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Tuesday, 18 April 2017

Tuesday, April 18, 2017 Posted by Hari No comments Labels: , , , , , , , ,
KJ and Fee know who and what is to blame...

In safe seats odds are firmly stacked against any voters looking for change. The average constituency last changed hands between parties in the 1960s, with some super safe seats having remained firmly in one-party control since the time of Queen Victoria. That means, at every election, the majority of seats can be predicted because of Westminster’s broken First Past the Post electoral system. As consituencies are small and only elect one MP, rival parties often don’t stand a chance of winning in hundreds of seats across the UK. Even if they have significant support it counts of nothing if they lose. As the loss of safe seats is rare, parties target their resources on a small number of floating voters in marginal seats – meaning they give up on millions of voters across the country. Four weeks away from the 2015 election we could predict the results for over half of the total constituencies.

OUR RELATED STORIES:

More votes shifted left than right at GE2015. That's where the Labour party needs to be. See the stats

It's constituency boundaries wot won it: The Tories won more swing seats. But more people shifted their votes left

Apathy? Since the 1970s Brits vote less. But they take part in community, charity and civic activities more

British Election Study shows UKIP voters are well to the left of the Tories and even the LibDems

Every democracy, including ours, needs a left and a right party. Politicians who shift too close to their opposition are putting their careers before the nation

Most MPs vote the way they're told by the party. Many have second jobs earning tens of thousands. Half sit in safe seats they never lose. It's tough being an MP!

British Social Attitudes Survey: Tories & Labour are losing their core supporters

In 1997 the percentage of young people not voting shot up. Under 55- year-olds too

Since 1979, Labour or Tory, inequality rose whilst economic performance remained the same

"It's the economy, stupid" means the economies of individual families, not just UK Plc

Hope you didn't vote for anyone who helps pump up house prices

Lest we forget: all policies are pointless unless the banks are reined in


Thursday, 13 April 2017

Thursday, April 13, 2017 Posted by Hari No comments Labels:
Google accused of being 'less than transparent' after revealing latest UK tax payments
The search giant said in its UK accounts that it had made sales of £1 billion - despite declaring a figure of over £5 billion to US officials. In Google's US accounts for 2016 the company said it made sales of $7.8 billion in the UK - which is £5.65 billion at current exchange rates. That means it paid just £36.4 million in UK corporation tax on pre-tax profits of £148.8 million - much less than if the full £5.65 billion of turnover had been put through the UK. It is the result of a legal loophole which means some sales are recorded via Ireland where the revenue is untouchable by the UK taxman. Tax expert Richard Murphy, a Professor of Practice in International Political Economy at City, University of London, told ITV News: "What this implies is that £4 in every £5 that Google sells in the UK is not subject to UK tax, and as the accounts note, this is with the full agreement of our tax authority." He added: "The implications are big. Google is reporting profits in its UK accounts of £149 million, or roughly £15 for every £100 of sales it does actually record here. But if, as its US accounts imply, Google should be recording five times more here than it does then the profit in the UK would logically be at least five times higher too. And in that case so too would the tax payment be bigger. And that’s why this matters." The company has faced mounting pressure over its tax affairs amid a backlash against corporate tax avoidance by multi-national companies. Google agreed to a controversial £130 million deal with HM Revenue & Customs in January last year to settle a 10-year tax inquiry into its UK business. Labour's Shadow Chancellor John McDonnell tweeted: "It seems Hammond and May are more interested in cutting Google’s taxes than making them pay their fair share.” A Google spokesman said: "As an international business, we pay the majority of our taxes in our home country, as well as all the taxes due in the UK.” ITV NEWS

Benefits Cap reduces thousands to 50p-a-week housing benefit
A Panorama survey of hundreds of councils shows at least 67,600 homes in England, Scotland and Wales have lost some money due to the new welfare cap. The cap is £23,000 in London and £20,000 in the rest of the country. More than 7,500 of those households have all but entirely lost their housing benefit and instead receive a nominal 50p a week. They have to be in receipt of some housing benefit in order to be eligible to apply for discretionary housing payments, a special government fund set up for those particularly affected by the cap. The cap is part of the government's drive to get unemployed people back into employment by cutting out-of-work benefits. The amount of money above the limit is taken from either housing benefit or Universal Credit. Alison Garnham, chief executive of the Child Poverty Action Group, said: "Removing people's housing benefit basically means that people can't afford their home, so it puts people at risk of homelessness. "It also means that they have to use money that's intended to buy food for their kids and for their other living expenses - this has to be used to plug the hole in their rent." Where someone finds work - 16 hours a week for single parents, 24 hours for a couple - their benefits are reinstated, and research suggests about 5% of those affected by the cap have returned to work. But Ms Garnham said about 80% of those affected cannot be expected to work as they are sick or have very young children. BBC NEWS

Lloyds to pay £100m to victims of HBOS Reading fraud as FCA reopens probe
The bank has already written off about £250m of fraudulent loans made in the scandal, which in February saw six people, including two former HBOS employees, being jailed for a combined 47 years and six months. It now expects to spend a further £100m reimbursing customers who suffered “economic losses, distress and inconvenience” because of the fraud at HBOS’s Reading office in the years before the financial crisis. In a further blow, the Financial Conduct Authority (FCA) also announced that it had resumed a probe that it had suspended in early 2013 while Thames Valley Police conducted its own six-year investigation into the scam, which resulted in this year’s convictions. The scam was carried out at HBOS’s division in Reading which handled small businesses that had run into trouble and took place between 2003 and 2007, before Lloyds rescued the bank with a disastrous takeover in 2009 during the financial crisis. It involved bribery with sex parties, luxury holidays, expensive watches and cash to refer companies that were HBOS clients to a consultancy firm called Quayside Corporate Services (QCS). The troubled businesses were then asset-stripped by QCS. The £100m provision taken by Lloyds will surprise investors because the bank, which is just under 2pc-owned by the taxpayer, had recently been playing down the amount of compensation it expected to pay. It had initially estimated that about 50 customers had been embroiled in the fraud but because others have come forward it now believes between 70 and 100 clients could have been hurt by the scam. TELEGRAPH

Libor: Bank of England implicated in secret recording
A secret recording that implicates the Bank of England in Libor rigging has been uncovered by BBC Panorama. The 2008 recording adds to evidence the central bank repeatedly pressured commercial banks during the financial crisis to push their Libor rates down. Libor is the rate at which banks lend to each other, setting a benchmark for mortgages and loans for ordinary customers. The Bank of England said Libor was not regulated in the UK at the time. The recording calls into question evidence given in 2012 to the Treasury select committee by former Barclays boss Bob Diamond and Paul Tucker, the man who went on to become the deputy governor of the Bank of England. Libor, the London Interbank Offered Rate, tracks how much it costs banks to borrow money from each other. As such it is a big influence on the cost of mortgages and other loans. In the recording, a senior Barclays manager, Mark Dearlove, instructs Libor submitter Peter Johnson, to lower his Libor rates. He tells him: "The bottom line is you're going to absolutely hate this... but we've had some very serious pressure from the UK government and the Bank of England about pushing our Libors lower." Banks have already been fined more than £6bn for allowing submitters to be influenced by requests from traders or bosses to take into account the bank's commercial interests, such as trading positions. Chris Philp MP, who sits on the Treasury committee, said: "It sounds to me like those people giving evidence, particularly Bob Diamond and Paul Tucker were misleading parliament, that is a contempt of parliament, it's a very serious matter and I think we need to urgently summon those individuals back before parliament to explain why it is they appear to have misled MPs. It's extremely serious." BBC NEWS

Struggling credit card holders could see fees and charges waived
The Financial Conduct Authority (FCA) has announced a raft of measures to help people in persistent credit card debt, including waiving or cancelling interest and charges if customers cannot afford to curb their liabilities through a repayment plan. The watchdog found that 3.3 million people have fallen into a persistent credit card debt spiral, where all their money is spent on repaying interest, while the total debt is never lowered. Debt campaigners welcomed the announcement, but warned that the proposals do not address the fundamental question of how credit cards trap people in “persistent debt”. Andrew Bailey, chief executive of the FCA, said credit card companies are reluctant to intervene to help these customers because they are profitable business. Persistent debt can be very expensive – costing customers on average around £2.50 for every £1 repaid – and can obscure underlying financial problems. Because these customers remain profitable, firms have few incentives to intervene. The proposals drawn up by the FCA would force firms to contact customers and ask them to make faster repayments if they are struggling with persistent debt. Those customers that remain in debt for another year-and-a-half would then be put on a repayment plan. However, customers could have their card suspended if they fail to respond, or can make the repayments but refuse to do so. Credit card holders that cannot afford any of the options would be offered even greater help from firms, such as cutting or waving their interest or charges. GUARDIAN

Credit Suisse embroiled in major global tax evasion investigation
In a fresh blow to Switzerland’s attempts to clean up its reputation for banking secrecy and tax evasion, the Netherlands is leading a coalition of five tax authorities conducting a criminal investigation into undeclared “black” accounts and money laundering. Raids on homes and offices took place across the Netherlands and France on Thursday and Friday. Taxpayers and high ranking bank employees in Britain, Germany and Australia are under investigation. Dutch prosecutors acted after receiving a tip-off on assets hidden within “offshore accounts and policies”, estimated in the millions of euros. They say the information concerns a single Swiss bank, but have so far declined to name the target. However, Credit Suisse confirmed on Friday that its offices in London, Paris and Amsterdam had been searched by local authorities concerning “client tax matters”, and that it was cooperating with their inquiries. The action has prompted fresh calls for an end to Swiss banking secrecy. If proven, evasion on this scale would amount to a “global criminal enterprise”, one tax expert said. The raids sparked a diplomatic row between Switzerland and the Netherlands, with officials in Geneva furious at what they claim was a deliberate decision to keep them in the dark. Two arrests have been made in the Netherlands, where the haul of assets seized from safes and homes in the Hague and other areas included property, cash, 35 paintings worth €1.2m (£1m), a luxury Mercedes, and a 1 kilogram gold ingot. The country’s Fiscal Information and Investigation Services (FIOD) has reportedly been handed the names of 3,800 account holders and details of 55,000 accounts by a Dutch informant. Dozens of Dutch taxpayers are under investigation. More actions would follow in the coming weeks, the agency said in a statement released on Friday. France announced that 25 customs agents had carried out raids across the country as part of an inquiry into “aggravated money laundering and financial fraud” which began on 26 April last year. Investigators have found “several thousand” bank accounts opened in Switzerland by French taxpayers who are suspected of having failed to declare them to the authorities. Alex Cobham, chief executive of Tax Justice Network, said: “Allegations of laundering and tax evasion on this scale would, if proven, indicate the bank was effectively a global criminal enterprise.” GUARDIAN

Travel websites ticked off over 'misleading' claims
Websites that show bargain prices for flights, hotels and other travel bookings, are not giving customers accurate information, say European consumer protection authorities. The first price shown was often much lower than the final price, they said. Some offers that look too good to be true, are - because when you click to buy they aren't available. The Consumer Protection Cooperation body said the 235 websites that they had identified would be required to correct the problems. If websites failed to comply, national authorities could pursue legal proceedings, it said. Key findings: In one third of cases the first price shown was not the same as the final price to pay; In one fifth of cases promotional offers were not really available; In nearly one third of cases the way the total price was calculated was not clear; In one quarter of cases prompts on scarcity (eg "only 2 left") only applied to availability on that particularly website, which wasn't made clear. The CPC screened the sector in October 2016, covering 28 European countries. It checked a total of 352 sites, including ones offering to book accommodation, transport tickets and car rental. Some were price comparison websites. It also found that over a fifth of the sites it looked at presented consumer reviews in an unclear way, sometimes throwing doubt over their truthfulness. BBC NEWS

MPs urge crackdown on excessive pay to rebuild public trust in business
Among their wide-ranging recommendations, the MPs’ committee called for a ban on long-term investment plans, complex multi-year pay deals that have been criticised for masking the true extent of huge awards to executives and for encouraging short-term thinking. Responding to the gulf in pay that has emerged between bosses and average workers, MPs on the business, energy and industrial strategy select committee also called on firms to publish pay ratios between top executives and other employees and to put workers on remuneration committees. The MPs urged the government to grant the corporate governance watchdog more powers to hold company directors to account. The committee highlighted revelations that workers at Sports Direct were being paid less than the legal minimum wage and the demise of BHS, which cost 11,000 jobs and prompted MPs to declare that the retailer had been subject to “systematic plunder” by former owners Sir Philip Green, Dominic Chappell and their respective “hangers-on”. It said that gathering evidence for the report, MPs were told by one witness “pay was now so complex that executives themselves do not always understand their own remuneration”. It also heard LTIPs could distort executive behaviour, with chief executives tailoring decisions to affect the share price around the time their shares were due to vest. The MPs’ new report recommended companies establish stakeholder advisory panels, including workers, consumers, and suppliers. It also suggested workers be represented on remuneration committees and for the chairs of those committees to be expected to resign if fewer than 75% of shareholders fail to approve the company’s pay policy. But it stopped short of demanding a worker representatives on boards – something proposed and then watered down by Theresa May last year. The Institute of Directors said that call reflected its own longstanding concerns about the lack of transparency in the governance of unlisted firms. “A code for private companies is supported by two-thirds of IoD members and should be established for the largest firms,” said IoD director general Stephen Martin. The TUC welcomed that and other recommendations. “British people are fed up with the bad behaviour of big business. Workers are getting a raw deal, and our economy is harmed by short-term thinking in the board room. Reform is badly needed, and the government should take up many of the excellent ideas in this report,” said the TUC general secretary, Frances O’Grady. GUARDIAN

Thursday, 30 March 2017

Thursday, March 30, 2017 Posted by Hari No comments Labels:
Debt-binge Britons stick £20m a day on credit cards: Plastic spending soars amid fears of a fresh crisis as we now owe £67 BILLION
Credit card debt is rising at the fastest rate for 11 years amid a dangerous borrowing binge, it was revealed yesterday. Shoppers put another £562million on plastic last month, or £20million a day, Bank of England data showed. British families now owe a record £67.3billion on their credit cards – around £2,500 per household. The 9.3 per cent rise in credit card debt in the last 12 months is the biggest increase since February 2006. The binge has fuelled fears that the UK is heading for another financial crisis. Jack Coy, an economist at the Centre for Economics and Business Research, said debt-fuelled spending has risen to levels ‘worryingly close to those seen around the financial crisis’. The Bank this week began a major review of lending practices in the UK and warned that the scramble to borrow ever-greater amounts of money was now a major risk to the economy. Yesterday’s Bank report also showed total unsecured debt – including credit cards, personal loans and car finance but not mortgages – hit a record £196billion in February. The last time household debt was mounting at such a worrying rate was in 2005 as Britain hurtled towards the worst financial crisis since the crash that triggered the Great Depression of the 1930s. DAILY MAIL

BT broke competition rules, fined £42m over delays to high-speed cable installation
BT has been fined £42m, the largest penalty imposed by regulator Ofcom, and will have to pay an estimated £300m in compensation to rival telecoms companies over delays installing high-speed internet connections. Ofcom found that BT broke rules put in place to stop Openreach, its subsidiary that controls the UK broadband infrastructure network, abusing its “significant market power” by cutting compensation payments to rivals, blaming installation delays on factors beyond its control when this was not the case. BT said it expected to pay out £300m in compensation to rivals including Sky, Vodafone and TalkTalk for the “serious breach” of Ofcom’s rules. Vodafone, which filed the original complaint, had accused Openreach of failing to meet its 30-day installation guarantee but then reclassifying the delay as having been agreed by rivals which allowed it to avoid paying compensation. Rivals have repeatedly called for Openreach, responsible for building and maintaining the tens of millions of copper and fibre lines that run from telephone exchanges to homes and businesses across the UK, to be split from BT. They argue that BT has dragged its heels in opening the network to their engineers, which has hampered their ability to offer homes superfast broadband access. The record £42m penalty, which was reduced from £60m after BT admitted full liability and agreed to pay back rivals, is more than 11 times greater than the previous largest fine levied on a telecoms operator by Ofcom. Last year, Vodafone was fined £3.7m for taking pay-as-you-go customers’ money without providing a service. BT’s fine is more than seven times that of the second largest penalty handed down, the £5.7m ITV had to pay in 2008 over the “abuse” of premium-rate phone lines in a number of hit shows. GUARDIAN

Minister Javid to end 'feudal' rip-off of home leases, that force new owners to pay spiralling annual “ground rent”
Communities Secretary Sajid Javid criticised the ‘practically feudal practices’ of developers who build new houses and sell them as leasehold, forcing buyers to pay a yearly ground rent. He is now planning a clampdown on the sale of such homes under the Government’s Help to Buy scheme, which offers support to first-time buyers struggling to get on the housing ladder. Under the plans, developers could be banned from selling a leasehold house to a buyer using the taxpayer-backed mortgage scheme. Buyers of leasehold homes do not own the property outright, and have to pay an annual fee to the developer or whoever owns the freehold. Some of these ground rents double every decade, meaning that a fee starting at £250 today would be £500 in ten years, £1,000 in 20 years and £2,000 in 30 years. Developers often flog freeholds on to wealthy investors who are attracted by the lucrative income stream. Families can attempt to buy the freehold, but the owner may then hold them to ransom by demanding a huge premium. The spiralling cost of owning a leasehold home can leave some families struggling to make ends meet. And even if they decide to sell up, the very existence of the punishing ground rent – and the cost of purchasing the freehold – makes it difficult or even impossible to find a buyer. The crisis has sparked a fierce backlash from campaigners, who have warned some families are stuck in their homes. Builders have been selling leasehold houses in recent years as they look to turn a profit, first through the initial sale and then by offloading the freehold to an investor. Mr Javid said he had heard ‘all kinds of horror stories’, including homeowners told they could buy their lease for 30 times the ground rent, ‘only to discover the freehold has been sold to a third party who won’t give it up for less than 100 times the ground rent’. DAILY MAIL

Cycle courier wins holiday pay battle
An employment tribunal has ruled that a self-employed courier for the firm Excel was actually "a worker". Cycle courier Andrew Boxer argued he was entitled to one week of holiday pay based on his work for Excel. The tribunal said his claim was "well-founded" and that the firm "unlawfully failed to pay the claimant". The ruling adds more legal weight to claims that some firms in the so-called gig economy are engaged in "bogus self-employment". Mr Boxer launched his claim for £321.16 after he took a week's holiday in March last year for which he was not paid. He had started working for Excel in September 2013. He signed contracts which referred to him as a "contractor" and "sub-contractor". But the tribunal concluded that his contract did not reflect the reality of his working situation. He argued that while at the firm, he was a "worker" as defined by the Employment Rights Act. Under the act, workers are entitled to basic rights including holiday pay and the national minimum wage. His claim was backed by the Independent Workers Union of Great Britain (IWGB). The tribunal heard that Mr Boxer worked approximately nine hours a day for five days a week. He had no opportunity to negotiate his pay rate or to provide someone else to do work on his behalf. According to the ruling, Mr Boxer was asked by the judge if he had ever queried any of the clauses in his contract. He said: "I had no choice, it would not have made any difference, they would have laughed at me if I had challenged a particular clause." Excel did not produce witness evidence or attend the tribunal hearing. The firm initially offered to pay the claim for holiday pay "without acceptance of the validity of the claimant's claim". That was rejected by Mr Boxer. IWGB General Secretary Dr Jason Moyer-Lee said the tribunal's judgement was "yet further evidence of what we have known to be true all along: courier companies are unlawfully depriving their workers of rights. "As the tribunal dominoes continue to fall we would recommend that courier companies which are not yet subject to litigation by the IWGB urgently get their act together." BBC NEWS

Theresa May threatens cap on energy prices following crackdown on rip-off gas and electricity bills
Firms will face limits on the difference in price between their cheapest and most expensive tariffs under plans that will be finalised within weeks. The Prime Minister said that relying on customers to switch energy suppliers to keep prices down was ‘clearly not working’. Prices had risen 158 per cent over the past 15 years, while the vast majority of consumers were on the most expensive tariffs, Mrs May said. The problem surrounds so-called standard variable tariffs (SVTs), which more than 60 per cent of households sign up to. They are up to £300 a year dearer than the cheapest market deals. Millions who have never switched supplier are on an SVT and those on good value fixed-rate tariffs are automatically switched to an SVT when their deal ends. Mrs May said: ‘Energy is not a luxury, it is a necessity of life... But it is clear to me – and to anyone who looks at it – that the market is not working as it should.’ She added: ‘Our party did not end the inefficient monopolies of the old nationalised energy corporations only to replace them with a system that traps the poorest customers on the worst deals.’ DAILY MAIL

Thames Water hit with record £20m fine for huge sewage leaks
The prolonged leaks led to serious impacts on residents, farmers, and wildlife, killing birds and fish. The fine was for numerous offences in 2013 and 2014 at sewage treatment works at Aylesbury, Didcot, Henley and Little Marlow, and a large sewage pumping station at Littlemore. The Environment Agency (EA), which brought the prosecution, said the enormous volume of untreated sewage discharged was unprecedented – 1.4bn litres – as was the length of time over which the discharges occurred. Justifying the huge fine, Judge Francis Sheridan, said: “It should not be cheaper to offend than to take appropriate precautions.”  Describing the breaches as “wicked” and noting the companies “continual failure to report incidents” and “history of non-compliance”, he said: “One has to get the message across to the shareholders that the environment is to be treasured and protected, and not poisoned.” Water companies have been the most frequent polluters of beaches and rivers in England and past fines were criticised as too low to deter these highly profitable companies that often offended repeatedly. But a change in sentencing guidelines in 2014 is now leading to far heavier penalties. Thames Water, which is the UK’s biggest water company and serves about a quarter of the population, was fined £1m in 2016 for repeated discharges of sewage into the Grand Union canal in Hertfordshire and £380,000 later the same year, after a sewage leak in an area of outstanding natural beauty in the Chilterns. The previous record fine was the £2m penalty imposed on Southern Water in December for flooding beaches in Kent with raw sewage, which left them closed to the public for nine days. The EA called that event “catastrophic” and the judge in the case said the company’s repeat offending was “wholly unacceptable”. The company apologised unreservedly, as it had when fined £200,000 in 2013 for similar offences. Water companies have been frequently criticised for making huge profits and awarding large shareholder dividends while paying little or no corporation tax. In October 2015, the National Audit Office found that an £800m windfall for water companies had not been passed on to consumers. Thames Water made an operating profit of £742m in 2015-16 and paid out £82m in dividends. GUARDIAN

Tesco to pay £129m fine over accounting scandal
The penalties relate to Tesco admitting in 2014 that it had overstated profits by £326m. Tesco is to pay out a total of £235m to settle investigations by the Serious Fraud Office and Financial Conduct Authority into the 2014 accounting scandal that rocked Britain’s biggest retailer. It will pay a fine of £129m. The supermarket group has separately agreed with the FCA to pay about £85m in compensation to investors affected by a trading statement on 29 August 2014 that overstated profits. Tesco will also pay legal costs associated with the agreements and said the total exceptional charge was expected to be £235m. The £129m fine is part of a deferred prosecution agreement (DPA) with the SFO. DPAs, which were introduced in the UK in February 2014, allow a company to suspend a prosecution in return for meeting specified conditions, such as paying a fine and demonstrating that its culture has changed. The agreements between Tesco, the SFO and FCA are not an admittance by the company that it or any of its employees committed a criminal offence. The DPA with Tesco follows a settlement with Rolls-Royce in January that saw the aerospace and defence company agree to pay £671m over allegations that it bribed middlemen around the world between 1989 and 2013. GUARDIAN

Sunday, 26 March 2017

Sunday, March 26, 2017 Posted by Hari No comments Labels: , , , , , , , , , , ,
Almost four decades of widening inequality caused Brexit. Who seriously thinks we’d have voted Brexit if low-end wages had risen in line with growing national wealth? If low income workers had been saving, rather than borrowing or going without? Instead, since 1979, the Tories increased inequality. Worse, Labour failed to reverse it. In fact, it crept up further. Immigration and the EU is getting the blame for that poverty. But neither caused it.

Source: Institute for Fiscal Studies http://www.ifs.org.uk/publications/4637
NOTE: The “Gini coefficient” is an internationally used measure of inequality, where zero corresponds with perfect equality (where everyone has the same income) and 1 corresponds with perfect inequality (where one person has all the income, and everyone else has zero income).

Inequality so what? It means we’ve become a nation of borrowers. Since the 1980s the bottom 50% have actually had to borrow money to cover their living costs. As the graph shows, the poorer you are, the more you had to borrow. And before you shout “If you can’t afford it, don’t buy it!” where do you think that huge chunk of the nation’s high street spending is going to come from, that’s paying your wages?! The "Savings Ratio" in the graph shows what percentage of income different groups (the poorest to the richest) save. A negative Savings Ratio means they are borrowing. 





SOURCE: Resolution Foundation report "Gaining from growth: The final report of the Commission on Living Standards"

So, anyone hoping that Brexit voters will change their mind before the EU plug is pulled must therefore pray that inequality gets better. But Chancellor Philip Hammond’s budget is about to make it worse.

Here’s a graph of how incomes changed in the first four years of the “cataclysmically awful” bank bust (2007/8 to 2011/12), overlaid with how incomes will change thanks to Hammond’s budget (2016/17 to 2021/22).

SOURCE: Resolution Foundation report: “Are we nearly there yet? Spring Budget 2017 and the 15 year squeeze on family and public finances”

The lines show household net income growth (i.e. after including tax and benefits, and housing costs) for all working-age households. The poorest are on the left, the richest on the right. The bank-bust brown line shows everyone’s growth was negative, but the poorest suffered least and the super-rich most. Hammond’s blue line shows the poorest will suffer more than anyone has since 2007/8, while incomes will actually grow for the top 50%, the richer the better.

The graph comes from a report by the Resolution Foundation, who said: “the final four years of the current parliament look like being worse for poorer households than the financial crisis period itself.”

And before you accuse the Resolution Foundation of being too lefty, its boss is David Willetts, the Tory peer and former cabinet minister.

Someone needs to tell Hammond that a recovery needs people to spend money. But Hammond’s plan is to give more money to people who will save it, and less to people who would spend it. It’s not going to work. Duh!


What of UK average earnings as a whole? Overall, has the UK got a pay rise yet, since the bank bust? Paul Johnson is the boss of the Institute for Fiscal Studies. The IFS is one of the few research bodies that politicians don’t argue with, such is the robustness of their work. He said: “On current forecasts average earnings will be no higher in 2022 than they were in 2007. Fifteen years without a pay rise. I’m rather lost for superlatives. This is completely unprecedented.”


Unprecedented. The never-ending stagnation has forced commentators to dive deeper and deeper into their tattered history books as every year passes. Yup, this has been the worst recovery for wages since... Napoleonic times!



SOURCE: Resolution Foundation report: “Are we nearly there yet? Spring Budget 2017 and the 15 year squeeze on family and public finances”

The Resolution Foundation report confirms it: “we are on course for average pay across the decade to 2020 to be lower than the average for the decade before. That would represent the worst decade for real earnings growth in 210 years.”

“But Brexit is not simply about inequality and wages. Get real! Plenty of Brexiters just don’t like immigration and the EU.” Sure, but there aren’t nearly enough of them to win a referendum on their own.

Both Theresa May and Philip Hammond voted Remain. Now they are the PM and Chancellor of Brexit Britain. What are they doing to prove their Brexit credentials? By deepening inequality, they ensure the fervour for Brexit never goes away. I guess that’s kind of pro-Brexit.

Thursday, 16 March 2017

Thursday, March 16, 2017 Posted by Hari No comments Labels:
Homeowners 'earn' up to £4k MORE a month from their properties than going to work: Ten places where property inflation makes more than your job
The average rise in house prices is outstripping post-tax earnings in a third of local authority districts, according to the report by Halifax, which highlights the gulf between wages and property inflation that is triggering a property crisis. The biggest gap between house prices and earnings is in London's Haringey, where the average home rose in value by £91,000 more over two years than the median earner living there took home after tax. Haringey, in North London, covers an area that includes parts of Finsbury Park, Wood Green, and Tottenham - all areas not typically considered expensive, but which have seen house prices rise rapidly in recent years. The huge gap there was down to house prices in the area rising by an average of £139,000 in the last two years, while median take-home earnings for those living there were £48,353 during the same period. That is a difference of £91,450, or the equivalent of £3,810 per month, according to the report by Halifax. The figures highlight how even in locations not traditionally considered upmarket, house prices are spiralling beyond the reach of the average family. Across the UK as a whole, property price rises outstripped post-tax earnings in 31 per cent of local authorities, up from 28 per cent in 2015, the report revealed. Yet, while this means that almost 70 per cent of areas at least saw post-tax wages match the rise in house prices, the property problems facing people living there remain substantial. Even in South Tyneside, in the North East, where median net earnings of £39,033 were higher than the £35,709 change in house prices, someone hoping to buy the average home would have had to save all but £3,324 of their post-tax earnings just to match the rise in the cost of the property. DAILY MAIL

Budget 2017: Until 2020s the poorest third will be even worse off than after the financial crisis
The UK is on course for an unprecedented 15 years of spending cuts and lost pay growth the Resolution Foundation said. It will leave the poorest third of households worse off than in the years after the financial crisis, it said. Torsten Bell, director of the Resolution Foundation, said: "Britain is set for a return to falling real pay later this year, with this decade now set to be the worst for pay growth since the Napoleonic wars. Some households will feel the pinch more than others. The combination of weak pay growth and over £12bn of benefit cuts means that for the poorest third of households this parliament is actually set to be worse than the years following the financial crisis." According to its analysis of the Budget, the Resolution Foundation, which says its goal is to improve lives for people on low and modest incomes, predicts that average earnings are only set to return to their pre-crisis peak by the end of 2022. On public finances, it said that despite the downward revision to borrowing forecasts, the UK was only on course to meet the government's objective of eliminating the deficit in 2025. If it does so, that would be 15 years after the previous chancellor, George Osborne, had started implementing spending cuts and raising taxes. BBC NEWS

16,000 families a year forced to live in half-built new homes as developers 'cut corners to hit targets' and boost profits
When Jordan Barker, 34, and his wife Lindsey, 35, were handed the keys to their new Bovis home in March 2015 their hearts sank. The couple, who have three children — aged seven, five and three — paid £465,000 for the four-bedroom house in Reading, Berkshire. But they arrived to find 15 workmen still finishing jobs. The windows were missing in the bathroom and utility room, and someone was replastering the living room ceiling where there had been a leak from the shower above. As the months went on, the couple discovered more problems. The front door lock worked only some of the time, the door needed realigning, the carpet needed relaying and the whole house needed replastering and repainting. In the kitchen dining room, the tiled floor continued under a wall and protruded into the living room. The garden path also hadn't been laid, leaving bare ground littered with rubble, screws and nails. In total, an exasperated Mr Barker found 176 separate 'snagging' faults and was driven to putting up Post-It notes around the house, pointing the builders to each one. It took until last November for the problems to be fixed — 19 months after the family moved in. The Barkers have since received £2,000 as a 'goodwill gesture' from Bovis. As the Mail revealed this week, almost 16,000 families a year are having to move into new-build homes that have not been finished. Many firms have set tough targets to cash in on huge demand — and meet the Government's pledge to build 200,000 new homes a year. Thousands of victims of poor workmanship have formed groups on social media websites such as Facebook, including Taylor Wimpey Unhappy Customers, Avoid Persimmon Homes and Bovis Homes Victims Group. Paula Higgins, chief executive of HomeOwners Alliance, says: 'You have more consumer protection when you buy a toaster. A report by the All-Party Parliamentary Group for Excellence in the Built Environment found more than nine in ten buyers report problems to their builder. Now MPs are privately lobbying the Government to intervene, fearing that standards are falling as builders rake in huge profits. Britain's biggest house builders nearly all reported soaring profits last month. Persimmon reported a pre-tax profit of £783 million for 2016 — a 23 per cent increase on 2015. Barratt Developments saw a 20.7 per cent rise to £682.3 million, Bellway a 36.5 per cent rise to £492 million, Redrow a 35 per cent rise to £140 million and Taylor Wimpey a 21.5 per cent rise to £733.4 million. DAILY MAIL

Weak pound has turned UK companies into 'sitting ducks' as US and Asian giants circle to buy our biggest firms
US and Asian firms will continue to circle the UK's largest companies as sterling's slump and the resilience of the UK economy lays fertile ground for deals, a report has suggested. Andrew Nicholson, the firm's head of M&A, said: 'International buyers emerged as a real force to be reckoned with towards the end of last year, as overseas trade acquirers - most notably those from the US and Asia - acted opportunistically to take advantage of a weakened sterling.' In July last year Japan's Softbank agreed to acquire ARM Holdings, the giant UK semiconductor firm that supplies part of the chip design used in Apple iPhones, in a deal worth more than $32billion. Shortly after popular flights website Skyscanner was bought by Chinese giant Ctrip.com in a deal worth £1.4billion - another UK tech star to fall into the arms of a Far East owner. The deals made a mockery of Prime Minister Theresa May's plans to allow government to intervene in purchases in sectors that are important to Britain. On taking power she had said her government would be keeping a close eye on foreign takeovers. The Office for National Statistics said there was 227 inward M&A worth £187.4billion over the period - its highest annual value on record. Sanjay Thakkar, KPMG's UK head of deal advisory, added: 'Couple brimming war chests with low interest rates, a favourable debt market, a relatively benign economic climate and a desire amongst corporates to disrupt, and it's no coincidence that we have seen a plethora of bids - some successful, some otherwise - hit the headlines since the turn of the year... We foresee this to be just the start, and that 2017 could well end up being a landmark year for deal-making.' DAILY MAIL

Private rents set to rise by 20% in five years: Poorer households being pushed out of the market, warn experts
People on low incomes and housing benefits are being pushed out of the UK's private rental market as rents soar, a survey by the Royal Institution of Chartered Surveyors revealed. A third of respondents to RICS' latest survey said access to private rented properties had fallen among those on housing benefits. Sean Tompkins, chief executive of RICS, said: 'In the current climate, it can be hard enough for young professionals to make ends meet. But for those on benefits, the pressures may be insurmountable... However, if Government were to put in place additional support measures through the introduction of help to rent schemes, the door to the rental market may once again be opened for Britain’s most vulnerable.' Over half of private landlords surveyed said they would be prepared to take on homeless people or those on housing benefits if the Government launched a state-endorsed deposit and rent guarantor scheme. The survey also found that shortages of available properties to rent are mounting, with tenant demand having outweighed the number of new properties coming onto the market for over three years. In England, private rental prices grew by 2.3 per cent, Wales saw growth of 0.4 per cent while Scotland saw growth of 0.1 per cent in the last year. London private rental prices grew by 2.1 per cent in the year to January, which is 0.1 percentage points below the national growth rate over the period. Between January 2011 and January 2017, private rental prices in the UK increased by 14.3 per cent, strongly driven by the growth in private rental prices within London. DAILY MAIL

Median price paid for a home leapt 259% between 1997 and 2016 while earnings rose only 68%
Rising house prices now stand at an average 7.6 times the average annual salary, more than double the figure for 20 years ago, according to official figures. However, the new headline figure disguises dramatic regional variations. In the affluent London borough of Kensington and Chelsea, house prices are typically 38.5 times greater than annual earnings, but, 330 miles to the north-west, prices in Copeland, Cumbria, which includes the port of Whitehaven, are typically 2.8 times the average salary. The new figures for housing affordability in England and Wales between 1997 and 2016 have been issued by the Office for National Statistics. The ONS said housing affordability “has worsened in all local authority districts”. In 1997, house prices were on average about 3.6 times workers’ annual gross full-time earnings. Of the 10 least affordable local authorities, seven were in London. For example, in 1999, an employee in the borough of Camden could expect to pay 7.7 times their annual salary on buying a property, whereas in 2016 this had leapt to an average 19.6 times their annual earnings. Other areas saw much smaller increases over the same period. In Hyndburn in Lancashire, the equivalent figure has risen from 2.6 times to 4.1 times earnings. GUARDIAN

Amazon, Uber, Deliveroo: Gig economy companies trying to have their cake and eat it, say workers
Companies operating in the gig economy are “having their cake and eating it” by treating workers like staff while avoiding the tax and regulations on employing people on full-time contracts, according to a study. The survey by the Chartered Institute of Personnel and Development, the trade body for human resources staff, found that although workers are classified as self-employed, many were concerned about the level of control exerted over them by the businesses they worked for. “This is supported by the data, as just four in 10 gig economy workers, or 38%, say that they feel like their own boss, which raises the question of whether some are entitled to more employment rights,” the report said. The gig economy has become a focus of concern following the commercial success of companies such as Amazon, the ride hailing firm Uber and the delivery service Deliveroo. These companies employ workers on short-term contracts that can last just a few hours, allowing them to avoid paying employers national insurance, sickness and holiday pay. The CIPD found that most people it classified as gig economy workers were permanent employees, students or unemployed people taking jobs to top up their incomes and accepting hourly pay rates averaging between £6 and £7.70 an hour. The CIPD said its survey of more than 5,000 people found that 4% of the working-age population, or 1.3 million people, operated in the gig economy, lower than the 5 million estimated in some studies, though these include people on zero-hours contracts, eBay traders and people who rent out their homes through online apps lsuch as Airbnb. The report, To Gig or Not To Gig: Stories from the modern economy, also found that only 14% of respondents said they did gig work because they could not find alternative employment. The most common reason for taking on gig work was to boost income, which accounted for 32% of responses. GUARDIAN

Audi and VW sites raided in emissions probe
German prosecutors have raided Audi and VW sites as part of a probe into the manipulation of US emissions tests. Officers searched the Audi factory in Ingolstadt in Bavaria, and eight other locations, including parent company Volkswagen's headquarters in Wolfsburg. The searches were carried out in order to identify those involved in installing the devices that cheated the diesel tests, Munich prosecutors said. Audi-owner VW has already agreed to settlements of $21bn (£17bn) in the US. The raid at Audi's sites coincided with the company's annual press conference, in which it reported pre-tax profits of 3bn euros (£2.6bn) for 2016, a 37% drop on the previous year. The firm also announced a new autonomous vehicles division. In September 2015, Audi admitted that more than two million of its cars were fitted with software that allowed for the manipulation of test. Prosecutors from three German states said the raids were in connection to some 80,000 V6 3.0-litre diesel cars sold in the US between 2009 and 2015, whose buyers were unaware of the emissions scandal. They added that the search warrants were carried out particular to "clarify which people were involved in applying the [manipulation] technology and in providing false information to third parties". BBC NEWS

Saturday, 11 March 2017

Saturday, March 11, 2017 Posted by Hari No comments Labels: , , , , , , , ,
Fee and Chris wonder whether a female PM's chancellor will do better...

SOURCE GUARDIAN: Women bearing 86% of austerity burden, Commons figures reveal
Labour has urged the Conservatives to carry out a gender audit of its tax and spending policies, as the shadow equalities minister, Sarah Champion, published analysis showing that 86% of the burden of austerity since 2010 has fallen on women. Champion said research carried out by the House of Commons library revealed that women were paying a “disproportionate” price for balancing the government’s books. The analysis is based on tax and benefit changes since 2010, with the losses apportioned to whichever individual within a household receives the payments. In total, the analysis estimates that the cuts will have cost women a total of £79bn since 2010, against £13bn for men. It shows that, by 2020, men will have borne just 14% of the total burden of welfare cuts, compared with 86% for women. Many of the cuts announced in earlier years by former chancellor George Osborne, including a four-year freeze on many in-work benefits and reductions in the universal credit, are yet to bite. Hammond has loosened Osborne’s fiscal rules, but he will press ahead with most of the pre-planned austerity measures – though the tax credits rebellion forced the government to promise not to look for fresh savings from the welfare bill in future years. Mary-Ann Stephenson, co-director of the Women’s Budget Group lobby group, condemned the Tories in light of the new research. She said: “The chancellor’s decision to continue with the decisions of his predecessor to cut social security for these low income families, at the same time as cutting taxes, is effectively a transfer from the purses of poorer women into the wallets of richer men.” The government publishes an analysis of the differential impact of its policies at different points on the income scale, but does not carry out a gender analysis.


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Thursday, 2 March 2017

Thursday, March 02, 2017 Posted by Hari No comments Labels:
Schools in England 'to see first real-terms funding cuts in 20 years'
Spending per pupil is to fall 6.5% by 2019-20, according to the Institute for Fiscal Studies (IFS), although it added that school funding had been well protected over the past two decades. Sixth-formers have been facing a continuing squeeze on budgets, with spending per further education (FE) student falling by 6.7% between 2010-11 and 2015-16 and a further drop of 6.5% expected over the next few years. It means that funding for 16- to 18-year-olds is no higher than it was almost 30 years ago. The IFS study examines education spending for different age groups – from early years to universities – over a number of years. It found that the biggest spending increases over the past 20 years have been on schoolchildren in England, with £4,900 currently spent on each primary school pupil and £6,300 spent per secondary student. In both cases, this is around double, in real terms, the amount spent in the mid-1990s. But the report shows that school spending is now falling and will drop by 6.5% over the course of this parliament. Regarding older children, the IFS report warns that 16-18 education has been “the biggest loser from education spending changes over the last 25 years”, adding: “It experienced larger cuts in the 1990s than other sectors, smaller increases during the 2000s and is currently experiencing the largest cuts. This long-term squeeze in resources is a major challenge for the sector as a whole.” Further education spending per student was 45% higher than secondary school spending in 1990, but will be around 10% lower in 2019-20. Luke Sibieta, one of the report authors and an IFS associate director, said: “Over the next few years, both further education and schools are due to experience cuts... For FE, this comes on the back of tight funding settlements for decades that will leave spending per student the same in 2020 as it was in 1990. The lack of priority given to FE by successive governments in spending settlements does not seem sustainable.” GUARDIAN

Typical household incomes in the UK will not grow for the next two years
In five years' time, median income will be 4% higher than it is now, the Institute for Fiscal Studies (IFS) predicts. This is due to the "long shadow" of the financial crisis. The recession and tepid recovery mean that from the start of the crisis to 2021, households will suffer the worst income squeeze for 60 years, it says. They will be £5,000 a year worse off than they might have expected. Tom Waters, an author of the report, said: "Even if earnings do much better than expected over the next few years, the long shadow cast by the financial crisis will not have receded." This was generally the result of small increases in wages, low productivity levels, tax and benefit policies and the state of the UK economy. The squeeze would be felt worst by low-income households with children, he said, owing primarily to the four-year freeze in working-age benefits. In contrast, pensioners would see their income growing faster than working-age households - a reversal of the position a decade ago. "Once you account for their lower housing costs and smaller household size, median income is projected to be nearly 8% higher for pensioners than for non-pensioners by 2021-22, having been nearly 10% lower in 2007-08," the report said. Campbell Robb, chief executive of the Joseph Rowntree Foundation, said: "These troubling forecasts show millions of families across the country are teetering on a precipice, with 400,000 pensioners and over one million more children likely to fall into poverty." He added: "It is essential that the prime minister and chancellor use the upcoming Budget to put in place measures to stop this happening. An excellent start would be to ensure families can keep more of their earnings under the Universal Credit." BBC NEWS

State pension age 'could rise above lifespan' in poorer areas, says MPs committee
The Work and Pensions Committee said the state pension age would need to rise above 70 by 2060 to make the current policy of increasing the pension amount sustainable. Currently, the state pension age is set to be 67 for both men and women by 2028. The committee said male life expectancy was below 70.5 in 162 areas in Scotland, and in 26 areas in England. By contrast, male life expectancy in the area of Westminster, which includes Mayfair and Covent Garden, was 92.9 years. State pensions rise each year by the inflation rate or whichever is highest of average earnings or 2.5% - as part of the so-called pensions triple-lock. The government said it was committed to the policy until 2020 at least. As a result of triple-lock policy, the state pension has risen by £1,100 since 2010. Back in November the committee said the policy should be scrapped. Frank Field, committee chairman, said: "With the triple-lock in place, the only way state pension expenditure can be made sustainable is to keep raising the state pension age. This has the effect of excluding ever more people from the state pension altogether. Such people will disproportionately be from more deprived areas and manual occupations, while those benefitting most will be the relatively prosperous." He said that the state pension will be at a level by 2020 where it will provide a "decent minimum income" for the older generation and the triple-lock "will have done its job and it will be time therefore to retire it". Instead of the triple-lock, the committee said the new state pension and basic state pension could be linked simply to average earnings - which the Institute for Fiscal Studies estimates would save 0.8% of GDP (Gross Domestic Product) a year. That would be a real terms reduction of £15bn at today's prices, the equivalent to 4p on the basic rate of income tax, it said. Historically, pensions were linked to inflation rather than earnings, which reduced pensioner incomes relative to those of the working population. BBC NEWS

'Rigged' system means 83% of working families living in rented homes cannot afford to buy a new-build property
Housing charity Shelter found that 83 per cent would not be eligible to buy such a property, even if they used the Help to Buy equity loan scheme, which only requires a deposit of 5 per cent. The charity's research identified the West Midlands as the least affordable region, with 93 per cent of privately renting families struggling to afford to buy an average new home in the area, which costs £206,950. It also found just over half - at 51 per cent - of new homeowners had experienced problems with their properties including issues with construction, unfinished fittings and faults with utilities. Shelter went on to claim that the current housbuilding system was 'rigged' and needed to be replaced. It said the current 'speculative' way that housebuilding worked resulted in a conflict of interests and a highly combative local planning process, with landowners wanting to maximise their windfall up-front, finance providers wanting to minimise risk and the local community wanting to minimise the impact. It called for the current approach to be replaced with a 'new civic housebuilding' system that supports the building of new, affordable high quality homes, with greater powers for local authorities over land in their area. Under the new scheme, land would be sold to the development group with the proposal that most closely met the needs of the community, rather than selling to the highest bidder alone. Shelter said that lower land prices would mean developers did not need to keep house prices 'artificially high' to turn a profit. Under Shelter's proposed initiative, landowners could choose to sell at reasonable prices, or to invest their land as equity and own shares in a development, taking long-term returns and a share of the profit. Shelter said civic housebuilding that met the needs of communities was used to deliver the Georgian 'new towns' of Edinburgh and Bath, the Edwardian garden cities and the post-war new towns. DAILY MAIL

Sir Philip Green's reputation 'still stained' despite BHS pension deal
Retail tycoon Sir Philip Green's £363m payment into the BHS pension scheme does not wipe away the stains from his reputation, a senior MP has said. Business committee chairman Iain Wright told the BBC that the payment does not necessarily safeguard his knighthood. Sir Philip agreed the settlement with the regulator to help fill the failed retailer's pensions black hole. Under the deal with the Pensions Regulator announced on Tuesday, former BHS workers will get the same starting pension that they were originally promised. But the protection against inflation is not as strong. The new scheme offered benefits of around 88% of the value of their full BHS scheme. Sir Philip's contribution is significantly less than the £571m pensions deficit BHS was left with. Sir Philip owned BHS for 15 years before selling it for £1 to former bankrupt Dominic Chappell. Mr Wright welcomed the pensions deal, saying  that Sir Philip had a moral duty to right some of the wrongs committed under his watch. "It sends out a very powerful message. You might try to sell a business. You might try to flog it off on the cheap because you don't want to deal with the pension deficit, but the pension regulator said we'll come after you and we'll make you pay big money in order to safeguard the interests of pensioners and that can only be a good thing," the MP said. He said Sir Philip's knighthood was a separate issue and nothing had changed in his opinion since the House of Commons unanimously backed a non-binding motion to strip Sir Philip of his title last October. BBC NEWS

Bovis to pay £7m to compensate customers for poorly built homes
Bovis Homes is to pay £7m to repair poorly built new homes sold to customers, raising fresh questions about the standards of new-build properties across the country and the regulation of the market. The company – one of the biggest housebuilders builders in Britain – will pay compensation after angry customers formed a Facebook group accusing Bovis of pressuring them to move in to incomplete houses so it could hit sales targets. The boss of Bovis apologised to customers on Monday for the poor quality of their houses and promised to finish them “to their satisfaction”. He refused to state how many homes needed the urgent repair work, or how much it will cost to fix each house. The company also refused to say which developments were worst affected, but it is understood that many of the problem homes are in Kent. The announcement led to more than £100m being wiped off the stock market value of Bovis, with its shares falling 10% to 757p. The news comes amid growing complaints about the quality of new homes and the organisation that sets the standards for new-build properties. Critics claim NHBC , which provides 10-year warranties for most new homes in Britain, is failing to protect consumers. Another recent controversy over new homes has seen Britain’s largest housing association, Clarion Housing Group, agree to buy back some properties on a housing development in the east London borough of Havering. Oliver Colvile, the Conservative MP who chairs an all-party parliamentary group on new builds, called for an independent ombudsman to hold housebuilders to account. He said: “There is a genuine need for more housing but we need to ensure they are going to be good quality housing rather than the sometimes frankly rubbish.” The affected customers have been left nursing problems such as faulty plumbing, no guttering, and half-finished tiling. Rob Elmes said he was offered £3,000 if he and his wife completed on 23 December, but declined the offer because of the defects with their £320,000 three-bedroom property in Inkberrow, Worcestershire. Helen Batt said her £389,995 Bovis home in Maidstone, Kent, had no turf in the back garden, the wrong kitchen units and had not been carpeted. Bovis built almost 4,000 homes last year, but said 180 properties that should have been completed in 2016 had yet to be handed over to buyers. GUARDIAN

Overdraft charges are elephant in the room, say MPs
Bank overdrafts were the major source of high-cost borrowing for millions of people, the All Party Parliamentary Group on Alternative Lending concluded. The costs can exceed those of payday loans, it said in a report. However, further price caps - as seen in the payday sector - may not be appropriate, the MPs said. Banks made £1.2bn in unauthorised charges each year, the committee heard during evidence, paid by those who were least able to bear the cost. The committee said there were concerns over the transparency of charges and how easy it was to compare between different banks. The model of "free banking", whereby banks clawed back costs through overdraft charges, required "government or regulatory attention", it said. In its report on bank accounts published in August, the Competition and Markets Authority decided against a cap on charges. However, the Financial Conduct Authority has now announced that it will examine the issue in detail itself. In its report, the parliamentary group said that regulators should concentrate on competition and conduct. BBC NEWS

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