Saving & Spending Wisely on Your Money Matters...with Ripon Ray

One-in-three adults in England and Northern Ireland cannot work out the correct change from a shopping trip, according to new research from UCL Institute of Education (IOE) and University of Cambridge. With Such a shocking data financial education plays a huge part in overcoming such a challenge especially when you are on low income. Tanzila Zaman, Money Mentor at Money A+E, elegantly demonstrates where listeners can save money just being clever with your shopping habits. She highlights three things:

1. Having a goal for saving is essential e.g. holiday, paying for your first mortgage or honing your existing skills for your career progression

2. Planning your budget to make sure essential expenses are already have been secured.

3. Looking around for cheaper deals instead of just going with your instinct as you see things

Tanzila does not shy away from talking about what’s in your wardrobe. There are clothes and other objects that you can sell to top up your income! Selling them will declutter your personal space and your mind!

Housing & homelessness on Your Money Matters...with Ripon Ray

I would like to thank Marc Lancaster, Housing Policy Officer of Tower Hamlets Council, for coming on Your Money Matters show this week to explain to me about the rights and responsibilities of being a private, housing association or local authority tenant. He talked about the differences between Section 8 and Section 21 of the Housing Act 1988 (as amended) and how you can use the law strategically to protect yourself.

Current legislation protects a tenant's deposit. If it's not protected you can ask the court to make a judgement against your landlord to compensate you three times the amount due for breaking the law. 

He elucidated that local authorities also have a duty to support vulnerable tenants with advice and provide accommodation when they are at risk of homelessness.

Betar Bangla radio’s Ripon Ray: How fashionista turned political activist and debt advisor

PUBLISHED: 09:02 13 March 2019 | UPDATED: 09:03 13 March 2019

Emma Bartholomew

Ripon Ray: Picture: Rukya Khan

​Debt advisor and radio talk show host Ripon Ray tells Emma Bartholomew how he’s seeing more and more people who are unable to just pay the basic bills

Ripon Ray: Picture: Nick De Marco

Self-confessed “arty-farty creative” Ripon Ray originally set out to be a fashionista in life, when he “found his calling” and changed track to become an activist.

He’d been studying at the London School of Fashion, but going on an anti-fascist protest “triggered a couple of things”.

“I dumped my studies and went to Kingsley College where I was doing full-on activism, and organising protest marches,” he told the Gazette. “I loved it but I got kicked out of there because I was too much of an activist and I wasn’t focusing on my studies.”

He knuckled under, bagged a history degree and started out in the charity sector as a housing advisor. Being mugged in Victoria Park made him rediscover his penchant for politics, however. He began a safety campaign, blaming the lack of street lamps for the attack, and joined the Labour Party to raise the issue.

“I was outraged and wrote emails left right and centre,” he said. “Since then I haven’t looked back.”

The debt advisor hosts a weekly radio show on the Bengali radio station Betar Bangla where he takes calls from people with money problems. A welfare rights campaigner, last year he urged Hackney not to reduce council tax benefits. Now his attention is firmly set on the Tories’ much maligned Universal Credit.

Introduced in Hackney in October, Ripon claims to have seen its “devastating effects” first hand through working in Tower Hamlets where it was introduced in 2017. He’s been giving voluntary talks to unions, advice bureaus, carers and Labour members.

“I’ve been rampaging around Universal Credits,” he said. “There’s a demand for speakers on the subject as not many people know how it works in practice. I’m seeing the claimants in destitution. Since the welfare reforms kicked in people are having problems paying the bog standard bills, and that wasn’t the case before.

“I’m seeing people who simply can’t make ends meet.”

It’s not all bad news. “Payday lenders are gone,” he said, “and the mainstream lenders have been emasculated by the financial regulator. They have to be so polite, and there is no longer aggression there.” But, he adds: “The concern now is now that people can’t pay the basic essential bills.”

He urges anyone with a problem to call in to his radio show, Your Money Matters on Tuesdays at 5pm.

“The longer you leave it the worse it gets, with debt,” he said.

Alternative lending on Your Money Matters...with Ripon Ray

This week, CEO of Fair Finance gives the listeners an overview of the alternative lending industry. Prior to taking on the role of CEO, Faisel Rahman worked for the World Bank and Grameen Bank. He  subsequently set up a microfinance service in East London, a debt advice project for local residents and founded Fair Finance in 2005.  He speaks to me about the role of payday lenders, credit unions, peer-to-peer and other ethical lending.

I also had the opportunity to hear views from the members of the public as to what you think about alternative lending.

If you have any money related ideas that you want me to cover just send me a message on www.commmunitymoneymatters.com

The Post War Welfare State is crumbling - who is to blame for it? Asks Ripon Ray

The current welfare state changed in such a way that a true reflection is required as to how this has come about and and its context.

Post Second World War, the Attlee government nationalised the Bank of England, the coal industry, the Central Electricity Generating Board and area electricity boards, Cable & Wireless Ltd, the railways and the local authority gas supply undertakings in England and Scotland. It introduced free education for all by nationalising institutions which were either provided by parishes or philanthropists. The National Health Service was formed and made accessible to everyone regardless of ability to pay.  

If you were unemployed there was infrastructure to support you when you could not afford to pay by creating the welfare system as you see today. The expenses of running such a nationalised state was met by cheap loans borrowed from overseas, contributions made by tax payers and companies in times when Britain was losing imperial dominance. Post war employment was near to 100%.

Such a boom would not last forever; an oil price shock lead to a 70% increase in oil prices when Arab oil producers imposed an embargo on Western countries in retaliation for their support for Israel during the Arab-Israeli War in 1973.  This increased costs to industry and was a trigger in their decline. According to a recent Government report:

’Since 1973…there has been a substantial decline in the share of manufacturing in economic activity on all measures. The sharpest decline has been in the share of manufacturing in total output at current prices, from 31.9% in 1973 to 12.4% in 2007’^[1].’ ^[2]

In the early 1980s over 3 million people were unemployed;  more than 10.5% of the total workforce in Britain.^[3] Most of those unemployed were in former manufacturing areas which saw the highest unemployment rate since the Great Depression.^[4]  Although the intention of the Conservative Government was to cut welfare spending, due to the high unemployment level, increased expenditure on the benefit system was inevitable.

By the end of Margaret Thatcher’s premiership, nearly all the publicly owned industries and utilities had been privatised. The justification for doing it was to make these firms more efficient and competitive.^[5]

The financial industry emerged as a powerful force during this period partly as a result of the deregulation of the mortgage market. This, among other changes, enabled local high street banks to lend mortgages instead of solely local building societies which helped to fuel a rise in house prices.^[6] We have also saw the first mass use of credit cards which created a consumer bubble.^[7] In 1980 banks created £109 billion. Just after the financial crisis in 2010 it was up to 2,213 billion. In London at least 50% of the sector’s output was generated in this way. ^[8]

Though this gave finance a powerful presence in the economy, the fracture in this sector began to emerge once Lehman Brothers filed for bankruptcy in the US due to its high exposure in subprime mortgages. Many of the household financial institutions in Britain were also exposed to these toxic investments, so much so that the British government had to intervene to rescue these banks instead letting them go insolvent.  Northern Rock was nationalised; the Royal Bank of Scotland, Lloyds TSB and HBOS were also classified as public owned financial corporations by October 2008.^[9] These institutions received over £500^[10] billion of tax payers money in order for them to stay afloat because they were deemed too big to fail.

According to Lord Adair Turner, former chair of the Financial Services Authority:

‘“The financial crisis of 2007 to 2008 occurred because we failed to constrain the financial system’s creation of private credit and money.”

Under the Conservative-Lib Dem coalition government, the Chancellor George Osborne stated that the government’s fiscal policy would be to make substantial reductions in public expenditure.  According to the Institute of Fiscal Studies, almost one in three councils have faced 30% or more in budget cuts in real terms ^[11]. Such cuts reduced the ability of councils to spend on social care, health, housing and education. 90% of British councils have now charged council tax to those who were previously deemed too poor to pay. Local councils in the fiscal year 2016/17 in England and Wales referred 2.3 million debts to bailiffs^[12] adding further indebtedness to the most disadvantaged communities.

As local council budgets shrank due to cuts in grants provided by the central government, the welfare reforms also targeted vulnerable communities who have physical and/or mental health problems. As a result of these changes, according to Disability Rights UK, £5 billion has been cut in the last decade from disability benefits.^[13]  The same data shows that, cumulatively, £37 billion less will be spent on working age social security benefits by 2021 under the current Conservative Government compared with 2010.^[14]

Shelter, the homeless charity,  emphasised that homelessness is increasing year on year.  Currently one in every 200 ^[15]people are now homeless in Britain. In London, however, the figure is one in 52 people^[16]. Polly Neate, CEO of Shelter states the following:

‘Due to the perfect storm of spiraling rents, welfare cuts and a lack of social housing, record numbers of people are sleeping out on the streets or stuck in the cramped confines of a hostel room.’^[17]

According to the Trussell Trust, in every area where universal credit goes live, within 12 months of rollout foodbanks see a 52% increase in demand, compared to 13% in areas with where universal credit has been in force for three months or less,^[18]  The trust cites delays in receiving the first payment and the process of moving to a new benefit system as the cause.

It seems that the current welfare reforms are removing the safety net which the welfare state was supposed to provide and is putting the most vulnerable people in our society at serious risk.

---

^[1] https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/277158/ep2-government-policy-since-1945.pdf

^[2] https://www.cbr.cam.ac.uk/fileadmin/user_upload/centre-for-business-research/downloads/working-papers/wp459.pdf

^[3] https://www.theguardian.com/business/2006/aug/16/socialexclusion.politics

^[4] https://www.economicshelp.org/blog/630/economics/economy-in-1980s/

^[5]https://www.centreforpublicimpact.org/case-study/privatisation-uk-companies-1970s/

^[6]https://econ.economicshelp.org/2010/02/economy-of-1970s.html

^[7]https://econ.economicshelp.org/2010/02/economy-of-1970s.html

^[8] https://researchbriefings.parliament.uk/ResearchBriefing/Summary/SN06193

^[9] ukpublicsectorinterventionsinthefinancialsector22may15_tcm77-404993.pdf

^[10] https://publications.parliament.uk/pa/cm200809/cmselect/cmtreasy/27/27.pdf

^[11] https://www.ifs.org.uk/publications/8780

^[12] https://www.stoptheknock.org/

^[13] https://www.disabilityrightsuk.org/news/2018/september/disability-benefit-spending-reduced-%C2%A35-billion-over-last-decade

^[14] https://www.disabilityrightsuk.org/news/2018/september/disability-benefit-spending-reduced-%C2%A35-billion-over-last-decade

^[15] http://media.shelter.org.uk/press_releases/articles/320,000_people_in_britain_are_now_homeless,_as_numbers_keep_rising

^[16] http://media.shelter.org.uk/press_releases/articles/320,000_people_in_britain_are_now_homeless,_as_numbers_keep_rising

^[17] http://media.shelter.org.uk/press_releases/articles/320,000_people_in_britain_are_now_homeless,_as_numbers_keep_rising

^[18]https://www.trusselltrust.org/what-we-do/research-advocacy/universal-credit-and-foodbank-use/

Universal Credit Workshop at the Community Hub, Wood Green, London

Pension & Universal Credit on Your Money Matters show (19/02/2018)

Pension: Since auto-enrollment began in the UK in 2012, we are beginning to properly save for our retirement. On this show, Robert Parker - Chair of the Personal Financial Society - talks about the differences between state and private pension, risks that are involved with investing your pension in stocks and shares and many more issues related to your pension.

Universal Credit: How do you apply for such a benefit? When are you going to be migrated to it? What are the condition for applying it? What is included as part of the claim? What does it not include? I talk about all the above issues and more.