Credit Action News Round-up (8 November 2011)

Compulsory financial education petition reaches 100,000 signatures: An e-petition started by Martin Lewis of MoneySavingExpert.com which calls for compulsory financial education in schools has exceeded the 100,000 signature mark needed for it to be considered for debate in the House of Commons. The Government issued a statement about the petition after it reached 100,000 signatures, saying that: “The Government agrees that young people should have access to good quality personal finance education, so that they leave school with the knowledge and confidence to manage their money effectively. Schools already use Personal, Social, Health and Economic (PSHE) education as a framework within which to teach young people about personal financial management.”

However, in response to the Government’s statement Lewis made clear that: “It’s slightly depressing to be greeted with such political waffle over the petition. The petition is about compulsory financial education. PSHE, which it mentions, isn't compulsory, nor is personal finance a substantial part of this.” Conservative MP Justin Tomlinson, who has set up the All Party Parliamentary Group (APPG) on Financial Education for Young People which currently has 225 members across all parties, has agreed to sponsor the petition along with other MPs. Lewis said that "We will be working hard with the APPG to ensure this stays on the agenda and we get a debate”.

Personal insolvencies fall in third quarter of 2011: According to the latest quarterly figures from the Insolvency Service, the third quarter of 2011 saw 30,219 personal insolvencies, a fall of 1% compared to the second quarter. Furthermore, compared to the third quarter of 2010, personal insolvencies were down 11%. Over the three months between July and September there were 9,567 bankruptcies (down 31.2% from the third quarter of 2010), 13,048 Individual Voluntary Arrangements (up 0.7%) and 7,604 Debt Relief Orders (up 7.6%). Meanwhile, there were 1,253 company insolvencies in the third quarter of 2011, up 2% compared to the second quarter of 2011 and up 10% compared to the same period last year.

Accountancy firm PricewaterhouseCoopers highlighted the massive fall in bankruptcies, noting that the quarterly figure was the lowest since 2004 when just under 9,000 people entered bankruptcy. However, the Consumer Credit Counselling Service (CCCS) expressed concern at the increasing number of people likely to go bust in the coming months due to high inflation, wage freezes and redundancies. Delroy Corinaldi, Head of External Affairs at CCCS said that “There are millions of people teetering on the brink financially, whose household budgets are getting harder to manage every month.”

Twenty-seven universities seek last-minute change to their fee package: With just weeks to go before the application deadline for university places, more than a fifth of England’s universities have applied to change their fee package, according to the Office for Fair Access. This follows a late announcement by government of measures that could allow universities to expand. These proposals, published in the Higher Education White Paper, were delayed by several months and include allowing universities charging less than £7,500 a year in fees to expand by bidding for 20,000 degree places. These measures came after the date that universities were required to submit their plans for higher charges, bursaries and fee-waivers back in April.

The fair access regulator, Offa, said it had received 27 applications from universities wanting to reduce their fees to £7,500 or below to enable them to bid for the 20,000 places set aside for this purpose. Offa will assess the revised applications and inform higher education institutions of decisions by November 30.  Meanwhile universities and colleges must contact and inform applicants affected by the changes, and allow them the opportunity to reconsider their options.

House prices up in October but down on 2010: Figures from Halifax show that house prises rose by 1.2% over the previous month, bringing the UK’s average property price to £163,311. Meanwhile, quarterly figures showed a downward trend with prices dropping 0.3%. Annual comparisons also showed a decline, with the average house price recorded during the three months to October 2011 down 1.8% on the same period in 2010. However, this annual fall is the lowest since December 2010. Halifax’s Housing Economist, Martin Ellis, noted that “The housing market has proved highly resilient in recent months despite the weak economic recovery and the deterioration in the outlook for both the UK and global economies ... Both prices and activity levels are expected to remain close to current levels over the coming few months”.

Supermarket petrol prices fall, further fuelling price war: As Asda reduces the price it charges for unleaded fuel its lowest level since February 2011, the price of petrol is also being cut at Tesco, Morrisons and Sainsbury’s. The price reductions follow a fall in the cost of wholesale fuel prices which have dropped by up to 4p a litre due to the decreased value of the euro. Asda has cut its prices by 2p a litre at all of its 192 petrol stations, taking the price of a litre of petrol to 128.7p, and 136.7p for diesel. Using its own income tracker index, Asda found that transport costs are the dominant pressure on households, who are now £15 a week worse off than during the same period last year. “This price reduction will be a helpful boost to families,” said the supermarket. Following this, Tesco announced a 2p per litre cut on unleaded fuel; Sainsbury’s and Morrisons have also said they will cut petrol prices. 

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