BANKS AND building societies shielded borrowers from the full impact of rising base rates this year but made their money by cutting the gains for savers, says the Daily Telegraph .
Over the course of the year, base rates increased by one percentage point to 4.75%, however independent statisticians at Moneyfacts revealed "both mortgage and savings rates have in general risen by less than one percentage point".
Given savers outnumber borrowers by about six to one and so the failure of banks and building societies to pass on the full increase in base rates is likely to have boosted their profit margins.
PAUL MYNERS report into corporate governance of mutual insurers says Standard Life must keep policyholders fully informed about the negative aspects of demutualisation - including the falling value of insurance policies, according to the Scotsman.
The governance review of mutuals report, published yesterday, says members should be made aware the value of their policies will be weakened as part of a flotation on the stockmarket.
"Members should appreciate that they will suffer lower policy returns unless further capital is raised. That will require a successful investment strategy - a move that would need the full co-operation of members,” says Myners.
PRIVATE schools and hospitals should today escape the crackdown they had feared on their £100m tax breaks when ministers publish the long-awaited Charity Bill, says the Times newspaper.
The Bill will stop short of automatically stripping elite schools such as Eton and Harrow of their charitable status or of demanding that they throw their doors open to the wider public.
The Charity Commission has indicated that it will begin its review of the “public benefit” definition by looking at fee-charging charities and that the review will include a consultation on whether the definition is “clear and intelligible” to the general public.
AND ECONOMISTS are warning Gordon Brown may have to raise taxes by up to £10bn after next year’s election, continues the Times, as a surge in public spending and disappointing tax revenues sent the country deeper into the red.
Public finances recorded their worst November for two decades last month as public spending rose at a faster pace than the Chancellor had planned and a shortfall in tax revenues continued.
The cash measure of government borrowing, its public sector net cash requirement (PSNCR), hit just under £9bn last month – unfortunately that was £3bn more than expected.IFAonline
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