Home | Contact Us | Help | About moneybasics
Brown plans to sell student loan debt
This week the Prime Minister Gordon Brown unveiled plans to reduce the national debt by selling assets worth £16 billion. One asset for sale is a part of the student loan book, which is the income from the repayments of student loans.
The student loan portfolio is worth around £18.1 billion and is expected to increase in value to £55 billion over the next ten years. A spokesman for the Department for Business, Innovation and Skills (BIS) said the sales would not mean higher loan repayments for students and graduates. The Government is also to retain control of all loan arrangements and regulations, including interest rates and repayment plans.
This fund-raising proposal comes amid complaints of widespread delays for students in England applying for loans and grants. A separate review of student fees is to begin this autumn.
Other public assets for sale include the Tote bookmaker, the Dartford Crossing and the Channel Tunnel rail link, all of which are estimated to raise £3 billion. The Prime Minister said the plan would support growth and jobs. The process is expected to be completed in two years.
Here is a review of the other top money stories of the past week commencing the 12th October 2009.
Monday 12th October
Interest rates to stay low -Interest rates will remain at a record low for at least the next five years according to the Centre for Economics and Business Research. Interest rates are figures that set how much interest is paid on a loan, or how much a person may receive if they put money into a savings account. The rate is usually linked to the Bank of England base rate and can move up or down. The Bank’s rate-setting committee has kept UK interest rates on hold at 0.5%, which means the official cost of borrowing will stay at this level until at least 2011. Low base rates encourage lending and borrowing and are intended to help speed the return to economic growth.
The student loan portfolio is worth around £18.1 billion and is expected to increase in value to £55 billion over the next ten years. A spokesman for the Department for Business, Innovation and Skills (BIS) said the sales would not mean higher loan repayments for students and graduates. The Government is also to retain control of all loan arrangements and regulations, including interest rates and repayment plans.
This fund-raising proposal comes amid complaints of widespread delays for students in England applying for loans and grants. A separate review of student fees is to begin this autumn.
Other public assets for sale include the Tote bookmaker, the Dartford Crossing and the Channel Tunnel rail link, all of which are estimated to raise £3 billion. The Prime Minister said the plan would support growth and jobs. The process is expected to be completed in two years.
Here is a review of the other top money stories of the past week commencing the 12th October 2009.
Monday 12th October
Interest rates to stay low -Interest rates will remain at a record low for at least the next five years according to the Centre for Economics and Business Research. Interest rates are figures that set how much interest is paid on a loan, or how much a person may receive if they put money into a savings account. The rate is usually linked to the Bank of England base rate and can move up or down. The Bank’s rate-setting committee has kept UK interest rates on hold at 0.5%, which means the official cost of borrowing will stay at this level until at least 2011. Low base rates encourage lending and borrowing and are intended to help speed the return to economic growth.
Tuesday 13th October
Rise in house prices – More estate agents are reporting rising house prices than at any time since the recession. Figures released by the Royal Institute of Chartered Surveyors (RICS) show that the number of agents reporting a rise in prices in the last three months outnumbers those reporting they were falling. A RICS spokesman said the lack of supply of houses is responsible for underpinning the rise in house prices.
Youth struggling to find jobs – A third of young people receiving Jobseekers Allowance have been unemployed for more than six months and experts say it is the worst rate for 15 years. Youth unemployment is almost certain to breach the one million barrier. The impact of the recession is heightened by the hundreds of thousands of school-leavers and graduates, now trying to find a job. Predominately-male industries such as construction and the private sector have been hit hardest by job losses. In August the Confederation of British Industry (CBI) called on the government to do more to help tackle youth unemployment urging the government to fund 50,000 new apprenticeships.
Rise in house prices – More estate agents are reporting rising house prices than at any time since the recession. Figures released by the Royal Institute of Chartered Surveyors (RICS) show that the number of agents reporting a rise in prices in the last three months outnumbers those reporting they were falling. A RICS spokesman said the lack of supply of houses is responsible for underpinning the rise in house prices.
Youth struggling to find jobs – A third of young people receiving Jobseekers Allowance have been unemployed for more than six months and experts say it is the worst rate for 15 years. Youth unemployment is almost certain to breach the one million barrier. The impact of the recession is heightened by the hundreds of thousands of school-leavers and graduates, now trying to find a job. Predominately-male industries such as construction and the private sector have been hit hardest by job losses. In August the Confederation of British Industry (CBI) called on the government to do more to help tackle youth unemployment urging the government to fund 50,000 new apprenticeships.
Wednesday 14th October
Inflation falls to a 5 year low – The Consumer Price Index (CPI), which measures the average price of consumer goods and services purchased by households, has fallen to 1.1%. Statistics revealed by the Office for National Statistics yesterday show the fall was part driven by a 7.2% fall in electricity prices and a 5.6% fall in gas prices compared with a year ago. Food bills have also dropped by nearly 1% between August and September. Lower inflation has eased some of the pressure on recession-hit households. However, it also shows the economy has yet to recover.
State pensions will rise – The basic state pension will rise by £2.40 a week next April. Chancellor Alistair Darling is to announce the increase of 2.5% in this autumn’s pre-budget report. For a single person, the pension will rise from £95.25 a week to £97.65 a week next April. Couples will see their weekly income go up from £152.30 to £156.15. The government has pledged not to cut other benefits even if prices are falling.
Inflation falls to a 5 year low – The Consumer Price Index (CPI), which measures the average price of consumer goods and services purchased by households, has fallen to 1.1%. Statistics revealed by the Office for National Statistics yesterday show the fall was part driven by a 7.2% fall in electricity prices and a 5.6% fall in gas prices compared with a year ago. Food bills have also dropped by nearly 1% between August and September. Lower inflation has eased some of the pressure on recession-hit households. However, it also shows the economy has yet to recover.
State pensions will rise – The basic state pension will rise by £2.40 a week next April. Chancellor Alistair Darling is to announce the increase of 2.5% in this autumn’s pre-budget report. For a single person, the pension will rise from £95.25 a week to £97.65 a week next April. Couples will see their weekly income go up from £152.30 to £156.15. The government has pledged not to cut other benefits even if prices are falling.
Thursday 15th October
Growth in unemployment slows – The latest UK unemployment figures show that unemployment continues to rise but the rate of increase has slowed from 7.9% to 7.6%. The number of those unemployed has risen by 88,000 to 2.47 million between May and August this year. The Office for National Statistics said the rise in the number of unemployed is the lowest since July 2008. The number of people claiming Jobseekers Allowance is at its highest since 1997 but it is the smallest increase since May 2008. However, Work and Pensions Secretary Yvette Cooper said unemployment 'remains a serious problem' and called for increased support. Credit Action has a Redundancy Money Manual, which is free to download and contains information about what redundancy entails and the help that is available to you.
Growth in unemployment slows – The latest UK unemployment figures show that unemployment continues to rise but the rate of increase has slowed from 7.9% to 7.6%. The number of those unemployed has risen by 88,000 to 2.47 million between May and August this year. The Office for National Statistics said the rise in the number of unemployed is the lowest since July 2008. The number of people claiming Jobseekers Allowance is at its highest since 1997 but it is the smallest increase since May 2008. However, Work and Pensions Secretary Yvette Cooper said unemployment 'remains a serious problem' and called for increased support. Credit Action has a Redundancy Money Manual, which is free to download and contains information about what redundancy entails and the help that is available to you.
