The Sunday Times - UK (2022-04-10)

16 The Sunday Times April 10, 2022

MONEY

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The government has made

eight state pension payment

errors over the past 15 years,

leaving hundreds of

thousands short-changed.

A Freedom of Information

request from Steve Webb, a

partner at the pensions

consultancy LCP, showed a

“catalogue of errors” by the

Department for Work and

Pensions (DWP) since 2007.

The public were told about

Groceries

Utilities

Education

Childcare

In-home entertainment

Housing costs

Paying off debt

Transport costs

Food delivery

Electronics

Home improvements

Gym or sports club memberships

Clothing

International travel

Eating out

23%

18%

14%

6%

3%

3%

1%

-1%

-3%

-7 %

-11%

-15%

-19%

-23%

-31%

Expected percentage change in spending over the next 12 months

Source: Trahan Macro Research

Soaring inflation is

already altering the way

we’re spending. Over

the next 12 months

consumers expect to

spend more on

essentials such as

groceries, utilities and

childcare because of

rising prices and they

plan to cut back on life’s

little luxuries. Spending

on eating out is

expected to fall 31 per

cent, on overseas travel

23 per cent and on

clothes 19 per cent.

CHART OF THE WEEK OUR STAY-AT-HOME SPENDING PLANS

Are you getting the correct state pension?

only two of them — 36,000

people underpaid £83 million

because years spent raising

children were left off their

state pension record, and

134,000 people being owed a

collective £1 billion after

problems with the DWP’s

computer system led to

decades of underpayment.

The new errors range from

mishaps affecting a handful

of people to multimillion-

pound blunders. Those

underpaid include surviving

spouses and a group of

transgender women.

“What is worrying about

this catalogue of errors is how

long it can take for anyone to

spot that anything is wrong,”

Webb said.

The DWP said: “This year

we will spend over £100

billion on the state pension.

Our priority is ensuring

everyone gets the financial

support they are entitled to.

Where errors do occur, they

are identified and rectified.”

Imogen Tew

Funds that back small British

businesses and offer investors

tax breaks raised a record

amount last year. Venture

capital trusts (VCTs) secured

£1.13 billion in the 2021-22 tax

year, up from £685 million in

2020-21, according to the

Association of Investment

Companies (AIC), the trade

body. The previous record

was £779 million in 2005-06.

Jason Hollands from the

Wealthy investors search for tax breaks

Bestinvest platform said that

the surge in fundraising was

driven by existing companies

needing more money

because of the impact of the

coronavirus pandemic.

VCTs are an alternative to

pensions for wealthier

investors because of tax

reliefs, said Alex Davies from

the research company Wealth

Club. The lifetime pension

allowance has been frozen at

£1,073,100 since 2020.

Investing in newly issued

shares of a VCT provides you

with up to 30 per cent income

tax relief when the shares are

held for at least five years.

Both dividends and capital

gains made on any VCT

investment are tax free.

VCTs are risky, however,

because the businesses that

they invest in are at the start

of their existence and can be

hard to sell. VCT’s have

returned an average of

155 per cent over the past ten

years, according to the AIC.

David Brenchley

Proportion of top 1 per cent

of earners who are women

20%

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Working in her parents’ shop and later in a bank,

Kaur dreamt of The Apprentice. Despite winning

Lord Sugar’s £250,000 for her dessert business,

she doesn’t feel wealthy yet. By York Membery

H

arpreet Kaur won the latest

series of The Apprentice

last month, securing a

£250,000 investment from

Lord Sugar for her dessert

parlour business, Oh So

Yum, which she co-founded

with her sister, Guv. Kaur,

30, lives with her parents

and her “fur ball of a dog”

in Brighouse, West Yorkshire.

How much money do you have in your

wallet?

A £5 note, some loose change and my

bank cards.

What credit cards do you use?

I prefer to use my debit card most of the

time because then I know I’m not

overspending. But I think credit cards

can be useful to build up your credit

history, and for racking up points to

redeem against travel vouchers.

Are you a saver or a spender?

I’d say 50:50. My parents taught me

the importance of saving, so by

the age of 21 I’d saved £12,000,

enough to put down a deposit

on a three-bedroom Victorian

terraced house in Brighouse. But

I like to live a little as well. My last

big-ticket buy was a pair of £500

Louboutin high heels, with red soles,

which I treated myself to while in The

Apprentice house after making the final

four. But I haven’t treated myself to

anything yet for winning — I’ve been far

he was 21, and married my mum, Jas,

who is British-born but also has Punjabi

heritage. They opened a corner shop

and off-licence in Brighouse 20 years

ago and the business is still going strong.

My parents work hard seven days a week

and I’ve inherited their work ethic.

How much did you earn last year?

A lot more than I earned in the early

years of my business, though my

earnings took a hit from Covid. However,

my company sales were the highest that

they’ve ever been, showing we are going

from strength to strength. If we reach

our target turnover will hit seven

figures this year.

What was your first job?

Working behind the counter of my

parents’ shop and cashing up at the end

of the day. I started working at the age of

12 and worked every single day after

school and at weekends. I didn’t get

paid but my parents fed and watered

me, and put clothes on my back, and

that was enough. I got to meet lots of

different people too. After leaving

school at 18 I got a job at Barclays as a

cashier, but quickly worked my way

up the ladder. By 24 I was branch

manager of the HSBC in Oldham

earning £45,000. My parents were very

proud of me.

When did you first feel wealthy?

I’ve never really felt wealthy because

the £250,000 investment I’ve won on

The Apprentice isn’t money for me to

go and spend; it’s for my business. I’m

still working on becoming wealthy, but

I’m getting there! I suppose I had the

most disposable cash during my bank

manager days.

outlet, in Sheffield, shut permanently.

But we realised there was a massive

demand for home dessert deliveries,

so we advertised on social media and

recruited more drivers so we could

deliver to people’s front doors. It was

great being able to bring some feelgood

moments to people during the dark days

of the lockdowns.

Do you invest in shares?

No. But maybe I’ll float my own business

someday, though I’ll have to see what

Lord Sugar says first!

What’s best for retirement — property

or pension?

I think you need a mixed strategy. You

can’t just rely on one or the other.

What has been your best business

decision?

First, setting up Oh So Yum, aged 24.

Six years on, I’ve got a dessert parlour in

Huddersfield and a kiosk in a Leeds

shopping centre, and employ around a

dozen full and part-time staff. Last year’s

turnover was in excess of £500,000.

Second, going on The Apprentice — my

winnings are going to help me take the

business to the next level. I’d wanted to

be a contestant since my teens, so being

on it was a dream come true.

And your best investment?

Investing in our Huddersfield outlet

because it’s a proper sit-down parlour

and really put us on the map.

What about your worst investment?

A £900 Mulberry handbag, which I

bought ten years ago but have only used

twice. It’s collecting dust in a cupboard.

What’s your money weakness?

I think I’m quite good at money — if I do

spend anything it’s usually on a nice

outfit or a meal.

What’s your most extravagant

purchase?

A £700 pink dress that I bought for a

photoshoot with Lord Sugar. But it’s

money well spent: investing in

something you wear can set you up for

the day and give you extra confidence.

What’s your financial priority for the

future?

To roll out my dessert business

nationwide and be the number one

brand. I’ve no time for romance right

now but hope to settle down one day.

What would you do if you won the

lottery?

I’d invest the bulk of the money in Oh So

Yum because I know it has bags of

potential. I’d also pay off my parents’

mortgage and make sure they never had

to work again. I’d love help women and

children in India get a better life for

themselves too.

What is the most important lesson

you’ve learnt about money?

It’s easy to spend but hard to earn, so

you’ve got to watch the pennies.

Instagram @harpsi_kaur

‘I started

work aged 12.

I’ve no time

for romance’

FAME AND FORTUNE HARPREET KAUR

Harpreet Kaur

once spent £900

on a Mulberry

bag that she

used twice. Left:

Lord Sugar

too busy to go shopping. I might treat

myself to a car for my birthday in June.

Do you own a property?

I rent out the property I bought ten years

ago, and it’s worth a fair bit more now.

I’m living with my parents in their

semi-detached house with my poochon

dog, Rosie. We share the bills.

Are you better off than your parents?

I don’t know — they don’t tell me what

they earn [laughs]. My dad, Pete, moved

to the UK from India in the 1970s when

Have you ever worried about how you

were going to make ends meet?

Definitely. When I first set up the

business I took a big financial hit, and

didn’t pay myself anything for the first

six months. I didn’t even have the

money for a coffee or odd meal out.

I relied on the support of my parents

who were thankfully there for me.

What has been your most lucrative

work?

The Apprentice, though it took around

two months in all — a long time to be

away from my business — and I had to

immerse myself in the process 100 per

cent, but it was so worth it. I like the way

that Lord Sugar doesn’t sugar-coat

anything, then you know exactly where

you stand. My confidence took a bit of a

knock at the beginning of The Apprentice

but it grew back.

How has the pandemic affected you?

It was very difficult. I had to close my

Leeds dessert kiosk temporarily and one

Investing

in clothes

can set

you up for

the day