Cuts, Bovis, housing and loans

The prospect of swingeing cuts to public services edged closer today despite plans by nearly every local authority in England to raise council tax in 2017.

The BBC reports that rises of up to 4.99 per cent are expected across the country. Nevertheless, libraries, bin collections and other services will still face funding problems. The Local Government Association says the cost of care for increasing numbers of elderly people is forcing up bills. But a spokesman for the Department for Communities and Local Government insisted that local authorities had been given a ‘historic’ four-year settlement. Bovis Homes  Following widespread publicity of the alleged shoddy quality of new houses built by Bovis, The Guardian reports that the company is being forced to pay £7 million for ‘remedial action’ to fix customers’ homes. Angry home-owners formed a Facebook group with some accusing Bovis of pressuring them to move in to incomplete houses to hit sales targets, also claiming that they had to spend their own money fixing faults at newly built properties. Now Bovis’s boss has apologised for the poor quality of their homes and promised he would ‘make sure [we] finish their homes to their satisfaction’. Inequality Inequality is gathering pace among UK households, says ThisisMoney, with the difference in financial fortunes between low and high income families becoming more obvious over the past 12 months.

According to Aviva’s latest Family Finances Report, families are dealing with increased financial pressure from stalling incomes and limited savings, combined with rising debt and inflation fears. The company found that the savings gap between low and high income families has increased 25 per cent year on year, from £50,072 in 2015/16 to £62,790 in 2016/17.

Vauxhall A pensions expert has told the BBC‘s Today programme that plans to sell the European arm of General Motors – including Vauxhall – to France’s PSA Group could be derailed by the deficit in GM’s UK pension scheme. John Ralfe said Peugeot owner PSA would not want to touch it ‘with a barge pole’, saying he thought it had a deficit of about £1 billion. Vauxhall’s pension scheme has around 15,000 members. Housing The Telegraph reports on the latest Rightmove housing survey which shows that the growth in house prices has slowed to the lowest rate in almost four years. Rightmove’s index of asking price for properties found that the annual rate of growth was just 2.3 per cent, the lowest since April 2013. Meanwhile, Mail Online reports that ‘buying a home remains cheaper than renting, with first-time buyers spending £651 less a year than tenants’. The website says that, according to research by Halifax, the average cost of buying a three-bedroom house was £705 a month, compared to £759 a month for tenants.

Loans

The number of guarantor loan problems Citizens Advice has helped people with has risen by 40 per cent over the last year, latest figures show.

When taking out a guarantor loan the borrower gives the name of a guarantor, normally a friend or family member, who is then pursued for payment if the borrower can’t repay. Last year Citizens Advice helped people with more than 2,000 guarantor loan issues. Between October and December 2016, it dealt with nearly 600 problems – a 40 per cent rise compared with the same period in 2015 (400 problems).

This included cases where people were hit with shock debts totalling thousands of pounds after guaranteeing a loan that the borrower failed to repay. In many cases guarantors were not aware of the risks they faced should the borrower get into difficulty.

Kraft Heinz

The Times reports that ‘an opportunistic attempt by Kraft Heinz to snap up one of Britain’s biggest companies passed its sell-by date last night after little more than 50 hours on the table’.

The American foods group unexpectedly withdrew its proposed £115 billion offer for Unilever, claiming that the decision had been amicable and with little apparent appetite for taking on anything more hostile. Economy The economic forecasting group EY Item Club has said that stronger-than-expected tax receipts means the Office for Budget Responsibility is likely to cut its borrowing forecast for the current year by £3 billion to £65 billion on budget day next month. Small businesses More on the row over an imminent increase in business rates. The Times reports that ministers risk angering small businesses by asserting that the revolt over rate revaluations was rooted in ‘distortions and half-truths’. In a private letter to Conservative MPs that was passed to The Times, Sajid Javid, communities secretary, and David Gauke, Treasury minister, criticised what they described as a relentless campaign of misinformation that had gained traction in the media. Retirement Almost half of the over 50s say they notice more repairs that need to be done to their home since retiring. Two thirds have bought a new kitchen, the same number have bought a new bathroom and two thirds say they have carried out major work to their home. According to the research by Saga Personal Loans among more than 8,000 over 50s, these home projects do not come cheap; typically people said they spent around £17,000 on renovations, they spend around £5,000 on a new bathroom and £13,000 on a new kitchen. People seem keen to continually revamp their homes, with one in eight typically refitting the bathroom twice and carrying out three-six major home improvements.