Wednesday 27th July 2016
New low-cost lending plan to eat into moneylenders profits
Says Leo Varadkar
The huge profits being made by moneylenders are likely to be eaten into by a new low-cost lending plan that is being extended nationwide, a Cabinet minister said.
Social Protection Minister Leo Varadkar said a scheme being rolled out nationwide to offer a low-cost alternative to moneylenders will put the money into the pockets of low-income people.
“Moneylenders are making profits of between €90m and €100m a year. We could get an amount of that €100m going back into the pockets of those in receipt of social welfare with this scheme,” he said.
The scheme is designed to allow credit unions provide small affordable loans people who would otherwise rely on moneylenders or unlicensed loan sharks.
There is a quick turnaround for assessing applications and a minimum of bureaucracy.
The loans of up to €2,000 can be used for funding back-to-school expenses, and to pay for family expenses like funerals.
A pilot scheme in 30 credit unions saw 1,300 people accessing the loans, the average amount of which was under €500.
Now the scheme is being extended nationwide, in a move Mr Varadkar said would open it up to around one million people.
It applies to anyone in receipt of social welfare, including pensioners, carers and the unemployed.
Up to 400,000 people are estimated to use moneylenders in Ireland, who can legally charge interest rates of up to 200pc.
Launching the nationwide roll-out of the scheme at Dublin’s Meath Street Credit Union, Mr Varadkar said the scheme “represents real practical help for families and individuals struggling on low incomes”.
“Many of the participants may struggle to get credit elsewhere, and may not have a bank account or savings.
“So when the unexpected bill arrives for home or car repairs, a new fridge or a family occasion, some turn to money lenders and loan sharks. This new scheme will ensure access to small loans at reasonable interest from the credit union.”
Mr Varadkar urged all 333 credit unions sign up for the micro-lending scheme, called It Makes Sense.
Some 50 credit unions have now committed to offer the new loans, with more expected to sign up in the coming weeks.
Permanent TSB back in profit for first time since 2007
Bank records €80 million profit following loss of €410 million in previous year
PTSB chief executive Jeremy Masding
PTSB’s mortgage lending rose 4% cent year on year to €211 million in the first six months of 2016.
Permanent TSB made an after-tax profit of €80 million in the first six months of 2016, a major turnaround on a year earlier when it recorded a loss of €410 million.
This was the first group profit recorded by State-controlled PTSB since 2007, the year before the global financial crash.
Its net interest margin, excluding guarantee fees paid to the Government, increased by 31 basis points to 1.43%.
The bank, which is 75% owned by the State, recorded an impairment write-back of €61 million in the period, an improvement of €85 million on a year earlier.
Mortgage lending rose 4% year on year to €211 million while its non-performing loans reduced further by €400 million from December 2015 to €6.2 billion.
The bank said its cost-income ratio “remains elevated” at 87% due to regulatory cost pressure.
PTSB’s fully loaded core equity tier 1 ratio increased by 9 percentage points to 15.9%.
Commenting on the results, PTSB chief executive Jeremy Masding said: “Having recapitalised the bank during 2015, the group has moved to pre- and post-tax profitability and is generating capital for the first time since 2007. This positions us better to focus on our commercial agenda and to grow the business.
“Of course there are challenges ahead. However, we remain as committed as ever to serving our customers and to delivering attractive and sustainable returns to our shareholders by making the most of our key strengths.”
The write-backs included €26 million in relation to a better underlying net performance, reflecting “sustained loan cures”. They also included €35 million resulting from an adjustment to the house price inflation assumption.
But the group expects an impairment charge in the second half of the year, arising from its underlying performance. This is mainly due to the quantum of write-backs from loan cures “moderating” and it returning to a normalised impairment flow. Its medium-term guidance of a cost of risk of 40 basis points or less remains unchanged.
PTSB said it had made a gain of €29 million from the sale of a share held in Visa Europe in the first half, which is included in other operating income.
Its total operating expenses, excluding regulatory costs, increased by 7.5%, primarily due to a higher spend on certain regulatory and mandatory projects that are not expected to be recurring over the medium term.
Regulatory costs increased by €19 million as a result of its contribution to the Single Resolution Fund of €9 million and the deposit guarantee scheme of €10 million.
“We are anticipating potential increases in these costs going forward,” the bank said.
The Irish bank levy of €27 million will be paid in October. Excluding this levy, the group expects operating expenses to be lower in the second half.
PTSB said talks with the European Commission on extending the deadline for the sale of its non-core £2.3 billion CHL mortgage book in the UK are underway.
This book was to have been sold by the end of June but the sale was postponed due to the impact of the UK’s referendum on its EU membership of market activity.
PTSB said its intention remains to exit this business fully subject to market appetite and appropriate pricing.
“In this respect, it is not possible to give a precise date for completing a transaction, in particular, in light of the UK’s recent decision to leave the EU,” the bank said.
Farmers want extra time to pay tax bills due to ‘income crisis’
IFA president urges Irish State to tackle ‘income volatility’ due to Brexit vote and low prices
The IFA president said cattle prices had dropped by up to 20 cent a kilo since result and dairy prices had fallen by more than 30% in the last 18 months.
Farmers should get extra time to pay their tax bills and receive further income support, the Irish Farmers’ Association (IFA) has said.
The association, which represents 75,000 farmers from all sectors, revealed its pre-budget submission on Tuesday that emphasised an “income crisis” in the industry.
IFA president Joe Healy called on the Government to deliver short-term measures to tackle “income volatility” in October’s budget.
The IFA president said a combination of low product prices and “bad spring weather”, which negatively affected grass growth and increased feed costs, had put farming families under “huge pressure” as cash flow tightened.
“Throughout 2016 we’ve seen many of the commodities sell below the price of production and on top of that the recent vote in the UK has added fuel to the fire,” he said.
Mr Healy said the Britain’s vote to leave the European Union had added to the uncertainty in the industry with 40% of agri-food exports going to UK.
He said cattle prices had dropped by up to 20 cent a kilo since result and dairy prices had fallen by more than 30% in the last 18 months.
Recent figures from a survey carried out by Teagasc in 2015 showed the average farm income in the State was about €26,500, up 6 per cent from 2014.
In a breakdown of the sectors, the survey found the average incomes on a dairy farm, traditionally the most profitable, were €63,000, tillage of €33,700, cattle and other at €16,200, sheep at €15,800 and cattle rearing farms at €12,900.
In its submission to the Minister for Finance, the IFA has asked for €600 million in funding for farm schemes under the Rural Development Programme, up from the €450 million allocated in last year’s budget.
Mr Healy said the organisation proposed a new tax payment option for farmers on income averaging, which is when a farmer elects to have their profits taxed on an average basis over five years.
Under the new proposal a farmer would be allowed, during a year when their income falls significantly, to have longer to pay their tax bill.
“To pay the tax due for a single year only on the actual income earned in that year, rather than the average tax due arising from five years’ income,” Mr Healy said.
He said the deferred tax would be paid over a three-year period.
“It’s not in any way getting out of paying tax, it’s just in the difficult year to defer tax over the following few years,” Mr Healy said.
A Revenue spokeswoman said there were no numbers on how many farmers were on “income averaging” yet as 2015 was the first year people were asked to note it on their income tax returns (Form 11).
The association is also asking for income averaging to be extended to include farmers whose spouse has a self-employed income and the tax credit to be increased to the same level as the PAYE credit.
“We recognise the commitment in the Programme for Government to increase this to match the PAYE credit, by 2018. However, IFA believes that the Government should equalise the credits fully by 2017, which would give a direct cashflow boost to farmers and other self-employed,” he said.
Other key priorities in the submission include: funding of €250 million for agri-environment schemes, introduction of a targeted sheep scheme of €25 million, extra funding of €25 million in support for the suckler cow and increasing the number of places on the Rural Social Scheme from 2.600 to 4,000.
Dutch men are the tallest in the world but how do Irish fellas measure up?
The average Irish man stands at 5.8ft while the typical Irish woman stands at 5.4ft.
Dutch men and Latvian women are now the tallest in the world a height study revealed.
The study showed that the Swedes who were the tallest people in the world in 1914 have been overtaken by Dutch men who rose from 12th place to first at almost 6ft tall.
Latvian women rose from 28th place in 1914 to become the tallest in the world a century later with an average height of 5.7 ft.
While the Irish don’t make the top 10, we’re universally tall apparently, coming in 20th place for men and 24th for women out of 200 countries.
The average Irish man stands at 5.8ft while the typical Irish woman stands at 5.4ft.
A century ago Irish men ranked 43rd and Irish women 44th in the world for height, but we have consistently grown taller ever since.
The shortest men on the planet come from East Timor, with an average height of 5.2ft. Women from Guatemala were the smallest with an average of4.8ft.
The international study collected data from 1,472 population surveys with height information on 18.6 million people.
The numbers spanned a 100-year period and included statistics on people who turned 18-years-old between 1914 and 2014.
The research was published in the journal eLife by the NCD Risk Factor Collaboration, a network of nearly 800 health scientists worldwide, including scientists from Ireland.
New Zealand to exterminate rats and all other introduced predators
Possums, stoats and other introduced pests to be killed in ‘world-first’ extermination programme unveiled by PM John Key
Pests above left like rats to be exterminated and the Kiwi right an endangered species
The New Zealand government says introduced species cost the economy NZ$3.3bn a year
The New Zealand government has announced a “world-first” project to make the nation predator free by 2050.
The prime minister, John Key, said on Monday it would undertake a radical pest extermination programme – which if successful would be a global first – aiming to wipe out the introduced species of rats, stoats and possums nation-wide in a mere 34 years.
According to the government, introduced species kill 25m native New Zealand birds a year including the iconic ground-dwelling, flightless Kiwi, which die at a rate of 20 a week, and now number fewer than 70,000.
The government estimates the cost of introduced species to the New Zealand economy and primary sector to be NZ$3.3bn (£1.76bn) a year.
“Our ambition is that by 2050 every single part of New Zealand will be completely free of rats, stoats and possums,” said Key in a statement.
“This is the most ambitious conservation project attempted anywhere in the world, but we believe if we all work together as a country we can achieve it.”
Existing pest control methods in New Zealand include the controversial and widespread use of 1080 aerial poison drops, trapping and ground baiting, and possum hunting by ground hunters (possum fur has become a vibrant industry in New Zealand, and is used for winter clothing).
Emeritus Professor of Conservation Mick Clout from the University of Auckland said he was “excited” by the “ambitious plan” which if achieved would be a “remarkable world first”.
“Even the intention of making New Zealand predator free is hugely significant and now it has money and the government behind it I believe it is possible, I am actually very excited,” said Clout.
“The biggest challenge will be the rats and mice in urban areas. For this project to work it will need the urban communities to get on board. Possum extermination will be the easiest because they only breed once a year and there are already effective control methods in place.”
Economist and philanthropist Gareth Morgan, of the Morgan Foundation, said he was “ecstatic” about the government’s announcement.
“This is the first time the government has really swung in behind investing in New Zealand’s environmental capital,” he said.
“This is a big, ambitious project but with the government making it a priority you will see increased interest in the sector, and further exploration of innovative trapping and extermination techniques beyond toxic chemicals like 1080.”
The Royal Society of New Zealand Forest and Bird was optimistic about the country’s chances of success.
Advocacy manager Kevin Hackwell said: “I think 2050 is a conservative goal, we could be on track to doing it by 2040. The government has just come on board but many groups around New Zealand have been working towards being predator-free for years.”
“New Zealand is a world-leader in eradicating rats from the landscape. New Zealand can’t go predator free without targeting the cities so we will have to look to places like Alberta, Canada, on how to tackle rat infestation in an urban environment. But it is doable, and not that hard.
“A predator-free New Zealand has been National party policy for the last three elections, but now it has gone from being the governing party policy to becoming government policy. But National has already invested a lot of money and resources into research on this.
“The biggest hurdle in the end will be public support for the project. That will be the most important facet of this.”
Rocky the orangutan who can ‘ape’ human words and sounds
An orangutan called Rocky (Left Picture) has outperformed Sylvester Stallone in the movie of the same name by displaying an ability to emulate human speech.
In the film, Stallone’s character Rocky Balboa is better at talking with his fists than communicating verbally.
But Rocky the ginger ape has astonished experts by producing sounds similar to words in a “conversational context”.
Researchers conducted a game in which Rocky mimicked the pitch and tone of human sounds and made vowel-like calls.
Comparing Rocky’s sounds against a large database of recordings of wild and captive orangutans showed they were markedly different.
Rocky was able to learn new sounds and control the action of his voice in the way humans do when they conduct a conversation, the scientists concluded.
They believe Rocky could be the key to understanding how human speech evolved.
The discovery, led by Dr Adriano Lameira of Durham University, shows orangutans could have the ability to control their voices.
It might answer the argument about whether or not spoken language stemmed from early human ancestors.
Previously it was thought that great apes – our closest relatives – could not learn to produce new sounds and because speech is a learned behaviour, it could not have originated from them.
Eight-year-old Rocky was studied at Indianapolis Zoo in the US, where he still lives, between April and May 2012.
In the “do-as-I-do” game he attempted to copy random sounds made by the experimenter which included variations in tone and pitch.
His calls were compared with sounds collected from more than 12,000 hours of observations of more than 120 orangutans from 15 wild and captive populations.