This piece first appeared in Saga Magazine in April 2012
The text here may not be identical to the published text  

Money News April

True value of money, power bills, TV licence, Pension credit lost, Pension release warning, Tax credit lost

Trial of the Pyx
Every year since 1282 a formal court has assembled in London to test the coinage and ensure it is the right size and weight and made of the correct metal. It is called the Trial of the Pyx and I was very privileged to be there this year when the first stage of the testing took place.

Until a hundred years ago the coins we used were made of gold and silver and had an intrinsic value for their metal content. Coins today are made of copper, nickel and zinc (and a growing number of steel). But it is still important to check that they are precisely made of the right materials as Adam Lawrence, Chief Executive of the Royal Mint, told me

“The Trial if a nice bit of theatre but serves the practical purpose of checking that we are sticking to the principles of quality and getting the coins right first time.”

The Trial of the Pyx is held in the Hall of the Goldsmith’s Company who have been responsible for it since the reign of Elizabeth I. It is presided over by a senior judge known as the Queen’s Remembrancer, currently Steven Whittaker, who appeared not just with gown and full wig but a black tricorn hat on top of that. The Jury of 14 members of the Goldsmith’s Company and four of its Wardens in splendid red coats swear to test the coins fairly for weight and composition.

More than 81,000 coins were brought to Goldsmith’s Hall from the Royal Mint at Llantrisant – one coin out of every 50,000 minted is selected at random throughout the year. The Jury members are given paper packets of a set number of coins which they carefully count and select one from each for testing. The Trial assesses circulation coins as well as the many gold and silver coins which the Mint issues to collectors and investors. I was allowed to admire – and even handle – gold coins from a tiny quarter sovereign to a heavy £5 gold piece as they were carefully prepared for melting down and assaying. It seemed such a waste!

In another room counting machines checked thousands of circulation coins and jury members randomly selected individual coins for assay of their metal content – copper, nickel, and, for £1 and £2 coins, zinc.

That assay will take weeks of work by the Deputy Warden and Head of Assay Dr Robert Organ whose department is also in charge of hallmarking – the unique guarantee of quality on English silver and gold. He will prepare his report and on May 4th the court will read out its Verdict. I hope to be there too, tweeting it live @paullewismoney.

Money off power bills
The Consumer organisation Which? is signing up tens of thousands of people in the hope that it can negotiate a good collective deal for them with the power companies. To join in you will have to be quick and register at www.whichbigswitch.co.uk by 31 March at the latest. You can register on someone else’s computer but you will need an email address. Once the deadline has passed Which? will run a reverse auction with the energy companies where the lowest price wins. Which? will then tell those who have signed up whether the new deal is better than their existing tariff. They will not be under any obligation to move so signing up carries no risk. A similar scheme in Holland cut the annual energy bills of 57,000 customers by more than £250 each. Which? hopes for something similar here.

British Gas is giving free insulation and £50 to some groups of people – and there is another £50 for the person who nominates them. To qualify for the offer the person must be on Pension Credit, or get child tax credit and have an income below £16,190, or get a means-tested benefit and have a child under five or a disability premium. They should ring 0800 975 1195 and say who recommended them. If their home is eligible – it must have less than 60mm of loft insulation or no cavity wall insulation – then the work will be done free and both will get £50 from British Gas. Neither has to be a British Gas customer. The deadline for calling is 8pm on May 15th.

Free TV licence
A Saga reader aged 75 who lives with her grown up children asked me if she was eligible for a free TV Licence. Her daughter apparently thought she should not be as most of the people who would watch the television in the house were under 75. But in fact that does not matter. Anyone aged 75 or more can get a free licence for the address where they live whoever lives with them. All she has to do is contact TV Licensing on 0300 790 6131 with her National Insurance number and the licence can be transferred into her name. Then it will be free for as long as she lives there as her main home.

The licence is free from the moment you reach 75. So if you are already 74 and your licence runs out apply for a short-term one until your birthday and then a new free licence from the day you reach your three-quarter century.

Pension Credit removed
The Department for Work and Pensions has told Saga that up to 30,000 people over 65 will lose their pension credit from the second week in April. I reported in Saga last month that more than three million households who get pension credit will get less from April, wiping out some of the extra they get on their state pension. Now it has emerged that thousands of people who get small amounts of pension credit (usually around £3.40 a week or less) will lose it altogether. Thousands more who would have been eligible next year now will not be able to get it. That also means that next winter they will not get the £25 a week cold weather payment for each week of freezing temperatures. It will also exclude them from help with insulation through Warm Front and free equipment and installation for the Digital TV Switchover.

Pension release warning
People under 55 have been warned not to put their pension savings at risk by falling for offers to ‘liberate’ their fund before it is legally possible to do so. The Pensions Regulator says these offers come from fraudsters based overseas and target middle-aged people.

The typical scheme offers to give the customer half the value of the fund in cash and invests the rest outside the UK. The Chief Executive of the Pensions Regulator warns “if you have a pension pot of £20,000, they will offer you access to half of that. They'll take a commission of around £4,000 - 20% - leaving you £6,000 in your pension fund and often invest that in offshore vehicles you might never see again."

The cash will also be at risk. Any unauthorised payment from a pension scheme is taxed at 40% and there is another 15% if it is more than a quarter of the fund. So out of £10,000 the customer would be left with just £4,500.

Over the last three years more than £200 million has been moved from pension schemes to one of these scams. Because they are almost all based overseas they are hard to close down and there is no redress or compensation. If someone offers you pension liberation or early release just say ‘no’. Or you could be impoverished for the rest of your life.

Tax credits cut
People in their fifties who return to work after at least six months unemployment will no longer get a higher rate of working tax credit if their wages are low. The ’50-plus element’ gave over 50s an extra £39 a week for 30 hours or more – or £26.25 a week if they worked down to 16 hours. The extra payment lasted a year. But the supplement is scrapped from the April 6th and anyone who gets it now will find it disappears on that date.


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