Metro Bank Struggles to Recover from Past Accounting Errors as It Reduces Services and Exits Credit Card Market Amidst Financial Instability

The new Chancellor of the Exchequer, Rachel Reeves, has stumbled out of the gate with her recent financial update.

It’s been a shaky start, like Hartley’s Jelly on a wobbly table. Just six days ago, she delivered a grim report to the House of Commons, revealing a harsh cut to the winter fuel payment. This adjustment will see ten million pensioners losing out on the benefit, which could be as much as £300.

Under the new rules, only those receiving pension credit or a few other means-tested benefits will get the winter fuel payment this year. This means that up to 1.2 million pensioners, who are eligible for pension credit but haven’t claimed it (due to reasons like pride, ignorance, or the complex application process), will miss out.

Even those just shy of qualifying, but who are still struggling financially, will feel the pinch. My inbox has been flooded with angry responses from readers who feel that pensioners, lacking a strong voice in government, are being unfairly targeted.

I spent hours on the phone with readers who are deeply affected by this change.

For some, losing this payment will strain their already tight budgets. Others, though it may not impact their finances directly, feel betrayed.

They remember how Labour promised before the election that the payment wouldn’t be means-tested.

Julia Holmes, a 69-year-old retiree from Saltash in Cornwall, is particularly upset. She’s already had to adjust to the delay in her state pension due to changes in pension age policies and now faces losing her fuel payment.

Julia feels disheartened, saying, “You work hard for decades, save a bit for tough times, and then this woman just comes in and makes things worse.”

Mixed Reactions from Pensioners

On the other side of the spectrum is John Lloyd from Letchworth, Hertfordshire. At 84, John and his wife Anita, who have been married for 62 years, are less concerned about the loss of the payment.

Their financial situation, supported by multiple pensions from John’s successful double-glazing business, means they won’t be affected as much.

However, John criticizes the hypocrisy of the Labour government, which cuts pension benefits while making generous payments to public sector employees to maintain union support.

Similarly, Maggi Warner, a 75-year-old retiree from Yate in South Gloucestershire, finds the cut “despicable.” She argues that pensioners need better representation in government and suggests that Baroness Ros Altmann could be a strong advocate for their needs.

Many organizations have called for Reeves to reverse the decision, and Independent Age is urging pensioners to contact their MPs and check their eligibility for pension credit.

Metro Bank’s Troubles

Meanwhile, Metro Bank is struggling to regain its footing after being shaken by accounting errors from five years ago.

The bank, once a promising alternative to traditional high street banks, has been forced to make significant cutbacks. Although it secured £925 million in emergency refinancing last autumn, it’s paid a high price.

Many of the features that set Metro apart have been reduced or removed, such as its commitment to seven-day banking.

Most of its branches now close on weekends, and the bank has exited the credit card market, leaving customers to find new card issuers.

Issues with M&S Bank

M&S Bank is also in the news for less favorable reasons.

It has confused credit cardholders with conflicting letters about interest rate changes. A letter dated July 29 announced a rise in rates starting October 24, but this contradicted a previous notice stating the increase would occur in March. M&S Bank has attributed this mix-up to a “technical error” and is reviewing the issue.

Interest Rate Changes

On a broader economic note, the Bank of England recently cut the base rate by 0.25 percentage points, marking the first reduction in four years. This move was welcomed by many, despite its potential negative impact on savers.

I had anticipated the rate would stay at 5.25 percent, and as promised, I’ve donated £50 to Prostate Cancer UK, topped up with gift aid.

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