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Feeds 
What's this?
Public encouraged to save whilst the governments debt spirals out of control
Government debt
The Pre-Budget Report was unveiled yesterday outlining various measures that the government are going to use to revive the economy. The general theme was clear, that the government plan to spend their way out of the recession. Mr Darling introduced various schemes yesterday including increased benefits for pensioners, cuts in VAT, new savings schemes and provision of credit for struggling small businesses.
This spending does come at a cost, with £78 billion to be borrowed this year, and with further borrowing expected to increase over the next few years. The borrowing is expected to leave the UK economy with a debt balance of over £1 trillion by 2012/13.
National Savings Scheme
The Government have pledged to contribute 50p for every £1 saved by those on low income with the launch in 2010 of the Savings Gateways scheme. The Government revealed this scheme yesterday in the Pre-Budget Report.
The government will add a maximum of £300 to a saver's account after they have been saving for 2 years. Further conditions need to be met, with contributions only being paid during months that no withdrawal has been made.
Those entitled to the savings scheme include those receiving working tax credits, child tax credits paid at the maximum rate, income support, jobseeker's allowance, incapacity benefit, employment and support allowance and severe disablement allowance.
New mortgage lending falls
Mortgage lending fell in October to 21,584 approvals, down 52% from October 2007. However these figures not only reflect the reduced number of approved mortgages, but also a reduced number of consumers wanting to borrow. This dramatic fall in mortgage lending reflects the increasing influence the current economic conditions are having on consumers.
Alistair Darling announced yesterday in the Pre-Budget Report numerous measures to stimulate the housing market, including a 3 months grace period for homeowners struggling to meet mortgage repayments.
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