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Just 32,000 mortgages were approved in January compared to 62,800 in December, the CML said, as first-time buyers deserted the market

The number of mortgages approved for house purchases fell by almost half in January, as the reintroduction of stamp duty on homes costing more than £125,000 hit the market, the Council of Mortgage Lenders (CML) said today.

A total of 32,000 homebuyer loans worth £4.7bn were approved during the month, a fall of 49% on December’s figure of 62,800.

The biggest fall was in first-time buyers, with the number of purchasers entering the market down 54% on December at 11,300. The CML said this reflected the fact that a high proportion would usually be buying homes costing between £125,000 and £175,000, on which stamp duty was reintroduced at the end of last year.

Its figures for December showed first-time buyer numbers at a two-year high, suggesting many had rushed to complete before the end of the month.

Remortgage activity also fell in January, with the number of loans dropping 15% to 24,000 and the value of those mortgages down 12% at £3bn.

This is 47% down on January 2009’s figure and is the lowest for remortgages in the eight years for which the CML has data, and suggests borrowers are still opting to remain on their lenders’ standard variable rates at the end of a deal to take advantage of current low rates.

Although lending to homebuyers slumped in January, it remained much higher than last January when the housing market was in the doldrums. The number of loans approved was up by 38% on January 2009’s low of 23,000.

The CML’s director general, Michael Coogan, said it had been a quiet start to the year. “Lending volumes in January were low, but we had predicted this would happen due to the end of the stamp duty holiday distorting December’s figures,” he said.

“When December and January data are taken together they show little change in underlying market conditions compared with recent months, with activity still slow but well up on the lows of a year earlier.

“We expect lending over the coming months to remain weak as uncertainty over of the state of the economy and the upcoming election are likely to continue to hold back housing market activity.”

Figures released earlier this week by the Royal Institution of Chartered Surveyors suggest the fall in buyers at the start of the year has resulted in the supply of properties outstripping demand, and could have a knock-on effect on house prices.

Last year’s surprise turnaround in the housing market was widely attributed to a lack of homes coming up for sale, and commentators have suggested that a reduction in the number of would-be buyers could push prices down again.

Officials agree to pay up to $660m to Ground Zero workers who say they were made ill by inhaling fumes and dust at site of 9/11 attacks

New York City authorities have agreed to pay up to $657.5m (£437m) to rescue and recovery workers who claim that they became ill after inhaling dust at the Ground Zero site of the 9/11 terror attacks.

Lawyers representing more than 10,000 plaintiffs, who claim they were exposed to toxic contaminants after the collapse of the World Trade Centre, said the settlement must first be approved by a judge and agreed by 95% of the claimants.

The deal would make the city, and other companies represented by the insurer, liable for at least $575m. Most, if not all, of the money would come from a $1bn Federal Emergency Management Agency grant.

The New York mayor, Michael Bloomberg, called the deal “a fair and reasonable resolution to a complex set of circumstances”. He said: “The resolution of the World Trade Centre litigation will allow the first responders and workers to be compensated for injuries suffered following their work at Ground Zero.”

The agreement comes two months before the first trial in the case. Thousands of police officers, firefighters and construction staff who worked at the 16-acre site in lower Manhattan had filed lawsuits against the city, claiming it sent them to Ground Zero without proper protective equipment.

James Nolan, a 45-year-old carpenter from Yonkers, said he helped recover bodies and build ramps for firehoses at the site and then developed lung and leg problems, for which he takes medication. He sued the city for negligence six years ago.

“We’ve had to fight for what we deserve,” he said. “I’m glad it’s coming to an end. I can feel a little comfortable if I pass away because my wife and kids will get some money.”

Many of those workers say they have since fallen ill. A majority have reported a respiratory problem similar to asthma, but many have also sought damages for hundreds of other ailments, including cancer.

Payments will be based on a system that ranks each illness by severity and potential exposure to the dust. Some workers are likely to receive payments of a few thousand dollars; others could receive more than $1m. A separate insurance fund will be set up to cover workers who develop cancer.

The settlement would mean a postponement or cancellation of the trials tentatively scheduled to begin in May. Some of the cases due to be heard include that of a firefighter who died of throat cancer and another who needs a lung transplant.

The $1bn New York insurance fund, created by Congress, has been depleted in the long-running legal battle in the case, with the bill now in excess of $200m.

The law firm Worby, Groner, Edelman & Napoli, Bern, representing 9,000 of the plaintiffs, is expected to take up to a third of the total settlement in legal fees.

At least 39 killed and 95 wounded in suicide blasts which appeared to target Pakistani military

At least 39 people were killed in Lahore today by two separate suicide bombs, in the second deadly attack on the Pakistani city in a week.

Gunshots were heard after the blasts which appeared to target an army convoy at around 1pm, shortly after Friday prayers.

“There were two suicide bombers who attacked two military vehicles within the space of 15 seconds,” police official Mohammad Shafiq told reporters in Lahore, according to Reuters.

“The heads of both attackers have been found,” he said.

Up to 95 people were wounded in the blasts, and soldiers were among the dead, he said. Pakistani police officials said the death toll was 39.

The first bomb went off in a military neighbourhood near a mosque, while the second hit military vehicles that arrived at the scene.

TV footage showed a heavy security presence in the area as bystanders helped the injured into ambulances.

Eyewitness Afzal Awan said he saw several people, some without limbs, lying in pools of blood.

“It was a big blast. I saw smoke rising everywhere. A lot of people were crying.”

The blasts struck the RA Bazaar where several security agencies have offices.

There have been five blasts in Pakistan this week, including a suicide car bomb attack on a police intelligence building in Lahore on Monday that killed 13 people, and a shooting and bombing at a US-based aid agency that killed six in the northwest.

The attacks have shattered a period of relative calm in Pakistan, which has been battling al-Qaida and Taliban violence.

The Pakistani Taliban claimed responsibility for Monday’s attack.

Aside from an insurgency at home, Pakistan is under heavy pressure from the US to go after Afghan Taliban militants in border regions.

At least two explosions have hit crowded areas of the eastern Pakistani city of Lahore and killed at least 12 people, officials say.

At least 25 people were also injured in the blasts – one of which hit the RA Bazaar at a busy time.

No group has said it carried out the attack. Lahore has been targeted by bombers several times in recent months.

On Monday at least 13 people died in a suicide attack that destroyed a building used by intelligence services.

Friday’s explosions were reported to be small blasts, but occurred at a busy time during Friday prayers.

They took place in a residential and shopping district where several army and security agencies have facilities.

Reports say gunshots were fired after the first explosion.

Pakistani TV showed security forces being deployed and ambulances rushing to the scene. </p

This article is from the BBC News website. © British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.

By Nick Triggle
Health reporter, BBC News

Adult social care in England is "chronically under-funded" and "severely rationed", MPs say.

The Health Committee warned urgent action was needed and told the political parties to stop their point-scoring and seek solutions instead.

The cross-party group said if politicians failed they would "betray current and future generations".

Ministers are expected to set out their plans for reform of the £16bn system in the coming weeks.

ANALYSIS
Nick Triggle, health reporterThe challenge facing social care is the perennial problem of supply and demand. While the NHS budget doubled in real terms over the last decade, social care funding rose by little more than 50%.

It has created a situation where councils have responded to more and more requests for help by restricting access to services, leaving vulnerable people to decide between struggling along on their own or selling their homes to pay for residential care.

In truth, the social care system was only ever created as a safety net. The expectation was that a large proportion of caring would be done by relatives and friends, but with community and family life now very different from the 1940s that has become less likely.

Politicians have responded by calling for a "partnership" between the state and individuals. That, of course, requires people to dip into their own pockets, creating an explosive issue in the run up to the election.

Social care, which includes support provided by councils to people in their own homes for things such as washing, eating and dressing as well as residential home placements, is now at the top of the political agenda.

Last summer the government put forward three options for change – one of which involved charging people a compulsory levy of up to £20,000, which has been dubbed a death tax by the Tories.

In recent weeks, the row has escalated with the parties launching attacks on each others’ policies.

Two summits have been held in the last month alone, but still no consensus has been reached.

But the committee said it was essential agreement was brokered early in the next parliament so as not to "betray current and future generations".

The report said reform was long-overdue, pointing out it is 13 years since Tony Blair announced changes would be made.

In that time, councils have been placing more and more restrictions on who can get access to care.

Three quarters of the 152 local authorities with responsibility for care now only provide services to those with the highest needs.

Costs

What is more, the means-tested threshold, which stipulates that anyone with assets of more than £23,000 has to pay for their care, was unrealistic, the MPs suggested.

They point out that the actual cost of care on average, certainly of care homes, was much higher.

And without reform, the situation is only going to get worse because of the ageing population, the MPs said.

WHERE THE PARTIES STAND

• Labour – Put forward three proposals – all of which involve the state providing a basic level of care which would be topped up by either personal contributions, a voluntary insurance scheme or compulsory levy. The third option – dubbed a death tax – is said to be favoured by ministers
• Tories – Proposed an £8,000 voluntary insurance model to cover residential care costs. Now drawing up plans for a voluntary scheme to cover domestic care, such as help washing, eating and dressing in the home
• Lib Dems – Initially supportive of free personal care – like Scotland has introduced – but now want a "partnership" whereby state pays some and individual tops this up. Open to compulsory levy

Q&A: Social care

However, they pointed out that the baby-boomer generation will not hit their mid 80s until the early 2030s, creating what they claimed was a "window of opportunity" to improve the system.

Committee chairman Kevin Barron added: "We don’t want this issue to be turned into an election football for it to be kicked back into the long grass again in a few weeks."

And as an interim measure, while the system is being reformed, he said the £23,000 threshold should be raised so that more people could get access to care.

Mr Barron also said general taxation should not be ruled out as a way of funding social care – all the options being considered at the moment involve some state funding, coupled with individual contributions.

Stephen Burke, of Counsel and Care, a charity for older people, said: "This sets out in clear terms why we need reform. The three parties now need to meet the challenge."

Care services minister Phil Hope said a white paper setting out how the system should be changed and funded in the future would be published soon.

He added: "Fixing our system of care for people who are older and disabled is our very highest public service priority." </p

This article is from the BBC News website. © British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.