New measures put down to help the Government crack down on rogue traders and consumer debt have been announced by their Consumer White Paper.

The paper: ‘A Better Deal For Consumers’, bans unsolicited credit card cheques in order to promote responsible lending and borrowing and provides longer term framework to enhance and enforce consumer rights in the wider economy.

The Measures

Some of the measures that will be put in place according to the Consumer White Paper include:

1. Reforms in the regulations of credit and store cards so that consumers are in more control of their borrowing which will help people avoid running up huge debt they can’t afford to pay back;

2. It bans unsolicited credit card cheques so that consumers unaware of high interest rate charges don’t get caught out;

3. A review by the Office of Fair Trading into the market for high cost credit, usually above 50% APR – pay day loans and door step lending;

4. The introduction of a new Consumer Advocate responsible for the co-ordination of work to educate consumers and help them get their money back when things go wrong has been appointed;

5. The courts will also get new powers in order to ban persistent rogue traders including a new national specialist team for internet enforcement tackling scams over the internet. They will also get money for a central ‘Fighting Fund’ to tackle large scale rogue traders; and a pilot scheme giving Trading Standards officers powers to help consumers reclaim their money;

6. Also, a Money Advice Trust new self-help tool-kit, and the Insolvency Service introduce a new Debtor’s Guide to help those in debt stay in control of their finance.

What Consumer Minister Kevin Brennan said:

“Consumers have been seriously affected by the past two years of turmoil in the financial markets, as well as by the longer term changes in the way that goods and services are bought and sold. We are taking decisive action now to prepare for the future. 

“We are delivering a new approach to consumer credit with a review of the regulation of credit card and store cards. We are imposing requirements on lenders to explain their products and to check creditworthiness before they lend, and revised OFT guidance to tackle irresponsible lending.

“There will also be tougher action against rogue traders and fraudsters who look for ways to fleece consumers out of their hard-earned cash, and a new emphasis on consumer rights spearheaded by the Consumer Advocate.”

What Do You Think?

Will this help consumers or not? We want to know your thoughts and opinions. Leave your comments here.

Slashing Records Again

Between January & March the UK economy contracted 2.4%, the highest it has reached in 51 years according to the latest figures.

Initial estimates were for a 1.9% fall, so the situation is worse than analysts at the Office for National Statistics (ONS) previously expected.

The weakened output in the construction and manufacturing industries are being blamed for this sharp revision of decline that also indicated that the recession started earlier than previously thought.

The ONS now says that the recession began during the second quarter of 2008 rather than the third. Therefore, it has now been running an entire year.

All Areas Suffer

According to the ONS, compared to the first quarter of 2008, economic output shrank by 4.9% by the end of the first quarter this year – the biggest yearly fall recorded.

This means that it will also be more difficult for the Treasury to reach its forecast of 3.5% decline in the UK economy for the year that was made in this April’s Budget. Though the Treasury has said it will not be revising its forecast.

The 2.4% decline seen between January & March is the highest it’s been since 1958 when it shrank 2.6%. Though a decline of 2.4% was also seen in 1979 as well.

The output in construction also decreased in the first quarter of the year by 6.9%; manufacturing output fell 5.5%; and the service sector by 1.6% with banking and financial industries leading this fall at 2.5%. Real household disposable income also fell by 2.4% as saving rates also dropped to 3%.

Economy Extremely Weak

Senior economic advisor of Ernst & Young, Andrew Goodwin, said the figures were worse than expected.

He said: “We had expected a downward revision to GDP, given the plunge in construction output since the last quarter, but the scale of revision comes as a real shock, and highlights the extreme weakness of the economy in the early months of the year.”

George Osborne, the shadow chancellor said that GDP figures show that the recession has been “longer and deeper than we had thought”.

“This also means that in the future, unemployment will be higher and Labour’s debt crisis will be even worse.”

Vince Cable of the Liberal Democrats also said: “Rather than making promises on public spending that nobody believes, the Government must start making tough choices on whether it is going to cut spending or raise taxes to bring the economy out of the red.”

However, despite the revision for the first quarter of this year, it is expected that official figures for April-June will not be as bad as initially predicted. These are due to be published at the end of July.

What Do You Think?

We would love to know your thoughts and opinions on this. Leave your comments here.