and stop the threat to freeze key workers’ pay. 

“Ministers must bring forward the long-awaited employment bill to end expoitative working practices like zero hours contracts, and boost rights and pay.”

£400 million of new funding to support Scotland through Covid-19

New funding of £800 million is being guaranteed for the devolved administrations in Scotland, Wales and Northern Ireland to support people, businesses and public services with the ongoing impact of Covid-19.

Yesterday’s announcement increases the UK Government’s unprecedented upfront guarantee this year to at least £16.8 billion on top of funding outlined in Spring Budget 2020.

This funding can be spent on priorities such as the NHS and business support.

This means a further £400 million for the Scottish Government, £200 million for the Welsh Government and £200 million for the Northern Ireland Executive.

Any changes to devolved funding are normally confirmed towards the end of the financial year – but in July the UK Government introduced an unprecedented guarantee to provide them with funding certainty to respond to Covid-19.

Wednesday’s announcement ensures that all parts of the UK can continue their response to Covid-19 through the winter months.

The Chief Secretary to the Treasury Steve Barclay MP said: “We’ve already committed unprecedented levels of support to Scotland, Wales and Northern Ireland.

“This extra funding will provide the nations with the certainty they need to plan through these difficult months.

“We remain committed to an economic recovery for the whole of the United Kingdom and will continue to work closely with the devolved administrations to support people and businesses.”

Scottish Secretary, Alister Jack said: The UK Government is committed to supporting people in all parts of the UK during this difficult time which is why today we have given £400 million extra to the Scottish Government for their Covid-19 response. This brings our total additional Covid-19 support to Scotland to £8.6 billion since Spring Budget 2020.

“This is on top of direct UK Government Covid-19 support to people and businesses in Scotland, including the furlough and self-employment schemes, business loans, VAT cuts for the hardest hit sectors and investing billions in our Plan for Jobs and our welfare safety net.

“The UK Government is also providing the bulk of Covid-19 testing in Scotland and we invested £6 billion to ensure we were the first country in the world to roll out the first vaccine.

“The strength of the Union and support offered by the UK Treasury has never been more important. Together, we will continue to get through these challenging times.”

People and businesses in Scotland, Wales and Northern Ireland will also continue to benefit from the UK Government’s unprecedented £280 billion UK-wide economic response package.

This includes schemes such as the Coronavirus Business Interruption Loan Scheme and the Bounce Back Loan Scheme providing billions in support to businesses across the three regions.

Alongside this, millions of jobs in the three regions continue to be supported through the Coronavirus Job Retention Scheme and the Self-Employment Income Support Scheme.

Latest COVID-19 funding allocations

Money for business support and vaccine programme

More than £1.8 billion of extra funding has been allocated to tackling the impact of coronavirus (COVID-19) in Scotland.

It covers areas including health, transport and business support, accounting for all but £330 million of the latest consequentials generated by UK Government spending. The remainder will be used to meet further urgent demands relating to both COVID-19 and Brexit up to the end of March 2021.

The funding is detailed in a letter from Finance Secretary Kate Forbes to the Scottish Parliament’s Finance and Constitution Committee.

Ms Forbes said: “From the outset, I have ensured that the money we receive is distributed as quickly as possible to where it is needed most. Our decisions have provided vital additional resources to our NHS, schools and other public services, they have kept our transport system running and provided much needed financial support for businesses impacted by the pandemic.

“To provide full transparency, I detailed earlier allocations in the summer and autumn budget revisions. This latest round will deliver measures such as the COVID-19 vaccination programme, local business support packages and free school meals over the holidays.

“The UK Treasury has indicated that this funding covers the period up to March 2021, so I have allocated £330 million as a contingency to ensure we are in a position to provide further support to health and businesses, including for issues arising from Brexit, as it is required over the coming months.

“Our limited borrowing powers mean we do not have flexibility to increase spending to meet demand and therefore must manage our expenditure – much of which is demand led so cannot be accurately calculated in advance –  within the consequentials provided.”

The latest allocations include:

  • around £600 million for health and social care, wider public health initiatives and welfare support. This includes the COVID-19 vaccination programme, test and trace and the £500 bonus for health and social care workers. 
  • support for business and the wider economy totalling £570 million, including funding for the strategic framework, local business support packages, the newly self-employed hardship fund and local authority discretionary business funding
  • an estimated £139 million of previously announced funding for government, bringing the overall support package to councils to more than £1 billion
  • around £500 million to support transport services and cover pandemic-related income shortfalls within organisations such as Police Scotland, the Scottish Funding Council and the Scottish Courts and Tribunals Service

The latest COVID-19 consequentials bring the total received by the Scottish Government to £8.2 billion.

A further update on COVID-19 spending will be provided through the Spring Budget Revision in the New Year.

A copy of Ms Forbes’ letter to the Finance and Constitution Committee Convener Bruce Crawford is below:

Dear Bruce,

I am writing to update the Finance and Constitution Committee on usage and allocations to date of consequential funding received during 2020-21 as a result of the Covid-19 outbreak.

We have drawn down and allocated this funding over the course of the year in response to what has been an exceptional and dynamic set of circumstances. I have updated Parliament on several occasions and, although a further update will be provided through the Spring Budget Revision in the New Year, I thought it would be helpful to provide further information in advance of that.

Around £6 billion of consequentials were allocated in the unprecedented Summer Budget Revision and as part of the Autumn Budget Revisions. Since then, consequentials provided have been increased to £8.2 billion.

I can confirm that thus far, further allocations have been provided as follows:

  • Around £600 million has been provided to health and social care, wider public health initiatives and welfare support. This funding supports the public health response to Covid including: vaccinations and test and trace; the £500 non-consolidated payment for health and social care staff; and the Winter Plan for Social Protection, which helps people pay for food, heating, warm clothing and shelter as well as free school meals over the school holidays and the self-isolation support grant.
  • Support for business and the wider economy of £570 million, including grants via the Strategic Framework, funding for local support packages, the newly self-employed hardship fund, digital support, Local Authority Discretionary Business Funding and remaining allocations from the £97 million support for culture and heritage.
  • Previously announced support for Local Government, relating to the estimated £90 million Lost Income Scheme as well as £49 million of additional funding confirmed to councils in September. Added to additional funding already committed, this brings the value of the overall support package to councils to more than £1 billion.
  • Around £500 million of funding to support continued provision of transport and funding for income shortfalls within our partner bodies including Police Scotland, the Scottish Funding Council, Registers of Scotland and the Scottish Courts and Tribunals Service in order to ensure that they can continue to deliver vital services, as well as mitigating shortfalls in devolved tax as a direct result of Covid-19.
  • Due to the nature of the Covid-19 outbreak, the potential asks for further demand led spend with regards strategic framework support for business in Scotland and additional demands on health, and the requirement that the funding provided to date will cover all costs until the end of March 2021, I have allocated £330 million of funding in order to support these asks. This is consistent with the terms of the funding guarantee provided by HM Treasury to the devolved administrations, which specified the funding was to cover the period until March 2021. This contingency is also required in order to support any additional funding requirements as a result of the end of the EU transition period.
  • The Scottish Government’s limited borrowing powers means we do not have flexibility to increase spending and therefore must manage demand-led expenditure risks within the consequentials provided.

The figures above remain a snapshot of a dynamic funding position. I will formally advise of final allocations as part of Spring Budget Revision, the last formal opportunity in the financial year to transfer budgets.

KATE FORBES

https://twitter.com/i/status/1337006754421501952

Businesses across Scotland will benefit from a new £185 million package of targeted coronavirus support.

The announcement follows discussions with business groups and sees a wide range of sectors benefiting, from taxi drivers and arts venues to travel agents and hospitality.

In addition, there will be additional one-off payments to hospitality businesses in January to help them deal with the traditional post-Christmas dip in demand. These will be of £2,000 or £3,000, depending on rateable value.

The package was announced by Finance Secretary Kate Forbes, who also said she had written to the Treasury calling for Scotland to receive its share of rates relief reimbursed by supermarkets “to ensure this is spent on those areas hardest hit as part of Scotland’s recovery from COVID-19”.

Ms Forbes said: “Today I am pleased to confirm an allocation of £185 million for new and additional business support in the new year. We have listened to businesses and this assistance will be provided on a sector-by-sector basis, targeted at those who need it most.

“We are developing grant schemes for hospitality, for the events sector, live music and cultural venues, for the arts, indoor football centres and for the food and drink sector, including £1.8 million for brewers.

“We will give £1.5 million to travelling show people ineligible for other support, while a new £19 million fund, plus a one-off grant, will help taxi drivers.

“I can also announce that further support of £60 million will be provided to the tourism sector, details of which will be developed in consultation with the industry.

“I am listening to the needs of business and we will continue to review and refine our COVID-19 support offer within the available resources.”

Specific support detailed in Wednesday’s announcement includes:

  • £15 million for the wedding sector and its supply chain, including photographers
  • one-off grants totalling £15 million for mobile close contact services, such as hairdressers
  • a £19 million fund and one-off grants for taxi drivers
  • £5 million for travel agents
  • almost £6 million for coach companies and tour operators
  • £1.5 million for visitor attractions.

More detail on the package will be announced in the coming days and businesses can expect to apply for all the new grant schemes in January.

Growing gulf between savers and those with debts amongst UK households, says new report

COVID-19 is having a massive impact on household finances, with personal debts increasing.  But some people are seeing their savings rise as their incomes remain unaffected and their spending has been curtailed, says a new financial inclusion monitor from the University of Birmingham and the University of Lincoln.

The research also shows that the impact of COVID-19 comes on top of poor economic performance in 2019 (a likely result of Brexit uncertainties).  Economic growth was negative and in the fourth quarter of 2019 it was zero. Furthermore, unemployment, under-employment and zero-hour contracts had all increased in 2019, while wages had started to fall in real terms towards the end of that year and into early 2020.

The 2020 briefing, now in its eighth year, highlighted that even though strains on family budgets were there prior to the pandemic, the impact of COVID-19 on top of this situation looks set to be monumental.

From just March to May 2020, between one quarter and one third of jobs were furloughed, and from March to April that year there were 2 million more claims for Universal Credit than there had been in the same period in 2019. By the end of May 2020, 28 per cent of the population said that COVID-19 had had a direct negative effect on their income.

For some households the Job Retention (furlough) Scheme and the boost to Universal Credit have been incredibly important interventions to support people’s incomes. However, those on ‘legacy’ benefits, are not seeing the same level of income protection, leading to a two-tier benefit system.

Karen Rowlingson, Professor of Social Policy and a member of the Centre on Household Assets and Savings Management (CHASM) at the University of Birmingham, and co-author of the report said: “COVID-19 has had, and is likely to continue for some time to have, a devastating impact on UK household finances.

“But it is important to note that, even prior to the pandemic, family budgets and the UK’s economy more generally were already faltering in many ways, possibly as a result of Brexit-related uncertainties during 2019.”

“Our research shows these are extremely difficult times for the country and many within it. Some statistics reveal, however, that a significant minority of the population is unaffected, financially, by COVID-19 or, indeed, are somewhat better off financially as their incomes remain the same but their expenditure drops. Inequality is rising still further as a result.”

Other key findings of the report show:

  • Unemployment had started to increase even before the COVID-19 crisis, possibly due to Brexit-related uncertainties.
  • Underemployment was similarly trending slightly upwards again to 2.5 million in December 2019. And the number of zero hour contracts also began increasing again in 2019 to a record high of 974,000.
  • The Trussell Trust has seen a doubling of emergency food parcels going to children in April 2020 compared to April 2019.
  • Prior to the COVID-19 crisis, nearly 2 million families (6 per cent) said that they could not keep up with bills and regular debt payments according to 2018/19 data. Levels of problem debt were highest among renters, particularly council and housing association renters with Council Tax debt being the most common type of debt in 2018/19.
  • There has been an increase in the last year from 1,590 mortgage possessions in the third quarter of 2018 to 2,130 in the third quarter of 2019.
  • There is slightly more positive news in relation to financial inclusion with the number of people ‘unbanked’ reaching an all-time low in 2018/19. But there is growing concern about access to cash as bank branch closures escalate and free cash machines continue to disappear from local high streets.

Steve McKay, Distinguished Professor in Social Research from the University of Lincoln and a co-author of the report says: “COVID-19 has led to an increase in already high levels of anxiety about finances with an estimated 4.6 million people now in arrears on household commitments totalling around £6 billion.

“As the furlough scheme finishes at the end of October and the eviction ban on tenants has already ended we will see a further rise in personal debt and people losing their homes”

Download the Financial Inclusion Annual Monitoring Briefing Paper 2020.

Clydesdale no more

VIRGIN MONEY INVESTS IN NEW FLAGSHIP STORE IN SCOTLAND’S CAPITAL

  • New store first of its kind in Scotland
  • 55 Clydesdale Bank branches will rebrand to Virgin Money Stores
  • Entire nationwide network of stores will operate under the new Virgin Money brand by spring 2021

Virgin Money has opened its state-of-the-art flagship Store in Edinburgh as part of its UK wide store rebrand programme.

The new flagship store located at 83 George Street, is the latest example of Virgin Money’s innovative approach to what a bank branch can offer. Once Covid-19 restrictions have been lifted, customers will be able to experience the full range of the new store’s features, including  a space for entrepreneurs to co-work and create, a venue for events and much more as Virgin Money invests in UK high streets as part of its nation-wide rebrand.

The multi-million-pound rebranding of its national network of Clydesdale Bank, Yorkshire Bank and Virgin Money sites to the new Virgin Money branding will be completed by spring 2021, bringing all stores under a single brand.

Each rebranded store will offer full banking services to all 6.6 million customers in the Virgin Money Group, vastly increasing the network of available stores to existing Clydesdale Bank, Yorkshire Bank and Virgin Money customers. Over the coming months customers will also begin to see credit cards, banking apps and account statements change to Virgin Money as part of its wider rebrand activity.

Customers will continue to benefit from the same friendly and knowledgeable teams, providing excellent customer service and access to a wide range of Virgin Money products and services from current account to mortgages and credit cards. Customers will also have access to exclusive products and services from the wider Virgin Group of businesses.

Paul Titterton, Head of Personal Distribution at Virgin Money said: “These are exciting times for Virgin Money as we invest in our stores and move to a single brand for all customers.

“The new George Street store brings together the very best of digital banking with a unique offering on the high street. It’s a new chapter for our history, and our new approach to stores proves that a bank branch can be a buzzing creative space where businesses and people can come together.

“We can’t wait for the Covid restrictions to lift so customers can enjoy the full Virgin experience in our new Edinburgh store.”

As part of the programme 55 Clydesdale Bank branches will be rebranded to Virgin Money Stores across Scotland.

Virgin Money are in communication with its customers in advance of their own branch being rebranded to let them know about when they can expect the changes to be made.

Huge jump in number of people missing card and loan payments as financial support cut back

The number of people missing a credit card or loan payment in the UK is estimated to have almost doubled in just a month, new Which? research has revealed.

The consumer champion warns scaled back financial support measures may not be sufficient to protect consumers in financial difficulty.

The latest findings from Which?’s consumer insight tracker reveal that approximately 370,000 more people defaulted on a credit card or loan in October than in September, with the estimated number rising from 410,000 to 780,000. This is the sharpest rise in missed payments of this type since the start of the pandemic.

Overall, 5.8 per cent of respondents to the Which? survey reported that their household had defaulted on at least one housing, credit card, loan or bill payment in October. This was a significant increase from September’s figure of 3.8 per cent, and was driven by the increase in defaults on credit cards and loan repayments.

A missed payment is an indicator of significant financial difficulty, and the large spike is highly concerning as it comes as the financial regulator reduces the level of support given to people who are in financial difficulty on 31 October – the same date that the government’s Job Retention Scheme also finishes.

With the Bank of England predicting that unemployment is expected to rise to around 7.5 per cent by the end of the year, and debt advice charity StepChange seeing 13,000 people seeking debt advice for the first time in August alone, Which? is concerned that the Financial Conduct Authority’s scaled back measures will not be enough to tackle the looming challenge to the financial wellbeing of huge numbers of people.

The FCA initially responded rapidly to the coronavirus outbreak, working with the banking industry to introduce a range of financial assistance measures – including payment holidays for mortgages and other forms of credit for those who are struggling financially as a result of the pandemic.

Which? has been warning since August about the need to prepare robust plans to help people through the winter months, after its research indicated that furloughed workers are three times more likely to have defaulted on at least one payment in the previous month. The consumer champion subsequently called for an extension of existing support measures until the start of next year.

However, the FCA has since announced that, from 1 November, lenders will be required to carry out assessments of individual circumstances in order to provide support, rather than consumers being able to self-report their financial difficulty.

Which? has serious concerns about the industry’s capacity to handle a potential deluge of requests for urgent assistance.

Recent research from the consumer champion found that 22 per cent of mortgage holders had contacted, or attempted to contact, their lender since the start of the pandemic and 61 per cent of those requested a payment holiday.

Worryingly, more than half (56%) reported having a problem doing this – with issues including long call wait times, and no responses to email or phone messages.

While it will always be better for a customer who can afford to continue to make payments towards their credit card or loan payments to do so, these figures suggest many people are struggling financially and will need support from their lender.

The consumer champion fears that the additional requirement to assess people’s personal circumstances could create a significant backlog with firms who are having to deal with consumers needing financial support as their payment holidays come to an end, and an additional influx of people seeking help after the government’s job retention scheme finishes on 31 October.

Which? does not want to see consumers denied support altogether, or facing delays that mean they are unable to access help before missing a payment. It believes the regulator should be prepared to move quickly to reintroduce measures similar to the original support if the industry struggles to cope with demand.

Which? is also opposed to a return of normal reporting of financial support on consumer credit files, as this risks pushing large numbers of people facing temporary financial hardship into long-term difficulties.

Currently, payment holidays are not marked on credit files as it has been acknowledged that these are exceptional circumstances. However after 31 October, if a lender offers a payment holiday or agrees an arrangement with a consumer to make reduced payments, these will be reported as missed payments.

Which? believes it is not fair to penalise customers who fall into financial difficulty at this stage of the pandemic through no fault of their own, when people who needed help at the start were able to take payment holidays without facing the same consequences.

Gareth Shaw, Head of Money at Which?, said: “This significant increase in missed payments is a warning sign that large numbers of people could be on the brink of really struggling financially, and it reinforces our concerns about the impact of the government, regulators and industry rolling back vital support.

“There is a real risk that the additional hurdles customers face could mean help is delayed, or impossible to access at all – which could leave many facing serious debt problems.

“Firms need to be proactive and flexible with people who need urgent help, and if there is evidence that customers can’t get the support they need quickly enough, the regulator must be prepared to introduce stronger measures.”

Cosla welcomes additional support worth £750 million

A package of financial flexibilities and extra funding for councils which could be worth up to £750 million has been agreed by the Scottish Government in partnership with COSLA.

To address the financial pressures caused by the coronavirus (COVID-19) pandemic over the next two years, councils will be granted additional spending powers which could be worth around £600 million.

In addition to this, a Lost Income Scheme will be established to help compensate councils and council trusts for lost sales, fees and charges from services such as sports centres and parking charges.

Councils and their trusts will have access to an estimated £90 million of funding with council trusts delivering services on behalf of councils able to receive a share of a further £49 million of support through the scheme.

Added to additional funding already committed, this brings the value of the overall COVID-19 support package for councils to more than £1 billion.

Finance Secretary Kate Forbes said: “I have been clear that the Scottish Government needs appropriate fiscal levers in order to respond effectively to the COVID-19 pandemic. That is equally true for local government, which is why I am very pleased that we have been able to deliver a package of support for local services worth up to £750 million.

“Working in partnership with COSLA, the Scottish Government has delivered on our commitment to support councils across Scotland with a game changing package of financial flexibilities, giving them the powers they need to make informed decisions about spending at a local level.

“In addition, we are close to finalising the details of additional financial support through a Lost Income Scheme, worth an estimated £90 million subject to confirmation of the funding from the UK Government. For trusts delivering services on behalf of councils this can also be topped up with £49 million of additional funding already confirmed.

“This support will help councils and their trusts manage the loss of income they are facing from local services due to COVID-19.  

“These measures are excellent examples of how the Scottish Government is working together with COSLA and local authorities to ensure that we are doing everything within our power to save jobs, protect our public services and reboot our economy.”

COSLA’s Resources Spokesperson Cllr Gail Macgregor said: “We welcome this substantial package of measures from which councils can choose, depending on local circumstance.

“Responding to COVID-19 whilst continuing to deliver essential, everyday services has put extreme pressure on Local Government finances this year. The pandemic has also meant substantial losses of income across a range of council services including leisure, sport, culture, and planning.

“Balancing budgets will be a real challenge and this has been fully recognised by Scottish Government who we have worked with constructively and positively.”

Devolved nations issue united call for financial action

Finance Ministers from across the devolved nations have joined forces to call for flexibility, fairness and clarity from the UK Government.

For the first time, all three finance ministers – Kate Forbes, Rebecca Evans and Conor Murphy –  today made co-ordinated statements in their respective legislatures.

The ministers are asking the UK Government for greater fiscal flexibility to manage the implications of coronavirus (COVID-19), meaningful involvement in the Spending Review to enable planning of budgets and an assurance that lost EU funding will be replaced in full and brought under the control of devolved administrations.

Finance Secretary Ms Forbes said: “Today the finance ministers of the devolved administrations are taking this unprecedented step to demonstrate the level of concern we share across the different nations of the UK, across different parties and across different legislatures.

“The importance of these issues cannot be overstated. They directly impact our ability to respond to COVID-19, to manage our nations’ finances and to support our communities and businesses during the pandemic.

“As representatives of our three nations, we are calling for the UK Government to provide the clarity, certainty and flexibility we require. These calls must not go unanswered.”

Ms Evans said: “I am focused on protecting the people of Wales from the worst impacts of the pandemic, while laying the foundations for recovery based on jobs, our young people and the environment.

“However, the Chancellor’s decision to cancel the UK autumn budget, alongside the uncertainty of the Spending Review and the complete lack of information on replacement EU funding, all contribute to making our task harder still.

“Wales, Scotland and Northern Ireland are today calling on the UK government to provide the fairness, flexibility and clarity we need to support and protect our communities and businesses.”

Speaking in the Northern Ireland Assembly, Mr Murphy said: “As Finance Ministers we represent over 10 million people and today we speak with one voice. We are calling for more fiscal flexibility to manage the implications of COVID-19.

“We are calling for proper involvement in the Spending Review so we can plan our Budgets. We are also calling for lost EU funding to be replaced in full, and brought under local control.” 

Finance Secretary Kate Forbes’ statement to the Scottish Parliament is available online.

40% of Scots feel worse off due to the coronavirus

The financial impact of the lockdown imposed at the end of March has been revealed in new research of UK adults by credit reference agency Equifax. The study found that 40% people living in the Scotland feel worse off financially due to the coronavirus lockdown.

Figures suggest this could be a consequence of the fact that 38% of people living in Scotland reported they took home a reduced salary during lockdown, compared to 37% nationally, with 1 in 5 people believing they will be made redundant when furlough ends.

  • 43% of people in Scotland believe it will take up to 12 months to recover financially compared to 36% nationally  
  • 1 in 10 of those living in Scotland are behind on regular payments for which they don’t have payment holidays
  • 52% of people in Scotland continued saving during lockdown and 44% saved more than pre-lockdown.

Lisa Hardstaff, credit information expert at Equifax, commented: “For those on furlough, the fear of redundancy once the scheme comes to an end is very real. And even for those who don’t believe they will be made redundant; nearly a third of people living in Scotland believe their employer will ask them to reduce their salary in the immediate future once they return to work.

“Everyone has been affected differently during this crisis.  National figures show that more than half (52%) said they were able to put aside more money into their savings compared with pre-lockdown.

“And nearly a quarter (24%) said they actually feel better off.  However, in contrast, 18% admitted they were behind on regular payments for which they don’t have a ‘payment holiday’ in place

“Expenditure on outgoings has changed since lockdown; nearly half of those surveyed that live in the Scotland spent more each week on their food bill and 43% spent more on gas and electricity. As the work from home culture continues it’s likely these additional costs will remain, even though, not surprisingly 66% said they spent less on travel.

“With areas of the country in localised lockdowns and a second COVID-19 wave predicted in the Autumn, recovering from the financial impact of COVID-19 could be prolonged.

“National figures also show that over a  third (36%) believe it will take them up to 12 months to recover and 31% said they think it will take between 13 to 24 months to get back on a solid financial footing. Now more than ever, therefore, it’s vital to have a really good understanding of financial incomings and outgoings.”

With uncertain times ahead Equifax has created an online budget planner that allows people to monitor their income against their outgoings, to help them take control of their finances now and in the future.  

Lisa Hardstaff concluded: “A financial planner not only helps manage outgoings each month, it allows people to prioritise important financial commitments like mortgage payments, council tax, etc.

“It can also help to see where money can be saved, such as unused memberships or cutting back on food bills.”