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Money digest: today’s need to know financial news

31 March 2016

9:10 AM

31 March 2016

9:10 AM

New research from Aviva is making headlines this morning after the insurer revealed statistics on so-called ‘crash for cash’ claims. Of its 3,000 motor insurance claims last year, a quarter were in Birmingham, making the city England’s crash for cash capital.

The study also showed Leeds, Harrow, parts of London, Bradford, Luton, Coventry and Oldham were all in the top 10 hotspots. The figures include induced accidents, where innocent motorists are targeted, as well as staged accidents, when two damaged cars are brought together to make it look like an accident.

On an equally gloomy note is the news that the cost of the most basic funeral can drive families into debt. The Work and Pensions Committee said the maximum award for essential funeral costs under the means-tested social fund funeral payment system has been frozen at £700 for 13 years but even ‘simple’ funerals cost more than £1,200. MPs have urged the government to overhaul the support system in England and Wales.

The average funeral in the UK now costs about £3,700, with funeral directors’ fees rising well above the rate of inflation in recent years, the committee’s report said.

The Telegraph reports that millions of families face council tax increases of up to £58 tomorrow as local authorities across England take advantage of new powers from the Treasury. Bills are set to rise by an average of 3.6 per cent outside London in what amounts to the largest council tax rise since 2008, according to the Chartered Institute of Public Finance and Accountancy. It comes after George Osborne allowed councils to charge an extra 2 per cent to fund social care on top of the 1.99 per cent rise already permitted without a local referendum.

Also in The Telegraph is the news that complaints about Payment Protection Insurance (PPI) rose 6 per cent in the second half of last year compared to the first six months, and accounted for almost half of all complaints about banks, suggesting the product continues to confuse and frustrate customers. There were 932,000 PPI complaints in the six months to December, according to the Financial Conduct Authority. Overall, the watchdog processed more than 2 million new complaints across all banking products over the period, although this was a 1.4 per cent drop compared to the previous six months.

The FCA added that customers are battling for compensation after being tricked into signing up for expensive current accounts by their bank. Payouts to people who protested about their bank accounts and credit cards have risen by 27 per cent.

Also on the theme of customer grievances, complaints about Vodafone soared towards the end of last year, according to the latest report from UK telecoms watchdog Ofcom. The regulator says it recorded 32 complaints for every 100,000 of the firm’s pay-monthly subscribers over the last three months of the year. That is more than double the figure for the same period in 2014, at which point Vodafone was still the most complained about network. The company blames an IT glitch.

If your payday is just around the corner, consider the fact that a third of Britons routinely spend the majority of their wages within a week of being paid. Cashback and rewards site Quidco who commissioned the poll found that seven per cent splash their salary within just 24 hours. The study also revealed that almost half of workers in the UK attempt to stick to a budget each month for it to ‘never work out’ – with 42 per cent struggling to make their money last the full month.


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