MONEY NEWS IN BRIEF

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The Independent Online
Tougher benefits

The Government's new incapacity benefit comes into effect on Thursday 13 April. replacing state sickness benefit (payable to the self-employed during the first 28 weeks of illness) and invalidity benefit (payable to employees and self-employed after 28 weeks).

The criteria for receiving benefits will be much tougher, involving stringent medical tests, and the benefits will be taxed after 28 weeks. Norwich Union estimates that the changes, expected to achieve savings of £2.3bn a year by 2000, will reduce the average payment to £52.50 a week from £150.

Money changers

From Monday the Post Office will become the country's largest chain of bureaux de change, with 19,000 outlets throughout the UK. Foreign exchange services will be available at almost all post offices, which will be allowed to accept credit cards for the first time. Commission will be charged at 1 per cent and the minimum fee will be £2.50.

It also plans to offer travel insurance in a trial starting next month and is examining other insurance opportunities with the help of Sun Alliance.

Trust measure

Charitable and private trusts are to be allowed to earn more income as a result of measures being introduced by the Government. Trusts will be able to invest a higher proportion of funds in equities, although they will be subject to a restriction that is opposed by charities and investment managers.

Under the Trustee Investments Act, 1961, trusts have been required to split their funds equally in two, one portion to be invested in equities, the other in gilts. A statutory instrument awaiting approval by the Lords will enable charitable trusts to invest 75 per cent of their funds in equities. The Treasury has launched a consultation proposals on similar changes for private trusts.

Pension split

Blackburn County Court this week agreed that a husband's pension fund be split in a divorce settlement. The course of action in Pilkington vs Pilkington was agreed to by both parties.

The Lords this week heard the case of Brooks vs Brooks, where the husband is contesting a similar move. Judgment is expected in the Summer.

ShareLink deal

Charles Schwab Corporation, America's largest discount broker, is paying £39.7m for ShareLink, the loss-making execution-only share dealing group. The move could transform the services offered to private buyers of stocks and shares in the UK.

Charles Schwab has more than 200 branches in the US and has a reputation as a low-cost, highly efficient provider of execution-only share services.

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