Browsing "Breaking News"
A round-up of the main news stories this week. (Transcript Below).
UK Falls Deeper into Recession
The UK has fallen even deeper into recession, with GDP falling by 0.7%. The Office of National Statistics pointed to the struggling construction sector, where output fell by over 5%. Shadow Chancellor Ed Balls told the BBC that the Chancellor should admit now that he’s got it wrong.
We need some action from the Chancellor, not excuses, not political slogans, not short-term thinking, not digging a deeper hole for him, the government, and the country.
Shadow Chancellor, Ed Balls MP.
Virgin Money Buys Up Northern Rock Mortgages
In better news for the Treasury, Virgin Money has bought up mortgage assets from Northern Rock’s holding company in a deal that pays back £538 million to the taxpayer. Virgin took over Northern Rock earlier this year after agreeing a £747 million fee. It says that it will contact all mortgage holders affected by the transfer before the handover is completed.
British Gas Posts Rising Profits
British Gas has announced a £345 million profit for the first half of the year, a rise of 23%. This takes the profits of its owner, Centrica, up to £1.45 billion. Consumer groups say this reflects how quickly energy companies act to raise tariffs when oil prices have risen, and how slowly they reduce them when prices fall again.
Savers Clueless About Their Rates
Over half of British savers have no idea about the rates they are receiving on their savings accounts, according to the Nationwide Building Society. Almost two-thirds are unsure if they are receiving the best rates that their banks can offer. With many accounts sustained by temporary bonus rates that expire after just 12 months, there are concerns that many savers will be receiving next to nothing on their savings. Which4U’s guide on savings and bonus rates could help savers to deal with this problem.
New Rules for Packaged Bank Accounts
And finally, the Financial Services Authority has announced a set of new regulations that will affect the way that packaged bank accounts are sold. Customers who pay a fee of up to £40 for their current accounts are often unable to claim on the insurance policies. From March next year, banks will be forced to take stricter measures to ensure that customers will be eligible for the policies they are paying for. The regulator said that it’s important that bank accounts don’t become the next big mis-selling scandal for banks.
For latest news, features, and guides, why not visit us at Which4U.co.uk?
“When’s the next Lubbock Holiday, dear?”
One of those fabulous nuggets of history known only to social historians and experienced pub-quizzers has been brought to the table by the House of Lords in a fascinating proposition of nomenclature.
From Tax to Taxonomy
To Lord McColl of Dulwich, such has been the deplorable behaviour of banks that they should no longer be nationally commemorated by association with the traditional ‘bank holiday’.
Instead, he argued, these days – of which there are currently six permanently established in England and Wales – should revert to the name they were originally given, St. Lubbock Days, after the MP who contrived the Bank Holidays Act in 1871.
Read More »
There’s little that should surprise us in this day and age, but the good old social media stratosphere has proved its mettle when it counts. As has – this author is proud to say – the genial spirit of the North-East.
NatWest (the bank – it pays to elucidate) has had a torrid week. A technical glitch in a routine software upgrade last Tuesday evening led to a backlog of millions of transactions.
Millions of customer bank accounts have been affected by the problem, which shows no immediate sign of abating.
The RBS group has fervently assured customers that nobody will be left out of pocket by the chaos. But risk assessment analysts have queried why no adequate contingency plans were in place to deal with such a problem.
The episode has heaped more pressure onto the shoulders of beleaguered RBS boss Stephen Hester, who has faced numerous calls for his resignation. The taxpayer-owned group had already taken a blow last week when RBS was downgraded by credit ratings agency Moody’s, along with four other major British banks and 15 worldwide.
Read More »
Even in the world of literary theory, semantics is a thorny field. Transpose that to an uncomfortable argument about where to attribute blame for the onset of the financial crisis, and we’re all on tenterhooks.
Bank of England Governor Sir Mervyn King made an unlikely admission this week that the Bank, under his stewardship, should have done more “to prevent the disaster”.
“Our banking and financial system overextended itself”, he observed, in a speech for the BBC Today Programme Lecture.
He even turned to the tale of The Emperor’s New Clothes to demonstrate the fundamental ineffectiveness of contingency loans dished out by central banks – a thought that most would prefer not to visualize.
Read More »
“Robbing the poor to feed the rich”
The ‘banking crisis’ is set to strike a new low in confidence at the end of 2011. And there is no Eurozone to blame here; it is a situation entirely of UK banks’ own making.
This week has been a decidedly poor one for banks, and has highlighted several problems endemic within the financial system.
[Read more at Which4U]
George Osborne delivered his riposte today in the face of mounting pressures, but weak growth forecasts look set only to further intensify the pressure on the beleaguered Chancellor.
The Autumn Statement revealed that figures from the Office of Budget Responsibility (OBR) show a significant downgrading of growth over the coming years.
Importantly, for Osborne, they do not predict a recession. Growth has been revised from 1.7% to just 0.9% for 2011, and is set to contract slightly to 0.7% in 2012, before rising to 2.1% in 2013. The OBR suggests that unemployment is set to rise over this period, even accounting for the growth measures stipulated in the report.
Eurozone & Debt
The Chancellor adopted the OBR’s assessment that the Eurozone was a signficant factor in the downgraded growth prediction. Under pressure to defend his defiance of austerity measures, Osborne sought to contextualise the current situation in the UK via the Eurozone.
Without his austerity plan in place, he argued, borrowing would have been high enough to launch the UK into the centre of the Euro debt storm. Read More »