TOP STORIES
CARTOONS
HMRC GOOGLY
PENSION TAX RAID
IDS IS UNFIT-TO-WORK
BANK LOBBY NOBBLE
3 KINGS, NO GIFTS
SPORTS DIRECT GULAG
FLOODY HELL!
PLAN B, BOMB SYRIA?
ARMS v LIVES
PM AGAINST THE CUTS!
DOCTOR STRIKE
TAX CREDIT ANTHEM
TURKEYS VOTE TORY
FACEBOOK TAX
3m POOR GET POORER
AN ENGLISHMAN'S HOME
BANKS BRIBE TREASURY
PICKING WINNERS
LABOUR v CORBYN
STUDENT GROAN
CORBYNOMICS
BUSINESS BENEFITS
LEFT BEHIND VOTE
DEAD WRONG ON NHS
ANTI-STRIVER OSBORNE
EU'S GREEK HYPOCRICY
BORIS ATTACKS!
GAIA v BIG OIL

Friday, 5 February 2016

Friday, February 05, 2016 Posted by Hari No comments Labels: , , , , ,
KJ and Fee doubt it...
SOURCE GUARDIAN: If having more no longer satisfies us, perhaps we’ve reached ‘peak stuff’
The economy pumps out goods and services, all of which create jobs and incomes. There is no value judgment in such a statement, no view of what constitutes the good life. Even to invite such a question of an economist is to risk ridicule. The task of economists – a value-free quasi-science – is to make sure that as little as possible gets in the way of turning inputs into more outputs. But around the developed world consumers seem to be losing their appetite for more. Even goods for which there once seemed insatiable demand seem to be losing their lustre. Last week, mighty Apple reported that in the last three months of 2015 global sales of the iPhone stagnated, while sales of iPads tumbled from 21m units in 2014 to 16m in the same three months of 2015. In the more prosaic parts of the economy – from cars to home furnishings – there are other warnings that demand is saturated. At a Guardian Sustainable Business debate, Steve Howard, head of Ikea’s sustainability unit, declared: “In the west, we have probably hit peak stuff. We talk about peak oil. I’d say we’ve hit peak red meat, peak sugar, peak stuff… peak home furnishings.” The average western consumers’ home is bulging with all the materials and goods it needs, runs the line. Suddenly, whether more is always the answer is being questioned, not by environmental thinktanks, but by the market. Only in developing countries have consumers the capacity to want more, but as Howard accepted, for that they need buying power, which in turn rests on the global distribution of income and wealth being fairer.



Thursday, 4 February 2016

Thursday, February 04, 2016 Posted by Hari No comments Labels:
Wealthy Tory council publicly warns David Cameron his cuts are 'unrealistic'
East Sussex County Council, a Tory stronghold since its creation, said the Government’s fiscal policy would “significantly reduce the quality of life for many people in East Sussex”. The letter to the PM was signed by Councillor Keith Glazier, who leads the council, and the leaders of the other political party groups in East Sussex: Labour, Liberal Democrat and Ukip group leaders on the council, as well as the leader of the area’s independents group. “The fact that leaders of all parties have put their names to this letter shows that this is an issue which transcends politics,” Mr Glazier said. The local authority has cut more than £78 million since 2010 but has to make further savings of up to £90 million by April 2019, including £40 million from its adult social care budget. This is despite a plan to increase council tax by 3.99 per cent raising £4.7m, the maximum allowed by the Government without holding a costly local referendum. Last November Mr Cameron came to blows with his own local Tory council, Oxfordshire County Council. The Prime Minister was accused of not understanding the impact of his own policies on local services when he claimed the council should be making “back-office savings” and protecting frontline services. Both East Sussex and Oxfordshire’s budget situation comes despite being two of the more wealthy county council in the UK. INDEPENDENT

London's black-cab drivers claim 'Four cabbies pay more tax than Uber'
London’s black-cab drivers are considering court action to try to revoke Uber’s licence to operate in the city, citing the fact that the ride-hailing app firm pays no corporation tax in the UK. It emerged last October that Uber paid just £22,134 in UK corporation tax in the most recent financial year despite making an £866,000 profit. The tax paid related to amounts deferred from previous years when Uber’s UK operation made a loss. An Uber spokesperson said: “The comparisons being made with other companies are misplaced. They are profitable and have been for years. Uber is younger and still investing heavily... We make a loss and corporation taxes are paid on profits not revenues.” John Christensen, co-founder of the Tax Justice Network, said there could be some profit-shifting in the case of Uber that had reduced the group’s UK profits. The firm was able to pay such a low sum partly because it legally transfers profits generated within the UK to its sister company in the Netherlands, where it would be liable for a lower rate of tax. GUARDIAN

Think Help to Buy London will get your first home in the capital? You might need to earn £73k a year
The government’s Help to Buy London helps buyers of new-build homes get onto the property ladder with a deposit of as little as 5 per cent. It tops their deposits up with an interest-free loan of up to 40 per cent of the price of a property. It is available for properties costing up to £600,000 but property listing website Zoopla claims that the average London home costs almost £40,000 more than this - leaving hopeful buyers needing large salaries even if they take on the maximum help available. To buy a £600,000 home - the maximum price under the scheme - a buyer would need to be earning a 'substantial' salary of £73,000, according to Zoopla. It is double the average London salary of £35,000. Their 5 per cent deposit of £30,000 would be topped up with a Government interest-free loan for 40 per cent of the price - the equivalent of £240,000. That would leave them needing to borrow a mortgage of £330,000 - and based on an income multiple of four times wages they would need a £73,000 salary to get that. For a lower purchase price of £350,000, buyers would still need a higher than average salary of £43,000 for a mortgage of £192,500, according to Zoopla. Help to Buy London's deposit assistance doubles that of the original Help to Buy, which provides a 20 per cent interest-free loan for new-build properties. The London scheme offers a bigger loan due to the higher price of property in the capital. The Help to Buy Equity Loan scheme was first introduced by the Government in April 2013 and has been extended until 2021. DAILY MAIL

Universal Credit leaves working families worse off, IFS says
Universal Credit (UC), which combines six benefits into one monthly payment, was intended to be more generous than the current system but the IFS said cuts to the programme meant this would not be the case. But it said UC would encourage people into work and save £2.7bn a year. According to the IFS research, an estimated 2.1 million families will face an average loss of £1,600 a year, while 1.8 million will gain an average of £1,500. Its figures suggest 1.1 million homes with no-one in paid work will lose out by about £2,300 a year, while 500,000 are expected to gain £1,000. Working single parents are said to face an annual loss of £1,000. The new payments system still only affects a minority of claimants, but it is gradually being rolled out across the country. The government has always said that Universal Credit (UC) would encourage more people to find work. The IFS said that was true for most people, but not all. It said that single parents, for example, had less of an incentive to work under UC than under the old system. Where couples are concerned, UC encourages just one of them to find employment, rather than both, the IFS claimed. The government has always said that no individuals will lose money as a result of the changes. New claimants for UC will also be helped by transitional support. BBC NEWS

Bus services being wiped out in England and Wales by cuts
Councils are reducing expenditure on buses by more than £27m over the coming years as a result of government funding being slashed by £78m since 2010, says a study by the Campaign for Better Transport (CBT). The cuts are on a par with the controversial Beeching plans of the 1960s to scale down the rail network, according to the report. People living in Lincolnshire, Derbyshire, Somerset, Dorset, west Berkshire, Wiltshire, Oxfordshire, Hertfordshire, North Yorkshire and Lancashire would be worse affected, the CBT found. Martin Abrams, CBT’s public transport campaigner, said it was a “bitter irony” that many of the bus routes being cut had originally replaced the thousands of rail services Beeching had marked for the chop, leaving more areas without any public transport. Peter Box, the Local Government Association’s transport spokesman, said councils were finding it impossible to keep making up a funding shortfall for the concessionary fares scheme, which is in place for young, elderly and disabled people. He added: “The way the concessionary travel scheme is funded by Whitehall has long been unfit for purpose and has not kept up with growing demand and cost. Unless the government commits to fully funding concessionary fares, vital bus services that support the most vulnerable in our society will continue to come under pressure.” GUARDIAN

Age UK’s promotion of energy deals with E.On to be examined by regulators
The Sun claimed that Age UK recommended a special rate from E.On which would typically cost pensioners £1,049 for the year - £245 more than its cheapest rate in 2015. It also alleged that Age UK received about £41 from energy supplier E.On for every person signed up. Age UK's accounts indeed show that it received £6.3m in income from energy deals in the year to April 2015. But the charity said the commission was typically only £10 per customer. The charity said its two year fixed tariff was the cheapest deal on offer when it launched in January. It said customers were free to choose the one-year option, but many preferred the reassurance of a two-year tariff. The energy regulator Ofgem and the Charities Commission are to examine the deals. BBC NEWS

EU watchdog considers action against "closet" tracker funds
Investors, both consumers and pension fund managers, have long suspected some of the funds that charge them higher fees to scour the market for the best picks may in reality be "closet" trackers that simply mimic the performance of stock indexes. Actively managed funds charge fees that are multiples of those charged by tracker funds. After calls in 2014 from EU investor lobby group Better Finance, the European Securities and Markets Authority (ESMA) studied a sample of 2,600 funds over 2012-2014. The watchdog said it had found that 5 percent to 15 percent of UCITS equity funds could potentially be closet index trackers. It is the latest blow to the asset management sector where regulators are also scrutinising fees at a time cash-strapped governments want people to save more for their retirement. UCITS (Undertakings for the Collective Investment in Transferable Securities) are EU regulated funds touted by Europe as the "gold standard" of mutual funds globally. There are 29,000 UCITS holding 9 trillion euros ($9.8 trillion). Academics have said an actively managed fund should be at least 60 percent different from an index to be genuinely active, and inserting a requirement to disclose the active share metric could be one option for ESMA. REUTERS

Thursday, 28 January 2016

Thursday, January 28, 2016 Posted by Hari No comments Labels: , , ,

SOURCE GUARDIAN: Google expected to reveal growth of offshore cash funds to $43bn
Google is poised to confirm next week that controversial tax structures in Ireland, the Netherlands and Bermuda have boosted its offshore cash mountain to more than $43bn (£30bn), figures from financial analysts suggest. Despite governments around the world promising to crack down on the tech company’s tax avoidance arrangements, Wall Street analysts are confident Google will continue to salt away profits in Bermuda for years to come. Alphabet, Google’s parent company, will report its 2015 earnings next week and is expected confirm that offshore cash funds have grown by about $4bn in just 12 months. Offshore reserves of $43bn, held largely through Bermuda, represent profits from markets outside the US. Of these markets, the UK is the largest, accounting for 17% of non-US sales. But latest published accounts show Google’s UK subsidiary paid just £21m in tax for 2013. Google’s tax structure means income from many major overseas markets – including £4.56bn from the UK – is booked through Ireland. Much of it is then bounced through the Netherlands and back to Ireland and Bermuda. These strategies are known in tax jargon as the “Double Irish” and the “Dutch Sandwich”. Two years ago, George Osborne promised to bring an end the “extraordinary lengths … some technology companies go to to pay little or no tax [in Britain]”, introducing a tax on diverted profits last year. Last week, however, Google reached a long-awaited settlement with HRMC – in which it agreed to pay £130m in back taxes and bear a greater tax burden in future – that effectively sanctioned its continued use of Irish companies to book UK sales. Only a small increase in UK tax must now be paid by Google’s British arm.

SOURCE ITV NEWS: Intimate waxing? Worst tax return expense claims revealed
HM Revenue and Customs (HMRC) has revealed the top five most outrageous personal expenses claims included in last year’s Self Assessment tax returns. The expenses range from furnishing a new flat to the cost of storing Mars bars overnight in a fridge. Here’s the full list of bizarre expenses that some taxpayers have tried, and failed, to claim for:
  • The costs for storing Mars bars overnight in a fridge
  • The cost of a pair of flip flops so I don’t have to walk barefoot between my work’s changing and shower rooms
  • The costs for my intimate waxing
  • I bought a second hand car to get me from home to work so I didn’t have to walk
  • I purchased my own flat, so I need to claim back the money I spent on the furniture.
Ruth Owen, HMRC Director General Of Personal Tax, said: “There are a number of items and expenses that people can claim against, such as genuine business costs and items needed to do a job. But a painful beauty regime or the furniture for your own home are not items that every taxpayer in the country should be contributing towards. It’s wrong that a small minority of people expect the honest majority to subsidise their lifestyle and HMRC will never allow for these to be processed as genuine claims.”


OUR RELATED STORIES:


Thursday, January 28, 2016 Posted by Hari No comments Labels:
Secret deal with regulator OFGEM that lets greedy energy firms hide their obscene profits
Power giants have won a secret battle to hide the scale of the profits they are making by refusing to cut prices. Last April the energy watchdog was bullied into ditching data that show whether households are getting a good deal. These vital figures used to be published monthly. They showed the difference between what power firms were paying to supply energy to your home and what they were charging you on your bill. It was a rough guide to the size of the profits they were likely to make. In the last month before these figures were scrapped, the Big Six energy companies were shown to be charging 9 per cent more than it cost them to provide gas and electricity to households.  This translated into £120 profit per customer, according to regulator Ofgem. But the information was quietly removed. Since then it has been impossible for households to know whether providers are making a fair return.  This is because in the past nine months power firms have benefited hugely as the price of oil has crashed by 54 per cent to a 13-year low of $30 a barrel. In turn, this has slashed the cost of supplying energy to British homes. But the greedy firms have failed to pass on these savings to customers. Just three of the major firms have cut gas prices since April — and by no more than 5.1 per cent. And electricity prices have not budged in two years. In yet another sign that the Big Six are charging too much, smaller companies are using falling oil prices to launch ever-cheaper dual-fuel tariffs. The result is a ballooning gap between the rip-off charges at giant providers and the cheapest deals on the market. We found families can save £405 by switching supplier — a record amount. Providers say they are making less money this year because of the warm winter and have kept prices high to compensate. But experts suspect they are boosting profits while sitting on piles of your cash. And after a major crackdown on the industry was delayed for months,  the energy giants have been left free to profiteer. DAILY MAIL

Tax Dodge: Google expected to reveal growth of offshore cash funds to $43bn
Google is poised to confirm next week that controversial tax structures in Ireland, the Netherlands and Bermuda have boosted its offshore cash mountain to more than $43bn (£30bn), figures from financial analysts suggest. Despite governments around the world promising to crack down on the tech company’s tax avoidance arrangements, Wall Street analysts are confident Google will continue to salt away profits in Bermuda for years to come. Alphabet, Google’s parent company, will report its 2015 earnings next week and is expected confirm that offshore cash funds have grown by about $4bn in just 12 months. Offshore reserves of $43bn, held largely through Bermuda, represent profits from markets outside the US. Of these markets, the UK is the largest, accounting for 17% of non-US sales. But latest published accounts show Google’s UK subsidiary paid just £21m in tax for 2013. Google’s tax structure means income from many major overseas markets – including £4.56bn from the UK – is booked through Ireland. Much of it is then bounced through the Netherlands and back to Ireland and Bermuda. These strategies are known in tax jargon as the “Double Irish” and the “Dutch Sandwich”. Two years ago, George Osborne promised to bring an end the “extraordinary lengths … some technology companies go to to pay little or no tax [in Britain]”, introducing a tax on diverted profits last year. Last week, however, Google reached a long-awaited settlement with HRMC – in which it agreed to pay £130m in back taxes and bear a greater tax burden in future – that effectively sanctioned its continued use of Irish companies to book UK sales. Only a small increase in UK tax must now be paid by Google’s British arm. GUARDIAN

Tesco knowingly delayed payments to suppliers, with sometimes millions of pounds unpaid for years
The Grocery Code Adjudicator, Christine Tacon, said the supermarket seriously breached the industry's code of conduct to protect grocery suppliers. Tesco apologised for the practices, saying they had harmed its suppliers. Tesco remains under investigation by the Serious Fraud Office (SFO) into alleged accounting irregularities. The grocery ombudsman's investigation began in February 2015 following the revelation of an accounting scandal at Tesco. In September 2014 a £250m black hole was found in the company's accounts - a sum later revised up to £326m - because of the way Tesco booked income from its suppliers. Ms Tacon said: "I received internal Tesco emails which encouraged Tesco staff to seek agreement from suppliers to the deferral of payments due to them in order to temporarily help Tesco margins... I also saw internal Tesco emails suggesting that payments should not be made to suppliers before a certain date in order to avoid underperformance against a forecasted margin." Ms Tacon's investigation found that even when a debt had been acknowledged by Tesco, on occasions the money was not paid for more than 12 months, with some amounts taking two years to be repaid, the investigation found. One example involved a supplier owed a multi-million pound sum as a result of price changes being incorrectly applied to Tesco systems over a long period. This was eventually paid back by Tesco more than two years after the incorrect charging had begun. Ms Tacon cannot fine Tesco as she only acquired the power to fine companies after the Tesco investigation began. BBC NEWS

New pension taxes are £5bn/year 'milch cow' for chancellor, says IFS head
George Osborne is using pension taxes as a “milch cow” to pay off the deficit, the head of the Institute of Fiscal Studies has said. The chancellor is expected to announce the results of a Treasury inquiry into tax on pensions in the budget on 16 March. Among the changes being considered is the replacement of variable tax relief on pension contributions with a single, flat-rate of between 25% and 33%, which would cause high earners to lose some of their rebates. Paul Johnson, director of the leading independent thinktank the IFS, said: “The tax regime has been changed and changed again as pension savings have proved something of a milch cow for the current chancellor. “By reducing the amount that can be put in a pension free of tax in any one year and the maximum size of the accumulated pot, he has increased tax revenues by more than £5bn a year.” Johnson said changes to pensions tax relief could cause “the implicit contract at the heart of our pension system [to] buckle under the pressure... Governments of all stripes have recognised that widespread access to good private pensions is an essential part of the implicit deal with the voter — we won’t pay you much of a state pension, but we will make sure you have the chance to save for yourself,” wrote Johnson in the Times. “And at the heart of that deal has been the tax treatment of private pensions. It should go without saying that nobody would tie up hundreds of thousands of pounds in a pension, which they can’t access for decades, if there weren’t some benefit for doing so compared to saving in some other way. That benefit is tax relief.” Former Conservative leadership hopeful David Davis told the Times that such a move would deter people from providing a full state pension for themselves. “It’s problematic because the pension industry used to be the jewel in the economic crown when it comes to having a population looking after themselves.” GUARDIAN

NHS staff cuts: Number of mental health nurses falls 10%
Figures from the NHS’s health and social care information centre, obtained through a parliamentary question, show that the number of qualified nurses working in psychiatry dropped by 10.8% from 41,320 in 2010 to 36,870 in 2015. The figures raise questions about the funding of mental health services, whether NHS workforce planning is delivering enough of the staff needed and the former coalition government’s repeated pledge to introduce “parity of esteem” in the NHS treatment received by patients with mental health problems compared to those with physical ailments.
The sudden drop comes at time when more and more people are seeking mental health treatment from the NHS. Official figures show that the number of people in contact with NHS mental health services has surged by as much as 40% over the same period. Other RCN research from earlier this month, showing that London hospitals had 10,000 nursing vacancies, found that NHS mental health trusts were among those worst affected by the shortage of nurses. The South London and Maudsley trust, England’s largest specialist provider of mental health care, has 440 vacant nursing posts, representing more than one in four (26%) of its total complement of nurses. Similarly, the West London mental health trust is short of 242 nurses – 22% of its headcount. Meanwhile, student nurse bursaries are being abolished as part of the Department of Health’s (DH) plan to boost NHS England’s budget by £8bn by 2020-21 by cutting the budgets of non-frontline NHS organisations such as Health Education England (HEE), which looks after staff training and education, and Public Health England. Forcing would-be nurses to take out student loans will save £650m a year from HEE’s budget by 2018-19 and ultimately £1.2bn a year by 2020-21. GUARDIAN

Appeal court rules bedroom tax discriminatory in two cases
The bedroom tax has been declared unlawful by the appeal court due to its impact on vulnerable individuals, dealing a significant blow to the work and pensions secretary, Iain Duncan Smith. Judges ruled that in two cases – those of a victim of extreme domestic violence and grandparents of a severely disabled teenager – the government’s policy amounted to unlawful discrimination. The first case involved A, a single mother living in a three-bedroom council house fitted with a secure panic room to protect her from a violent ex-partner. The other was brought by Paul and Sue Rutherford, grandparents of Warren, who is seriously disabled child and who needs overnight care in a specially adapted room. In both cases, the claimants faced a cut in housing benefit because they were deemed to be “under-occupying” the additional rooms which were classified as spare. A government spokesman said: “We know there will be people who need extra support. That is why we are giving local authorities over £870m in extra funding over the next five years to help ensure people in difficult situations like these don’t lose out.” But the ruling heaps pressure on the government over the bedroom tax, which the Labour party has vowed to abolish. A DWP evaluation of the policy published last month found that it it was not meeting its key aim of freeing up larger council properties Just one in nine affected tenants were able to avoid the tax by moving to a smaller property. GUARDIAN

G4S paid to look after empty beds at scandal-hit Medway youth jail
The security firm G4S is being paid for looking after empty beds in a secure training centre (STC) that is the focus of allegations of widespread abuse by staff, the Guardian has learned. The company has received over £260,000 since the abuse story broke. The Youth Justice Board (YJB), which oversees the detention of young people in England and Wales, said that 47 children are detained at Medway STC in Kent. But G4S is being paid to look after the full capacity of 76. Following the allegations, the YJB announced it would stop sending children to Medway. Earlier this month, a BBC Panorama investigation revealed footage, taken by an undercover reporter working as a guard at Medway, in which children were being assaulted by staff, who later boasted about the abuse to colleagues. Staff were also seen talking freely about falsifying records of violent incidents. Under STC rules, if more than two children are fighting, it is classified as staff losing control of the centre and G4S faces heavy fines. Footage showed a guard saying: “If we get an incident with four kids, it will get split up so they, G4S, don’t get fined.” G4S runs England’s three STCs – Medway, Oakhill in Milton Keynes and Rainsbrook in Northamptonshire. But following a damning inspection report last year, the contract to run Rainsbrook was taken away, although the company is in place until May when MTCnovo will take over. The inspection at Rainsbrook found children had been subjected to degrading treatment and racist comments from staff. Six members of staff were dismissed. In 2014, 14 children who had been unlawfully restrained in STCs run by G4S and Serco were awarded damages amounting to £100,000. Neither company admitted liability but paid two-thirds of the damages. The remaining third was paid by the YJB. GUARDIAN

Friday, 22 January 2016

Friday, January 22, 2016 Posted by Hari 2 comments Labels: , , , ,
KJ, Chris and Fee come to terms with it all...

SOURCE GUARDIAN: Pension taxes are 'milch cow' for chancellor, says IFS head
George Osborne is using pension taxes as a “milch cow” to pay off the deficit, the head of the Institute for Fiscal Studies has said. The chancellor is expected to announce the results of a Treasury inquiry into tax on pensions in the budget on 16 March. Among the changes being considered is the replacement of variable tax relief on pension contributions with a single, flat-rate of between 25% and 33%, which would cause high earners to lose some of their rebates. Paul Johnson, director of the leading independent thinktank the IFS, said: “The tax regime has been changed and changed again as pension savings have proved something of a milch cow for the current chancellor. “By reducing the amount that can be put in a pension free of tax in any one year and the maximum size of the accumulated pot, he has increased tax revenues by more than £5bn a year.” Johnson said changes to pensions tax relief could cause “the implicit contract at the heart of our pension system [to] buckle under the pressure”. “Governments of all stripes have recognised that widespread access to good private pensions is an essential part of the implicit deal with the voter — we won’t pay you much of a state pension, but we will make sure you have the chance to save for yourself,” wrote Johnson in the Times. “And at the heart of that deal has been the tax treatment of private pensions. It should go without saying that nobody would tie up hundreds of thousands of pounds in a pension, which they can’t access for decades, if there weren’t some benefit for doing so compared to saving in some other way. That benefit is tax relief.” Former Conservative leadership hopeful David Davis told the Times that such a move would deter people from providing a full state pension for themselves. “It’s problematic because the pension industry used to be the jewel in the economic crown when it comes to having a population looking after themselves.”

OUR RELATED STORIES:

Tory promises of "Low Tax, High Pay" has given us higher taxes & lower pay. See the stats

Is your Cost of Living crisis over?! Average wages are still back where they were 10 years ago

Graphs at a glance: Budget 2014 document shows we’re growing through borrowing. Again. That's why Britain needs a pay rise


Thursday, 21 January 2016

Thursday, January 21, 2016 Posted by Hari 1 comment Labels:
Oil price crashes, but Big Six energy firms failed to pass on massive savings to consumers
The Big Six energy firms have been accused of overcharging consumers by the watchdog. Ahead of the results of an eagerly-anticipated Competition and Markets Authority investigation, Ofgem chief executive Dermot Nolan yesterday told the BBC: “The market is not working as competitively as it should be.” He was reacting to growing anger about energy giants’ not passing on large cuts in wholesale prices to consumers. A report from comparison site Energyhelpline showed that wholesale gas prices dropped 51 per cent while electricity prices fell 33 per cent over the last two years. "This could have been passed through as price cuts of around 25 per cent on gas and 11 per cent on electricity for UK households, yet all customers have seen is an average of 5 per cent off gas bills and nothing off electricity bills," pointed out Mark Todd from the comparison site. In fact British Gas was the only big six energy giant to reduce prices when wholesale costs fell last summer, and then it was just 5 per cent off gas bills. The other big six firms firms EDF, E.on, Npower, Scottish Power and SEE decided against passing on any savings to their customers. INDEPENDENT

“Smash and grab raid”: Holland & Barrett accused of squeezing its suppliers
In a letter this month, seen by the BBC, the high street retailer says it wants a reduction of costs of at least 5% from all its suppliers. It also wants suppliers to pay for £3m worth of security tags and CCTV. The Forum of Private Business (FPB) has described it as a "smash and grab raid" on the supply chain. Ian Cass, Managing Director of the FPB, said: "Many of their suppliers are small firms who have helped the retailer increase their margins and have been unable to put up prices themselves over the last few years... Sometimes it is helpful to suppliers to offer discounts to retailers in return for product placement or increased marketing of their products, which is beneficial to both parties, but this needs to be agreed by both sides, not a unilateral decision as in this case." Holland and Barrett is owned by the American private equity company, The Carlyle Group, and has 735 shops in the UK and Ireland. Last year its profits increased by 12% to £146m. In its letter, the company said that it increased turnover thanks to a range of new initiatives and internal investment but that suppliers were not contributing proportionately to the growth of the business. The letter has been greeted with dismay and anger by one small supplier, who did not want to give his name for fear of losing his contract. "What they will gain is a 5% increase in profits and dividends for their shareholder for nothing. What they have done to their suppliers is abhorrent," he said. The (FPB) said it would be writing to the company to make clear its concerns. It has a hall of shame of other companies it has accused of mistreating suppliers. Companies include Carlsberg, Mars, Halfords, GlaxoSmithKline, Debenhams, Premier Foods, Monsoon and many others. BBC NEWS

IMF says refugee influx could provide EU economic boost
The recent influx of refugees into Europe is likely to raise economic growth slightly in the short term – mainly in Austria, Germany and Sweden – and could deliver a bigger long-term economic boost to the EU if refugees are well integrated into the job market, according to the International Monetary Fund. The number of asylum seekers arriving at EU borders is unparalleled in recent times – in the first 10 months of last year, 995,000 first-time asylum applications were submitted to EU countries, more than twice the number over the same period in 2014, the 50-page report said. The fund said this is likely to result in a “modest increase in GDP growth” in the short term, due to higher state spending on housing and benefits for asylum seekers, as well as a boost to the job market from the newcomers. GDP in the EU as a whole could be lifted by 0.05%, 0.09% and 0.13% in 2015, 2016 and 2017 respectively. The IMF estimates the largest impact in Austria, with GDP rising by 0.5% by 2017, followed by Sweden (0.4%) and Germany (0.3%). In the long run, the economic impact could be larger, but will depend on the integration of refugees into the labour market. Assuming this is successful, by 2020 the level of GDP could be 0.25% higher for the EU as a whole, and between 0.5% and 1% higher in Germany, Austria and Sweden. “Rapid labour market integration is key to reducing the net fiscal cost associated with the current inflow of asylum seekers. Indeed, the sooner the refugees gain employment, the more they will help the public finances by paying income tax and social security contributions,” the report said. The IMF noted that the Swedish introduction programme, which includes language training, employment preparation and basic knowledge of Swedish society, has helped refugees achieve high rates of employment, although it is a lengthy process. Confounding widespread fears, the IMF said most immigration studies showed that the effect of new arrivals on domestic workers is usually small, possibly because they are in different segments of the job market or because of a rise in investment in response to a sudden surge in workers. Enrica Detragiache, one of the report’s lead authors, said: “By and large the negative effects tend to be short-lived and temporary.” GUARDIAN

Balfour Beatty admits liability, pays £137k to whistleblower over dodgy £18.5m public contract
Nigel McArthur, from Devon, claimed he was hounded out by his bosses after he made a protected disclosure about an £18.5m office building project in Cardiff. The Welsh government awarded a contract to Balfour Beatty to construct a building in Callaghan Square as part of a regeneration on a vacant site. The project was later halted but the firm was paid about £600,000 for work carried out. The whistleblower said the firm's true sub-contract costs had been hidden, and raised its profit margins from an agreed 3.3% to 7.34%. Pre-construction manager Mr McArthur, 56, from Exmouth, said he reported his findings to his line manager but "was told that he should not have investigated the costs or alternatively that he should not be concerned about it". His solicitor, Terry Falcao, of Stephens and Scown, said the claim was brought in February 2015, and was met with denials until last November, just two weeks before a full five-day hearing was due. The company paid £137,000 before the case was due to be heard at a tribunal. Balfour Beatty admitted liability with the caveat that it had not carried out criminal activity or breached legal obligations. It said it regretted that it "failed to properly support our employee following concerns they raised". It added it also "provided full disclosure to the Welsh Assembly who were satisfied with our approach". The Welsh government did not comment. BBC NEWS

NHS funding is falling further behind European neighbours' average
The UK is devoting a diminishing proportion of GDP in health and is now a lowly 13th out of the original 15 EU members in terms of investment, according to research by the King’s Fund. Ministers highlight that they are giving the NHS in England an increasing share of overall government spending, ringfencing its budget and handing it annual increases totalling £8.4bn in real terms by 2020-21, despite very tight public finances. But the Kings Fund’s chief economist Prof John Appleby also found that the government’s decision to increase the NHS’s budget by far less than the anticipated growth in GDP meant the service would miss out on what would have been an extra £16bn by 2020. The latest OECD data shows that the UK spent 8.5% of its total GDP on healthcare in 2013, though that includes a small amount of private spending, such as private medical insurance. “This placed the UK 13th out of the original 15 countries of the EU and 1.7 percentage points lower than the EU-14’s level,” Appleby said, referring to the EU 15 without the UK. “If we were to close this gap solely by increasing NHS spending, and assuming that health spending in other UK countries was in line with the 2015 spending review plans for England, by 2020-21 it would take an increase of 30% – £43bn – in real terms to match the EU-14’s level of spend in 2013, taking total NHS spending to £185bn.” GUARDIAN


62 richest people own as much as half of the world's population put together
Oxfam's publication also reveals that the wealthiest one per cent, around 73million out of the 7.3bn people in the world, now own the same as everyone else put together. As recently as 2010, the combined wealth of the 388 richest people was needed to equal that of the poorest half of the world, but that number has since plummeted to 80 last year and 62 now. The total wealth of the poorest half of the world fell by a trillion US dollars (£694bn) since 2010 even though the actual number of people in this group rose by 400 million, said the report, “An Economy for the 1%”. Meanwhile, the wealth of the super-rich 62 rose by more than half a trillion dollars over the same period to 1.76 trillion (£1.22trn). This equates to an average of around £20 billion for each of the 62. Although the number of people living in extreme poverty halved between 1990 and 2010 globally, the average annual income of the poorest 10 per cent has increased by less than three dollars (£2.08) a year over the past 25 years. Globally, the super-rich are estimated to have a total of 7.6trn dollars (£5.3trn) stashed in offshore accounts, depriving governments around the world of 190bn dollars (£132bn) in tax revenues each year, said the report. As much as 30 per cent of all African financial wealth is believed to be held offshore, costing 14 billion dollars (£9.7bn) in lost tax revenue each year - enough to save four million children's lives a year through improved healthcare and employ enough teachers to get every African child into school. The new findings have been released ahead of the annual World Economic Forum (WEF) of global political and business leaders in Swiss ski resort Davos. Nine out of ten WEF corporate partners have a presence in at least one tax haven and it is estimated that tax dodging by multinational corporations costs developing countries at least 100 billion dollars (£69bn) a year, said Oxfam. Corporate investment in tax havens increased almost quadrupled between 2000 and 2014. DAILY MAIL

Apple may owe $8bn in back taxes after European commission ruling
Apple may owe $8bn in back taxes from its use of potentially illegal tax shelters in Ireland. This is not the first time Apple has been investigated for its accounting practices in Ireland. Executives including Cook appeared before the US Senate in 2013 to testify about whether it had renegotiated Ireland’s 12.5% corporate tax rate down to 2%. The company denied any wrongdoing. Matt Larson, litigation analyst for Bloomberg Intelligence, calculates that the company would owe $8.02bn at that rate. The European commission has been cracking down on US companies trying to negotiate sweetheart deals with individual EU member nations for the last several years. Starbucks’s operations in the Netherlands and Amazon and McDonald’s in Luxembourg have all been subject to similar investigations. The commission found that Starbucks owed Dutch authorities upwards of $22m, and a ruling from Belgium this week determined that 35 companies across the EU owe the equivalent of $760m in back taxes. Apple has already said it would appeal against a ruling against the company; CEO Tim Cook called the investigation “political crap.” GUARDIAN

Excessive pension exit fees to be capped, says government
The Treasury has confirmed that "excessive" exit fees charged by some pension providers will be banned. The precise level of the cap will be set by the Financial Conduct Authority (FCA), after a public consultation. The chancellor, George Osborne, told the House of Commons that as many as 700,000 people faced such penalties. "The government isn't prepared to stand by and see people either being ripped off or blocked from accessing their own money by excessive charges," he told MPs. The Treasury said that 66,000 people over the age of 55 face currently face charges worth more than 10% of their pension pots. Since April 2015 anyone over the age of 55 has been free to withdraw as much money as they like from their pension pot (subject to income tax). But such investors are being advised to consider holding back on withdrawals until the reforms are in place. However, it could be as much as two years before the new law is passed. Pensions minister, Baroness Altmann, said that such policies would never have been sold, had customers understood the hefty exit penalties. "In some cases these penalties can run to hundreds or even thousands of pounds," said Tom McPhail of Hargreaves Lansdowne. Baroness Altmann has previously said that up to 40% of a pension's value can be lost in all the different fees applied over a lifetime’s saving. BBC NEWS

Thursday, 14 January 2016

Thursday, January 14, 2016 Posted by Hari 1 comment

SOURCE INDEPENDENT: DWP fit-to-work assessments cost more money than they save
The study by the National Audit Office (NAO) found that the Department for Work and Pensions is handing over £1.6bn over the next three years to private contractors who carry out the controversial health and disability assessments. But at the same time, the Government’s own financial watchdog has warned that savings in benefits payments are likely to be less than a billion pounds by 2020 as a result of the new tests. The NAO report also found: The cost of carrying out each employment and support allowance (ESA) test had risen from £115 to £190 after the controversial outsourcing firm Atos pulled out of its contract to run the tests last year; Benefit claimants are still waiting for more than six months before they are assessed during which time they are not entitled to full payments; None of the companies carrying out the tests met the Government’s own quality assessment threshold – with reports including spelling mistakes and unintelligible acronyms. The report found evidence that ministers set completely unrealistic targets for the number of ESA assessments that could be carried out each year. As a result, there is a backlog of at least 280,000 new claims while ministers have been forced to suspend plans to carry out periodic reassessments of those already claiming the benefit. The report also found significant problems with the American outsourcing company Maximus which took over the contract to carry out ESA assessments from Atos. Only half of all the doctors and nurses hired to carry out the assessments completed their training against a target of 95 per cent, while average staff costs rose from £26,000 in 2014 to £44,000 last year. Over the summer the company was carrying out just 37,000 face-to-face assessments a month compared with a target of 57,000. It had carried out 10,000 fewer paper assessments than it had promised the Government.


Thursday, January 14, 2016 Posted by Hari No comments Labels:
Lawyers fees and legal aid cuts block access to justice, warn top judges
In a stark message, the Lord Thomas of Cwmgiedd, the Lord Chief Justice, said bringing legal action – or, alternatively, defending oneself against litigation – has become “unaffordable” for most people. It has led to ever-growing numbers of people representing themselves in court because they cannot afford a lawyer, which leads to delays and further inefficiency in the system, he said. In his annual report, Lord Thomas referred to a study published earlier this week by Lord Justice Briggs, a Court of Appeal judge, which concluded that some of the blame could be “laid at the door of the legal professions.” Lord Justice Briggs said: “The single, most pervasive and intractable weakness of our civil courts is that they simply do not provide reasonable access to justice for any but the most wealthy individuals, for that tiny minority still in receipt of Legal Aid, for those able to obtain no win no fee agreements with their lawyers, for the few who obtain free advice and representation, and for substantial business entities. “To any rational observer who values access to civil justice, this is a truly shocking state of affairs." Last June Michael Gove, the Justice Secretary, said lawyers who have "done very well" financially could be compelled to give up their time for free to shore up the less well-funded areas of law. Mr Gove said: "When it comes to investing in access to justice then it is clear to me that it is fairer to ask our most successful legal professionals to contribute a little more rather than taking more in tax from someone on the minimum wage... If we are going to have effective access to justice then we need to ensure that those who have done well out of our justice system contribute more.” TELEGRAPH

Tory bill could cost UK nearly 200,000 council houses, warns Labour
A proposal to force councils to sell their highest value homes, as well as the impact of increased discounts for council tenants granted the “right to buy”, will result in the loss of one in every eight council properties, according to the shadow housing minister John Healey. He said the homes could be snapped up by overseas investors and buy-to-let landlords rather than people in housing need. “Rather than running down the number of much needed affordable homes, ministers should be investing more homes to rent and buy,” said Healey, who was housing minister in Gordon Brown’s government. The government has pitched its housing reforms as a major boost for the construction of homes to buy rather than rent, arguing that is what the majority of the population wants. Its initiatives include 13,000 directly commissioned new homes and a £1.2bn grant to help private housebuilders clean up brownfield land and build 60,000 new homes for sale, half for buyers under 40. On Monday, David Cameron announced a £140m redevelopment programme for Britain’s sink estates, which he described as “concrete slabs dropped from on high, brutal high-rise towers and dark alleyways that are a gift to criminals and drug dealers”. The scheme will include demolition of some estates and he said tenants and homeowners will be given binding guarantees that their right to a home is protected. The policy is partly based on analysis by Savills, the property consultancy, which found that more and better homes can be created if 1960s-style estates are demolished and replaced by new housing with conventional layouts. But Labour believes that the government’s parallel demand, that town halls sell off their most valuable council homes to fund the extension of the right-to-buy scheme to tenants of housing association properties, will combine with the existing decline in council housing numbers to see around 40,000 council homes disappear annually. There were 1.8m council homes in 2009 but that will drop to 1.4m by 2020 according to estimates by Labour with the House of Commons library. GUARDIAN

£1.6 billion: DWP fit-to-work assessments cost more money than they save
The study by the National Audit Office (NAO) found that the Department for Work and Pensions is handing over £1.6bn over the next three years to private contractors who carry out the controversial health and disability assessments. But at the same time, the Government’s own financial watchdog has warned that savings in benefits payments are likely to be less than a billion pounds by 2020 as a result of the new tests. The NAO report also found: The cost of carrying out each employment and support allowance (ESA) test had risen from £115 to £190 after the controversial outsourcing firm Atos pulled out of its contract to run the tests last year; Benefit claimants are still waiting for more than six months before they are assessed during which time they are not entitled to full payments; None of the companies carrying out the tests met the Government’s own quality assessment threshold – with reports including spelling mistakes and unintelligible acronyms. The report found evidence that ministers set completely unrealistic targets for the number of ESA assessments that could be carried out each year. As a result, there is a backlog of at least 280,000 new claims while ministers have been forced to suspend plans to carry out periodic reassessments of those already claiming the benefit. The report also found significant problems with the American outsourcing company Maximus which took over the contract to carry out ESA assessments from Atos. Only half of all the doctors and nurses hired to carry out the assessments completed their training against a target of 95 per cent, while average staff costs rose from £26,000 in 2014 to £44,000 last year. Over the summer the company was carrying out just 37,000 face-to-face assessments a month compared with a target of 57,000. It had carried out 10,000 fewer paper assessments than it had promised the Government. INDEPENDENT

Ofwat blamed for high water bills by overestimating water companies' costs
A report from the Public Accounts Committee (PAC) said the water regulator Ofwat regularly overestimated companies' financing and tax costs when setting price caps. The PAC said this meant the companies had made windfall gains of at least £1.2bn between them. Household water bills averaged just under £400 per year last year. Ofwat came into being to oversee the 18 privately owned companies that supply separate areas with water and sewerage services after the service was privatised in 1989. They currently operate as local monopolies but the government has announced plans to free the market for limited competition between suppliers by the end of this parliament in 2020. PAC chairwoman Meg Hillier said: "Ofwat was set up to protect the interests of customers, most of whom have no choice over who supplies their water yet must pay bills typically running to hundreds of pounds.” BBC NEWS

'Sell everything!' Dire warning from Royal Bank of Scotland as fears mount that markets are set for new crash and oil could plunge to $10 a barrel
The bank told investors stock markets could fall 20 per cent this year as it urged them to sell with a stark warning, saying: 'In a crowded hall, exit doors are small. Risks are high.” The horrifying warnings follow a torrid start to the year on financial markets, with billions of pounds wiped off stocks in the UK and elsewhere. London's top stock index saw £85billion wiped off its value after tumbling 5.3 per cent last week, during what is being dubbed the worst start to a New Year ever on world markets. A string of banks including Barclays, Bank of America Merrill Lynch and Societe Generale have slashed their 2016 oil forecasts this week, while Standard Chartered cautioned that the price could plummet to $10 a barrel. The slump in oil prices has coincided with turmoil on global financial markets as the slowdown in China and higher interest rates in the US knock fragile confidence. RBS warned that it could be a punishing setback for savers with pensions and other investments tied up in shares. A 20 per cent fall in stock markets would wipe more than £300billion off the value of Britain’s biggest companies. In its note to clients, RBS warned that ‘this all looks similar to 2008’ when the collapse of US banking giant Lehman Brothers triggered the global financial crisis. The RBS analyst advised investors to switch their money out of risky assets such as shares and into the safety of government bonds. DAILY MAIL

London help-to-buy scheme to launch in February
Help to buy London is an extension of the equity loan scheme that has been available to buyers around the country since April 2013, which doubles the amount of money being offered from 20% of a property’s purchase price to 40%. While mortgage rates are still at record lows and lenders are increasingly willing to offer loans to first-time buyers, high house prices in the capital have locked many out of the market. To meet affordability checks and qualify for mortgages, borrowers have had to raise increasingly large deposits. Data from Halifax published on Monday showed the average first-time buyer in London spent £367,990 in 2015, while the average deposit was £91,409. To spend the same amount with a 40% loan the same buyer would need a deposit of just£18,399. The extension, which was announced in the chancellor’s autumn statement, will be available to buyers of new properties in Greater London costing up to £600,000. As under the existing scheme, borrowers will need to be able to raise a deposit of at least 5%, and to qualify for a normal mortgage. They will also have to show that they can afford interest payments on the government loan when the five-year interest-free period ends. Funding for the scheme comes from the £8.6bn budget set aside to extend the help to buy equity loan scheme from April 2016, when it was originally due to end, to March 2021. By the end of September 3,548 households had used an equity loan to buy properties in the capital, and the government said more than 10,000 more could benefit from the new scheme. Developers have been among the biggest beneficiaries of the help-to-buy scheme, reporting big demand for homes through it. The scheme has its critics. Campbell Robb, the chief executive of housing charity Shelter, said: “What we need to tackle the housing crisis in London isn’t more gimmicky schemes that are only available to higher earners, but investment in genuinely affordable homes.” He added: “To solve the housing crisis for the long term, both central government and the mayor need to prioritise building homes that people on low or average incomes can actually afford to rent or buy... Without this, millions of Londoners on ordinary incomes will continue to be stuck in unstable, expensive private renting.” Housing expert Henry Pryor said it would stoke demand and house prices in London. “First introduced as a measure to encourage house builders to take off the tarpaulins off their moth-balled sites and get building again after the 2007-8 crash the initiative has worked well with more homes being built but the byproduct is toxic - higher prices that require even more help to buy,” he said. “Results from the quoted developers illustrates who is really being helped and a London version of the scheme is wrong both from a moral and practical perspective. There are no work-shy builders in the capital, in fact we need more sites to satisfy demand.” GUARDIAN

Tuesday, 12 January 2016

Tuesday, January 12, 2016 Posted by Hari No comments Labels: , , , , , , , ,
Wage restraint has been tough. In March 2015 the Chief Secretary to HM Treasury announced:

"Our teachers, doctors and armed forces do a wonderful job serving the people of this country. Pay restraint has been very difficult for many, but has helped us to protect vital public service jobs while we deal with Britain’s deep financial problems.

The independent pay review bodies have worked hard to bring forward a balanced and affordable set of recommendations that delivers on our commitments to increase pay by around 1% and deals with particular pressures. The government is grateful for their work and I am pleased that we are able to accept their main recommendations.

The government has accepted in full the recommendations for the following workforces who will receive an average of a 1% pay increase:
  • Armed Forces
  • independent contractor GPs and dentists
  • Prison Service
  • teachers
  • senior military
  • judiciary"

Happily for some the doom and gloom did not spread everywhere.

From 31st July 2015 MPs pocketed a 10% payrise, their pay going up from £67,060 to £74,000 per annum (backdated to the General Election in May 2015). 

Perhaps you remember all those MPs shaking their heads and shooting out their lips protesting that the payrise was a disgrace in these times of austerity? According to the website Donate My Payrise 74 out of the 650 MPs pledged to hand over the extra cash to charities. The website helpfully gives links to the individual MPs’ public statements, so you can check what your MP did or didn't say.

A report in October 2015 by the Sun newspaper stated in fact only 26 MPs had actually done so. [Subsequent to the Sun report the SNP chimed in saying their MPs too would donate their rises to charity, but hadn't at that time decided to which ones]. 

Asked what David Cameron would do with his payrise, the Sun reported Cameron’s spokesman would only say:
“The PM has been explicitly clear since the very start that he does not agree with this pay increase.”

Which may remind you of Cameron's response when asked whether he benefited from the "millionaire's tax cut" in 2013. Cameron was asked by Stephen Pound MP, during Prime Minister's Questions of February 13th 2013 : 

"Q12. [142834] Stephen Pound (Ealing North) (Lab):  will [the Prime Minister] tell the House whether he will personally benefit from the millionaires’ tax cut to be introduced this April?

The Prime Minister: I will pay all the taxes that are due in the proper way. "

There is a spooky similarity between Cameron's statement and that of the Starbucks and Google bosses when they were being grilled by a parliamentary select committee on multinationals tax dodging shenanigans:
Tax avoidance

"we strive to follow the letter of the law and have done so in the case of our tax obligations. All taxes owed to the UK have been timely and fully paid"
Mr.Troy Alstead, Starbucks

"We pay all the tax you require us to pay in the UK."
Mr.Matt Brittin, Google

Could it be Cameron, Starbucks and Google share tax advisors? Surely not!

The Government is not simply turning a blind eye to the predicament of the less well off. Iain Duncan Smith's Department for Works and Pensions (DWP) showed enough concern to commission a report on the impact of the Bedroom Tax: "Evaluation of Removal of the Spare Room Subsidy". This report found that three quarters of those affected tried to make ends meet by cutting back on food and clothing. The report also states that even among people not affected by the Bedroom Tax (referred to in the report as the "comparison group"): 56% cut back on food and 62% cut back on clothing. Which is not so surprising when, acccording to OECD figures, the UK has one of the highest proportions of workers on low pay in the developed World:



Duncan-Smith, thoughtful chap that he is, waited until the day MPs broke up for Christmas holiday, on 17th December 2015, before publishing the report. So as not to spoil their mood as they scampered off to spend their 10% payrise on presents and other festive stimulants. You can't say our Government isn't sensitive and caring.


Share This

Follow Us

  • Subscribe via Email

Search Us