The deputy governor of the Bank of England, has written to firms asking about their 'operational readiness' for a zero or negative Bank Rate. The Bank is asking firms to provide information on what operational preparations they would need to make in the event that the Bank’s Monetary Policy Committee considers a zero or negative policy rate. The deadline for responses is Thursday 12 November 2020. In August, the Bank of England’s Monetary Policy Committee (MPC) noted that it would continue to assess the appropriateness of a negative official Bank Rate alongside all of its other tools.
How pension schemes provide tax relief to their members so what is the difference between net pay and relief at source? Net pay schemes can sound very misleading because the contributions are paid out of the gross earnings before any tax is deducted. This means that for those that pay tax it automatically reduces their taxable earnings so they will immediately pay less tax. On the flip side, it means that for those that don't pay tax they won't benefit from any relief.
With the past decade have driven the base rate to just above zero, and now the Bank is debating whether to follow the example of the eurozone, Japan and several other countries in setting a negative interest rate.
A new report from PwC has outlined how banks and lenders should prepare for the possible introduction of negative interest rates. In the report, PwC says that "noises from the Bank of England suggest the chances of it dropping its base rate below zero have gone from “don’t count on it” to “anything’s possible” and for banks, that’s a big deal.”
The government has been criticised for it’s "woefully inedequate response" to the issue of tens of thousands of married women receiving the wrong amount of state pension. A research paper published by pension consultants Lane Clark & Peacock suggests that tens of thousands of older women may be entitled to a higher rate of state pension than they are currently receiving.