Consols was a name given to certain government debt issues in the form of perpetual bonds, redeemable at the option of the government. They were issued by the U. S. Government and the Bank of England; the first British Consols were issued in 1751. They have now been redeemed; the first U. S. Government Consols were issued in the 1870s. In 1752 the Chancellor of the Exchequer and Prime Minister Sir Henry Pelham converted all outstanding issues of redeemable government stock into one bond, Consolidated 3.5% Annuities, in order to reduce the coupon paid on the government debt. In 1757, the annual interest rate on the stock was reduced to 3%, leaving the stock as Consolidated 3% Annuities; the coupon rate remained at 3% until 1888. In 1888, the Chancellor of the Exchequer, George Joachim Goschen, converted the Consolidated 3% Annuities, along with Reduced 3% Annuities and New 3% Annuities, into a new bond, 2¾% Consolidated Stock, under the National Debt Act 1888. Under the Act, the interest rate of the stock was reduced to 2½% in 1903, the stock given a first redemption date of 5 April 1923, after which point the stock could be redeemed at par value by Act of Parliament.
In 1927 Chancellor Winston Churchill issued a new government stock, 4% Consols, as a partial refinancing of the National War Bonds issued in 1917 during World War One. On 31 October 2014 the UK Government announced that it would redeem the 4% Consols in full in early 2015, it did so on 1 February, 2015, redeemed the 3½% and 3% bonds between March and May of that year. The final 2¾% and 2½% bonds were redeemed on 5 July 2015. Given their long history, references to Consols can be found in many places, including Pride and Prejudice by Jane Austen, David Copperfield by Charles Dickens, Howards End by E. M. Forster, Vanity Fair by William Makepeace Thackeray, Of Human Bondage by William Somerset Maugham and The Forsyte Saga by John Galsworthy. War bond#United Kingdom Annuity Certificates of the Bank of England Consolidated Annuities
War bonds are debt securities issued by a government to finance military operations and other expenditure in times of war. In practice, modern governments finance war by putting additional money into circulation, the function of the bonds is to remove money from circulation and help to control inflation. War bonds are either retail bonds marketed directly to the public or wholesale bonds traded on a stock market. Exhortations to buy war bonds are accompanied by appeals to patriotism and conscience. Retail war bonds, like other retail bonds, tend to have a yield, below that offered by the market and are made available in a wide range of denominations to make them affordable for all citizens. Governments throughout history have needed to borrow money to fight wars. Traditionally they dealt with a small group of rich financiers such as Jakob Fugger and Nathan Rothschild, but no particular distinction was made between debt incurred in war or peace. An early use of the term "war bond" was for the $11 million raised by the US Congress in an Act of 14 March 1812, to fund the War of 1812, but this was not aimed at the general public.
Until July 2015 the oldest bonds still outstanding as a result of war were the British Consols, some of which were the result of the refinancing of incurring debts during the Napoleonic Wars, but these were redeemed following the passing of the Finance Act 2015. The government of Austria-Hungary knew from the early days of the First World War that it could not count on advances from its principal banking institutions to meet the growing costs of the war. Instead, it implemented a war finance policy modeled upon that of Germany: in November 1914, the first funded loan was issued; as in Germany, the Austro-Hungarian loans followed a prearranged plan and were issued at half yearly intervals every November and May. The first Austrian bonds had a five-year term; the smallest bond denomination available was 100 kronen. Hungary issued loans separately from Austria in 1919, after the war and after it had separated from Austria, in the form of stocks that permitted the subscriber to demand repayment after a year's notice.
Interest was fixed at 6%, the smallest denomination was 50 korona. Subscriptions to the first Austrian bond issue amounted to the equivalent of $440 million; the limited financial resources of children were tapped through campaigns in schools. The initial minimum Austrian bond denomination of 100 kronen still exceeded the means of most children, so the third bond issue, in 1915, introduced a scheme whereby children could donate a small amount and take out a bank loan to cover the rest of the 100 kronen; the initiative was immensely successful, eliciting funds and encouraging loyalty to the state and its future among Austro-Hungarian youth. Over 13 million kronen was collected in the first three "child bond" issues. Canada's involvement in the First World War began in 1914, with Canadian war bonds called "Victory Bonds" after 1917; the first domestic war loan was raised in November 1915, but not until the fourth campaign of November 1917 was the term Victory Loan applied. The First Victory Loan was a 5.5% issue of 5, 10 and 20 year gold bonds in denominations as small as $50.
It was oversubscribed, collecting $398 million or about $50 per capita. The Second and Third Victory Loans were floated in 1919, bringing another $1.34 billion. For those who could not afford to buy Victory Bonds, the government issued War Savings Certificates; the government awarded communities. Unlike France and Britain, at the outbreak of the First World War Germany found itself excluded from international financial markets; this became most apparent after an attempt to float a major loan on Wall Street failed in 1914. As such, Germany was limited to domestic borrowing, induced by a series of war credit bills passing the Reichstag; this took place in many forms. Nine bond drives were conducted over the length of the war and, as in Austria-Hungary, the loans were issued at six-month intervals; the drives themselves would last several weeks, during which there was extensive use of propaganda via all possible media. Most bonds had a rate of return of 5% and were redeemable over a ten-year period, in semi-annual payments.
Like war bonds in other countries, the German war bonds drives were designed to be extravagant displays of patriotism and the bonds were sold through banks, post offices and other financial institutions. As in other countries, the majority investors were not individuals but institutions and large corporations. Industries, university endowments, local banks and city governments were the prime investors in the war bonds. In part because of intense public pressure and in part due to patriotic commitment the bond drives proved successful, raising 10 billion marks in funds. Although successful the war bond drives only covered two-thirds of war-related expenditures. Meanwhile, the interest payable on the bonds represented a growing expense which required further resources to pay it. In August 1914 the gold reserves of the Bank of England, of all banking institutions in Great Britain, amounted to £9 million; the banks feared the declaration of war would trigger a run on the banks, so the Chancellor David Lloyd George extended the August bank holiday for three days to allow time for the passing of the Currency and Bank Notes Act 1914, by which Britain left the gold standard.
Under this Act the Treasury issued £300 million of paper banknotes
The United Kingdom the United Kingdom of Great Britain and Northern Ireland, sometimes referred to as Britain, is a sovereign country located off the north-western coast of the European mainland. The United Kingdom includes the island of Great Britain, the north-eastern part of the island of Ireland, many smaller islands. Northern Ireland is the only part of the United Kingdom that shares a land border with another sovereign state, the Republic of Ireland. Apart from this land border, the United Kingdom is surrounded by the Atlantic Ocean, with the North Sea to the east, the English Channel to the south and the Celtic Sea to the south-west, giving it the 12th-longest coastline in the world; the Irish Sea lies between Great Ireland. With an area of 242,500 square kilometres, the United Kingdom is the 78th-largest sovereign state in the world, it is the 22nd-most populous country, with an estimated 66.0 million inhabitants in 2017. The UK is constitutional monarchy; the current monarch is Queen Elizabeth II, who has reigned since 1952, making her the longest-serving current head of state.
The United Kingdom's capital and largest city is London, a global city and financial centre with an urban area population of 10.3 million. Other major urban areas in the UK include Greater Manchester, the West Midlands and West Yorkshire conurbations, Greater Glasgow and the Liverpool Built-up Area; the United Kingdom consists of four constituent countries: England, Scotland and Northern Ireland. Their capitals are London, Edinburgh and Belfast, respectively. Apart from England, the countries have their own devolved governments, each with varying powers, but such power is delegated by the Parliament of the United Kingdom, which may enact laws unilaterally altering or abolishing devolution; the nearby Isle of Man, Bailiwick of Guernsey and Bailiwick of Jersey are not part of the UK, being Crown dependencies with the British Government responsible for defence and international representation. The medieval conquest and subsequent annexation of Wales by the Kingdom of England, followed by the union between England and Scotland in 1707 to form the Kingdom of Great Britain, the union in 1801 of Great Britain with the Kingdom of Ireland created the United Kingdom of Great Britain and Ireland.
Five-sixths of Ireland seceded from the UK in 1922, leaving the present formulation of the United Kingdom of Great Britain and Northern Ireland. There are fourteen British Overseas Territories, the remnants of the British Empire which, at its height in the 1920s, encompassed a quarter of the world's land mass and was the largest empire in history. British influence can be observed in the language and political systems of many of its former colonies; the United Kingdom is a developed country and has the world's fifth-largest economy by nominal GDP and ninth-largest economy by purchasing power parity. It has a high-income economy and has a high Human Development Index rating, ranking 14th in the world, it was the world's first industrialised country and the world's foremost power during the 19th and early 20th centuries. The UK remains a great power, with considerable economic, military and political influence internationally, it is sixth in military expenditure in the world. It has been a permanent member of the United Nations Security Council since its first session in 1946.
It has been a leading member state of the European Union and its predecessor, the European Economic Community, since 1973. The United Kingdom is a member of the Commonwealth of Nations, the Council of Europe, the G7, the G20, NATO, the Organisation for Economic Co-operation and Development and the World Trade Organization; the 1707 Acts of Union declared that the kingdoms of England and Scotland were "United into One Kingdom by the Name of Great Britain". The term "United Kingdom" has been used as a description for the former kingdom of Great Britain, although its official name from 1707 to 1800 was "Great Britain"; the Acts of Union 1800 united the kingdom of Great Britain and the kingdom of Ireland in 1801, forming the United Kingdom of Great Britain and Ireland. Following the partition of Ireland and the independence of the Irish Free State in 1922, which left Northern Ireland as the only part of the island of Ireland within the United Kingdom, the name was changed to the "United Kingdom of Great Britain and Northern Ireland".
Although the United Kingdom is a sovereign country, Scotland and Northern Ireland are widely referred to as countries. The UK Prime Minister's website has used the phrase "countries within a country" to describe the United Kingdom; some statistical summaries, such as those for the twelve NUTS 1 regions of the United Kingdom refer to Scotland and Northern Ireland as "regions". Northern Ireland is referred to as a "province". With regard to Northern Ireland, the descriptive name used "can be controversial, with the choice revealing one's political preferences"; the term "Great Britain" conventionally refers to the island of Great Britain, or politically to England and Wales in combination. However, it is sometimes used as a loose synonym for the United Kingdom as a whole; the term "Britain" is used both as a synonym for Great Britain, as a synonym for the United Kingdom. Usage is mixed, with the BBC preferring to use Britain as shorthand only for Great Britain and the UK Government, while accepting that both terms refer to the United K
Taxation in the United Kingdom
Taxation in the United Kingdom may involve payments to at least three different levels of government: central government, devolved governments and local government. Central government revenues come from income tax, National Insurance contributions, value added tax, corporation tax and fuel duty. Local government revenues come from grants from central government funds, business rates in England, Council Tax and from fees and charges such as those for on-street parking. In the fiscal year 2014–15, total government revenue was forecast to be £648 billion, or 37.7 per cent of GDP, with net taxes and National Insurance contributions standing at £606 billion. A uniform Land tax was introduced in England during the late 17th century, formed the main source of government revenue throughout the 18th century and the early 19th century. Income tax was announced in Britain by William Pitt the Younger in his budget of December 1798 and introduced in 1799, to pay for weapons and equipment in preparation for the Napoleonic Wars.
Pitt's new graduated income tax began at a levy of 2 old pence in the pound on annual incomes over £60, increased up to a maximum of 2 shillings on annual incomes of over £200. Pitt hoped that the new income tax would raise £10 million, but receipts for 1799 totalled just over £6 million. Income tax was levied under five schedules. Income not falling within those schedules was not taxed; the schedules were: Schedule A Schedule B Schedule C Schedule D Schedule E Later, Schedule F was added. Pitt's income tax was levied from 1799 to 1802, when it was abolished by Henry Addington during the Peace of Amiens. Addington had taken over as prime minister in 1801; the income tax was reintroduced by Addington in 1803 when hostilities recommenced, but it was again abolished in 1816, one year after the Battle of Waterloo. Considerable controversy was aroused by the malt, house and income taxes; the malt tax was easy to collect from brewers. The house tax hit London town houses; the income tax was reintroduced by Sir Robert Peel in the Income Tax Act 1842.
Peel, as a Conservative, had opposed income tax in the 1841 general election, but a growing budget deficit required a new source of funds. The new income tax of 7d in the pound, based on Addington's model, was imposed on annual incomes above £150; the war was financed by borrowing large sums at home and abroad, by new taxes, by inflation. It was implicitly financed by postponing maintenance and repair, canceling capital expenditure; the government avoided indirect taxes because they raised the cost of living, caused discontent among the working class. There was a strong emphasis on being "fair" and being "scientific"; the public supported the heavy new taxes, with minimal complaints. The Treasury rejected proposals for a stiff capital levy, which the Labour Party wanted to use to weaken the capitalists. Instead, there was an excess profits tax, of 50% on profits above the normal prewar level. Excise taxes were added on luxury imports such as automobiles and watches. There was no sales value added tax.
The main increase in revenue came from the income tax. 6d in the pound, individual exemptions were lowered. The income tax rate increased to 5s. In 1916, 6s. In 1918. Altogether, taxes provided at most 30% of national expenditure, with the rest from borrowing; the national debt soared from £625 million to £7,800 million. Government bonds paid 5% p.a. Inflation escalated so that the pound in 1919 purchased only a third of the basket it had purchased in 1914. Wages were laggard, the poor and retired were hard hit. Britain's income tax has changed over the years, it taxed a person's income regardless of, beneficially entitled to that income, but now tax is paid on income to which the taxpayer is beneficially entitled. Most companies were taken out of the income tax net in 1965; these changes were consolidated by the Income and Corporation Taxes Act 1970. The schedules under which tax is levied have changed. Schedule B was abolished in 1988, Schedule C in 1996 and Schedule E in 2003. For income tax purposes, the remaining schedules were superseded by the Income Tax Act 2005, which repealed Schedule F.
For corporation tax purposes, the Schedular system was repealed and superseded by the Corporation Tax Acts of 2009 and 2010. The highest rate of income tax peaked in the Second World War at 99.25%. This was reduced after the war and was around 97.5 percent through the 1950s and 60s. In 1971, the top rate of income tax on earned income was cut to 75%. A surcharge of 15% on investment income kept the overall top rate on that income at 90%. In 1974 the top tax rate on earned income was again raised, to 83%. With the investment income surcharge this raised the overall top rate on investment income to 98%, the highest permanent rate since the war; this applied to incomes over £20,000. In 1974, as many as 750,000 people were liable to pay the top rate o
A coupon payment on a bond is the annual interest payment that the bondholder receives from the bond's issue date until it matures. Coupons are described in terms of the coupon rate, calculated by adding the sum of coupons paid per year and dividing it by the bond's face value. For example, if a bond has a face value of $1,000 and a coupon rate of 5% it pays total coupons of $50 per year; this will consist of two semi-annual payments of $25 each. The origin of the term "coupon" is that bonds were issued in the form of bearer certificates. Physical possession of the certificate was proof of ownership. Several coupons, one for each scheduled interest payment, were printed on the certificate. At the date the coupon was due, the owner would present it for payment; the certificate also contained a document called a talon, which could be detached and presented in exchange for a block of further coupons. Not all bonds have coupons. Zero-coupon bonds are those that pay no coupons and thus have a coupon rate of 0%.
Such bonds make only one payment: the payment of the face value on the maturity date. To compensate the bondholder for the time value of money, the price of a zero-coupon bond will always be less than its face value on any date before the maturity date. During the European sovereign-debt crisis, some zero-coupon sovereign bonds traded above their face value as investors were willing to pay a premium for the perceived safe-haven status these investments hold; the difference between the price and the face value provides the bondholder with the positive return that makes purchasing the bond worthwhile. Between a bond's issue date and its maturity date, the bond's price is determined by taking into account several factors, including: The face value. Credit Credit spread TED spread Yield curve
Department for Business, Energy and Industrial Strategy
The Department for Business and Industrial Strategy is a department of the government of the United Kingdom, created by Theresa May on 14 July 2016 following her appointment as Prime Minister, through a merger between the Department for Business and Skills and Department of Energy and Climate Change. BEIS brought together responsibility for business, industrial strategy, science and innovation with energy and climate change policy, merging the functions of the former BIS and DECC; the Ministers in the Department for Business and Industrial Strategy are as follows: In October 2016, Archie Norman was appointed as Lead Non Executive Board Member for the Department for Business and Industrial Strategy. The department is responsible for government policy in the following areas: Some policies apply to England alone due to devolution, while others are not devolved and therefore apply to other nations of the United Kingdom; some economic policies are devolved but many aspects of several important policy areas are reserved to Westminster.
Reserved and excepted matters are outlined below. Scotland Reserved matters: The Economy Directorate of the Scottish Government handles devolved economic policy. Northern Ireland Reserved matters: Business regulation and support Climate change policy Company law Competition Consumer protection Corporate governance Import and export control Employment relations Energy Export licensing Insolvency Intellectual property Nuclear energy Outer space Postal services Product standards and liability Research councils Science and research Telecommunications Time Trade associations Units of measurementExcepted matter: Outer space Nuclear powerThe department's main counterpart is: Department for the Economy