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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to http://pennystockpaycheck.com for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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George Osborne to tell IMF that austerity U-turn would do damage

Category : Business

Chancellor is determined to resist pressure for greater boosts to growth in talks this week, arguing harm would outweigh benefits

George Osborne will warn the International Monetary Fund that a U-turn on the government’s budget plans would do more harm than good when officials from the Washington-based organisation arrive in London on Wednesday for two weeks of talks.

The Treasury intends to reject the IMF’s call for an easing in the pace of deficit reduction and will insist that any change in the strategy is both unnecessary and counterproductive. Alarmed at the flatlining of the British economy in 2011 and 2012, the IMF said last month it was time for Osborne to do more to boost economic growth and urged that he should rethink plans to cut the government’s structural budget deficit by 1% of national income in 2013-14.

The chancellor was stung by the criticism, which was seized upon by shadow chancellor Ed Balls as evidence the government had damaged the economy with an over-aggressive austerity approach.

Despite the government’s poor showing in last week’s local elections, Osborne has no intention of changing course but is keen to avoid a public call for a volte-face from the IMF, which initially was a strong supporter of the coalition’s approach to tackling the UK’s record peacetime budget deficit.

Treasury officials intend to show that any change to the strategy followed for the last three years would damage the government’s credibility in the financial markets and that the subsequent increase in long-term interest rates would outweigh any benefits from cutting taxes or increasing spending.

They will also say that the sluggishness of the UK economy in 2012 was a result of the drop in exports to the crisis-hit eurozone, rather than weak consumer spending.

The IMF has become more concerned about the health of the UK economy over the last year and has called for a rethink of fiscal policy – tax and spending – unless the pace of growth picked up. Olivier Blanchard, the IMF’s chief economist, embarrassed the chancellor last month when he singled out the UK as a country that had the scope to ease fiscal policy to boost growth. The chancellor was particularly irritated by Blanchard’s comment that the UK was “playing with fire” by refusing to change tack.

IMF officials are likely to point out in the discussions that the level of national output in the UK is still more than 2% below its peak five years after the recession began in early 2008. By contrast, the US and Germany have both more than recovered the ground lost in the slump.

Osborne’s team knew about Blanchard’s views but expected any concerns to be raised by the IMF in the Article IV discussions – the organisation’s annual economic health check on its 188 member states – that begin this week. IMF deputy managing director David Lipton will issue advice to the government on 22 May at the end of the discussions.

The Treasury will say that the economy is gradually on the mend and that the IMF’s anxiety about the weakness of growth has already been addressed in recent policy initiatives.

Osborne believes that the “help to buy” measures announced in the budget to stimulate the housing market, and last month’s decision to target lending to small and medium-sized businesses in a beefed-up Funding for Lending scheme, should be taken into account by the IMF before it calls for a budget volte-face. And it will insist that the loss of credibility suffered by the UK from changing course would outweigh any benefits from fine-tuning the government’s financial plans.

The Treasury will argue that budget plans are in line with the advice the IMF has been dispensing to rich countries following the deep slump of 2008-09: that there are other western nations doing a faster repair job on their public finances, despite even weaker growth; the IMF’s view about the need for a different approach is not shared by Brussels.

The European commissioner for economic and monetary affairs Olli Rehn said last week: “The level of public debt is projected to rise to close to 100% next year.

“There really is no case for a discretionary fiscal loosening in the UK. It is important the UK follows through with consistent consolidation of public finances to achieve a more sustainable fiscal position.”

Vince Cable: Consider RBS break-up to increase banking competition

Category : Business

Business secretary speaks out against rush to sell bailed-out bank, saying it could be used to make sector more competitive

The business secretary, Vince Cable, is urging the chancellor to consider breaking up Royal Bank of Scotland to boost competition in the financial sector instead of dashing to privatise the bailed-out lender.

He waded into the debate about the future of RBS after reports that George Osborne was hoping for a quick selloff. Cable said: “I don’t see the need for any haste.”

Sir Philip Hampton, the bank’s chairman, said on Friday that the clean-up of the battered lender would be “substantially complete” by 2014, allowing the Treasury to start selling shares before the general election. But Cable is keen to ensure that all options remain on the table, including breaking the bank up. “There’s a lot to be said for the idea of using RBS to create a more competitive banking sector,” he said. Insiders have argued that splitting up RBS would create insurmountable legal and practical problems, but Cable said: “You probably could create separate entities and I’m sure that would be healthy.”

Encouraging competition in banking is a key aim of the coalition and ministers were disappointed by the collapse last month of a deal under which the Co-operative Bank sought to buy more than 600 branches from Lloyds Banking Group, creating a powerful mutually owned “challenger bank”.

Cable said consumers and businesses had been left with even less choice than before the financial crisis. “It’s become very, very narrow, and it almost entirely consists of shareholder banks,” he said. RBS was bailed out by Alistair Darling, the then Labour chancellor, in the financial crisis in late 2008. It required two fresh recapitalisations the following year as the shaky state of its finances became clearer, receiving a total of £45bn.

With lending to small businesses in Britain’s recession-scarred economy still falling, despite a series of government initiatives, the future of RBS has become a fraught political issue. Senior figures, including the archbishop of Canterbury and former Tory chancellor Lord Lawson, have called for it to be broken up into a “bad bank”, with legacy loans from the boom years, and a “good bank” that would then be free to make new loans. Some campaigners have argued that it should be split into a series of regional lenders that could focus on small businesses.

Tony Greenham, of the New Economics Foundation thinktank, said: “It absolutely should not be flogged off: why would you turn the clock back to a banking system that was so manifestly dysfunctional before 2008 by just selling it back?” The share price of both RBS and Lloyds Banking Group remain well below the average paid by the government when it part-nationalised them.

Samuel Tombs, of Capital Economics, said: “The bottom line is that a selloff of the government’s stakes in the banks would be no quick fix for either the public finances or the problems in the lending market.”

But some Tory strategists believe that selling at a loss would be better than hanging on to RBS beyond the election. A Treasury spokesman insisted the chancellor was willing to examine alternatives to a full privatisation and denied any rush to offload the bank. “It’s a company that’s gradually returning to health, but it is gradual: it’s still quite a long slog,” he said.

No 10 accused of ‘caving in’ to cigarette lobby as plain packs put on hold

Category : Business

Tobacco giant warned of loss of jobs in UK before packaging rules were dropped, and anti-smoking camp also cites possible fear of Ukip

Anti-smoking campaigners have accused the government of caving in to pressure from the tobacco lobby and running scared of Ukip after plans to enforce the sale of cigarettes in plain packs failed to make it into the Queen’s speech.

Minutes released by the Department of Health show that one of the industry’s leading players had told government officials that, if the move went through, it would source its packaging from abroad, resulting in “significant job losses.”

Cancer charities and health experts were expecting a bill to be introduced last week that would ban branded cigarette packaging, following a ban introduced in Australia last December. At least one health minister had been briefing that the bill would be in the Queen’s speech. But the bill was apparently put on hold at the last minute with the government saying it would be a distraction from its main legislative priorities.

Ukip, which enjoyed considerable success in last week’s elections, has positioned itself firmly on the side of smokers and there is a suspicion that the Tories scrapped the plan because they did not want to be seen as anti-smoking.

It has emerged that senior Department of Health officials held four key meetings with the industry’s leading players in January and February, when at least one of the tobacco giants spelled out to the government that its plan would result in thousands of jobs going abroad.

Department of Health minutes released last week reveal that Imperial Tobacco, British American Tobacco (BAT), Philip Morris International and Japan Tobacco International were each invited to make representations to the government, in which they attacked the plan and its impact on the UK economy.

Only the minutes of the meeting with Imperial have been released. They record that Imperial warned if plain packs were introduced it would source packaging from the Far East resulting “in significant job losses in the UK.”

The tobacco giant also outlined how its packaging research and development department supported small and medium-sized enterprises in the UK and argued that standard packs would “result in some of these being put out of business”.

It added that the plan would boost the illicit trade in cigarettes, which already costs the Treasury £3bn in unpaid duty and VAT a year. And it noted that 70,000 UK jobs rely on the tobacco supply chain, implying some of these would be threatened if the illicit market continued to grow.

When asked to hand over its assessment of the impact of the plan, Imperial refused, citing commercial sensitivity.

The decision to delay the introduction of plain packs is a major success for the tobacco lobby, which has run a ferocious campaign against the move. Cigarette makers fear that the loss of their branding will deprive them of their most powerful marketing weapon. The industry has backed a series of front campaign groups to make it appear that there is widespread opposition to the plan, a practice known in lobbying jargon as “astroturfing”. Many of the ideas were imported from Australia, where the tobacco giants fought a bitter but ultimately unsuccessful campaign to resist plain packs. Much of the Australian campaign was masterminded by the lobbying firm Crosby Textor, whose co-founder Lynton Crosby is spearheading the Tories’ 2015 election bid.

Crosby was federal director of the Liberal party in Australia when it accepted tobacco money. Crosby Textor in Australia was paid a retainer from BAT during the campaign against plain packs. Some anti-smoking campaigners are now questioning whether the decision to drop the plain packs bill was as a result of shifting allegiances at Westminster.

“It looks as if the noxious mix of rightwing Australian populism, as represented by Crosby and his lobbying firm, and English saloon bar reactionaries, as embodied by [Nigel] Farage and Ukip, may succeed in preventing this government from proceeding with standardised cigarette packs, despite their popularity with the public,” said Deborah Arnott, chief executive of the health charity Action on Smoking and Health.

The decision to drop the plan will become a divisive issue for the coalition because the Liberal Democrats were strongly in favour of the measure, which will still be introduced in Scotland.

It is also a concern for the government’s own health adviser. “Our view is that plain packaging is one of a range of measures shown to be effective in reducing the amount of people taking up smoking,” said Professor Kevin Fenton, director of health and wellbeing at Public Health England, the government agency charged with helping people to live longer and more healthily.

A Department of Health spokeswoman denied that tobacco lobbying had been a factor in the decision to pull the bill. “These minutes simply reflect what the tobacco company said at the meeting, not the government’s view,” she said. “The government has an open mind on this issue, and any decisions to take further action will be taken only after full consideration of the evidence and the consultation responses.”

There’s nothing wrong with low-carbon policy that strong government can’t fix

Category : Business

Apocalyptic predictions are circulating about the size of electricity bills in 2030 if the move to green power goes ahead. There is no need for them to come true

The UK’s energy policy is not “plausible” and a “crisis” is inevitable. That is the view of Peter Atherton, a respected utilities analyst who works for Liberum Capital, an investment bank in the City.

Atherton is convinced that successive UK governments have grossly underestimated the engineering, financial and economic challenges posed by the planned move from a high-carbon electricity sector to a low-carbon one.

He believes that the cost of switching from largely coal- and gas-fired power stations to a mix of gas-, wind- and nuclear-generated electricity will cost more than £160bn by 2020 and more than £375bn 10 years later. He warns that it means “electricity bills rising by at least 30% by 2020 and 100% by 2030 in real terms.”

That would be political dynamite and Atherton knows it. He predicts that there will be three groups of “casualties”: the government, consumers and investors.

This apocalyptic scenario – contained in an investment note issued last week – will warm the hearts of many in the City (and possibly some in the Treasury) who believe the green agenda is a giant waste of money.

It will alarm the wider community who accept that climate change must be tackled, and those who believe a “carbon bubble” is developing around fossil fuel companies whose assets are overvalued in a world turning away from coal and oil.

And it is clearly at odds with the ideas of ministers such as Ed Davey, the energy secretary, whose Department of Energy and Climate Change (DECC) calculated last month that “household dual fuel bills are estimated to be on average 11% (or £166) less in 2020 than they would be without policies being pursued.” Those figures do, however, involve some heroic assumptions about energy-efficiency measures being

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London no longer looks for northern lights like Harry Whewell

Category : Business

Once upon a time, news editors in Manchester and Glasgow were the equal of those in Fleet Street. Now a regional political breakthrough like Ukip’s takes the capital by surprise

There was a sudden remembrance of times past the other day when Harry Whewell died. Harry, in his pomp, was the great northern news editor of the (ex-Manchester) Guardian while the Guardian’s greatness still dwelt in the north. He cherished and developed many young Oxbridge hopefuls: Michael Frayn, Jonathan Steele, Benedict Nightingale, Simon Hoggart. He loved his Manchester, knew every nook and cranny of it, strove tirelessly to bring it to life. And the question he left behind remains hauntingly difficult for journalism to answer in a week where local elections stole the headlines. Whatever, in day-to-day newspaper terms, became of the Britain beyond Watford Gap?

Helen Pidd, Harry’s many-stages-on young successor as northern editor of the paper, was brooding in precisely these terms recently. Forty years ago, she wrote, there were 95 journalists working in the Manchester office. Now “I will be the only staff reporter in the north … Whenever the Guardian runs a trend piece about how ‘we’ are all watching The Wire/eating baba ghanoush/wearing harem pants, I always think to myself: in north London maybe. No wonder the media, particularly the so-called ‘quality’ press, misses important shifts among the majority of people in the UK who do not live inside the M25.”

It’s a theme that can’t be brushed aside too easily. Once upon a time – Harry Whewell’s time – Fleet Street and its northern outposts of Glasgow and Manchester marched in step, well-resourced regional editions of the nationals digging and noting. Birmingham and Liverpool had their own substantial morning papers. The Yorkshire Post often seemed a quasi-national itself. Darlington’s Northern Echo basked in the glory of Harry Evans’s editorship.

Not all of that has evaporated. The Post and the Echo soldier on. But there is no critical mass, nor any balancing act. Northern newsrooms – like Midlands correspondents and the rest – have all but vanished. Local news agencies feeding the nationals are similarly diminished. London, reaching for its newspaper or clicking online each morning, gets no consistent sense of what non-metropolitan life is like.

Pidd remembers the plaudits she won for correctly predicting that George Galloway might win the Bradford West byelection. “‘How did you know?’ I was asked at the Guardian’s morning conference after the Respect MP won a 10,000 majority. It wasn’t rocket science, I said. ‘I was there’. Or, perhaps more accurately, I had bothered to go.”

Perhaps you can replay that selfsame record today in the wake of Ukip advance from South Shields to deepest Surrey. Some shifts can’t be spotted sitting at terminals in Canary Wharf or WC1. Some mood swings begin on the ground far from Westminster. But devolution actually seems to mean less news from Scotland, and vice versa. And the web-based march of British journalism across the world can leave home bases scantily covered, as though

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Food scares, the big four and F1: Justin King of Sainsbury’s on the retail race

Category : Business

The supermarket boss insists that he only wants to overtake Asda – but the Grand Prix rumours won’t go away

As the horsemeat scandal reached its peak in February, the bosses of Britain’s biggest supermarkets and suppliers were summoned to Whitehall to explain themselves.

Packed into a Defra meeting room on a Saturday morning, the shopkeepers were given an almighty dressing down and ordered to take responsibility for one of the biggest food adulteration revelations of recent years.

Among them was Justin King, at 51, and after nearly a decade at the helm of Sainsbury’s, regarded as the elder statesman of the grocery business. He was, he says, determined not to take the criticism lying down. He accused government officials of failing to understand the industry, and even threatened to call on the prime minister to demand a ceasefire.

Three months on, with horsemeat found in beefburgers, bolognese sauces, lasagnes and corned beef – but not in any Sainsbury’s products – King still recalls the behaviour of those running the country with exasperation.

He said: “That moment was when politics and business were at their most tense, because politicians felt they had to be saying something. The reason no one was saying anything was because we were doing the responsible, trustworthy thing, which is understanding the issue before we shouted about it, while the dynamic of politics is the opposite.

“In business, we understand it and then we talk about it, while in politics they talk about it and at some later date work out whether their understanding fits with what they said about it some weeks before.”

It was perhaps surprising that King wanted to take such an active role in tackling the scandal on behalf of the industry, given that his own supermarket group had come through unscathed while bitter rivals Tesco and Asda were caught out.

But the new old man of retail, having worked for PepsiCo, Marks & Spencer and Asda before his nine years at Sainsbury’s, says he has seen far worse and that the public is not quite as worried about horsemeat as might be expected.

“We’ve had foot and mouth, bird flu and BSE, all of which were examples where the supply chain was challenged, so this is nothing new. It’s all about trust and acting in a trustworthy way.

“People are pretty realistic. If you Google horsemeat, [a lot of the hits] are horsemeat jokes. So there was an immediate juxtaposition in the consumers’ minds that it was serious but they got a lot of enjoyment from it, too.”

However, King is keen to stress that businesses must stop feeling sorry for themselves and realise that the customers are victims too.

“I don’t think it is fair enough for retailers affected to say they were victims. I had a very simple view – which is that I’m on the same side of the table as the customer.

“The second you say you’re a victim in this situation, even when you are, you put yourself on the wrong side of the table. The real victims are the consumers, who have paid their hard-earned cash.”

This week, the City will see that Sainsbury’s has been largely unaffected by the scandal. Full-year results released on Wednesday will show sales up 4.6% to around £25.6bn, with underlying pre-tax profits expected to be up 5% to £748m.

The focus may now have moved away from horsemeat, but City investors will be keen to learn more about King’s future. He has been touted as the next boss of Formula One, when Bernie Ecclestone hands over the keys to the world’s most glamorous sporting franchise.

Last weekend that speculation reached a new pitch after the supermarket confirmed that headhunters Egon Zehnder had been retained to advise on King’s successor. Sources inside the company suggest the process could take a year and that the process is merely a matter of good management.

King refuses to quash rumours that he is interested in the F1 job – he only ever says that he is “not aware of a vacancy”. He is a huge racing fan and has helped his son Jordan to become one of the most promising drivers of his generation.

But if the call from Ecclestone, F1′s diminutive owner, fails to come, a career in politics might appeal.

King is a former board member of the London Organising Committee of the Olympic and Paralympic Games, and was a member of David Cameron’s business advisory group – before they fell out over King’s objections to government plans to allow new staff to surrender employment rights in exchange for shares.

However, poor pay in the public sector could prove a sticking point for the businessman, who earned £3m last year – 20 times more than the PM.

On the subject of King’s future, analysts at Barclays wrote: “No CEO remains forever, and at some point Justin King will prove the press predictions correct and move on. However, he may be keen to be in charge when Sainsbury’s regains its number two market-share position from Asda – his former employer.”

That could happen later this year, after a remarkable 33 consecutive quarters of growth.

According to industry data from Kantar Worldpanel, Sainsbury’s is outperforming its rivals as the only big four supermarket to be increasing its market share. The grocer now accounts for nearly 17% of all the money spent on groceries in the UK, a slight rise on last year, at a time when Morrisons, Asda and Tesco all lost customers.

Sainbury’s successful Paralympics sponsorship, leading position in convenience stores and growing online presence have also helped, while Tesco’s decision to open no more megastores, and write off £800m on land it had bought for new developments but will now never use, may also give King cause to crow.

He was always angry about Tesco’s land-grab. “If you’re acquiring a site just a mile from an existing site, are you doing it because you think it’s valuable to trade, or because it stops a competitor?”

And his vitriol for the number one supermarket doesn’t stop there. He is equally scathing about Tesco’s new price promotion, which promises shoppers that Tesco’s prices for own-label and branded goods are cheapest. Having complained directly to Tesco and failed to reach a compromise, Sainsbury’s has now appealed to the Advertising Standards Authority. “We have exhausted everything we could with them [Tesco], so were left with no choice but to go to the ASA,” he says.

“You can’t have advertising saying that where your chicken comes from is important, while at the same time still sourcing your chicken from Thailand and Brazil, and then doing a price comparison with Sainsbury’s chicken, which is sourced from the UK. That is inherently unfair.”

Tesco said: “We use an independent agency to check prices of branded and own-label products at other retailers – online daily for Asda and Sainsbury’s, and, since they don’t have an online grocery service, twice a week at Morrisons stores. The basis for our comparisons is made clear on the price promise website.”

This may not be enough to soothe King’s feelings, but perhaps he will soon be directing his passions elsewhere. Less horsemeat, more horsepower?

Health minister threatened with ejection from royal college

Category : Business

Earl Howe’s position on advisory committee under threat as doctors claim he ‘mis-sold’ health reforms

A health minister is facing the humiliation of being ousted from a prestigious role within the Royal College of Physicians over claims that he falsely reassured doctors who feared the coalition would privatise of the NHS.

Earl Howe’s position on an advisory committee is being reviewed following a complaint. Six influential members of the professional body that represents doctors wrote to its president, Sir Richard Thompson, claiming that the minister was “not a fit person to fulfil this important role”. Thompson has launched an investigation by the College’s trustees into Howe’s probity.

The senior doctors claim that Howe, a former banker, falsely advised them that reforms under the health and social care bill would not force doctors to use market mechanisms to choose where patients will be treated.

According to the doctors, the regulations will mean that clinical commissioning groups – the bodies to be set up by GPs to organise patients’ care – will have to put services out to tender if there is more than one provider capable of offering particular treatments. This means NHS hospitals and services will have to compete with private health firms for business.

Andy Burnham, the shadow health secretary, said there had been a breakdown in trust between health professionals and government, adding: “This whole issue has become a crisis of trust for the department of health. There would be a straight forward breach of trust given that statements ministers have given have not been honoured.

“The medical profession feels the government has mis-sold its NHS reforms. It was sold on the principle that doctors would be in control but in fact it will be the market that will decide.”

A spokeswoman confirmed that Thompson, and “in the interest of probity”, had “referred the issue to the board of trustees and would report back in June”.

She said the Friends of the RCP, the committee on which Howe serves, is an informal advisory group, including past presidents and officers, and figures from finance, industry, and other charities, that plays no role in the governance or management of the RCP but offers advice in areas such as effective fundraising.

The coalition denies the regulations will force doctors to put services out to tender, believing it will give GPs the ability to select a variety of providers and will improve standards.

Mobile networks see bright future for electronic wallet

Category : Business

Britain’s big three mobile networks have united on a project to make debit cards of our smartphones. And they’re even planning to outsmart Google

There is a scene in the 2002 film Minority Report where Tom Cruise walks into a clothes store and a computer scans his eyes. “Hello Mr Yakamoto, welcome back to the Gap,” chirrups a sales assistant in hologram form. “How’d those assorted tank tops work out for you?”

Brands from Nokia to Bulgari collaborated in the Steven Spielberg film to paint a picture of what a shopping trip might look like in 2054. But we may not have to wait that long – science fiction could become reality later this year.

In the real world, though, individual shoppers will be identified not by iris scans, but by the portable devices in our pockets. The UK’s three largest mobile phone networks, EE, Vodafone and O2, have joined forces to turn smartphones into virtual wallets that know who we are, where we are and what we buy.

“Imagine: you are walking past Topshop and an alert pops up on your phone offering you a discount in store today,” says David Sear. The new chief executive of Weve, the company set up by the networks to manage the mobile wallet project, is giving his first interview.

You’d then walk into the store, pick out a purchase, scan the barcode, and pay by tapping your phone on an Oyster-card-style reader, rather than at the till.

“It is a bit of joy,” claims Sear. Bargain lovers would agree; others might find it intrusive. To those standing in line to pay, it could seem downright rude.

The idea is not a new one, but despite the efforts of companies ranging from Google to Barclays it has yet to gain traction with consumers. Google Wallet, launched in the US in 2011, has not made it to these shores. But Weve says 15 million mobile phone customers have already opted in to its service.

At the moment, those users receive nothing more than text messages alerting them to offers. But within months, Weve says it will have opened its database, allowing companies that buy advertising slots on web pages access to data ranging from users’ physical location to the websites they visit on their phones.

Before the end of the year, Sear hopes to have created an app capable of holding dozens of virtual loyalty cards, and to have recruited its first brand. Payment mechanisms will follow.

“My background is in disruption,” says Sear, who has made his career with payments firms that challenged the big banks. An early venture used data to help retailers spot cheques that would bounce. At online transactions firm WorldPay he helped shoppers in one country buy goods in their own currency from sellers abroad.

“I succeeded with the cheque business because we enabled people to do things at the point of sale which they couldn’t do before,” says Sear. “I have 17 loyalty cards sitting in my sock drawer because I can’t be bothered to carry them all around. I think there’s a real opportunity to create one place where you might hold competing loyalty mechanisms.”

But why should an unwieldy coalition of mobile phone firms, more used to competing than collaborating, succeed where a digital native like Google has so far come unstuck?

“People in the loyalty industry know what Google wants: their data. One of the large US supermarket chief executives said the thing he didn’t want to do was give Google his data. Whatever we do, it has to be a coalition of the willing.”

Weve claims it will share details of every purchase with the relevant loyalty card issuer. The system will also ask mobile phone customers to opt in, rather than acting like Facebook and Google and assuming users will accept advertising in exchange for a free service.

For the networks behind Weve, this is one of the advantages of having paying customers. Facebook has to presume we want advertising because it has few other sources of revenue, but mobile phone companies can afford to be a little less pushy.

“We want consumers to have bought into the value of the service,” says Sear.

He is particularly critical of Facebook Home, a new app from the social network that takes over a smartphone’s home screen to display ads alongside news and photographs from friends. “I personally do not want to see ads popping up on my phone when the screen is locked. In Facebook’s case I don’t think they are really asking for permission; it’s just part of the deal you sign up to on that system.”

Weve will not be a consumer brand. The networks will sign up customers themselves, using a dashboard of information-sharing options. Details shared could range from the first part of a postcode to age, gender, location, web browsing history and likes or dislikes. Some will be compulsory, some optional, and the requirements will vary by network. Google has a similar dashboard, but few users are aware of its existence.

“The consumer is more powerful in this stage of our digital revolution than I think they have ever been, and they will decide whether or not something is appropriate,” says Sear.

Security is another factor. When Weve is ready to link a customer’s debit card to their phone so that they can make payments, those details will be held on the Sim card. Should the phone be lost or stolen, the data can be remotely deleted by the operator.

Memory wiping was a favourite theme of Philip K Dick, on whose writing Minority Report was based. The film was made not long after the 9/11 terrorist attacks on the World Trade Centre, and Spielberg remarked at the time: “People are willing to give away a lot of their freedoms in order to feel safe. But the question is, where do you draw the line? How much freedom are you willing to give up?”

This applies increasingly to the trade-off between free services and private information. Those signing up for Weve’s service will at least be offered the choice.

Openreach leaves customers unconnected and angry

Category : Business

Frustration over endless waits for Openreach to instal phone lines is made worse by being unable to complain directly

Letters about the unreliability and inscrutability of Openreach, the division of BT which, in theory, provides access to the national phone network, has unleashed a torrent of woe from readers stranded, often for months, without phones. The complaints have a common thread: Openreach is unanswerable to the customers it lets down because grievances must be channelled through their own service provider, some of whom seem equally unable to communicate with the company they rely on to install new lines.

MN of London

has been waiting since November for his Sky telephone and broadband to be installed: “Appointments have been made, and each time the engineer failed to show. In desperation, I cancelled my contract with Sky and placed a new order with BT in February. I’m still waiting and was recently asked by an amused BT operative what life is like without a phone line.”

Primus customer VC of Althorne, Essex,

lost her line in January and is still awaiting reconnection. “We feel powerless before these faceless organisations,” she says. Londoner LN-C has also been waiting since January for a new line. Engineers have either turned up with the wrong parts or qualifications, arrived unannounced and were unable to gain access or did not come at all. “We have wasted more than 40 hours waiting for BT to show up, or telephoning them to complain. BT’s delays are also costing me thousands of pounds in lost productive working hours as we are unable to conduct our business effectively without the internet,” she writes. “One of the telephone lines awaiting installation is for our Dualcom alarm system, which is necessary to comply with our insurance requirements.”

SC of Colwyn Bay, Conwy

ordered a new line through Sky in January and was told she would have to wait seven weeks. Snow meant the engineer was a no-show and she was told the next available appointment was in May: “We have been told that you can’t contact Openreach, you have to go through our provider – Sky – but then all Sky will say is ‘sorry’ this is the first available appointment.”

SC of London

complained to his provider Zen of a slow broadband connection in December. “Zen has been fighting hard to get Openreach to resolve the issue… Openreach has no telephone number or email address for end user complaints and insists we must go through our ISPs. It seems absurd that Openreach has been set up as a monopoly supplier of the communications infrastructure without there being any way for the end user to complain to them directly about their services, or for there to be an external body to which we can seek redress.”

Telecoms regulator Ofcom tells me it doesn’t publish complaints about Openreach as the number is so small. Of course it is. Because of Ofcom rules, Openreach gets to skulk behind the service providers who have to deal with customer complaints on its behalf. However, even Ofcom has realised that Openreach’s performance has “deteriorated” since the summer and it is reviewing the wholesale access market – ie Openreach’s monopoly on installations agreed with Ofcom in 2006 – to enable service providers to access BT’s national network. It is planning to introduce new rules such as payouts for customers who suffer delays.

Meanwhile, Openreach blames last year’s wet weather for a backlog of delays, including SC of Conwy’s five-month wait (her appointment was brought forward a month thanks to press office muscle) and says it has appointed 1,000 new engineers and carried out 1.7m visits in the last quarter. It blames MN’s saga on the fact that both Sky and BT coincidentally committed an “administrative error” when processing the order. His line has now been installed.

VC is the victim of a faulty telephone pole, which requires input from the electricity company and the council to remedy. The council also had to be invoked in LN-C’s case because it had concreted over relevant manhole covers and she now has a working line. SC of London apparently suffered delays because of the technical complexity of the problem which necessitated several visits.

Although customers’ contracts are with their own service provider rather than Openreach, it’s worth complaining to Ofcom if Openreach irks you. While unable to intervene on an individual basis, it will add it to the growing tally. For mediation when you reach deadlock, turn to the telecommunications ombudsman,

Homebuyers turn to five-year fixed-rate mortgages

Category : Business

The number of five-year fixes has increased 73% in the past year as two-year deals lose popularity with mortgage borrowers

Would you fix your mortgage for five years, seven or even 10? A few years ago the vast majority of people would have said no, opting instead for a cheaper, shorter-term two-year deal. But the tide has turned and increasing numbers of borrowers want the certainty of a longer-term commitment, say brokers – and lenders are offering more, and better, deals.

Tomorrow HSBC is launching the lowest ever five-year fixed rate at 2.49% for those with a 40% deposit or the equivalent equity (be warned; the fee is a whopping £2,000).

This is the first time a five-year fix has dropped below 2.5% – but it’s not just HSBC getting in on the act. In the last year, the number of five-year fixed-rate deals has increased by 73%, says data provider Moneyfacts. By comparison, the traditionally popular two-year fixes have only increased by 33%.

Sylvia Waycot, editor at moneyfacts.co.uk said: “Five-year fixed-rate mortgages have traditionally been a bit too expensive to be the first choice for most of us. However, thanks to lenders enjoying cheap loans from the government this is changing.”

The government announced last week that it is extending its Funding for Lending scheme, which has been widely credited with bringing mortgage rates down for borrowers.

Experts believe rates on all mortgage terms could become more competitive in the year ahead. So, with all these cheap deals around, should you look to fix at all and if so, for how long?

Consider the base rate

Borrowers deciding whether to fix will undoubtedly want to take into account the widespread speculation that interest rates are unlikely to rise any time soon. “Our view is that we won’t see a rise in the 0.5% base rate until 2016,” says Rob Harbron, economist from the Centre for Economics and Business Research (CEBR). “Expectations for continued low rates are a result of our outlook for the economy – weak growth conditions are expected to remain the ‘new normal’ for the next few years.”

Economist Ian Kernohan from Royal London Asset Management adds that as the UK is still in post-crisis recovery mode, this means disappointing growth and low interest rates for at least a few years. “We have pencilled in the first rate rise for late 2015 at the very earliest,” he says.

Martin Ellis, housing economist at the Halifax, adds that as interest rates look set to remain at the same level for the rest of the year, this offers a compelling reason for some borrowers to stay on tracker rates.

“However, a fix provides absolute certainty about the cost of monthly repayments,” he says.

Robin Barter, 44, and his wife, Tracey, 46, are among those who have just remortgaged on to a five-year fix for the first time. The couple live in a four-bedroom house in Oxfordshire with their three children: Scott, nine, Luke, seven, and Hugh, four.

Prior to remortgaging, the Barters had held tracker mortgages with Halifax for 14 years but have now switched to NatWest. “Initially, I thought we’d go for another tracker, as I’m familiar with this kind of deal,” says Robin, an account director. “But when we contacted broker London & Country, they came back with the same conclusion that I was starting to reach, that in the current economic climate we’d be better on a fix.

“Given that the base rate is only going to go up at some point, we decided to go for a five-year fix with NatWest.”

This was priced at 2.99% and came with a £995 fee; the deal also offered both free valuation and legal work. “Locking into a low five-year fix now gives us peace of mind that our payments are protected for longer,” says Robin.

“It also means we won’t have to pay fees to remortgage again in a few years, as we would with a shorter deal.”

Beware sky-high fees

For some borrowers, choosing a rock-bottom mortgage rate may be a false economy, according to Andrew Montlake from broker Coreco.

“Having to remortgage and pay high arrangement fees every two years may not be the best way to go,” he says.

“For example, while borrowers may like the sound of HSBC’s two-year fix at 1.89%, at up to 60% loan-to-value (LTV), the fee of £1,999 adds roughly 0.5% to the rate spread over the two years. As a result, Norwich & Peterborough’s fix with a slightly higher rate of 1.99% at up to 60% LTV and a fee of £995 could be a better option over two years.” The key is to factor in the product fee as well as the headline rate. “This will determine whether you are better off paying a higher fee and taking the very lowest rate, or opting for a slightly higher rate with a lower arrangement fee,” says Montlake.

Is two years long enough?

With little expectation of the base rate climbing in the near term, brokers say borrowers are increasingly turning to deals that protect their payments for longer than two years.

After the new HSBC five-year fix, the lowest on rate alone is Yorkshire building society at 2.59% at 60% LTV. Again, this comes with a £1,475 fee. Norwich & Peterborough building society has a five-year fix at 2.74% at 60% LTV with a much lower fee of

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