Tag: finance

Kate Forbes: UK Budget ‘must give economic certainty’

Finance Secretary Kate Forbes has written to Chancellor of the Exchequer Rishi Sunak calling for additional spending to support households and businesses who are facing a perfect storm of rising prices, reduced support and increasing shortages.

Writing ahead of the UK Autumn Budget and Comprehensive Spending Review, Ms Forbes urged the Chancellor to at least match the Scottish Government’s £500 million Just Transition Fund for the North East and Moray and increase the Scottish Government’s borrowing powers to enable greater investment in decarbonisation schemes.

She also called for an extension of the reduced 12.5% VAT rate for the hospitality sector, which is due to end on 31 March 2022, for a further year,  a reversal of the decision not to award the Scottish carbon capture, utilisation and storage project Track-1 status and for the UK Government to “prioritise spending that supports the financial security of low-income households, the wellbeing of children and young people and delivers good, green jobs and fair work.” 

The letter states:

Dear Rishi,

I am writing to you in advance of the UK Government announcing the Autumn Budget and Comprehensive Spending Review on 27 October, with a view to constructively progressing the recent dialogue with the Chief Secretary to the Treasury and the First Minister’s meeting with the Prime Minister.

I am conscious that over recent days there has been wide media coverage in relation to Budget and Spending Review content. The reports have contained differing degrees of detail and a lack of clarity on how much of the predicted spend is new. In the absence of direct engagement, I have not reflected this information.

The Scottish Government will work to ensure that our responses to the unprecedented public health, economic and wider challenges presented by Covid deliver for the benefit of all of Scotland. This environment is compounded by the complexity and financial detriment to Scotland of the UK Government’s decision to leave the European Union against the will of the Scottish people, while we continue to work urgently to address the needs of climate change. These challenges will require short and long-term solutions and I set out below how the UK Budget and Spending Review can support priorities in Scotland.

Net Zero

COP 26 in Glasgow will focus international attention on the urgent action needed to tackle the global climate emergency. As outlined in the joint nations letter, and by the UK Climate Change Committee, significant investment is required from the UK Government in reserved areas to meet the Scottish Government’s ambitious emissions reduction targets. Given the requirement for co-ordinated action to address this challenge, it was disappointing that the UK Net Zero Strategy was launched without any meaningful engagement. The UK Net Zero Strategy provides some encouragement in key areas, but overall does not go far enough in many of the critical elements for ensuring the deep decarbonisation that the Scottish Government has repeatedly called for action in.

In Scotland, our climate change targets set their own pace and scale, requiring us to avail ourselves of every lever at our disposal. However, many levers remain at UK level, even where they affect Scotland directly. Following on from our recent meetings, it is worth highlighting again those actions which would most benefit our delivery in relation to funding key climate change commitments:

  • Removal of the capital borrowing cap, replacing this with a prudential borrowing scheme to help leverage the greater volume of capital investment required;
  • Agreement that all new spending will reflect the devolution settlement, enabling us to address Scotland’s specific challenges in making the transition to net zero (such as the needs of rural populations);
  • Meaningful and consistent dialogue between UK Government and Devolved Governments to allow consideration of all relevant input in advance of key green policy and regulatory decisions;
  • Engagement in relation to the net zero roadmap and other key strategies.

The Scottish Government has committed to working with partners, communities and other stakeholders to take forward a ten-year £500m Just Transition Fund for the North East and Moray. Given the UK Treasury has, over decades, benefited from billions of pounds of revenue from activity in the North Sea, I ask that you at least match our commitment to help secure jobs the North East of Scotland, support the energy transition, and reduce emissions.

There are a number of areas where we need the UK Government to take more action and act faster, including support for carbon capture, utilisation and storage (CCUS). Scotland represents the most cost-effective and deliverable opportunity for CCS in the UK by the mid-2020s. Therefore, the recent UK Government announcement failing to award the Scottish Cluster clear and definitive Track-1 project status as part of your CCUS cluster sequencing process is illogical.

We have previously advised the UK Government that we would help to support the Scottish Cluster, and stand ready to do so. However, we do not hold all the necessary legislative and regulatory levers which are retained by the UK Government. We are therefore calling upon the UK Government to reverse this decision, and accelerate the Scottish Cluster to full Track-1 status without delay.

Health & Social Care

I welcome the approach from UK Government officials to Scottish Government equivalents to form a working group in relation to the implementation of the levy, however this rise will have a notable impact on taxpayers in Scotland. Without necessary investments in supporting low-income households, this regressive approach to revenue generation will further compound the financial hardship many families already face as detailed above.

Whilst the UK Government has provided indications of the consequentials we will receive as a result of this tax rise, I remain concerned that reductions will be made in other areas giving rise to negative consequentials overall, and ask that this is ruled out in the forthcoming Budget and spending review. As part of this, I expect the allocation to devolved administrations will cover the full costs of the levy that will be incurred by our public sector employers including local government.

It is imperative that the UK budget delivers on your commitment to ensure that the NHS receives whatever support it needs throughout this pandemic. While the Health and Social Care Levy will go some way to supporting services, it is clear in particular that this will be insufficient to address the scale of social care pressure and consequent impact on NHS services.

I reiterate my previous call for a comprehensive package of investment, taking the whole health and social care system into account, both in terms of delivery of services and addressing specific Covid-19 pressures. I would also reaffirm the need for increased transparency of UK Government spending arrangements, so that the Scottish Government is clear on the funding that will arise from key programmes such as testing and vaccinations.

As I have previously highlighted, it will continue to be necessary for the UK Government to accommodate flexibility across the UK in these programmes of activity, so that devolved administrations can deploy resources in a manner that best meets spending profiles and specific needs in Scotland.

Recovery from the Combined Impacts of Covid and EU Exit

The Barnett guarantee provided in 2020-21 was a successful demonstration of the benefits of fiscal flexibility. UK fiscal policy and any new fiscal rules should be flexible as well as credible. This is something the Institute for Fiscal Studies has recently advocated to ensure fiscal policy can continue to respond to temporary economic shocks and help ensure fairness across generations. It is essential that the UK Government adopt such an approach.

As I have previously communicated, the Scottish Government is strongly opposed to any return to austerity and strongly urge you to reinstate the £20-per week uplift to Universal Credit. A real cost-of-living crisis is emerging as a result of this cut, combined with the escalating energy costs and upcoming rise in National Insurance Contributions. The Universal Credit cut alone will push an extra 60,000 people in Scotland, including 20,000 children, into poverty and hundreds of thousands more into hardship, whilst also reducing social security expenditure in Scotland by £461m by 2023-24.

I cannot accept that these cuts to individual income, alongside other poverty-inducing policies such as the benefit cap, or the two child limit for child tax credit are justifiable at this time. The UK Budget must prioritise spending that supports the financial security of low-income households, the wellbeing of children and young people, and delivers good, green jobs and fair work.

The choices made by the UK Government following Brexit are contributing to labour and skills shortages in Scotland. As predicted by Scottish Government modelling, severe impacts are disproportionately concentrated on the food and drink sector, particularly seafood, meat and dairy, as well as beverages and textiles. Evidence is mounting, including from BICs and HMRC Regional Trade Statistics to illustrate the detrimental impact on our trading performance, and supporting my call for the UK Government to re-engage in good faith with the EU and find pragmatic solutions to the blockages confronting businesses.

Where these create additional new costs or obstacles, I ask that the UK Budget and Spending Review is transparent about the impact and provides additional financial support to help compensate businesses for the losses incurred as a direct result of EU Exit.

Public Sector Pay

Decisions on public sector pay by the UK Government in this Budget and Spending Review are a material factor in setting pay awards for the public sector workforce in Scotland. Any continuation of the UK Government pay freeze has a material impact on our block grant settlement, within which we must balance reward and affordability. Public sector pay awards must be progressive, fair and allow valued workers to maintain their standard of living, as they continue to deliver the strong and innovative public services our people deserve.

Capital Investment

There is much common ground between UK and Scottish Government infrastructure priorities in delivering our net zero targets, delivering new jobs and securing Covid recovery. However, our economic recovery could be damaged if this spend is not prioritised and committed within the UK Budget. The decision taken by the UK Government to disburse the Levelling-Up Fund directly across the UK, despite previous commitments otherwise, impacts on the level of devolved funding available to the Scottish Government for Scotland.

To help achieve our Net Zero aims and grow our economy, I would welcome your assurance that the Scottish Government will receive a fair share of future years’ Capital and Financial Transactions allocations; that the gap in the Scottish Budget resulting from the change in approach to the Levelling Up Fund will be filled and that there will be appropriate governance arrangements for the UK Infrastructure Bank and other partnerships or funding routes to ensure that all interested parties have an appropriate ability to influence and control spend in the relevant areas of the UK.

VAT

I believe that the UK Government must make responsible tax policy decisions that will support the sectors and businesses economy throughout this challenging period, and I welcome measures taken on VAT to date. However, I am convinced that the increase in VAT from 1 October comes too soon.

This will affect many businesses that have been hit hardest by the Covid pandemic, potentially leading to their closure and therefore slowing the economic recovery in Scotland. It is vital that the UK Government takes account of the needs of all parts of the UK when deciding how best to support the recovery through its taxation levers, and I urge you to consider extending the reduced rate of VAT for the next financial year.

Air Passenger Duty

As you will be aware, the Scottish Government has a strong interest in the UK Government’s consideration of next steps for Air Passenger Duty following this year’s consultation on aviation tax reform. We accordingly asked to be fully consulted on any decisions before they are made, to ensure that any implications for devolution and the interests of Scotland are taken fully into account.

In that regard, it is concerning to see that the media appears to have been briefed on those decisions, without any discussion with the Scottish Government having occurred. Moving forwards, I would welcome your full commitment to meaningful dialogue on this, and indeed on all relevant tax matters, in advance of media briefings.

Replacement of EU Funding

In common with my counterparts in the Devolved Administrations, I expect full replacement of EU funds to ensure no detriment to Scotland’s finances, and I expect the UK Government to fully respect the devolution settlement in any future arrangements.

The current approach to the replacement of and participation in EU programmes leaves Scotland worse off. The ability to undertake long-term strategic planning has been significantly undermined as the flexible seven-year multi-annual funding mechanisms of EU funding are being replaced by annually managed allocations. Furthermore, the proposed methodology for determining farm funding allocations effectively penalises the use of the remaining flexibilities from legacy funding. I have written to you jointly with other finance ministers from the Devolved Administrations in order to express our concerns about this methodology and our expectations regarding future allocations.

With regards to fisheries, I consider the existing settlement to be vastly insufficient, given past underfunding and the significant impacts of Brexit on the sector. We provided clear evidence for a multi-year £62m allocation for Scottish fisheries, as opposed £14m allocation we received in the 20/21 Spending Review. Additionally, it appears that the yearly £5.5m top up which was previously provided to Scotland on the basis that the EU EMFF allocation was insufficient will no longer continue, increasing an already significant funding shortfall.

This process seems to mirror our experience with the Bew review, where commitments made in 20/21 are then being downgraded within the life of this parliament. In the case of the Bew review, this was to agree a process of engagement ahead of the upcoming Spending Review to address the issue of Bew funding from 2022/23 onwards. While the initial recommendations of the Bew review have been met, the proposed funding does not include any additional budget cover beyond 2021-22. This leaves Scotland in the same position as in 2019 where the inequality in distribution of land remains an issue.

Further discussions need to take place on the principle of intra-UK allocations in line with the wider observations of the Bew review. In the absence of such a review we would expect at least the £25.7m funding to continue beyond 2021-22 to address the funding inequality included in the previous ceiling levels. A failure to do so would result in a cut of £77.1m in our budget up to 2025. I require assurance that the UK Budget and Spending Review will redress these issues to ensure no detriment to Scotland’s finances.

Internal Market Act

The financial assistance powers in the Internal Market Act (IMA) confer new powers on UK ministers to spend directly in a wide range of devolved matters, bypassing parliamentary scrutiny and accountability at Holyrood. This also, in effect, gives the UK Government the power to bypass the Barnett Formula. Aside from being a profound departure from the existing devolution settlement, it introduces considerable additional uncertainty to future devolved funding and fundamentally alters the devolution landscape.

I ask for assurance that the powers will not be used without the prior consent of the Devolved Governments, and for clarity on how decisions on use of IMA financial assistance powers will be made, and under what circumstances. Without this it is difficult to see how the principles of consent, transparency, and stability and predictability espoused in the Statement of Funding Policy can be met. Moreover, it risks poor value for money as a result of incoherent policy and disjointed spending decisions.

As a minimum I would ask that the forthcoming spending review set out details on any plans to spend under the IMA over the course of the period (and beyond where known), and that the implications for devolved funding arrangements and decision-making are addressed in the planned update to the Statement of Funding Policy.

I trust that you will consider the suggestions made above and that we can work collaboratively to address the matters raised in order to provide certainty to the wider public sector, boost the economy and support our most vulnerable at this challenging time.

Yours sincerely,

KATE FORBES

Scottish Building Society announced as Building Society of the Year for third year in a row

Scottish Building Society (SBS) has scooped up Building Society of the Year for the third year in a row at the annual Mortgage Introducer Scottish Mortgage Awards, while its CEO Paul Denton was awarded Business Leader of the Year.

The awards ceremony took place at the Balmoral Hotel in Edinburgh on Friday 8th October, celebrating the best of the Scottish property finance market and bringing together some of the most senior operators in the industry.

Scottish Building Society is the oldest remaining building society in the world, offering a range of saving accounts and mortgages for every stage in life.

As a member-based mutual, Scottish Building Society’s focus and purpose is to serve its local communities.

Paul Denton, SBS Chief Executive, said: “The team at Scottish Building Society consistently go above and beyond.  Following the trials brought upon by pandemic, it is good to see the hard work and dedication of our people being recognised through these awards.

“To receive Building Society of the Year for the third year in a row is a testament to their hard work, especially when up against such a high calibre of nominees.

“After 173 years customers remain at the heart of our business, and we strive every day to do better. These awards highlight the Society’s enduring success which is founded upon a robust business model, skilled people and a reputation built on trust, confidence and exceptional customer service.”

Robyn Hall, Publishing Director at Mortgage Introducer, said: “Mortgage Introducer is delighted to announce that at this year’s Scottish Mortgage Awards, Scottish Building Society were awarded Building Society of the Year, and Paul Denton was named Business Leader of the Year. Congratulations from everyone at Mortgage Introducer on your well-deserved wins.”

Paul Denton brings a wealth of experience spanning over 30 years, having worked with RBS and the Co-op before joining SBS.

FT poll shows 90% learnt ‘little or nothing’ about finance at school

‘two in three of the global population, including one in three in the UK, are financially illiterate‘

The Financial Times has launched a new charity endorsed by the former prime minister Gordon Brown, focused on the promotion of financial literacy and inclusion around the world.

The FT Financial Literacy and Inclusion Campaign (FT FLIC) unveiled its strategic plan to boost the financial literacy of young people, women and disadvantaged communities at an event hosted by Roula Khalaf, editor of the Financial Times.

The plan will develop educational programmes to tackle financial literacy, initially in the UK and then around the world. It will seek to warn people about potential financial traps as well as empowering them to realise their aspirations. It will also campaign for policy change and clearer product communication by financial companies. 

“Improving financial literacy for people that need it most, will empower and build financial resilience amongst communities that have faced growing inequalities exacerbated by the pandemic and austerity,” said Aimée Allam, executive director of FT FLIC.

“We have now outlined our ambitious goals to improve financial literacy, and our success will be determined by our ability to achieve these goals in an effective and measurable way.”

A survey, commissioned for the Financial Times by Ipsos Mori, reveals shortcomings in financial understanding among four constituencies that have clear gaps relative to the national average: deprived areas, the young, women and ethnic minorities.

According to the research, 90% of the 3,194 people polled across England learnt “nothing at all” or “not very much” about finance at school. The research also found that barely half of 3,000 respondents were able to correctly compare the costs of borrowing via credit cards or bank overdrafts, regardless of their wealth, ethnicity or gender.

Not only will FT FLIC provide financial educational content for individuals and teachers, it also intends to lobby for education policy to change, in particular pushing for financial literacy to be integrated into school curriculums. FT FLIC will also focus on helping close the financial literacy gap for women and communities marginalised from accessing mainstream finance.

FT FLIC will partner existing charities and other organisations in financial education, and become a hub for the aggregation of the best materials, as well as developing its own content.

Patrick Jenkins, the FT’s deputy editor who chairs FT FLIC, said: “According to the World Bank, two in three of the global population, including one in three in the UK, are financially illiterate.

“If that were true of language literacy it would rightly be regarded as a scandal. Happily getting on for nine in 10 people around the world are now able to read and write. But why is it not regarded as a scandal that financial literacy levels are so low?”

Speaking at the launch of FT FLIC Gordon Brown, former Prime Minister of the United Kingdom, said: “In surgeries, I came face-to-face with constituents who could not manage their finances or pay their bills, who racked up debts and fell into the hands of money lenders.

“I saw not only the despair that this brings and the impact it has on physical and mental health but the need for far greater financial literacy. Financial worries have been exacerbated by the pandemic and will certainly worsen when six million families in the UK find their universal credit is cut by £20 a week.

“I welcome this initiative to create an umbrella foundation that will not only work with current providers at the grass roots level, but it will also seek changes to policy.”

The launch of FT FLIC follows 15 years of successful FT seasonal appeals that raised more than £19.5m on behalf of charities and supported many worthy causes.

Criminal Justice budget in the spotlight at Holyrood

MSPs on the Scottish Parliament’s Criminal Justice Committee are to examine all areas of the Scottish Government’s criminal justice budget in the coming weeks, and consider whether the current funding patterns are sustainable, effective and achieving good outcomes.

Ahead of making recommendations to the Scottish Government on how it spends money on justice services, the Committee is looking to hear opinions on funding for bodies such as prisons, courts, police, fire and rescue, victim support and community justice initiatives.

It will also consider whether funding is in place to support the sector to recover from Covid, and whether any of the changes brought in to help cope with the pandemic may lead to longer term savings, if those were desirable and made permanent.

Speaking as the call for views was launched, Criminal Justice Committee Convener, Audrey Nicoll MSP, said: “Criminal Justice services play a crucial role in keeping Scotland safe, supporting complainers and victims of crime, working to rehabilitate offenders, and diverting people who are at risk of doing wrong.

“Our Committee wants to take a wide look at the funding for these services – public and voluntary – and examine whether what we have in place supports the justice system to do what we ask of it.

“It goes without saying that we will need to consider the impact of Covid-19 on the justice sector’s budgets.

“We asked a great deal of those working on the frontline and administering justice throughout the pandemic.

“And while there may be savings from some of the new ways of working, overall, the sector will need a lot of help to recover from the pandemic – for instance, to deal with the huge backlog of trials.”

The call for views can be found at this link.

Specifically, the Committee is seeking views on:

The impact of COVID

• Whether the Scottish Government is providing enough budget for the criminal justice sector to recover from COVID-19?

• What the cost will be of making permanent some of the temporary changes  brought in because of the pandemic (if these are to become permanent)?

• Whether organisations in the criminal justice sector have enough budget and staff to be able to cope with a return to pre-pandemic levels of working (e.g. expected growth in the number of court trials)?

• Whether there have been any savings and efficiencies because of the different way of working during the pandemic, what these savings have been used for elsewhere, and could they be kept once the pandemic is over?

• Where are the opportunities for future reform and savings?

The budget provided for the Crown Office and Procurator Fiscal Service (COPFS)

• Whether the Scottish Government is providing enough budget for the work expected of the COPFS?

• What is the expected impact of the budget of the COPFS from the recent cases of malicious prosecution?

Prisons, prison reform and secure care

• Whether the Scottish Government is providing enough budget for the work expected of the Scottish Prison Service?

• Whether enough money has been allocated for the future modernisation of the prison estate beyond the work currently underway at HMP Glasgow and HMP Cornton Vale?

• Whether the current funding model for secure care in Scotland needs reformed?

Police and fire and rescue

• Whether the Scottish Government is providing enough budget for Police Scotland and the Scottish Fire and Rescue Service?

• In particular, is there enough budget to modernise the services, their buildings, vehicles and equipment etc?

The support for victims of crime

• Whether the Scottish Government is providing enough budget to enable organisations to support victims of crime?

Legal aid

• Whether the Scottish Government is providing enough budget to enable people to access justice through the support provided by legal aid in criminal cases?

• Whether further budget and reforms are necessary to tackle the problem of accessing legal aid in remote and rural areas of Scotland?

• Whether the Scottish Government is providing enough budget to attract people to work for organisations providing services funded by legal aid (e.g. defence solicitors)?

The Scottish Government’s Programme for Government

• What money will be required to finance the different criminal justice policies set out in the new Programme for Government and whether any new and extra finance has been allocated for the various initiatives?

2050 Climate Group present: Digital Youth Summit

4th September 2021, 10.00 -15.15 BST

With COP26 just around the corner, we are happy to announce our Youth Climate Summit, ‘Let’s Talk COP26’, taking place digitally on the 4th of September from 10.00 – 15.15 BST.

This event will host a diverse variety of speakers and workshop sessions grounded in 5 key themes up for discussion on COP26’s presidential programme: nature-based solutions, adaptation and resilience, finance, energy transition, and clean road transport.

These sessions will be led by youth activists, community groups, and industry leaders from organisations such as Friends of the Earth Scotland, the Black Environmental Network, and the Loss and Damage Youth Coalition (to name just a few!).

By engaging specifically with the event of COP26 and its themes, ‘Let’s Talk COP26’ strives to unpack a political decision-making process that lacks transparency and marginalises those experiencing the climate emergency first and worst. This event will tackle the key issues being discussed at COP26 so that we can take informed and effective youth action moving forward.

This event is free and open to young people aged 18-35 in Scotland and beyond. Sign up now!

https://hopin.com/events/2050-climate-group-summit

Consumer finance expert: How to fix finances for Summer

Relaxed restrictions in Scotland offer the chance to make the most of many of the much-missed activities that the pandemic put a stop to, from concerts to theatre trips and holidays abroad. But before you splurge on some much-missed activities, consumer finance expert PAUL WILSON explains ways you could get your finances in order first. 

With over 20 years experience in consumer finance, Paul has highlighted common pitfalls that consumers often fall into and the simple ways that consumers can get their finances in check whilst still making the most of the summer. 

“Many Scots will be excited to make the most of the things that they’ve missed out on in the past year, from concert tickets to holidays abroad. But, whilst there’s temptation to splurge and ‘go all out’ this summer to make the most of the relaxed restrictions, it’s important to make sure that spending doesn’t get out of control.

“Having worked in the finance industry for 20 years, some of the most common money management mistakes I see people make are not actively monitoring and striving to improve their credit score, not setting and sticking to a monthly budget and spending beyond their means on what often turns out to be frivolous.

“As things open up more, it’s important for consumers to enjoy their money, without falling back into bad habits they may have broken in lockdown. There are simple tricks and spending behaviours that can be adopted to make sure people keep their finances in check.”

Cancel those unused, or under utilised, subscriptions

“For many of us, TV and entertainment subscriptions were an essential part of getting through lockdown. But as restrictions lift and it’s easier to do more of the activities that used to fill your time, you may find that some subscriptions go unused.” 

“Check your subscriptions. It’s easy to sign up for a new subscription service – particularly when many companies offer free trial periods or low cost sign up offers – and then forget to cancel it. Or perhaps you have a number of subscriptions that you do use, but you could ask yourself how essential they really are. If you can live without it then you could save money by cancelling the subscription or choosing a cheaper alternative.”

Update your utilities providers

“The summer months are a great time to review your insurance and utilities providers. As things open up more, life admin tasks like this can fall by the wayside, so set aside some time to check your spending and see if you can get a better deal.” 

“Shop around for all of your insurance and utilities. Generally speaking, loyalty doesn’t pay when it comes to products such as insurance, energy, broadband and TV, and there are usually cheaper deals for an equivalent product out there. So when it comes time to renew one of these products, don’t just accept the renewal price – use a price comparison service to check for the best deals available.” 

Budget for your new lifestyle

“As tempting as it is to splurge this summer, make sure you properly budget all of your new spends, from setting aside a budget for going out and leisure activities to factoring in how much you want to spend on drinks at the pub or online shopping.”

“Calculate how much you have coming in each month and how much your essential financial commitments are (e.g. mortgage/rent, transport costs etc.) and therefore what you can afford to put away into savings and what your disposable income is. Once you have your budget – stick to it! Post it up somewhere in your house where you will regularly see it or set reminders on your phone to prompt you to check how you are tracking against your budget.”

Get on top of the weekly food shop

“For many of us, staying at home more often in lockdown meant spending more money on food and treats. So, the relaxing of restrictions is a great time to get on top of your food bill.”

“Save money on your weekly food shop by planning a menu and a shopping list to ensure you only purchase the items you need. Embrace batch cooking and freeze portions to be eaten at a later date – this may help avoid being tempted to use costly food delivery services when you haven’t got anything in for dinner. Consider choosing one of the budget supermarkets such as Aldi or Lidl for the bulk of your shop and downshift from brand name items to own-brand.” 

Spend savvy

“With more people getting out and about and making the most of the summer, there’s more incentive to buy new things, from new holiday clothes to treating yourself to see a band you haven’t been able to see live since 2019. So, if you’re planning on treating yourself, try using comparison sites that offer savings incentives in order to get your money to go further.”

“There are a number of ways you can save money when you are purchasing online. Firstly there are cashback sites that offer money back in your pocket when you purchase via a special tracked link – it costs you nothing extra, takes just seconds longer, and if you were going to buy the product anyway it’s a no brainer. Secondly there are browser extensions and apps you can use to hunt out bargains. For example, InvisibleHand is a chrome extension that runs in the background of your browser and automatically notifies you if it can find the product you are shopping for at a lower price on another site. Similarly, Honey is an extension that automatically finds and applies discount codes at the checkout when you shop online.”

Think about your credit options for big purchases

“It’s great to see the travel corridor opening up and more countries being added to the green list so that everyone can get a much-needed summer holiday. But as tempting as it is to go away, it is important to properly review your finances before committing to a summer holiday.”

“Save up for big purchases wherever possible rather than putting them on credit. Taking the time to save the money can give you time to evaluate if the purchase is really something you want or need. If you have the cash up front it will save you money on paying any interest and avoids any potential damage to your credit score through missed repayments. And remember, it’s tempting to pay for the holiday of a lifetime on a credit card, but then you’ll be paying for that holiday many years after you’ve come back.” 

Track your spending

“It can be very easy to lose sight of how you are spending your money so use a money tracking app linked to your bank account to ensure you keep track of every pound leaving your account.”

“Many money-tracking apps let you categorise spending and easily set budgets for different categories, such as shopping, eating out and groceries. This allows you to properly keep track of your personal finances and stick to your budget, as helpful notifications will let you know when you’re close to your budget for each category.”

Put savings away

“Don’t let the excitement of relaxed restrictions stop you from putting money away for a rainy day. Try to put a small amount away as soon as you get paid, or try saving a few pounds a week to kick-start your savings pot.” 

“If you do have any left over cash at the end of the month, put it in a savings account and try to build up an emergency fund. As a general rule, you should ideally have 3 months worth of critical expenditure (rent, food, bills etc) in your savings account to deal with unforeseen circumstances such as a redundancy or replacing an essential appliance.”

Save on travel to work

“One of the best things that came out of the pandemic is the uptake of cycling, with millions of Brits getting on their bikes to enjoy exercise and space outside in lockdown. Whilst some offices are inviting staff back to work in the office, a blended approach of remote and office-based working has been adopted by many businesses, which takes the pressure out of travelling in peak commuting times.”

“If you can sacrifice the convenience factor, you can save some significant money on fuel and parking by ditching the car and walking or cycling whenever possible. For example, could you walk or cycle to work? Even if it’s just one or two days per week or even just when the weather permits, the money saved can quickly add up.” 

“If I were to choose one of these tips as the most important, I would say that the additional benefits of walking or cycling – both in terms of the benefits to an individual’s health but also to the environment – make ditching the car more frequently the most important tip.” 

Paul Wilson is a consumer finance expert at Financial Conduct Authority authorised and regulated credit broker Little Loans.

Cashless is killing tips

Over a third of Brits won’t tip via card due to lack of confidence it goes to the right person

A recent report from UK Finance has revealed the UK is another step closer towards becoming a cashless society as the number of payments made using notes and coins last year declined by more than a third.  

As more businesses decide to go cashless, this new move towards a fast-tracked cashless society is having devasting effects on the nations tipping habits, according to a new report. 

The 2021 Tipping Index commissioned by card payment specialist takepayments Limited, surveyed over 2,000 consumers to compare how tipping attitudes and behaviours have changed through the pandemic. 

The findings reveal that pre-pandemic, cash was the most favoured payment method for tipping (91%) as almost two thirds (64%) of those that tip this way said they felt more confident the tip would go directly to the person who served them. 

However as more businesses are no longer accepting cash, the research reveals less Brits are opting to carry cash as almost one in five (18%) said they no longer carry cash which they would usually leave as a tip. 

This new cashless movement is impacting tipping habits as one in four (23%) said they would only leave a tip if they had spare cash on them and one in four (24%) said they would specifically bring cash especially to tip.

Coronavirus and hygiene fears play a part in people tipping less too, as almost one in six (14%) said they are now less likely to leave cash as a tip due to hygiene or health reasons.

While almost three in ten Brits recognise tips are a big part of peoples income, more than a quarter (27%) state that while places no longer accept cash and only accept card payments, tipping isn’t always possible as Brits lack confidence that tips made by card payments go directly to the person who served them (35%). 

And for those Brits that do feel confident tipping on card, more than a third (35%) admit they leave a bigger tip when paying cash. 

Sandra Rowley at takepayments Limited said:  “While the sectors which commonly involve tipping can finally re-open, the professions who rely on tips to top up their income are unfortunately continuing to struggle due to the nation’s lack of knowledge around tips and card payments. 

“There is a misconception around card payments and tipping which needs to be highlighted as businesses are able to separate tips from the cost of services when taking card payments.

“The government is set to announce a new proposal for a Tipping Bill next month which will hopefully give the public more knowledge around workers rights and tips, as well as instil confidence around tipping on card.” 

The full findings of the takepayments 2021 Tipping Point Report are available to view here. 

Chancellor hails Scotland’s pivotal role in future of UK economy

  • The Chancellor will visit Scotland today (29 July 2021) to meet people and firms supported by the UK Government’s Plan for Jobs throughout the pandemic.
  • In advance of the trip, Rishi Sunak hailed the economic strength of the Union and said Scotland’s “innovation and ingenuity” would be key in powering the UK’s future global economy;
  • He will meet firms in sectors ranging from tech to tourism and see how Scotland is helping drive the UK’s transition to net zero ahead of the COP26 summit in Glasgow later this year.

The Chancellor has hailed the economic strength of the union ahead of a visit to Scotland where he will see first hand how the UK Government’s Plan for Jobs has supported businesses and families during the pandemic.

Rishi Sunak will meet Scottish businesses and individuals in Edinburgh, Glasgow and Fife to discuss how they are recovering from the crisis and find out more about the ways Scottish firms are creating jobs and playing a key role in the UK’s green recovery.

Ahead of the visit, he hailed the economic strength of the union and said Scotland’s “innovation and ingenuity” would be key in powering the UK’s future global economy.

Chancellor of the Exchequer, Rishi Sunak said: “We’ve come through this pandemic as one United Kingdom – with our Plan for Jobs supporting one in three jobs and tens of thousands of businesses across Scotland.

“Thanks to the strength of our Union we’ve deployed the fastest vaccination rollout in Europe and our economy is rebounding faster than expected.

“It’s vital this continues, and Scotland’s innovation and ingenuity will be key in creating jobs, powering our growth and driving a green recovery.”

Since the start of the pandemic the UK government has delivered one of the world’s most generous packages to support, create and protect jobs across the UK.

In Scotland one in three jobs have been supported through the pandemic, over 900,000 people in Scotland were furloughed, more than 90,000 businesses have received loans and £1,535 billion has been paid in self-employment support.

People in Scotland are benefitting from the UK Government’s Plan for Jobs – the Kickstart scheme is already helping thousands of 16-24-year-olds into work, Job Entry Targeted Support (JETS) Scotland is providing up to six months of targeted support and 13,500 new Work Coaches have been recruited across Great Britain to give tailored support to people out of work.

On today’s visit, the Chancellor will travel to a number of businesses – both small and large – to meet business owners and furloughed employees who have returned to work after their jobs were protected through the UK-wide scheme.

With just under 100 days until the COP26 summit in Glasgow, he will also see how Scotland is harnessing the power of offshore wind, a sector which supports 2,800 jobs in Scotland and is key in helping the whole of the UK reach our climate goals.

The Chancellor will also meet representatives of Scotland’s financial services sector to thank them for keeping call centres and branches open over the pandemic as well as distributing billions of pounds through UK government loan schemes.

He will discuss his vision for the future of financial services – a sector which accounts for 153,000 jobs in Scotland (financial and professional related services).

He will also see how Scotland’s culture sector is preparing for the summer ahead, as it looks forward to welcoming back locals and tourists who wish to revel in Scotland’s rich cultural heritage.

Edinburgh’s Maison Sport secures Future Fund investment

Game-changing ski instructor platform Maison Sport is among only a handful of travel businesses to secure finance from the UK Government’s Future Fund.

The trio behind the innovative tech start-up, which connects skiers and snowboarders with some of Europe’s best instructors, set out to apply for the funding support in May 2020, at the height of the pandemic, when the scheme launched.

With the travel sector hit hard by the impacts of Covid-19, Maison Sport felt the effects of closures at countless resorts across Europe and ski holidays cancelled for many.  The funding has given the tech start-up a much-needed financial boost, allowing the platform to continue to support independent instructors across Europe.

The Future Fund – developed by government and delivered by the British Business Bank – was established to support the UK’s innovative businesses affected by Covid-19. It was created for businesses unable to access other government business support programmes, due to being pre-revenue or pre-profit and typically reliant on equity investment. 

With a third-party investor willing to support the growth and ambitions of Maison Sport, the trio of founders were able to apply for the convertible loan which saw the government match their investor funds.

It is the latest success in Maison Sport’s fundraising drive to ensure the business survives and thrives through the pandemic.  

Over the past six months, the business has secured further funds from their existing advisory board members Kevin Byrne, Founder of Checkatrade.com and serial entrepreneur Lorenz Bogaert, as well as new investor, Gareth Williams, Co-Founder of Skyscanner. This will enable Maison Sport’s expansion into new markets globally and will help to grow their impressive international portfolio of instructors and customers.

Started by three former ski champions – brothers Nick and Olly Robinson and Aaron Tipping – Maison Sport has more than doubled the number of instructors in its marketplace throughout the pandemic. It is currently represented in more than 350 resorts, with over 1,200 qualified instructors across France, Switzerland, Italy and Austria.

The aim now is to expand into four new markets this year – Scotland, Norway, Sweden and Japan – with plans to move into Asia and South America next year.

Founder and CEO Nick Robinson says: “We’ve worked so hard to remain positive and ambitious over this past year or so. The Future Fund initiative has really given us a boost to move on to the next level.

“As the only platform dedicated to independent instructors, we’re really optimistic about the way Maison Sport is evolving and we’re looking forward to spreading our vision globally.”

Future Fund, delivered by the British Business Bank, has allowed companies to apply for a convertible loan with private investors at least matching the government investment. 

For more information visit www.maisonsport.com

Investor confidence returning, says new research

Confidence levels are up, Millennials make their mark and interest in ethical investing hits new highs

Confidence levels amongst UK investors have risen 20 points (62 – 82) in the last 12 months according to new research amongst 1100 UK investors (£10k+).

The Investor Index, now in its second year, is conducted jointly by London-based communications agency AML Group and research agency The Nursery Research and Planning and was launched in April 2020 to assess the immediate impact of Covid 19 on investors and the UK investment marketplace.

The first report of its kind to provide an objective overview of the industry based on hard data,the study was welcomed as a barometer of post-Covid investor behaviours.

“57% of UK investors have changed their investment strategy since the pandemic started”

One year on, and still in the grip of the pandemic, the 2021 study has revealed some significant changes and ‘recalibrations’ amongst investors.

Confidence returns – but not to pre-pandemic levels

Over the past 12 months, confidence levels have risen most amongst older investors (55+) up 30 points (54 – 84), investors that are retired up 27 points (57 – 84), those that use financial advisers up 31 points (65 – 96) and investors with a portfolio of £200k+ – up 38 points (55 – 93).

The study has also revealed a disparity in gender confidence levels – with men indicating a 25 point rise over the last 12 months (61- 86) compared to a rise in confidence levels of just 10 points among female investors (65 – 75).

However whilst the results are cause for some degree of optimism – investor confidence levels are still 18 points down from pre-Covid levels.

Gen Z/Millennials Vs Baby Boomers – the emerging generational divide

10% of UK investors have started investing since the pandemic began – and of those new investors three-quarters (74%) are under 35s.

It’s a changing landscape with the younger investor bringing different attitudes and priorities to the investor table.

89% of under 35s have changed their investment strategy over the last year vs. 31% of 55+ investors. Younger investors are also increasingly looking to ESG products – with 27% including responsible investments in their portfolio compared to only 4% of investors aged 55 and older. Younger investors are also more focused on the long game – with 30% looking to longer term investments compared to 8% of investors 55+.

When it comes to investment decisions, younger investors are increasingly turning to family (40%), banks (30%) and friends (27%) for advice.

It’s a gift – investors demonstrate a change of attitude

57% of UK investors have changed their investment strategy since the pandemic started – with a focus on products offering ‘long term growth’ (46%) over ‘short term growth’ (30%).

Investors are increasingly concerned about their children’s financial security. 70% of investors are aware of the £3,000 wealth transfer allowance with 38% having given £500 or more over the last 12 months – with children the biggest recipients (72%). Indeed the average amount gifted in 2020 was £8087 compared to £5421 pre pandemic (2019) – a 49% increase and a clear indicator of the want for investors to safeguard futures for loved ones.

How invested is the UK investor in Responsible Investing?

Investors feel that ethical/socially responsible financial products are more important now than at the same time last year – up 9 percentage points (23% – 32%) with three in ten of those surveyed stating that they believe that these products will be more important in the future – up six percentage points (24% – 30%).

However despite investors acknowledging the importance of ESG/RI there is a continuing perception, despite contrary evidence, that it carries a performance penalty with investors ‘prioritising financial security over wider ethical considerations’ – up five percentage points (23% – 28%).

Younger investors look to DIY platforms

Since the start of the pandemic in March 2020, four in ten investors under 35 (39%) have invested more with DIY platforms – compared to just 14% of 55+. And while the younger investor has indicated a ‘happy to do it myself’ attitude regarding financial planning and investments they are less confident when it comes to their feelings about the industry. Just under one-third of under 35s (29%) are confident markets will bounce back compared to more than half (52%) of investors aged 55+.

Perhaps predictably, younger investors are more tapped into trends and news stories connected to investing.

39% of under 35s cited an awareness of the growth in DIY platforms with 44% familiar with the story around Reddit users driving up the share price of Game Stop and 31% aware of the rise in silver prices. Investors aged 55+ recorded significantly lower awareness across all trends.

Top 10 nine findings:

1. Investor confidence levels (overall index score) – 82 (up 20 points)

2. Confidence levels amongst men – 86 (up 25 points)

3. Confidence levels amongst women – 75 (up 10 points)

4. Confidence levels amongst under 35s – 74 (up 4 points)

5. Percentage of investors who have increased amounts invested since Covid-19 – 36%

6. Changed Investment strategy since the start of the pandemic – 57%

7. Ethical products considered more important now – 32% (up 9 percentage points)

8. Percentage of all new investors (in the last 12 months) that are women – 63%

9. Under 35s who have increased DIY investments since Covid – 39%

METHODOLOGY: 1,100 nationally representative interviews were conducted online in April 2021 from an adult sample with £10,000+ of investments. Respondents were recruited from Dynata’s online access panels. 7 in-depth interviews were conducted with a mix of IFAs and Wealth Managers – also in April 2021.