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Summertime and the dressing isn’t easy

Wednesday, June 3rd, 2009

Can you keep your cool in the office, or do rising temperatures have you panicking about what to wear, asks Huma Qureshi

Three days into the British summer and we are already struggling with what to wear in the office. At bus stops and train stations you can spy them a mile off: the suited-and-booted office workers sweltering in the sun, their feet no doubt a little claustrophobic in those leather lace-ups, top buttons undone, red in the face, fanning themselves with a free newspaper.

Dressing to go to a desk-job when the sun is shining is no easy task; the dos and don’ts of the fashion pages are endless, not to mention the stiff corporate dress codes that don’t let you lighten up when the sun comes out to play. Many offices across all sorts of industries instil a year-round “conventional business dress code”, making few concessions for rising temperatures (although women can usually get away with wearing less than office-working men).

Our office operates a relatively informal dress code and we can pretty much get away with wearing what we want. So on sunny days it is open-toes and floaty dresses and guys in bright polo shirts and tees.

But even if you are comfortable in what you are wearing, summertime in and around the office has its problems. Who doesn’t dread being rammed on the bus, train or tube under someone’s sweltering sweaty arm pit (please, no sleeveless tops)? Then there’s the long-standing battle with the air con once you’re at your desk; the colleague sitting next to you who casually slips his shoes off under his desk, prompting a distinctive mustiness in the air; the girl opposite whose worn-out espadrilles must surely be a bit whiffy by now; and the oddball guys who look like they’ve just come back from holiday in Marrakech – all linen trousers and flip-flops, hairy feet and stubbed yellowing toes proudly on show. That’s the media for you.

So are you struggling with a sweaty commute – do sweat patches drive you mad? Does the sight of your boss’s toes in sandals makes you cringe? Tell us your summer office-wear nightmares.

  • Work & careers
  • Fashion
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Is there tax to pay on a gift of property?

Tuesday, June 2nd, 2009

Q My fiancee and I are building a house together. The site for the house belongs to my fiancee’s mother but in order for us to get a mortgage we have to be the owners of the site, so the deeds will have to be signed over to us. Are there any financial implications if my fiancee’s mother gives the site to us for free?

A The main – and beneficial – financial implication for you is that if your future mother-in-law gives you the land and no money changes hands, there should be no stamp duty lands tax to pay. However, there may be a capital gains tax (CGT) bill for your fiancee’s mother, as the gift of an asset such as land counts as a disposal for the purposes of CGT. It all depends on the size of the plot and its location. If the land is part of her “principal private residence” she may escape CGT, but if it is a completely separate piece of land the transaction will be liable. The bill will be based on the difference between the price she paid for the land and its value at the date she gives it to you. More information on calculating CGT is available from HM Revenue & Customs.

  • Property
  • Capital gains tax
  • Tax
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Write a will: it’s the first thing to do before you die

Tuesday, June 2nd, 2009

A third of us die without a will. Apart from being a problem for your family, the only winner will be the state

Dying intestate – without writing a will – risks leaving your estate in the wrong hands and a larger slice with the taxman than necessary.

The Law Society says one in three people in the UK die intestate, and half of all people over the age of 45 have not made a will. Caroline Wallis, wealth protection partner at solicitors Boyes Turner, says: “It’s far better to make a will at any stage of life than let the intestacy rules come into play which can prove pretty disastrous in many types of situations. This remains a vital part of financial planning to reduce the risk of leaving unintended bequests to the state or distant family members.”

The good news for people who fail to make a will is that the rules governing an intestate death changed to their benefit in February, allowing more of their estate to be given to their spouse or civil partner.

Previously, if you did not have children £200,000 of your estate was awarded to your spouse should you die without a will. This figure has now been increased to £450,000. The remainder of an estate is then halved between your parents and your spouse. Should your parents be dead it is divided between your siblings and your spouse.

If you do have children, £250,000 (previously £125,000) of your estate will be awarded to your spouse before the remainder is divided between your children. Should the assets be worth more than £250,000 the rest is shared according to a stringent formula.

“These are positive changes as they recognise that estate values are far higher now,” Wallis says. “They give extra protection for the surviving spouse, but making a will is still vitally important for many people.”

Even with the increases in the limits a spouse or civil partner receives, they could still lose a substantial slice of the assets and income built up by their joint efforts.

People living with their partner outside marriage or civil partnership are most at risk. If there are no close relatives then the entire estate goes to the crown under intestacy rules, regardless of any unmarried partner who may have lived with the deceased – risking leaving your partner homeless unless you own the property jointly.

This could mean extensive legal costs for your beneficiaries, as they may have to hire legal help to contest the state’s decisions.

Despite recent changes to taxation, wills are still a useful way to safeguard the interests of your family. “They are really about estate planning these days rather than tax planning,” Linda Packard, director of probate specialist Kings Court Trust Corporation, says. “While they are used to avoid tax, people have more complicated lives these days and it’s about trying to be fair to everyone in your family.”

Dying intestate rules out gifts to charities or bequests to friends, or the ability to give one child more than another – or deal with more complex, but common, family arrangements such as stepchildren. You may also want to outline personal wishes, such as funeral arrangements or who should inherit particular property or items of worth.

Wallis says: “If you’re making a will later in life the first thing to think about is your spouse’s state of health and how they will cope if they have to go into a nursing home and whether the value of the estate means looking at some IHT [inheritance tax] planning.”

Trusts can also be written into a will to avoid nursing home or residential home fees that might be payable by a surviving spouse. “You would use a property trust, transferring your share of the property into this, and in the terms you would give a life interest to your surviving spouse making it more difficult for the state to claim it for nursing home fees,” Packard says. “And you can use a nil-rate band trust to make provision for your children or stepchildren.”

Writing a will with a solicitor costs between £150 and £200. You can buy do-it-yourself kits from stationers such as WH Smith or the Post Office for between £5 and £20, but these can be difficult to complete accurately, particularly if your financial affairs are complicated. Completing the forms wrongly could mean your will is invalid, leaving your estate ruled by the laws of intestacy or open to challenge.


Living Wills

An advance decision, sometimes called a living will, is a set of legally binding instructions that a person draws up to set out what they would like to happen if they lose the capacity to make or communicate healthcare decisions, for example if they are injured in a car crash or suffer an illness such as dementia.

Jo Cartwright, a spokeswoman for Dignity in Dying, says: “They may wish to refuse life sustaining treatment in this case, and want life support to be removed. So they would put in place an advance decision – which can just be a written statement – to make their decision known. This can be lodged with a doctor and a copy kept with a family member.”

She adds that this could be used as a standalone document or to compliment the lasting powers of attorney (LPA), which you can set up to cover your health and welfare as well as financial affairs. An LPA is a legal document giving decision making powers on healthcare, property and finance, to a friend or family member. Like an advance decision, this can also be put in place in advance of a loss of capacity and enacted at a later date.

Go to the government’s site for more information; you can get an advance decision pack from dignityindying.org.uk costing £25, or by calling 020 7479 7737.


The law in Scotland

For people with Scottish roots or other connections, the situation regarding wills is more complicated, writes Neasa MacErlean. While Scots can leave their land and buildings to whoever they like, there are provisions ensuring that spouses and children get a share in their “moveable” property – cash, shares and other assets. These inheritance rules apply in Scotland to people who die without a will and also overrule a will that tries to exclude spouses or offspring.

If there is no will, a Scottish widow or widower would get the first £300,000 of a house as well as the first £24,000 of assets such as furniture, and then £42,000 of cash if there were children or £75,000 if there weren’t.

Then there are so-called “legal rights” which apply whether there is a will or not. The widow or widower would also be entitled to claim “legal rights” to half of any other moveable assets, or a third of those assets if there were children.

The estate of a Scot who died in London, say, would be governed by Scottish law if it was clear that he intended to live in Scotland again. If, however, he had made England his permanent home, all his estate – including any assets in Scotland – would then be governed by English law.

Life after death: Where your money goes if you die without a will

I am single Your estate will be shared equally among any children you have. If you don’t have children it will be divided between your parents, and if your parents are dead between your siblings.

If you have no immediate family, half-brothers or half-sisters followed by grandparents and then any aunts or uncles will inherit. If you have none of these, everything will go to the crown.

I live with my partner, but we are not married Things might have moved on when it comes to equality for unmarried couples, but not as far as dying without a will is concerned. The Treasury will treat you as though you are single so your estate will be distributed in the same way as above. This is why it is particularly important to draw up a will if you want your partner to inherit.

I am married If your estate – including your home – is worth less than £125,000 (£250,000 from 1 February), your spouse will inherit everything. If it is worth more and you have any children, from this marriage or a previous one, your spouse will get the first £125,000 (£250,000 from 1 February) and life interest in half the remainder. The children share the rest. If there are no children your spouse will get the first £200,000 (rising to £400,000 on 1 February) and half the remainder. Your parents will share the rest. If your parents have died, any brothers, sisters, nephews and nieces will share the rest. If there are none your spouse inherits everything.

Source: www.makingawill.org.uk

  • Writing a will
  • Inheritance tax
  • Tax
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Would better parental leave harm employees?

Saturday, May 30th, 2009

Would more generous parental leave actually be worse for employees?

Yes says Sue Evans, partner with law firm Lester Aldridge LLP

The possibility of an employee taking maternity or paternity leave is most likely a factor considered by a number of employers (albeit subconsciously).

Maternity leave involves both pay and absence for the employer. As the majority of pay can be recovered from the government, it is often the issue of absence, and return to work, which causes greater practical problems.

Under current provisions, qualifying women receive 90% pay for their first six weeks’ maternity leave, with the lesser of a prescribed statutory rate (currently ?123.06 per week) or 90% pay for a further 33 weeks. An additional 13 weeks’ leave is then available, bringing the total up to 52 weeks.

Paternity leave is for two weeks and is paid at the lesser of the statutory rate, or 90% pay. Either parent can take unpaid time off up until the child is five years old in qualifying circumstances.

The recent proposals from the Equality and Human Rights Commission (“Working Better” report) provide that for the first 26 weeks of maternity leave, a woman should be paid at 90% of her salary. Beyond that, leave can be taken in three blocks of four-month periods: one for the mother, one for the father and the third for either parent.

The proposal is that the first eight weeks of each block would be paid, half at 90% and half at the statutory rate. Long term, the plan is for this leave to be paid at 90% for 26 weeks, or 50% for 52 weeks. These blocks could be taken any time up until a child’s fifth birthday.

The EHRC is also proposing that the qualifying period of employment for entitlement to statutory maternity and paternity pay be dropped, and that the two weeks’ paternity leave be paid at 90%.

An employer can recoup the majority of maternity and paternity pay from the government. However, the employer will still have to devote resources to recruiting and training suitable cover for those on leave.

The arrangements would be a massive change for employers. The blocks of leave would be like sabbaticals to care for the child. The timeframe of five years, within which parents could take leave, could make this difficult. It is likely to have a significant impact upon an employer’s ability to undertake strategic planning for the future. Only short-term planning may be possible with the looming possibility that an employee may opt to take substantial periods of leave.

At present (and as unpalatable as it may be), when considering two equally qualified candidates for a role, an employer may be minded to chose the male rather than the female. This could obviously be discriminatory.

If the government goes ahead and changes the law as proposed in the equality bill, an employer will be able to do precisely the opposite – choose the woman (as a form of positive discrimination) and this would not be discriminatory!

However, in conjunction with the EHRC proposals, this will not actually assist either the employer or employee, since it could be the male or female employee taking a block of leave. The risk therefore, is that it is employees with young children generally who are a cause of concern for employers.

This dilutes the intended impact of the positive discrimination.

No says Nick Clegg, leader of the Liberal Democrat party

Parental leave in this country doesn’t suit mothers, or fathers, or kids. But whenever anyone suggests designing it around what families need, critics pop up to claim that it would make life too difficult for employers. The implication is clear: you can’t be a good parent and a reliable employee.

But let’s look at this another way: if we don’t change the current arrangements for parental leave, who is it that misses out when the pay rises are handed out or the promotions decided? It’s women. Because our grossly unfair system gives fathers a measly two weeks to spend with their newborns compared to up to a year for mothers. And for employers that, all too often, makes women a liability.

As long as parental leave is divvied up so unequally, simply imploring companies to treat the sexes fairly won’t get us very far. Because the way leave works perpetuates the idea that retaining and promoting women is bad for business, while male employees are a much more rational investment.

Hence the widening pay gap. Hence the glass ceilings. Hence the scandalous persistence of the notion that gender equality at work is all well and good but when push comes to shove, it’s better for everyone that men take responsibility for bringing home the bacon.

And while women lose out at work, men lose out at home. Many fathers would love to take on a more involved role with their young children. But the division of labour entrenched by maternity and paternity leave emasculates those who seek to.

I’ve seen it first-hand at Westminster. Earlier this year, when I would mention that I’d be taking two weeks off following the birth of my son, eyebrows were raised. It’s ironic that this is where we legislate on improving the country’s “work-life balance”.

The Equality and Human Rights Commission’s proposal for sharing leave much more evenly is a massive step in the right direction. Instead of asking employers to put their better nature ahead of their business nous, it takes away the temptation to do otherwise.

But I do accept that planning around the EHRC’s proposed blocks of leave would take a bit of getting used to for companies. That’s why my party has its own, more straightforward, proposals. We would introduce 18 months of interchangeable parental leave, with no parent taking more than a year. Parents could divide it between themselves, perhaps taking nine months each, or they could choose to take time together. And by insisting the leave is shared – essentially on a “use it or lose it basis” – we avoid the trap of mothers feeling under pressure to take the whole year and a half. It’s also crucial to introduce these changes over time. They would represent a revolution in work-life balance in Britain and could not be introduced overnight.

Although I differ on the detail with the EHRC, I share the principle. Men and women with young children, as well as those who are likely to have children at some point, make up a major part of the workforce.

In the long run, it is in the interests of employers to get the best out of these people. Companies benefit from loyal, long-serving staff. Understanding and facilitating their family needs is one way to get that return.

What do you think?

Are you happy with the new parental leave proposals in the equality bill? Or will it just lead to more confusion and added potential for discrimination?

Write to Cash, The Observer, Kings Place, 90 York Way, London N1 9GU, email cash@observer.co.uk

  • Employee benefits
  • Maternity & paternity rights
  • Pay
  • Work & careers
  • Nick Clegg
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The reign of Spain in our high streets

Friday, May 29th, 2009

Three into one will go as familiar names are all rebranded … to Santander

Barcelona? No, Brighton! Western Road, in the East Sussex town, to be exact. This is just one of a number of shopping streets across the country where, come next year, you may well encounter as many as three identically-branded branches of Spanish-owned bank Santander, all just a stone’s throw from each other.

It emerged this week that Abbey, Alliance­ & Leicester and Bradford­ & Bingley are all to be renamed in a £12m rebranding exercise – bringing to an end hundreds of years of financial history. By the end of 2010, that means there will be more than 1,300 Santander branches across the UK.

And, rather than a massive branch-closure programme, Santander says it is “fully committed to maintaining the size of our branch network”.

A spokeswoman accepts this could mean that, in locations where there is currently an Abbey, an A&L and a B&B branch – such as Western Road and Guildford High Street – you could end up with three Santanders.

Apparently this isn’t unusual in Spain, and Santander has indicated that closing one (or two) of those three branches might not make sense on the grounds that there will still be the same number of customers to service.

But, at the same time, it is not completely ruling out closures. On its website it says: “Inevitably there will be areas where we have two or even three branches near to each other. Where this happens, we will review their ­locations to see how best we can serve the community. In some cases, this might mean some locations could change, although we will maintain the overall size of the network.”

One of the most important issues for savers will be the cover they receive from the Financial Services Compensation Scheme (FSCS), the official safety net for customers of financial firms that have gone bust. The scheme covers the first £50,000 a saver holds with an individual bank, but if one bank is running two savings providers under the same banking licence, sometimes only one set of protection applies.

Abbey and B&B share a licence, while A&L has a separate one – so someone with money in both gets two lots of protection. Santander says: “There are no plans to change that, especially as the A&L brand will stay until the end of?2010.”

  • Banks and building societies
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Cyber affairs cited in breakdown of real marriages

Wednesday, May 27th, 2009

Social networking sites and websites that facilitate adultery increasingly cited in divorce cases, say lawyers

Affairs conducted via social networking sites such as Facebook and Twitter are increasingly a cause of marriage breakdowns, according to divorce lawyers.

Matrimonial experts at law firm Turner Parkinson said social networking is increasingly cited as a reason for divorce as spouses embark on cyber affairs. The trend has been fuelled by websites that introduce like-minded adulterers such as Meet2cheat.co.uk and Affairsclub.com, as well as a host of self-help websites telling spouses how to look for telltale signs of a partner cheating online.

Martin Karran, partner and head of family law at Turner Parkinson, said: “People are using websites like Second Life to reinvent themselves and live out their fantasies. We have already noticed this having an impact in the divorces we deal with.”

Although aggrieved spouses would not be able to petition for divorce on the basis of cyber adultery unless actual sexual intercourse had taken place in the real world, they could claim unreasonable behaviour, according to Suzanne Kingston, partner at Dawsons solicitors.

“A wife might say her husband is spending several hours on the computer each evening and not giving enough attention to her or their family, or that he has formed an inappropriate relationship with someone via the computer and this is having a detrimental effect on family life,” she said.

David Lister, partner with Mishcon de Reya, the firm that represented Princess Diana and Heather Mills in their divorces, said the use of digital technology is cited in most cases that cross his desk: “Digital information – texting, emailing and having conversations on Facebook – is often the first cause of suspicion. A partner may wonder if such behaviour is appropriate.”

However, evidence of online affairs are unlikely to have an effect on the financial result of a divorce settlement. “Conduct is only considered in a minority of cases,” Kingston said. “The impact of the unreasonable behaviour would not have any impact on the financial outcome of the case unless there has been financial or litigation misconduct.”

Lister agreed that while information about such behaviour may be useful in obtaining the divorce, it will have little impact on who gets what. “Behaviour is irrelevant in the apportionment of money unless it’s really, really bad,” he said.

Online affairs

In November a British couple were set to divorce after a wife found her husband cheating on her with a female in Second Life, the online virtual world. It wasn’t the first time he had been caught out: Amy Taylor had previously played on Second Life with her husband David Pollard, but discovered him watching his character having sex with a prostitute in the virtual world.

In January, journalist Georgina Hobbs-Meyer warned Guardian readers not to get dumped online after her husband two-timed her on Facebook with a woman he met at a party. The cyber affair was exposed when Amy read messages sent between the pair after her husband forgot to log out of his Facebook account. It remains unclear whether the article was genuine, however, with a number of bloggers claiming Georgina could not be found on Facebook.

A woman was set to divorce her husband in February after she discovered him having virtual sex with another man in Second Life. Lisa Best caught her husband, John, 34, while in bed at their home in Derby, according to the News of the World.

In March the Sun reported that a wife had called in divorce lawyers after seeing her husband’s car parked outside another woman’s house on Google Street View. An American blogger claimed he invented the story to dupe the newspaper, but it helped raise awareness of privacy issues surrounding Google’s latest venture.

The Daily Mail reported that an Italian man decapitated his wife after suspecting she was having an online affair. Giuseppe Castro, 35, reportedly told detectives: “She was always chatting with other men, I couldn’t take it any more.”

  • Divorce
  • Facebook
  • Second Life
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Trading up, trading down

Wednesday, May 27th, 2009

On the look out for a bigger home, or wanting to downsize? Anna Tims picks some properties that might fit the bill …

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Britain’s millionaire list shrinks in face of recession

Wednesday, May 27th, 2009

UK has 242,000 millionaires, down from a peak of 489,000

Britain’s millionaires’ row has nearly halved in size due to the slump in property and share prices.

The number of millionaires in the UK has fallen from 489,000 at the peak of the economic boom in 2007 to 242,000, reducing the elite club to 2003 levels. Soaring property prices stoked a boom in the British rich list but the collapse in the housing market has suddenly reduced the net worth of thousands of former property millionaires.

The Centre for Economics and Business Research (CEBR) said a very large number of people had entered the lower echelons of the rich list due to the runaway property market and had dropped straight out again once prices faltered, falling 17.7% in the last year.

“Having just crept over the threshold, most of these people have crept back under it again – many, perhaps, without ever knowing that they had become millionaires for a temporary period,” said Douglas McWilliams, the chief executive of CEBR.

Owners of buoyant share portfolios have also seen their asset base deteriorate, with a 70% drop in City bonuses also playing a part in the decline.

The CEBR has scrapped its forecast that the UK would have 760,000 people whose wealth runs into seven figures by 2010. With property prices on the retreat, the CEBR admitted the figure would now be far lower. However, McWilliams said the number of millionaires should rise from 2011 onwards once property prices stage a recovery. “With property prices near to bottoming out, we would expect the number of millionaires to start to rise again in 2011,” he said.

Those with robust enough fortunes to remain in the millionaires’ club have seen their wealth decline by about a quarter, according to the CEBR, helping push down demand for luxury products. Acquisitions of status symbol cars have slumped, with sales of Bentleys down this year by 66% and BMW sales down by 35%.

Britain’s much smaller billionaires’ row has shrunk from 75 in 2008 to 43, according to the Sunday Times rich list. Lakshmi Mittal, the richest man in Britain, has seen his fortune fall by £16.9bn to £10.8bn, with Chelsea football club owner Roman Abramovich losing £4.7bn.

  • Rich lists
  • Recession
  • Property
  • Investments
  • Shares
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What percentage of a house do we own?

Tuesday, May 26th, 2009

Q My partner and I are hoping to buy a place together: he’s a first-time buyer with savings of £30,000; I should get £130,000 from the sale of my flat. We currently earn similar amounts (£38,000 and £40,000), but he has the potential to increase his salary whereas mine is likely to only rise with inflation. We are looking at a mortgage of 2.75-3 times our joint salaries and will take on half of the mortgage each, though the proportion could change if he did earn much more. Being practical rather than negative, we have agreed that if we split after 10 years everything would be divided equally, but before then I would take the first £100,000 (or whatever the difference is between our deposits). I assume we should be talking percentages rather than pounds, but what is the best way of putting this in writing or legalese?

A You certainly should be thinking in terms of percentages rather than pounds, but it is not clear to me why you think each of your shares in the property should change over time. The mortgage you get together will be based on your current salaries, and as you will split the payment of it equally the fact your partner’s earnings will increase faster than your own is pretty irrelevant.

Each of your shares in the property should reflect what you have put into buying it, which in each of your cases means the deposit amount plus your half share of the mortgage. So, if your were to get a mortgage of 2.75 times your joint salary, the total mortgage would be £214,500, which together with your combined deposit of £160,000 would mean you could buy somewhere for £374,500. Half the mortgage plus your share of the deposit would mean your contribution to buying the property would be £237,250, which translates into a 63% share of the property. So if you were to split, whether before or after 10 years, you should get 63% of the sale price less half of what you owe on the mortgage.

Your individual shares should be shown in the entry on the Land Registry, which your solicitor should arrange for you. You could also ask him or her to draw up a legally-binding document detailing what will happen were you to split, just to be on the safe side.

  • Property
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Consumer borrowing complaints rise

Tuesday, May 26th, 2009

• More households are struggling with debts
• Mortgage mis-selling complaints expected

The number of complaints about the way financial firms deal with customers’ personal loans and credit cards has risen by more than a third over the past year, according to figures set to be published tomorrow by the Financial Ombudsman Service (FOS).

The FOS, the independent service for resolving disputes, saw complaints about personal loans – traditionally a small part of its case load – rise by 44% between 2007/08 and 2008/09.

The number of complaints about credit cards, now the second most complained about financial product after the controversial payment protection insurance (PPI), was up by almost 30% to around 18,000.

The ombudsman’s report is expected to show a significant number of complaints now come from households struggling to pay back what they have borrowed and who believe their lender is treating them unfairly by, for example, refusing to negotiate on debt repayments or treating them unsympathetically.

“While the number of complaints overall has soared, the number about charges have fallen slightly and these have been replaced by those about financial difficulty,” a spokeswoman for the FOS said.

The ombudsman’s report is also expected to show a small but growing number of cases around repossession and mortgage lending. Some of these are from homeowners who believe they should never have been sold a mortgage in the first place because they had no chance of repaying it.

Others are from people who have already had their home repossessed and believe the lender then sold it at below market value, leaving them with an bigger than expected outstanding loan.

The chief ombudsman, Walter Merricks, has already found in favour of one man who had his home repossessed. He ruled he should never have been sold the mortgage and demanded the lender compensate him.

“We are now upholding more complaints in favour of the consumer across the board,” the FOS spokeswoman said. “This reflects the fact that complaints handling is now a lot worse in a lot of big institutions.”

Legal loopholes

A growing number of loan and credit card complaints are being raised by fee-charging claims handling companies. These firms have been targeting householders in debt, claiming to be able to exploit a legal loophole in order to get their credit card and loan debts written off for them.

But the FOS said many of these claim firms were hampering the process.

“We are concerned that by fixating on a technical legal issue that can only be ruled on in court, these firms are masking the real issues that we can tackle such as whether the consumer should even have been sold that loan in the first place,” the FOS spokeswoman said.

Debt charity the Money Advice Trust will shortly publish the findings of a report about debtor’s experiences with fee-charging debt advice companies.

Joanna Elson, chief executive of the Money Advice Trust, said: “There are people who will find these firms helpful, but we are seeing lots of cases of people coming to us who have felt these services are a costly waste of time.”

  • Borrowing & debt
  • Personal loans
  • Credit cards
  • Consumer affairs
  • Family finances
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