News: In the cities and shires, council tax goes higher

Households face 4.3 per cent increase in bills; with-profits policyholders denied payout; energy costs soar; fraudsters foiled

Council tax bills across England are to rise by an average of 4.3 per cent in the 2005-06 tax year to £1,009, up from £967.

Council tax bills across England are to rise by an average of 4.3 per cent in the 2005-06 tax year to £1,009, up from £967.

For a couple living in a middle-ranking Band D property, the annual average cost will be £1,214 - a rise of £47 on last year, according to figures released last week by the Office of the Deputy Prime Minister. In London, the Band D bill will be £1,162 on average, and in Gloucestershire the typical bill will be £1,234.

The council tax charge is currently based on house price bands set in 1991.

But new band calculations will apply from April 2007 based on property prices as at 1 April this year.

No bonus at Abbey

With-profits policyholders at Abbey National Life, Scottish Mutual and Scottish Provident providers - all owned by Abbey - will receive no 2004 annual bonus despite robust growth.

Each of the three funds grew by at least 7.6 per cent during the six months from July 2004. But instead of awarding bonuses, Abbey has cut the cost for policyholders who want to bale out of the funds (all closed to new money) after years of underperformance by reducing the Market Value Reduction charge.

Gas gloom

British householders should expect higher gas bills for the next two years because of supply shortages in the North Sea and the Government's struggles to find an alternative source.

A report from the Trade and Industry Select Committee has blamed DTI leadership for the continued problems, which have caused many consumers' gas bills to rise by at least a fifth since the start of 2004.

The cost of buying gas from overseas to meet demand means that prices are likely to stay high for the next couple of years and that "further increases are inevitable", the MPs' report said.

Higher bills have forced many customers to consider switching their provider.

Householders who have never changed energy supplier should be able to make savings of as much as £170, according to the price-comparison website uSwitch.com.

Insurance clampdown

A crackdown on insurance frauds - ranging from fake burglaries and personal injury claims to organised gang scams - saved the industry around £200m last year.

This figure, the total for the false claims detected by insurers in 2004, is double that of 2002 - the last time calculations were carried out - according to the Association of British Insurers (ABI).

Among the most common frauds were personal injury claims against local authorities - typically where people claimed for accidents allegedly resulting from tripping on loose paving stones, when they were really hurt elsewhere.

Another widespread fraud involved criminal gangs staging car accidents and then claiming for whiplash and damage to the vehicle, using witnesses who were actually accomplices.

False claims cost insurers millions every year and push up premiums for honest policyholders, the ABI said.

"As well as weeding out the opportunists, the industry is tackling the more organised frauds," said Chris Hannant, the ABI's head of financial crime prevention. "Insurance cheats not only face the risk of a criminal record but will find future insurance and credit much more expensive to obtain."