Friday 30 November 2012

Friday, November 30, 2012 Posted by Hari 2 comments Labels: , , , ,
Fee and KJ are just trying to help...

Thursday 29 November 2012

Thursday, November 29, 2012 Posted by Jake No comments Labels:
Iain Duncan Smith’s Work Programme 'worse than doing nothing'
The new £5bn scheme for finding work for the long-term unemployment is worse than not helping them at all, official results suggest. In its first year just 2.3% of people who enrolled in the scheme got jobs for six months or more. But according to the government’s own calculations, 5% of the long-term unemployed can find jobs for six months if left alone to do so. The long-term unemployed experience the greatest difficulty in finding work. TELEGRAPH
(“Please help. Another year’s past and still my CV has nothing worthwhile on it. No wonder everyone thinks I'm useless,” said one Secretary of State for Work and Pensions.)

Criminal tax evasion flourishing with help from UK firms
A flourishing industry which helps people evade UK tax has been exposed following an undercover investigation by the BBC's Panorama programme. Companies involved include Atlas Corporate Services, Turner Little, and Readymade Companies Worldwide, who said they will now tighten up their procedures and provide staff with further training. BBC NEWS
(Lesson 1: How to spot a hidden camera in a bag. That is all.)

UK 'could face austerity until 2018'
The chancellor may have to extend the squeeze on public spending until 2018 if the recent deterioration in growth prospects and tax receipts turns out to be permanent.The Institute for Fiscal Studies said George Osborne may then have to find another £11bn from tax rises or spending cuts, or miss one of his fiscal targets for 2015. BBC NEWS
(If picking up an MP's salary after the next election is his other fiscal target, he's gonna miss that one too!)

Increasing numbers of working people live in poverty
The Joseph Rowntree report calls for the government to "give up the belief that welfare reform" is the solution and focus instead on the phenomenon of in-work poverty. 4.4m jobs pay less than £7/hour. The report also shows that graduate unemployment, at 17%, is as high as it is for everyone else. Britain risks creating a "better educated workless population". GUARDIAN
(How do we get the unemployed to understand that it’s all their own fault? Send them to university first. It's all starting to make sense!)

Tuesday 27 November 2012

Tuesday, November 27, 2012 Posted by Hari No comments Labels: , , , , , ,
...but Cameron shouldn't worry...

Sunday 25 November 2012

Sunday, November 25, 2012 Posted by Jake 1 comment Labels: , ,
We at Ripped-Off Britons generally spend our time exposing rippers-off. For a change we want to put in a good word for a pack of ruthless ravaging ripping-off locusts. The good (consumer groups), the bad (bankers), and the ugly (the British Bankers Association (BBA)) have all condemned claims management companies, accurately stating that they charge a packet to do what Britons can easily do by themselves for free. But we are in good company in valuing the services of these insects. After all locusts have been deployed by no higher an authority than God himself to rescue his people:

“If you refuse to let them go, I will bring locusts into your country tomorrow. They will cover the face of the ground so that it cannot be seen. They will devour what little you have left after the hail, including every tree that is growing in your fields.”

God sent the plague of locusts to persuade the pharaoh to release Moses and his people from slavery in ancient Egypt. Even His people can’t have welcomed their arrival, as they would have been the first to lose their rations in any ensuing famine. But it was a price worth paying as the locusts, along with a series of other nastiness, got them out of slavery. If only Pharaoh had been more reasonable it would never have been necessary. Pharaoh brought the locusts onto himself, his country, and his victims. The plague of claims management companies has been brought on by the actions of the banks and the inactions of the courts and regulators. 

Locusts are far from the first choice solution for the banks' Payment Protection Insurance (PPI) thieving. However considering the alternative choices it becomes apparent that Claims Management Companies are the worst possible option except that of doing nothing and letting the banks keep the money:

Friday 23 November 2012

Friday, November 23, 2012 Posted by Hari 1 comment Labels: , , , , ,
...Chris, Fee and KJ aren't surprised to learn 'legal loan sharks' will again target hard-up families this Christmas...

Thursday 22 November 2012

Thursday, November 22, 2012 Posted by Hari No comments Labels:
Government stalls on payday loan regulation despite 'legal loan sharks' targeting hard-up families at Christmas
Ministers have postponed considering regulating payday lenders until next summer despite a rapid expansion of high-cost lending and firms targeting borrowers over the Christmas period. Research shows 5 million adults are considering taking a payday loan in the next six months - a 50% increase since this time last year. Payday lenders have told the government that the voluntary code is already working, making stiffer regulation unnecessary. DAILY MAIL
(“The voluntary code requires that we trade honestly, responsibly and treat customers with respect. And that is what we do,” said a man with a baseball bat and a Rottweiler.)

'Zombie businesses': One in three businesses is losing money
The Bank of England's latest Inflation Report estimates that 30.6% of firms are losing money. If the historically low base rate of 0.5% is raised they will be tipped over the edge. 'Zombie businesses' are those that survive only because the banks are reluctant to pull the plug on them and cause massive job losses. DAILY MAIL
(...and 'Zombie governments’ are those that survive only because the electorate are reluctant to pull the plug on them because the last lot were even worse.)

More than one in 10 shops standing empty

New data has revealed that 11.3% of the UK's retail space is now standing empty. The highest vacancy rate was in Northern Ireland, where one fifth of retail space was empty. This was followed by Wales, where 15.1% of retail space was unused, with the North & Yorkshire region in third place, with a vacancy rate of 14.6%. TELEGRAPH

'Second home' expenses: MPs allowed to hide details

More than 50 MPs have been allowed to censor details of their taxpayer-funded expenses claims after insisting that information about their second homes could compromise their security. They fear this sensitive information may fall into the hands of terrorist and hostile foreign governments. TELEGRAPH
(...and taxpayers.)

Tuesday 20 November 2012

Tuesday, November 20, 2012 Posted by Hari No comments Labels: , , , , ,
...and why not?...

Sunday 18 November 2012

Sunday, November 18, 2012 Posted by Jake 2 comments Labels: , , , , ,
If you fine someone far less money than what they made from the scam in the first place, you are giving them a clear signal to do it again. Here is a typical example.

The FSA imposed a "record fine" on CPP, who describe themselves as a provider of "Life Assistance products designed to make life less stressful". A penalty that CPP has accepted.

The greatest scandal is not what CPP got up to, but the FSA's performance in this debacle. What CPP did is typical of what financial services companies do: mis-sell (PPI; Mortgage Endowments; Personal Pensions; Interest Rate Swaps...).

Don't blame a dog that is trained to bite when it does bite - blame the trainer. The FSA has been training the financial industry for years that the penalties of biting their customers will be a tiny fraction of their profits. CPP is just the latest case in point, showing that even in the final months before the FSA is closed and replaced in 2013 it is determined to live down to its abysmal reputation. We sincerely hope that the FSA is being closed, though rather fear it is being cloned into its 'replacement' the spookily similarly named Financial Conduct Authority (FCA). After all, financial companies are among the most generous donors to political parties, and the most extravagant lobbyists (£92 million was spent by finance industry on lobbying in 2011).

The FSA’s “record fine” imposed on CPP exposes a number of nasty facts. None  nastier than the fact that the total stated penalty was less than 3% of the money taken by CPP selling the products in question. All the following facts are extracted from the FSA’s judgement. The two products CPP was punished for were Card Protection and Identity Protection. Each was sold as insuring you against the costs of fraudulent use of your card or your identity.

1)      Sales and Fines
The FSA imposed a “record fine” of £10.5 million. CPP also "estimates that around £14.5 million will need to be paid to affected customers" (presumably this small amount is because CPP assumes most customers won't claim - unless the claims handling companies get in on the act!!)  Sounds a lot? Well, that would depend on how much CPP made from selling these products. According to the FSA judgement:

“The principal sales failings which the FSA has identified relate to the period from 14 January 2005 to March 2011. During this period:
  • CPP sold 4.4 million Card Protection and Identity Protection policies and received £188.3 million in customer payments
  • CPP renewed 18.7 million Card Protection and Identity Protection policies and received £656.5 million in customer payments
  • CPP generated gross profits of £354.5 million and net profits of £79.1 million.
A £10.5 million fine, and £14.5 million compensation bill? But CPP took £844.8 million in customer payments. The FSA punishment was just over 1% of sales, and compensation amounted to less than 2% of sales.

Saturday 17 November 2012

Saturday, November 17, 2012 Posted by Hari No comments Labels: , , , , ,
Chris and Fee despair...

Saturday, November 17, 2012 Posted by Jake 3 comments Labels: , , ,

By Ann Pettifor and Douglas Coe
At their annual meeting in Tokyo this year, IMF economists destroyed the case for austerity. While their analysis constituted a small part of a routine report – the World Economic Outlook  - and was technical in form, the devastating impact of their conclusions could not be ignored by the media. These IMF conclusions are of the greatest possible importance and must not be allowed to be lost with the passage of time. We are concerned that they should be fully understood by the public at large.
IMF economists have finally acknowledged what politicians have long denied. They have shown that austerity policies implemented by politicians and demanded by financial markets are severely damaging to what economists define as ‘growth’. Ultimately, argues the IMF, these policies are self-defeating. As most thinking people now recognise, rather than repairing the broken and bankrupt economies of the world, austerity is making matters worse.

The IMF’s analysis goes further: it shows that Plan B is not only feasible, it is essential. 

Thursday 15 November 2012

Thursday, November 15, 2012 Posted by Jake No comments Labels:

Commons speaker John Bercow accused of trying to rig MPs' expenses watchdog
John Bercow has been accused of the rigging in “revenge” for its crackdown on what MPs can claim. In the latest revelation last month the Telegraph revealed 27 MPs were legitimately claiming expenses to rent homes in London even though they owned London properties themselves, which they rented out. At least eight MPs are either letting properties to, or renting from, another MP! TELEGRAPH
(Ooh, look! Someone's set up a tent in Parliament Square. In protest?... no, it's just Foxtons.)

Water companies pay little or no tax on huge profits
Thames Water, Anglian and Yorkshire Water are among companies paying little or no corporation tax while executives pocket huge bonuses. Meanwhile, Thames Water is seeking taxpayer support for a £4.1bn project to build a new 'super sewer' under the Thames. A Thames spokesman said: "We are structured in an efficient way in accordance with the tax system and the benefits from this flow through to Thames Water customers". GUARDIAN
(...he said through a 7.2 metre wide concrete pipe that once used to be his mouth.)

Energy price rigging 'could account for at least 50% of bill rises'
Experts believe the rigging could have an impact on the steeply rising bills for consumers and businesses. Five of the big six companies have raised bills again recently, all saying it’s due in part to rising wholesale energy prices. But following evidence from a whistleblower, the FSA and OFGEM are investigating massive rigging of the £300bn energy market. Stricter regulation and prosecutions are threatened. GUARDIAN
(...but won’t happen, or our great nation will lose its place as the global leader in rigging international markets!)

Banks will always blow themselves up, so live with it - regulator warns 
However, acceptance that banks will fail does not mean the taxpayer cannot be protected. “Too big to fail” banks should be forced to pay “penalties or taxes to create insurance funds” to cover the costs of a major bank collapse “and to create an economic incentive for the firms to downsize”. In the face of continuous and severe criticism, the RBS boss pleaded that banks “don’t deliberately make themselves unsafe.” TELEGRAPH
(“...drunk drivers don’t deliberately hit pedestrians, drug dealers don’t deliberately cause lethal overdoses, and dodgy builders don’t deliberately make houses collapse,” he didn’t add.)

Wednesday 14 November 2012

Wednesday, November 14, 2012 Posted by Hari 2 comments Labels: , , , ,
Cameron grills his Energy Secretary, Ed Davey...

Sunday 11 November 2012

Sunday, November 11, 2012 Posted by Jake 6 comments Labels: , , , , ,
The way it should be
We surely must admit the years before the bust were good. We had money to spend and things to buy. We had jobs to make the things we bought with the money we earned. Money, in the words of the old song, made the world go round. It was a result of our spending that companies grew, profited, invested, and employed us. So what went so horribly wrong?

Those halcyon days were like being at a great restaurant where the Maître d'  served us excellent steak at knock down prices. We were satisfied, the restaurant was profitable, all seemed excellent. But when we pushed our chairs back intending to get up we fell over. 

It took our collapse to realise the horrible truth. The restaurant was serving us steaks sliced from our own legs. The good times were paid for by money borrowed on our own houses and credit cards. When we got up with no meat left on our legs (nor any equity left in our houses) we collapsed. The banks and the World economy crashed too. 

As the graph below, by the Resolution Foundation, shows in the years up to the 2008 bust only the highest paid 20% were actually saving. The rest were funding their spending with debt.
The great rip-off of the boom years, and the ultimate cause of the bust, was that the profits of our spending were not being shared. The borrowing figures in the graph above show it. The stagnant wages of the 90% in the graph below show it. The distribution of wealth in the Bank of England graph at the bottom of this post shows it. 

When will we learn this lesson? And who are the "we" that need to learn the lesson?

Friday 9 November 2012

Friday, November 09, 2012 Posted by Hari No comments Labels: , , , , , ,
Can KJ get Fee to compromise on her principles, just a little...

Thursday 8 November 2012

Thursday, November 08, 2012 Posted by Jake No comments Labels:
All in this together? Boomtime in the boardroom as top bosses enjoy 27% pay rises
The average director in Britain’s top 100 companies saw their total earnings jump by 27%, despite pay and bonuses being cut. The report found top bosses are still coining it in thanks to share windfalls from previous years. MIRROR

Almost one in three MPs aren't paying staff a Living Wage
According to the Commons watchdog, 181 of 650 MPs are failing to pay all their staff the minimum "living wage" rate which was raised this week to £7.45/hour (£8.55 in London). MIRROR
("At least I gave my interns free laptops," said Denis McShane, sacked this month for falsifying his MP's expense claims for such things as, errr... free laptops.)

Pension pots to plunge under new rules
Millions of savers will see the predicted value of their retirement pots plunge by almost 40% after the financial regulator, the FSA, ordered pension firms to cut their growth forecasts due to the global economic slowdown. The FSA said unrealistically high growth forecasts gave savers the “false impression that they are likely to get huge returns”. TELEGRAPH 
(“But that’s the only way we get anyone to buy these pensions,” said roomfuls of unhappy pension salesmen.)

Barclays facing record $470m fine in US for rigging energy market
Barclays suffered another huge blow to its reputation yesterday as America's main energy regulator said it wants to fine the bank a record $470m (£292m) for rigging the Californian electricity market. INDEPENDENT
(All of a sudden the UK's human rights-breaking extradition agreement with the US looks worth preserving for a little while longer...)

HSBC warns it could be fined more than £1bn in the US and face criminal prosecutions over illegal money-laundering
The bank said that it had yet to reach an agreement with US regulators on the ultimate size of the fines following accusations it had handled money that derived from Mexican drug cartels and rogue nations such as Iran and Sudan. TELEGRAPH

Monday 5 November 2012

Monday, November 05, 2012 Posted by Hari No comments Labels: , , , , , , , ,
Both Cameron and Miliband have voiced support in the past. All it needs is the political will...

Saturday 3 November 2012

Saturday, November 03, 2012 Posted by Jake 7 comments Labels: , , ,
"The price of this financial crisis is being borne by people who absolutely did not cause it…..Now is the period when the cost is being paid, I'm surprised that the degree of public anger has not been greater than it has."
Mervyn King, Governor of the Bank of England, March 2011.

Post Credit-Crisis austerity has been about taking less from the wealthy, and taking more from everyone else. Income tax cuts for the rich; wage freezes, pensions and benefits cuts for the rest. 
Office of National Statistics Living Costs and Food Survey

Consumption taxes, like VAT, have gone up hitting ordinary Britons harder than the wealthy. Why harder? Because ordinary people spend all they earn to pay their bills, while the rich have surplus income to save. You don't pay consumption tax on what you don't consume. In this post, we reveal data from the Paris School of Economics that show how the 90% had their share of the boom stolen. The same 90% who are now made to endure austerity to pay for the bust.

The business and political elites tell us we must celebrate massive pay and bonuses for the elite for our own sakes. They tell us we must cut top rate income tax, we must not impose a wealth tax, we must allow tax avoidance loopholes for individuals and companies. All because if we did not it would hurt all us ordinary Britons. 

They reassure us that it is for our sake that energy companies hike prices, for our comfort that pension companies take up to 50% of our savings in fees, and it is to give us free banking that banks charge us extra. Which coincidentally generate the profits to pay the massive bonuses and pay for the elite we should be celebrating. We are told we ordinary Britons would be worse off if these were not so.

But is this actually true? The lie is exposed by comparing how the income shares of the elites in France and in Britain have changed. 

France and Britain have in recent history done about the same in terms of GDP (see graph at bottom of this post). Using Purchasing Power Parity (PPP), which shows the actual buying power of their money, in 2011 British GDP per person was US$36,500 while the French was US$35,200 per person. A difference in sterling of £2.50 a day. 

Britain and France: two nations, both alike in dignity as well as GDP. But between 1981 and 2006 British elites sucked up income ten times faster than the French elite. And the lower 90% of Britons saw their share drop five times faster than the equivalent group of Frenchman.
  • Top 0.1%: in France share increased by 40%; in Britain share increased by 362%
  • Top 1% : in France share increased by 18%; in Britain share increased by 222%
  • Bottom 90%: in France share dropped by 3%; in Britain share dropped by 16%
The assertion by the rich that giving more to the rich makes us all richer is a lie. France managed equivalent growth in national GDP without the soaring inequality that has happened in the UK. No need for many more words, just see the graphs: 
Saturday, November 03, 2012 Posted by Hari No comments Labels: , , , ,
...And Chris's banker chum is man enough to admit it...

Friday 2 November 2012

Friday, November 02, 2012 Posted by Jake 4 comments Labels: , , , , ,
More evidence that benefits subsidise business comes from the report by Queen Mary University of London.

The London Living Wage is calculated by the Greater London Authority's "Living Wage Unit", set up by Boris Johnson as Mayor of London in 2005. Boris Johnson stated in the 2011 report:

"The functioning of our great city relies on the work of many who carry out its essential functions on a daily basis – from office cleaners to care-workers in social services. It is right that their skills and commitment to London’s success are recognised, and one of the most fundamental ways of doing this is to ensure that all Londoners are paid properly.  That means receiving at least the ‘London Living Wage’, which is designed to provide a minimum acceptable quality of life."

Thursday 1 November 2012

Thursday, November 01, 2012 Posted by Jake No comments Labels:

Occupy protesters were right, says Bank of England official

The anti-capitalist protesters who occupied St Paul’s Cathedral were both morally and intellectually right in its attack on the international financial system, said senior Bank of England official Andrew Haldane. The movement’s “tent city” occupied the grounds of St Paul’s for more than three months. The protest ended after the Corporation of London, home to the UK’s major banks, had them evicted, claiming that the protesters were despoiling the cathedral’s grounds. TELEGRAPH
(“Those dummies! Had they despoiled the whole world and thrown it into a global recession, we’d have given them one of our big fancy buildings to live in,” said the Corporation of London.) 

Trainee teachers will face tougher entry tests
Education Secretary Michael Gove wants more rigorous tests to select trainees, in order to raise standards. But the National Union of Teachers criticised Gove for raising entry requirements while at the same time advocating that academy schools should be free to employ unqualified teachers. The proposed tests will assess the candidates' ability to solve problems, recognise patterns, think laterally, evaluate and analyse issues. BBC NEWS
(“If we’d had this sort of testing to screen every Education Minister over the last 30 years, we wouldn’t be in the mess we’re in now,” said every teacher in the land.)

London "tax dodge" inquiries by foreign governments rise by 18%
Overseas governments have intensified their pursuit of their own tax dodgers who hide in the UK. The global crackdown on tax evasion is picking up pace. In recent years legislation designed to fight terrorism and money-laundering has made it easier for countries to share information on tax affairs. Pinsent Masons, the law firm, said "The expertise of London in wealth management makes it a stable 'haven' for individuals looking to protect their assets from political or economic instability overseas." GUARDIAN
( “Political or economic instability”?? Surely “the taxes their honest hard working fellow citizens pay all the time.”)

Bob Diamond should explain Libor role in court, says judge

Guardian Care Homes (GCH) claims that Barclays mis-sold it a complex interest rate swap product based on Libor (the key interbank interest rate). Earlier this year major banks were caught rigging Libor rates, which affect transactions worth trillions of dollars worldwide. The landmark legal case will also determine which other firms can claim banks mistreated them. The judge warned Barclays against any attempt to undermine the trial, in which the bank will have to disclose 1.2m Libor-related emails. GUARDIAN
("Oops, sorry. I just deleted them all," said a Barclays executive.)

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