Could this plan give Child Trust Funds a future?

Child Trust Funds (government payments of £250 at birth and age 7 into an investment plan) are likely to be scrapped for all families with an income of more than £16,000, if the Conservatives stick to their manifesto pledge.

The Lib Dems wanted to to scrap them entirely. The coalition government is yet to announce what it will do.

In a new document today - The Coalition: Our Programme for Government - there was still a lack of detail, stating only: 'We will reduce spending on the Child Trust Fund and tax credits for higher earners.'

For and against CTFs

Fans of CTFs argue that they are key to teaching a new generation how to save.

Opponents say they are too big a cost in the age of austerity.

The SMF plan for saving CTFs for middle income families

Today, a think-tank today suggested a way to make CTFs 'work better for much less money'.

The Social Market Foundation argues that the cost of the scheme could be reduced by two-thirds by cutting the value of the CTF voucher given to each child at birth from £250 to £50 and scrapping the second contribution on a child’s 7th birthday.

To better encourage saving in the CTF, the government should match families’ contributions up to £50 per year up to age 5 funded by axing tax relief on all non-CTF children’s savings, it says.

The SMF argues: 'With reform, Child Trust Funds can achieve important policy objectives for the government widening financial engagement particularly amongst the less well paid, encouraging saving and giving all young people a financial stake in the future.'

The think-tank says that in contrast, other children’s savings accounts, which benefit from tax-relief, are typically used by wealthier households to shelter their savings from the taxman: government figures show that half of all children do not have any financial assets of their own.

To cut the annual cost of the Child Trust Fund policy, the SMF says the government should:

• - Abolish universal CTF payments for seven year olds, saving £218.5m;
• - Reduce the value of universal payments at birth to £50, and the value of additional awards for lower-income households to £200, saving £153m;
• - Abolish tax-relief on non-CTF children’s savings accounts for under-16s, saving the Exchequer £181.4 million, and recycle this saving to fund the cost of CTFs.

To improve saving rates and active engagement with Child Trust Funds (CTFs) among lower-income households, the SMF says the government should:

• - Simplify choices around opening a CTF account;
- Develop behavioural interventions, such as direct-debit schemes;
• - Impose restrictions on how Child Trust Funds can be used at the age of 18;
• - Make receipt of full voucher entitlements among low-income households conditional on using financial advice
• - Strengthen the role of the CTF in citizenship policy;
• - Implement matching contributions for low-income households up to £50 each year for the first five years of a child’s life, at a cost of £165m per annum.

My view

Speaking as an investor in two Child Trust Funds, I accept that doling out a total of £500 on Britain's richest kids is a nonsense. But entirely scrapping the scheme entirely for middle income families is throwing out the baby with the bathwater - especially if the Coalition government is to tranform Britons from consumer-obsessed spenders into shrewd savers.

My elder child will soon be at an age where I can explain why he's the proud owner of a growing investment account. Millions of other children will also be having the same conversations - without Child Trust Funds, that learning process would not be happening. Let us know what you think [Do you agree with the SMF's plan for CTF's?] and put your view in the comments box below.

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How banks took us all for mugs (and got away with it)

I’m at the European Commission’s Consumer Summit in Brussels, which has a focus on bank fees, and reluctantly, I’m beginning to accept that the villains of the Noughties will simply walk away from the mess they've created.

Let’s lay out the charge sheet covering the major sins of the last decade:

* Casino banking was a major contributor to the economy-wrecking credit crunch;

* Banks, and other lenders, pushed loans and mortgages to those unable to repay – on a grandscale;

* Banks aggressively ramped up the cost of banking for those most likely to be in financial hardship: the applying of penalty charges (sometimes more than £35 a pop) for millions of customers;

* And so as not to leave any group of customers feeling left out in the exploitation stakes, bank ‘advisers’ flogged high-risk investments to customers looking to avoid risk.

How not to treat customers

So, we have bank account customers, borrowers and investors all wronged to varying degrees.

It’s not exactly something out of the Tesco manual of how to keep your customers happy.

But hey, why should they care? The banking industry remains massively profitable, bankers continue to collect enormous bonuses and there’s little evidence of any over-arching force bringing it to an end.

For some bankers, it feels like the party’s only just begun. After all, some of the competition has disappeared at a time when there’s more business to be done: countless recession-hit companies have been forced to turn to banks to help them raise money by issuing extra shares or bonds. And the cherry on the cake has been that central banks have generously slashed rates and therefore borrowing costs for banks.

But don’t get me started on investment banking.

Instead, let’s focus on the banks’ consumer sins for a moment (putting aside the casino banking that bought about the worst recession in 80 years – that’s the last time I’ll mention it. Promise).

Credit cards, loans, mortgages

Banks lent to people who couldn’t afford it. On loans, they also added expensive insurance (payment protection insurance) that customers often didn’t need, or disguised the true cost of repaying the debt. They also sent enticing ‘cheques’ that added expensive debt to their credit cards of those cashing them. These, of course, were mostly cashed by those least likely to be in a position to repay. On mortgages, loans that were more than five times bigger than annual income were common. Some of those people are now in arrears or have had their homes repossessed.

The result: As the borrowers fail to repay all of the money lent out, the banks simply pass on the cost to other borrowers. That’s why rates on loans and credit cards have soared relative to the base rate in the past two years.

Action: The EC passed laws in 2008, which now force banks to make rates clear from the start. That doesn’t help those already lumbered with expensive debt. Today I asked the EC consumer department’s head of financial services and redress, Dirk Staudenmayer, whether banks can be trusted to make individual lending judgements. He preferred to put the emphasis on financial education: teaching the next generation how to manage money. But what about those in trouble today?

Investments

If you have a pot of cash, the last thing you should do is ask your bank what to do with it. That, at least, is the conclusion you could make from reading the countless tales of mis-selling in recent years. Our sister title Money Mail has done an incredible job in exposing this dubious practice. Basically, bank staff were able to earn better commission by selling a risky investment when a safer product may have been better,

Result: Sadly, many of the victims were elderly people looking to place their money somewhere safe where it could pay them an income. Some lost most of their money. Some Barclays customers were inspired to set up a website: http://www.barclaysinvestmentvictimsclub.co.uk/
Banks claim to be phasing out dubious bonus schemes.

Action: The FSA, which regulates the industry and makes up the rules, and the Ombudsman, which decides on compensation, are being urged to work together more closely to spot when problems arise. But there are no new rules in place to stop banks doing this again once the dust settles.

Bank accounts and charges

The banks began steadily increasing penalty charges – fees on exceeding overdrafts or bouncing cheques, etc - in the early Noughties as an easy way to make more money. But they overcooked it, and some shrewd consumers hit back. They found a law that suggested penalties should only cover the costs incurred by the bank. The industry ran scared, paying out millions in refunds until a two-year test case that repeatedly found against the banks got turned round on appeal, with the UK Supreme Court ruling late last year finally killed off the refund party. This week the Office of Fair Trading, previously feisty on the issue, tamely admitted that banks had done much to reduce fees..

Result: Many bank customers are unlikely to get back fees at a time they could really used them - the banking industry-induced recession may have left them struggling. They can still attempt to get back unfair fees by putting a case to the ombudsman. But in the end, the banks will probably keep most of the rip-off charges. Meanwhile, charges are lower but there’s no rules to stop them rising again – only consumer and media coverage could stand in the way.

Action: The OFT will continue to look at the issue, but don’t expect much given that the Supreme Court ruling clipped its wings on the issue. As for Europe, surely there’s good news around the corner if the EC’s consumer bods are focused on bank fees? I asked the top man on consumer issues John Dalli - the new EC Consumer Commissioner. He wants to provide the means for consumers to compare bank accounts on the full price (all bank fees included). He believes transparency and comparison is the answer then it can be ‘left to the market’. If this comparison could be extended across borders, then that would help further, he says, increasing competition and decreasing costs.

I like the theory, but the full 'harmonisation' of banking services across Europe is unlikely to happen in my working lifetime.

What’s more, Britain’s online banking comparison industry is far more advanced than in Europe. But the EC’s study of the cost of banking in nation states last year ranked the UK a pitiful 17th, with customers paying nearly £100 a year, on average. Conclusion? Widespread access to bank comparisons has not made banking cheaper in the UK.

The issue in the UK is the lack of competition (consider that the recent banking licence granted for Metro Bank was the first for a start-up in 150 years).

And that’s why bankers will get away with it.

P.S. Feel free to use this blog post to urge the EC and UK authorities to get tough on any of these issues. I’ll make sure they see it. Then write to your MP and tell them how you feel.

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Why it pays to complain... properly

Last week I witnessed possibly one of my favourite moments in television history.

OK, OK maybe that’s a slight overstatement, but the sight of a grown man unashamedly admitting that he has written to his local council to complain about himself was pure TV gold.

And the clincher for me? He was complaining about himself... for sending too many complaints.

Chris ‘the professional complainer’ Byrne made 179 complaints in all to his local council. Most of them were petty gripes – park benches in the wrong places, broken drain covers in roads and such like.

His official moanings had seen local authorities rack up a £100,000 bill investigating them all. But, rather tragically for the council, only three were genuinely worth the effort.

And - surprise, surprise – those three upheld grievances included the one against himself.

All in all, ITV’s It Pays to Complain was a bit of mixed bag. Some moments you thought, ‘Hey, it really does pay to complain - I’m off to get my money back!’; others, you were left frustrated as the advice dished out by presenter Jonathan Maitland and his side-kick, complaints expert Jasper Griegson, failed to hit the spot.

Alongside Mr. Byrne, ITV managed to unearth another unique character, Danielle Gallagher. Danielle told us she receives between £700 to £1,000 a year, averaging several complimentary vouchers per week, just for writing letters of complaint. Another professional whinger, but this time with an end product.

But the crux of ITV’s programme revolved around two hidden camera experiments to see how far the great British public needs to be pushed before the complaints start rolling in.

The first took place in a restaurant. ‘We’ve hired the worst waitress in Britain,’ Maitland said as three unwitting customers, Jenna, Sarah and Fabienne, were treated to unacceptably shoddy service.

First, the waitress dallied for 15 minutes before taking their order. Then she answered a phone call in the middle of noting their choices. Next, she brought out the wrong dishes and asked them to eat the food anyway. Finally, she added a 20% service charge to the bill.

Not a word of complaint. Not one. And they met the bill in full. ‘If we were with our boyfriends we would probably have walked out or got some money off,’ the girls explained afterwards. Not an acceptable excuse, said the experts.

In another scene, ‘Eddie the taxi driver’ takes all sorts of liberties while his passengers watch the meter tick round. In one set-up, he takes several wrong turnings, adding a few extra pounds to the fare. In another he stops for a newspaper, leaves the meter running, and dawdles around outside a local convenience store. Again, no complaints.

It made intriguing viewing – a window into our reserved Britishness. But for all the entertainment, ITV’s offering was short on substance. What should we say when a taxi driver takes liberties like that, Maitland asks? ‘I’d say something. I’d be firm but polite’, says Jasper. Thanks guys, but we need more.

Getting your money back often comes down to writing a succinct, yet powerful, letter of complaint. But as Danielle Gallagher would attest, this is a skill in itself. She offered up a couple of excellent pointers to getting started:

‘Know what you’re complaining about and don’t go off on a tangent,’ she said. ‘And know who you’re complaining to, as well. It’s no good complaining to the check out girl or waitress who’s just served you’.

Sound advice. But what about the actual writing business? What should you say? How should you word it? This is where ITV stopped short. Which was a shame, because a little guidance at this stage and you could be on to a winner.

But no fear, if it's help you crave, you've come to the right place. At This is Money we’ve put together a guide on how to write the perfect letter of complaint. It’s not a guarantee for success, but it’s as close as you’ll get.

So if you’ve been mistreated by a company and left out of pocket, don't get mad. Don’t sit back and accept your fate. Get even. Jasper Griegson, the 'King of Complainers' expands on the useful hints and delves into the finer details of the getting your money back.

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The credit card trick that won't die

Read about a credit card trick that just isn't dying, despite the best efforts of the government, the media and others.

It astounds me that none of our usually sharp-eyed readers have spotted an unexpected discrepancy on their credit card bills from September, but it's some comfort that no readers anywhere else have either.

I'm hoping it's because you lovemoney.com readers have been using your credit cards in a way that avoids all the many costly traps. One of the sneakiest and most expensive is supposed to be scrapped from the beginning of next year. Due to government pressure, the credit card industry has agreed to re-order the sequence in which we pay off the various debts on our cards (cash withdrawals, balance transfers and purchases being the main ones) so that the most expensive is paid off first.

Up till now, if you had, say, a balance transfer at 0% and a purchase at 16%, whenever you made a repayment the card provider would reduce your balance transfer first, leaving the more expensive purchase on the card for longer and therefore costing you much more interest. This practice is known as negative order of payment, but in January it should be reversed.

There have always been honourable exceptions to this that take a positive order of payment, notably the Nationwide Gold Card and the SAGA Platinum Credit Card, but 99% of credit cards have had the negative (expensive) order of payment I've just described.

MBNA (which includes the popular Virgin Credit Card and dozens of other brands) has tried to grab some attention by making the changes early. From September 2010 it has been paying off the most expensive debts first.

Or has it?

The credit card trick that won't die

Two months ago, I put my cynical hat on (it's rarely off) and called MBNA to find out exactly how it was going to implement the changes. I learned, incredibly, that it is still not going to quite make the switch to a completely positive order of payment.

Here's how it's going to keep doing it. Let's say you have a 0% balance-transfer deal lasting 12 months and a 0% on purchases deal lasting three months such as the MBNA Rewards Credit Card. (Most cards offer long transfer deals and short purchases deals.) If MBNA was giving us a completely positive order of payment, it would pay off the the purchases deal first during the initial three months. That way, if you have a £600 transfer and a £600 purchase, you could pay off the purchase in three months at £200 per month and be charged no interest in the fourth and following months.

However, MBNA is not doing that. When two 0% deals are running simultaneously, rather than paying off the shorter 0% deal first, MNBA will use your repayments to pay off the deal that reverts to a higher interest rate. You might have a balance transfer deal expiring in 12 months reverting to 17% and a purchases deal expiring in three months reverting to 16%. Rather than pay off the urgent purchase first, MBNA will pay off the transfer instead. The nub is that you will pay more interest sooner, and most people will pay much more interest altogether.

Back in August, MBNA's interest rates for balance transfers and purchases were identical but, low and behold, now it has increased the balance transfer rate by a couple of percentage points. That's all it needs to ensure that, after three months, those people who used both deals and haven't fully paid off their card will still pay interest.

Extraordinary defiance

Considering the huge pressure from the media and consumer groups, and threats from the government, this just shows how extraordinarily little respect lenders have for customers and authority. It's clear that treating customers fairly in the financial industry is still a long way off.

These firms have an unfair advantage in their knowledge of marketing and their expertise in cooking up contracts. We could be excellent scientists, mechanics and doctors trying to work hard and be productive, but since we have no training in matters of debt, we could be struggling under it, and being less productive and useful because of it. Lenders, meanwhile, work at nothing other than improving their methods for taking more money from borrowers.

As far as I know, I'm still the only commentator to have realised this trick continues at MBNA. I have read thousands of contracts and have years of practice gleaning these things, but if I'm still the only person to have realised what's begun here, what chance does the typical consumer have when attempting to read the small print? If the full force of the media, government and consumer groups can't protect us from these things, I don't see who can.

What this trick might now cost you

MBNA is still, even after huge and sustained condemnation and campaigning, clinging on to what it can from this old card trick. The good news is the power of negative order of payment has been substantially diminished. Anyone with a few thousand pounds on a new card before these changes might have expected to pay hundreds extra in interest per year. Now the extra interest could be reduced to just tens of pounds extra. Even so, from the many tricks card companies use, it will still remain one of their greatest winners.

Not all card providers will do the same

I called a couple of other banks to see what they're planning to do. Barclaycard, which will implement the changes on 26 November 2010, said that it will pay off the shortest 0% deal first. In other words, it should apply true positive order of payment, although I won't relax till I've read the details for myself.

Lloyds Banking Group told me it will always pay purchases before balance transfers when the interest rates are equal, regardless of the lengths of the deals. This means if the banking group develops a card with longer purchase deals than balance transfer deals, you'll meet the same trap as MBNA in reverse. The group comprises of Lloyds TSB, which will implement this new hierarchy on 15 January, and Halifax and Bank of Scotland, which will do so on 20 November.

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No more tired excuses on credit card debts

Let there be no more petty excuses - if you get into debt on credit cards, you’ve only got yourself to blame.

The news today that banks are ‘luring customers back into the red’ with juicy introductory credit card rates has been twisted by the critics to say the least.

It’s almost as if the poor, desperately in-debt Mr. Average Briton is scrambling around looking for a scapegoat. And in banks, he’s find a ready-made villain. ‘Why, oh why, did you offer me credit I couldn’t afford?’, Mr. B says. Please. Give me a break.

It reminds me of that wonderfully allegoric film, ‘Confessions of a Shopaholic’. You wouldn’t have thought it, but this Hollywood chick flick is as potent a study on modern consumerism as a scholarly journal (and easier on the eye, too).

Protagonist Rebecca Bloomwood (Isla Fisher) is a college graduate with a shopping addiction. She manages to rack up £19,000 of debt on credit cards buying clothes, bags, shoes etc.

And all this before she has a job. The metaphor for our modern consumer culture is clear: Rebecca can simply spend, spend, spend with no thought for tomorrow.

Her spendthrift profligacy is, of course, only made possible by cards offering dirt-cheap credit. But that is not the message of the film. No. The moral here is that getting into debt was her choice, her responsibility.

The same is clearly true in our own lives. Undeniably, having the ability to make key purchases when your cash flow has dried up is positive. Thank goodness for the credit card when you’re two days from payday and the fridge looks like a wasteland – crumbs, spilt milk, a knob of butter, but little else.

The problem, though, is that we abuse this luxury, this lender of last resort. We spend more than we have on cards far too often. ‘I want that plasma TV and I can afford it because I have a credit card’ is no good when you’re already deep into an overdraft.

We keep rack up debts, transfer the balance from card to card, pay off the minimum each month and try to survive. But eventually it always comes back to bite us when the interest-free periods end and we’re hit with punitive rates. Many borrowers end up paying through the nose for costly cards advertised as ‘free credit for 12 months'.

In ‘Confessions…’ (without ruining it for those still keen to watch), that’s exactly what happens to Rebecca, who is stalked by a debt collector throughout.

Blaming banks and card providers for our woes because they offer enticing deals is pretty pathetic – we must all learn to manage our own finances and take responsibility for our spending. Yet it’s almost as if today's apologetic commentators are excusing those who can’t and don't.

Stewart Hosie, a member of the Commons Treasury select committee, says: ‘Of course credit card companies are businesses, but I would ask them to have not just attractive deals for new customers and transfers, they should make sure they have affordable rates all the time.

'There is no point offering great introductory deals if people cannot service that debt.'

Sure banks have a responsibility to foster well-run businesses. But no more. The fact that banks offered offered credit to 'sub-prime' borrowers was no more the cause of current financial crisis than the fact that millions of us were reckless in applying for loans we couldn't repay.

Credit cards should be avoided altogether by those struggling under the weight of debts and who have small and unstable disposable incomes.

I know critics will argue with me, but I feel that we only have ourselves to blame. It's our modern materialistic insistence on keep up with the Joneses - whether it be the latest iPhone, an expensive holiday to the Costas, a new car, or a shopping spree in New York (delete as applicable). I admit, I'm guilty of craving what I can't have. But that doesn't make it right.

Sure today’s credit card offers are ‘even more generous than before the recession’ and that's a bad sign from a banking point of view. But on a personal level, it shouldn’t matter. We should have learnt our lesson by now: only ever borrow on a credit card if you are 100% sure you can afford to repay, in full, when the amount is due.

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Warning that IMF might have to rescue UK

Shadow business secretary Ken Clarke has warned that the International Monetary Fund might have to intervene if markets react badly to a hung parliament.

Clarke said the City would be greatly troubled by an indecisive election result.

"Bond markets won't wait," he said.

"Sterling will wobble. We have seen even minor flickers in the opinion polls causing problems with interest rates in the recent past.

"If the British don't decide to put in a government with a working majority, and the markets think that we can't tackle our debt and deficit problems, then the IMF will have to do it for us."

But is Clarke right or just scaremongering to secure more votes? Have your say using the comment section below

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Claim Back Default Charges

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Claim Back Your Unfair default Charges

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Do not delay in claiming back all your default charges from every credit card you have used in the last 6 years. 

 

The bank charges case was only lost on a narrow technicality and the court added that there may be different legal avenues through which bank charges can be challenged by consumers. We will wait and see and let you know.
Meanwhile do not delay in claiming back all default Charges on your Credit Cards.
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Beware April price changes

Spring is in the air as April approaches - but beware the price changes coming with it.

By Nathalie Bonney

Stamps

Make sure you stock up on stamps before 6 April, when the price of both first and second-class stamps will increase.

First-class stamps for standard letters weighing up to 100g will rise by 2p to 41p, while second-class stamps will increase in price from 30p to 32p.

The cost of sending ordinary meter and account mail, which is largely sent by small businesses, will remain at 36p and 25p respectively.

Royal Mail estimates the rises will add 3p onto the average household's 50p weekly expenditure on postage.

Last April, the cost of a first-class stamp increased from 36p to 39p and a second-class stamp rose from 27p to 30p. The price of special next-day delivery, meanwhile, increased from £4.65 to £4.95 for mail up to 100g.

TV licences

Licence fees are based on a six-year BBC funding settlement that started in April 2007. In year one (2008) and year two (2009), the licence fee increase was set at 3%. In years three (2010), four (2011) and five (2012), the increase is set at 2%. The BBC can set any increase in year six, up to 2%.

This means that on 1 April, the cost of a TV license will rise by 2% from 1 April, the cost of a colour television licence will be £145.50 (from £142.50) while a black and white licence will be £49 (up from £48).

Motoring costs

A new ‘showroom tax' based on the most polluting cars will come into effect in April. The introduction will cost drivers from £110 tax in the first year of ownership.

Band M vehicles (those that produce over 255g of CO2 per km) will have to pay £950 while drivers of greener cars – up to band D (producing (121-130g CO2/km) won't have to pay anything.

From 1 April, the government will also add 3p in fuel duty and VAT on to the cost of petrol and diesel.

Fee to go bankrupt

From 6 April 2010, the fee you will have to pay to go bankrupt will jump a whopping 25%, from £360 to £450. On top of this, bankrupts also have to pay a £150 court fee.

Phone calls

From 1 April, BT will shift the start time of its off-peak period from 6pm to 7pm. Meanwhile, its peak period will start at 7am rather than 6am.

The move means 4.7 million people signed up to BT's Evening & Weekend plan will no longer wil able to enjoy free calls until 7pm. A further 8.5 million people on BT's Weekend plan, meanwhile, will no longer talk for free from 6pm on Friday evenings.

BT has written to affected customers suggesting they move from its Evening & Weekend plan (which currently costs just £2.99 a month) to its Anytime Plan (which is more costly at £4.99 a month).

London taxis

Taxi fares are reviewed annually and calculated by Transport for London, based on a cost index that has been used since 1981. From 1 April 2010, the average taxi fare will increase by 2.3%. This is the lowest rise since 2004.

Last April taxi fares increased by 3.4%.

Multi-channel TV

Households with a subscription to Virgin Media's L and XL TV packages will see prices rise from 1 April. Customers with a subscription to the L package will see prices rise from £10 a month to £11 a month, while those on the largest package, XL, will now pay £23 a month, instead of £21.50.

New tax for high earners

Anyone earning above £150,000 will be subject to the new 50% tax rate - meaning 50p of every pound they earn goes to the taxman.

OTHER CHANGES TO EXPECT IN APRIL...

* The ISA allowance will increase to £10,200, of which £5,100 can be held in cash.

* The number of qualifying years for the full state pension will drop from 44 years (for men) and 39 years (for women) to a universal 30 years. The retirement age for women will also increase to 65 years, in line with men.

* New national insurance credits are being introduced for unpaid carers, so that the years they spend looking after others will count towards their state pension. They must spend at least 20 hours a week caring to qualify for this or in the case of parents receive child benefit for children under the age of 12.

* Child benefit and some disability benefits will increase by 1.5%.

* People in Northern Ireland will benefit from free prescriptions while prescription costs in Scotland will drop to £3.

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Plan to force dog owners to pay £500 to insure their pet 'will penalise responsible owners'

Plan to force dog owners to pay £500 to insure their pet 'will penalise responsible owners'

By Niall Firth and Steve Doughty
dailymail

A plan to force dog owners to fork out for expensive insurance will penalise responsible owners who look after their pets properly, animal charities warned today.

Owners may also be required by law to have a microchip implanted on their pet under Government plans to curb the use of dangerous dogs. Insurance for dogs can cost in excess of £500 a year.

But critics today warned that the new proposals should be targeted at those who to flout the laws rather than responsible dog owners who take care of their pets.

Dog owners could soon have to pay for insurance which covers damage or injury their pet causes

Shadow Environment Secretary Nick Herbert, said: 'The problem of dangerous dogs is growing and the current legislation is clearly not working, but the Government's proposals risk penalising millions of law-abiding dog owners with the blunt instrument of a dog tax.

'We should be targeting the minority of irresponsible dog owners, not the vast majority who are responsible dog lovers.

'And we need to legislate carefully, not in haste, so that we don’t repeat the mistakes of the infamously flawed Dangerous Dogs Act.'

The measures, part of proposed changes to the Dangerous Dogs Act unveiled today, are aimed at tackling the growing problem of vicious animals being bred for use as weapons, particularly on inner-city estates.

But a spokesman for the Kennel Club said: 'We believe that any new legislation must tackle the root cause of the problem which is irresponsible ownership.

'This sort of proposal will not work in isolation.

'Any new proposals must be targeted at those who continue to flout the laws rather than the majority of responsible dog owners.'

An RSPCA spokesman said: ‘It is important that the right people are targeted with this.

‘The crux of these proposals is that the Government is trying to tackle anti-social behaviour with dogs but it’s important that the vast majority of fantastic dog owners are not penalised for the small minority.’

'But in the end nothing has ever happened. If Labour are re-elected in May all we'll get is the same tired-out old approach and none of the changes the country really needs.'

Another measure being considered is the use of Dog Control Notices for misbehaving animals - known as 'Dogbos'.

Chris Laurence, vetinerary director at the Dog's Trust said that insurance for dogs was of relatively little value.

‘Far more important are control orders and compulsory micro-chipping,’ he said.
muzzle the devil dogs.jpg

Control notices would allow police officers and council officials to force miscreant owners to muzzle, leash or even neuter their pets.

‘It is control orders that are important because they mean legislation in a private place rather than just in public places,' said Mr Laurence

Ministers are suggesting making it compulsory to have only third party insurance to cover attacks by dogs on bystanders, neighbours or workers.

Dogs may be implanted with a microchip to identify their owner.

The price of microchipping and insuring a dog means that families could face bills of £100 and more to legally own a pet under the new rules.

The proposals come in the wake of outcries over incidents like the death of four-year-old John-Paul Massey, savaged by a pit bull at his home in Liverpool last November, and protests by employers and unions over the rate of attacks by dogs on workers such as postmen.

Home Secretary Alan Johnson said: 'The vast majority of dog owners are responsible, but there is no doubt that some people breed and keep dogs for the soul purpose of intimidating others, in a sense using dogs as a weapon.

'It is this sort of behaviour that we will not tolerate; it is this sort of behaviour that we are determined to stop.'

The plans for curbing the use of intimidating dogs were put forward in a Department of the Environment consultation over changes to the Dangerous Dogs Act, the 1991 law often cited as an example of hastily-made and unworkable legislation.

The Act names four breeds, including pitbull-terriers, which are banned.

However the law also allows the banned breeds to be kept in some cases, if they are neutered, tattooed with the owner's details, microchipped, and are allowed out in public only if on a lead and muzzled.

Figures uncovered by the Tories have suggested 100 people every week are treated in hospital after being bitten by a dog, with the number of cases rising from 3,079 in 1997-8 to 5,221 last year.

In London alone, the number of dangerous dog cases going to court increased from 35 in 2002-3 to 719 in 2008-9.

The rise in the so-called 'status dog' has prompted the Metropolitan Police to set up a new unit to handle a surge in the number of attacks and to kennel hundreds of seized animals.

Terrible cases to make the headlines in recent years include that of John-Paul Massey, a four-year-old who died at his grandmother's house in Liverpool last year after suffering 'massive injuries' inflicted by a dog later found in tests to be a pitbull, a breed banned under the Dangerous Dogs Act.

In February last year, three-and-a-half-month-old Jaden Mack was killed by a Staffordshire bull terrier and a Jack Russell at his grandmother's home in Ystrad Mynach, South Wales, devastating the local community.

The previous summer there was a rash of attacks by dogs on children in different parts of the country.

Victims: John-Paul Massey, four, died after suffering 'massive injuries' inflicted by a dob. Right, 13-month-old Archie-Lee Hirst was killedby a rottweiler

There were reports of children being bitten in Guisborough, Cleveland; Killingworth, North Tyneside; Chesterfield, Derbyshire; and Grimsby, Lincolnshire.

At the start of 2008, nine-year-old Chloe Grayson was left scarred after she was attacked by a 10-stone rottweiler in Rotherham, South Yorkshire. She was attending a New Year's Eve party with her parents at a neighbour's house.

The attack came just three days after 13-month-old Archie-Lee Hirst was killed by a rottweiler in the back yard of his grandparents' home in Wakefield, West Yorkshire.

Two weeks earlier, kennel worker Mandy Peynado's arm was amputated because of injuries she suffered trying to protect her throat when she was mauled by a rottweiler at Knightwood Kennels, near Salisbury, Wiltshire.

On January 1, 2007, five-year-old Ellie Lawrenson was found bleeding to death in the living room of her grandmother's home in Merseyside after attending a family party.

The dog involved, named Reuben, was shot at the scene by Merseyside Police. It was later confirmed that the animal was a 'pitbull terrier-type' banned under the Dangerous Dogs Act.

In September 2006, five-month-old Cadey-Lee Deacon was fatally attacked by a pair of rottweiler guard dogs at the Rocket pub in Leicester, which was run by her grandparents.

In March last year, an 11-year-old boy's ear was torn off in an attack by a pitbull-type terrier in the Alway area of Newport, South Wales.

Adults were also attacked - including railway engineer James Rehill, 78, who was 'dragged like a doll' through the street in a fatal attack by his own dog in January last year.

Witnesses looked on in horror as Mr Rehill was savaged by his rottweiler in Newham, east London.

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The 7 biggest supermarket scams

Household Bills - Beware of these supermarket scams


Find out how to fight back against supermarket scams and rising food prices so you can beat the grocery stores at their own game...

Believe it or not, recent figures suggest that over the past few years, the wholesale price of basic food essentials, such as bread and butter, has plummeted almost 50%.

No, I'm not making this up. And yet, I can't say I've noticed. In fact, every time I'm at the checkout, I'm continually amazed at how much money I manage to spend on food each week.

So why are my food bills continuing to spiral upwards? Well, apparently, supermarkets simply haven't been lowering their prices in line with declines. And in fact, prices have still been going up.

If you ask me, this is a bit sneaky. Unfortunately, however, it's not the only trick adopted by many supermarkets – there are lots of them. So here are seven supermarket scams to avoid at all costs...

Size matters

You might think you'll save yourself some pennies if you buy larger packs of goods. After all, generally speaking, buying in bulk is supposed to be cheaper.

But according to research from mySupermarket.co.uk, shoppers could be paying up to 46% more by opting for bigger packs. For example, an 800g jar of Hellmann's mayonnaise was found to be 33% (99p) more expensive than buying two jars of 400g mayonnaise.

The best way to avoid this is to always check product details before buying – it's a really good idea to check the price per weight. Although this may sound like a lot of hassle – particularly if you're walking around the supermarket in a bit of a hurry – if you shop online using mySupermarket.co.uk, you will find it much easier.

That's because this nifty website allows you to track how much your shopping would cost at each of the UK's four major supermarkets (Sainsbury's, Tesco, ASDA and Ocado/Waitrose). It also means you can easily see how much you'll be paying per gram/kilogram, so it's easy to check which is the cheapest option, no matter how big or small the packet.

What's more, it will also tell you when you can 'swap and save' by substituting a bag of grapes for a box of grapes, for example. The savings soon stack up!

Special offers

Special offers such as 'buy one get one free' deals can be very tempting. But while in some cases these can help to slash your food bills, they don't always provide the best value for money.

Often you'll find the very best deals are on perishable items such as fruit and vegetables. So unless you can guarantee you'll eat two bags of satsumas in a few days, you may find you end up throwing a lot of food away.

What's more, if you head down to your local greengrocers or market, you will probably find you can buy the same product even cheaper. Or simply grow your own!

Similarly, be wary of deals such as 'buy one get one half price' and 'two for £3' – if you don't actually need to buy two, don't get too sucked in. Some supermarkets cunningly raise prices one week and then reduce them the next so that they can claim a discount. So don't buy more simply because you can.

Delicious smells

I have to confess that I fall for this one on a regular basis. I just can't resist the smell of freshly baked bread as I walk down the bakery aisle. Usually this trick works its magic and I find myself loading up my trolley with the stuff.

But try not to let yummy smells tempt you into buying items you really don't need or didn't intend to buy in the first place. Stick to your shopping list!

Relaxing coffee shops

These days it seems that supermarkets are determined for you to spend hours and hours wandering around their aisles.As a result, coffee shops such as Starbucks and Costa have started springing up in supermarkets, allowing you to while away the hours, enjoying a cup of coffee and a spot of lunch, before continuing to amble along the aisle.

After all, what better way to spend your day than in the supermarket? And the longer you spend in the supermarket, the more you might spend on your food bill! Don't get sucked in – walk in, stick to your shopping list, get out!

Product placement

Do you ever find yourself wondering what's at the top of the supermarket shelf? The one you can't quite reach? Supermarkets will often put the most profitable items at eye level so they are easy to find, while the cheapest items will be at the very top or very bottom of the shelf. This means you may need to be prepared to do some hunting if you want the best bargains.

Similarly, you may find the most expensive products, such as electrical goods, are placed near the entrance to the supermarket. Meanwhile, the cheaper basic foods will be towards the exit – so you'll have to pass the tempting electrical products to get to them.

Changing layout

It drives me mad when I walk into my local supermarket to find that everything has been moved around.

This is another cunning ploy adopted by supermarkets and means that however well you thought you knew the layout, you can guarantee you won't know where anything is anymore, and you'll be forced to traipse around the supermarket looking for everything on your shopping list.

As a result, you'll pass other tempting items which you're more likely to throw into your trolley. So again, stick to your shopping list!

Location, location

If you often run into your local supermarket at the station to pick up a few bits on your way home from work, be careful. That's because prices can change depending on the store location – even if it's the same chain.

Very large stores are likely to be the cheapest, while convenience stores and those in petrol stations and at motorway service stations will be more expensive. So try to avoid doing a big shop in the more expensive stores.

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See you soon.

Postman loses job after signing for a parcel to help frail customer

A postman reportedly lost his job after signing for a parcel to help a frail customer.

Royal Mail bosses took disciplinary action after the pensioner called his managers to thank him for his kindness!

The postman is reported to have put his signature to the recorded delivery when a parcel firm arrived on the doorstep as he made his own rounds.

Concerned that the elderly householder would have to trek to the sorting office to collect the parcel when she got home, he signed for her.

After disciplinary action was taken the postman was signed off work with stress and subsequently retired on the grounds of ill health.

The case was one of several cited during a parliamentary debate by Liberal Democrat MP John Pugh.

Postal workers came in for some harsh criticism during last year's strike - but this case shows that they may have good reason to be angry with their bosses.

Have your say on this story using the comment section below

Why bother working when children of better-off parents are banned from school trips?

Why bother working when children of better-off parents are banned from school trips?
Thursday 28th January 2010

By Mike Jones

Schoolchildren have been barred from trips to a safari park, football ground and indoor ski centre because their parents are too well-off.

Instead, under a Government-funded scheme, being trialled across Trafford Council in Greater Manchester, the trips are open only to children who receive free school meals because their parents are on benefits.

This has led to accusations that some parents are being penalised for working as children were banned even when they were willing to pay.

While disadvantaged children should be helped whenever possible what kind of message does this type of initiative send out to the hard-working parents this Government supposedly stands up for?

Instead of tackling real inequality surely such initiatives do nothing but perpetuate this country's growing "Shameless" culture. Do you agree? Tell us your views using the comment section below

6-month paternity leave plan - that'll rescue the UK economy

Thursday 28th January 2010

By Mike Jones

Women are already entitled to a year's maternity leave - now their other halves will be able to get six months off under plans to improve fathers' rights.

Ministers are understood to be pushing ahead with the plan after it was delayed because of the economic downturn.

But with our economic recovery already delicately poised, what impact is this likely to have (aside from deferring thousands from appearing on the dole figures?) Tell us what you think using the comment section below

When did blowing your nose become a criminal offence?

When did blowing your nose become a criminal offence?

Thursday 28th January 2010

By Mike Jones

A man is reported to be facing a criminal trial after he was caught blowing his nose behind the wheel of his car.

He was given a £60 fixed penalty notice after a policeman decided he was "not in control of his vehicle" when he wiped his nose with a tissue.

But the father-of-two told the Daily Record newspaper that he had "made sure it was safe" to blow his nose before taking his hands off the wheel.

He claimed he was in stationary traffic and had put his handbrake on when he committed the alleged offence in October last year.

When did blowing your nose become a criminal offence? Have your say using the comment section below