UK will automatically enrol up to 90,000 companies in customs system as it readies for Brexit

( via — Wed, 21st Aug 2019) London, UK —

LONDON (Reuters) – Britain will automatically enrol nearly 90,000 companies in a customs system in order to reduce the risk of Brexit disruption, the government said, its latest attempt to show it can leave the European Union without a deal if necessary.

More than 88,000 companies which are in Britain’s value-added tax register will be allocated an Economic Operator Registration and Identification (EORI) number in the next two weeks, the finance ministry said on Wednesday.

So far, around 72,000 firms have registered for EORI numbers which identify them for customs authorities.

“As the government accelerates its preparation to leave the EU on Oct. 31, it’s right businesses are prepared too,” finance minister Sajid Javid said.

“This will help ease the flow of goods at border points and support businesses to trade and grow.”

A group representing small businesses welcomed the move but said companies also urgently needed tax measures to boost cash-flow and adapt to any new trading circumstances from Nov. 1.

“If the nightmare of a chaotic no-deal Brexit on Oct. 31 becomes a reality, our small traders will be the first ones off the cliff,” Mike Cherry, chairman of the Federation of Small Businesses, said.

The FSB and the Confederation of British Industry, another employers group, have previously urged the government to issue EURI numbers automatically to businesses.

New Prime Minister Boris Johnson has said he wants Britain to leave the EU with a transition deal but he says he is prepared for a no-deal Brexit if the bloc does not renegotiate the deal it struck with his predecessor Theresa May.

Bank of England Governor Mark Carney has warned that many companies are not ready for the shock of a no-deal Brexit, adding to the risk of a shock for the economy.

Johnson’s government plans to double the support available for customs agents to train new staff or invest in technology to help businesses complete customs declarations.

By William Schomberg

Weak pound attracts investors from the US and Asia to UK tech

( via – – Wed, 21st Aug 2019) London, Uk – –

The UK tech sector has attracted more investment from the US and Asia in the first seven months of this year than it did during the whole of last year.

Japan and Singapore are the biggest Asian investors into UK tech, beating China,figures from the UK's Digital Economy Council and Tech Nation show.

Industry players say lower valuations in the UK due to the weaker pound are attracting investors to the sector.

The pound is currently trading at about a two-year low against the dollar.

Increasingly, UK companies are also heading to Asia to raise capital.

“I've seen a lot more requests from UK start-ups tapping Asian markets capital financing in comparison to a year ago,” said Aditya Mathur, founder and managing director of Singapore based venture capital fund

“They typically want access to the Asian market that is large and diverse, and for that they need an Asian investor to help them understand these markets, and also provide the kind of financing they're looking for.”

Hedging tool

UK tech firms also provide Asian investors with a way to hedge against the trade war, analysts say.

“Foreign investment into both the US and Chinese tech sectors has gone down because of the trade war and because Europe has provided several attractive investment opportunities lately” said Yoram Wijngaarde, founder and chief executive of Dealroom, the company that pulled together the figures for the research.

“The UK provides an attractive opportunity for funds looking to grow their investments.”

Investment from the US and Asia into the UK tech sector totals $3.7bn (£3.02bn; €3.31bn) so far this year. That's in comparison to $2.9bn for the whole of last year.

In total, Asia invested $1.8bn into the UK tech sector in the first half of this year, compared to $0.6bn the year before.

Companies in the UK's fintech and financial sector are amongst those that attracted the most interest from Asia's investors.

In May, Japan's Softbank bought an $800m stake in Britain's Greensill, which provides short term loans to companies to help with their operational needs.

Softbank and the Singapore-based Clermont Group also invested $400m in UK firm OakNorth Bank, a digital-only bank providing loans for small and medium-sized companies.

And Japan's Mitsubishi Corporation spent $220m buying a 20% stake in UK power firm Ovo Energy.

Still, the US is by far the biggest investor in the UK's tech sector, figures show, with $2bn worth of investments so far this year.

Online food delivery businesses like Deliveroo and digital payment platforms are among the areas that caught the attention of American investors.

‘Investor confidence'

“Today's figures demonstrate investors' confidence in the UK tech sector,” Natalie Black, the UK Trade Commissioner to Asia Pacific said.

“By attracting a broader mix of investors, particularly from Asia, we are showing that the UK's tech sector is one of the most competitive in the world, with a stable, bright future.”

Still, worries about what impact Brexit will have on the UK's tech talent pool are worrying investors and companies, who are concerned the UK will see a brain drain if EU nationals aren't able to work in the UK in the event of a no deal Brexit.

“It's our biggest concern right now,” said Russ Shaw, founder of Tech London Advocates, a campaign group promoting London's technology sector.

“One in five tech workers in London is from the EU. We're growing these businesses, and the money is flowing in, but we don't have enough talent in the country.

“We need a transition plan for companies who need to know what to do about staffing after October 31. Otherwise it undermines our credibility.”

Mr Shaw has said one of the ways the UK could mitigate these risks is by making the immigration process for overseas workers easier and more welcoming in the future.

By Karishma Vaswani

National Grid faces Ofgem investigation over lightning strike power outage

( via – – Tue, 20th Aug 2019) London, Uk – –

The regulator is looking into whether electricity firms breached licence conditions after a blackout which hit 1.1 million homes.

National Grid is facing an investigation by Ofgem over a major power cut earlier this month – as it blamed a lightning strike for the outage.

The regulator – which has the power to fine firms up to 10% of UK turnover – said it was looking into whether the Grid and other electricity companies breached their licence conditions.

Ofgem said it would focus on whether National Grid complied with requirements to hold sufficient backup power as well as how separate generation and distribution companies met their obligations.

It announced the investigation at the same time as it published National Grid's interim report into the power failure on 9 August, which left more than a million homes without power and caused major rail disruption.

The report blamed an “extremely rare and unexpected” outage at two power stations caused by one lightning strike at 4.52pm that day.

That resulted in a combined power loss to the network which was greater than the backup capacity held in case of emergency.

The report said the system automatically turned off 5% of Britain's electricity demand to protect the other 95% – a situation which it said had not happened in over a decade.

Ofgem's investigation will include questions over whether the companies involved made the right decisions about the number of customers who were cut off and if they were the right ones.

National Grid also admitted that the government, the regulator and the media were not made aware of what had happened as quickly as they should have been “impacted by the availability of key personnel given it was 5pm on a Friday evening”.

The business department was not updated until 5.40pm and Ofgem at 5.50pm, nearly an hour after the initial event.

The outage left 1.1 million customers without power for between 15 and 50 minutes as well as affecting trains in the South East.

Problems on the railways were mainly blamed on one particular type of train, of which there were around 60 in use, reacting unexpectedly to the outage, and half of them failing to restart – requiring an engineer to attend to do so.Sky Views: Who was to blame for the power cut?How black-outs may have boosted the argument for renationalisation

Other “critical facilities” hit by the power cut included Ipswich hospital and Newcastle airport.

National Grid must submit its final detailed technical report to Ofgem by 6 September.

Jonathan Brearley, Ofgem's executive director of systems and networks, said: “The power cuts of Friday 9 August caused interruptions to consumers' energy and significant disruption to commuters.

“It's important that the industry takes all possible steps to prevent this happening again.

“Having now received National Grid ESO's [Electricity System Operator] interim report, we believe there are still areas where we need to use our statutory powers to investigate these outages.

“This will ensure the industry learns the relevant lessons and to clearly establish whether any firm breached their obligations to deliver secure power supplies to consumers.”

The power cut came after a lightning strike just before 5pm, resulting in disruption for many commuters travelling home from work or going away for the weekend.

It knocked out Hornsea off-shore windfarm, off the Yorkshire coast – owned by Danish company Orsted – as well as Little Barford gas power station in Bedfordshire – owned by the Germany's RWE – resulting in the loss of 1,378MW.

That was more than the 1,000MW being kept by National Grid at that time – a level designed to cover the loss of the single biggest power generator to the grid.

Its report said that after the lightning strike at 4.52pm, National Grid restored the system to a “normal stable state” by 5.06pm and distribution network operators returned supply to all customers by 5.37pm.

However some major electricity users including rail services were affected for a number of hours “by the action of their own systems”.

By John-Paul Ford Rojas, business reporter

Persimmon profit falls as it spent heavily on schemes to counter quality complaints

( via – – Tue, 20th Aug 2019) London, Uk – –

Persimmon has reported a drop in profit for the first half of the year as it spent heavily on schemes to aimed to counter complaints over the quality and fire safety of its homes. 

The figures

Britain’s second largest housebuilder reported a 1.4 per cent drop in pre-tax profit, which fell to £509.3m for the six months ending 30 June. 

Persimmon said it had spent 40 per cent more on customer service than in the same period last year and that this would lead to an estimated £15m annual increase in customer care costs. 

The average selling price of Persimmon’s homes rose to £216,942 – up from £215,813 a year ago. 

Basic earnings per share dipped 4.15 per cent to 129.3p. 

Persimmon’s shares were up 0.91 per cent in morning trading to 1,879p.

Why it’s interesting 

Persimmon has faced criticism recently over the quality of its new-build homes, leading to the firm being branded a group of “crooks, cowboys, and con-artists” by an MP last month.

Robert Halfon also said he had met constituents living in Persimmon homes that were “shoddily built, with severe damp and crumbling walls”. 

A recent investigation by Channel 4 found one of Persimmon’s Help to Buy homes had a total of 295 faults, including fire doors that did not close. 

The housebuilder launched a review of its business practices in April, and had decided to push back the timing of handovers to allow homes to be checked more thoroughly.

Arlene Ewing, an investment manager at Brewin Dolphin, said that while investing in the quality of its homes and customer care “has taken a small bite out of profits, it appears to be the right trade off for the long term”.

Julie Palmer, a partner at Begbies Traynor, said Persimmon “faces a recovery operation that’s going to be more than just a quick fix”.

“The spectre of Brexit still looms,” she added, “and without a decision on terms of leaving and a damaged reputation, Persimmon may struggle to grow. Its priority must be to rebuild its reputation because in this highly competitive and uncertain market its needs to win back the hearts and minds of customers.”

What Persimmon said 

In today’s results document, Persimmon said it would be introducing a “new independent team of construction quality inspectors” to help address concerns over the quality of its homes. 

Chief executive Dave Jenkinson said the changes made in the first half “clearly shows that Persimmon is changing”. 

“I am proud of the commitment and dedication our teams have shown in supporting the many initiatives we have introduced to deliver a step change in our customers’ experience,” Jenkinson added.   

“I am confident that the progress we are making with our initiatives, our strong forward build, healthy forward sales and robust balance sheet place Persimmon in a strong position for the second half.”

By Anna Menin

Chancellor Sajid Javid: I won’t shift stamp duty to sellers

( via – – Mon, 19th Aug 2019) London, Uk – –

Chancellor Sajid Javid has said he has no plans to make house sellers rather than buyers pay stamp duty tax.

“I wouldn't support that,” the chancellor said in a tweet on Sunday.

His comments came after the Times reported on Saturday that Mr Javid was considering the idea, to save first-time buyers from paying the tax.

“I know from the Ministry of Housing, Communities and Local Government that we need bold measures on housing – but this isn't one of them,” Mr Javid said.

Stamp duty – a purchase tax paid in England and Northern Ireland on properties worth more than £125,000 – was abolished in 2017 for first-time buyers spending up to £300,000 on a house.

Forcing home sellers rather than buyers to pay the stamp duty tax would have made house purchases cheaper for those buying their first home or people trying to upgrade to larger homes, but could have made owners of larger homes reluctant to downsize.

The latest housing figures suggest that both house prices and sales are losing momentum amid Brexit uncertainty.

Key aspects of the housing market were “pretty much flatlining”, the Royal Institution of Chartered Surveyors (Rics) said earlier this month.

In the interview with the Times, Mr Javid refused to give details of his plans to reform the tax system, instead saying “wait and see for the Budget” which is due to take place in the autumn.

According to the newspaper Mr Javid said: “I'm a low-tax guy. I want to see simpler taxes.”

The report added: “he said that he was looking at various options when asked about stamp duty reforms including reversing liability from those buying property to those selling”.

Mr Javid also said he had not yet decided whether to hold the Budget before 31 October, the date the UK is expected to leave the EU.

What is Stamp Duty?

It's a tax that people who buy property or land must pay. In England and Northern Ireland buyers pay Stamp Duty Land Tax, in Scotland it is Land and Buildings Transaction Tax while in Wales buyers pay Land Transaction Tax.

In England and Northern Ireland the tax falls due on homes sold for £125,000 or more. However, first-time buyers pay no tax up to £300,000 and 5% on any portion between £300,000 and £500,000.

For people who have bought a home before, the rates are 2% on £125,001-£250,000, 5% on £250,001-£925,000, 10% on £925,001-£1.5m, and 12% on any value above £1.5m.

So if you are not a first-time buyer, and you buy a house for £275,000, the Stamp Duty you owe is calculated as follows:

•0% on the first £125,000 = £0

•2% on the next £125,000 = £2,500

•5% on the final £25,000 = £1,250

•Total Stamp Duty = £3,750

In Scotland, the rates on Land and Buildings Transaction Tax are 2% on £145,001-£250,000, 5% on £250,001-£325,000, 10% on £325,001-£750,000, and 12% on any value above £750,000.

In Wales, the rates on Land Transaction Tax are 3.5% on £180,001-£250,000, 5% on £250,001-£400,000, 7.5% on £400,001-£750,000, 10% on £750,001-£1.5m, and 12% on any value above £1.5m.

Global dividends hit record high but growth slows to just 1.1% compared to last year

( via – – Mon, 19th Aug 2019) London, Uk – –

Financial companies achieve fastest rise but technology sector payouts fall

Shareholders in companies listed on the world’s stock markets pocketed more than half a trillion dollars in dividends during the second quarter of the year, a record for investors’ payouts.

But despite dividends hitting an all-time quarterly high of $513.8bn (£423bn), the pace of year-on-year growth slowed to just 1.1%, compared with 14% this time last year.

Analysts at the asset manager Janus Henderson, which collated the figures from the 1,200 largest listed companies, said this slowdown reflected a weakening global economy and the strength of the dollar.

Financial and energy companies, largely oil and gas, increased their dividends faster than other sectors on an underlying basis, stripping out currency effects and one-off payouts. Banks and other financial companies handed out dividends that were 9.9% higher, and energy companies handed out an 6% increase.

Investors in the fast-growing technology sector, who have seen their dividend income triple over 10 years, had to accept a rare decrease after cuts at Nokia and Samsung.

Ben Lofthouse, head of global equity income at Janus Henderson, said: “At this stage in the economic cycle, we are seeing a moderation of dividend increases across a broad range of companies, and the number of cuts is on the rise, too.

“Global dividends have been growing very quickly over the last two years, however, so the slowdown we are now seeing is not a cause for concern. The underlying growth rate we expect this year is simply in line with the long-run average, rather than well ahead of it.Advertisement

“The impact of the global economic slowdown is greater in some parts of the world than others, with Europe seeing a particular impact. But this is why taking a global approach to income investing is so valuable – the regional and sector diversification brings significant benefits to investors.”

The world’s largest dividend payer was the Swiss food company Nestlé, which topped the list for the sixth quarter in a row, ahead of the French pharmaceuticals company Sanofi and China Mobile in third. Nestlé paid out more than $7bn in dividends last year.

Shareholders in British companies enjoyed an 8.6% rise in payouts, which reached a quarterly record of $35bn thanks to a $4.2bn boost from special dividends paid by Rio Tinto and Royal Bank of Scotland. The growth was in line with the global average of 5.3% once the impact of one-off payouts and the robust dollar were filtered out.

The strength of the US currency means that dividends paid out in sterling and other struggling currencies are lower when reported in dollar terms.

Investors scouring global markets for growth will have done well if they put their money in stocks from Japan, where payouts rose 10%, or emerging markets such as Brazil, China, India and Turkey, up 12.6% on average.

Janus Henderson said its forecast of global dividend payouts for the year remains unchanged at $1.43tn, an annual increase of 4.2%.

By Rob Davies

Why The Big Tech Giants Are Partnering With Automotive Companies to Bring AI Into Your Vehicles

Source: CNBC

Apple, Amazon, Google, and Microsoft are partnering with automotive companies that rely on the tech giants to bring phones and artificial intelligence into vehicles.

At its WWDC this week, Apple rolled out updates to CarPlay, which is now available in 90% of new vehicles in the United States. At Google I/O last month, Google announced an update to Android Auto and said Android Automotive, the first card with the Android operating system natively built in, will be available next year.

Amazon Alexa and Apple's Siri are also increasingly showing up in automobiles. IHS Markit forecasts that by 2024 almost 700 million of these software platforms will be enabled in vehicles.

Inside The $2.8 Million Real Life Flintstone Home in Hillsborough, California

Source: BI

The Flintstone House is an eccentric house in Hillsborough, California. It was designed in 1976 by William Nicholson and most recently purchased by Florence Fang in 2017 for $2.8 million. Large dinosaur statues and other Flintstone-themed artwork cover the front and back yards. Town officials from Hillsborough sued Florence Fang, stating that her property doesn't comply with the community's code.

Will Chatbots Automate Call Centers replace the livelihood of millions of agents around the world?

Source: Bloomberg

At a call center in the Dominican Republic, Laura Morales is designing chatbots to respond to customer service requests. A former call center agent herself, Morales has benefited from her new job that is better paid and higher skilled than what she used to do. But will these chatbots end up replacing the livelihoods of millions of agents around the world? This is an episode of Next Jobs, a mini-documentary series hosted by Bloomberg Technology's Aki Ito.

Turkey’s military pension fund in exclusive talks for the takeover of British Steel

( via– Mon, 12 Dec, 2019) London, Uk – –

The Scunthorpe-based steel maker, which has 5,000 staff, collapsed into insolvency in May.

Turkey's military pension fund has entered into exclusive talks for the takeover of British Steel.

Sky News first revealed that Ataer, a unit of Oyak which looks after the pension pots of Turkey's military personnel, had entered into exclusive talks with advisers to the government who have been running the auction of the ailing steelmakeron behalf of the Official Receiver.

British Steel, which has its largest manufacturing site in Scunthorpe, collapsed into insolvency in May after the government chose not to give £30m to the company under its then-owner, Greybull Capital.

In a statement, Ataer Holding said it was now exclusively conducting a detailed financial, legal and operational review for a period of two months.

It said: “During the exclusivity period, close negotiations to be held with customers, suppliers, employees and trade unions is significant for the future success of British Steel.”

Ataer said since British Seel went bankrupt on 21 May and entered a formal auction process, nearly 80 bidders across the world have expressed an interest.

The Official Receiver, a government agency responsible for the auction process, said the talks were for the whole of British Steel.

It said: “Following discussions with a number of potential purchasers for the British Steel group over the past few weeks I am pleased to say I have now received an acceptable offer from Ataer Holdings A.S. for the purchase of the whole business and I am now focusing on finalising the sale.

“I will be looking to conclude this process in the coming weeks, during which time British Steel continues to trade and supply its customers as normal.”

OYAK general manager Suleyman Savas Erdem said: “We have achieved one of the biggest achievements of the Turkish steel industry and signed a preliminary agreement to buy the industrial giant of UK, British Steel.

“We will continue to evaluate opportunities globally inline with our growth-oriented vision and we will continue our investments to provide sustainable high benefit to our members.”

Around 4,000 people are employed at Scunthorpe, with more than 700 employees in Teesside and an estimated 20,000 in its supply chain.

Sky's City Editor Mark Kleinman exclusively revealed that Ataer's bid in British Steel came after lenders to the steelmaker put pressure on EY, the adviser to the government, to seal a takeover or begin closing down the Scunthorpe site.

Since its collapse into liquidation, British Steel ‎has been funded through a taxpayer-backed indemnity and is estimated to be losing around £5m a week.

By Ganesh Rao, business reporter

Cathay Pacific boss resigns after protest row

( via – – Fri, 16th Aug 2019) London, Uk – –

The chief executive of Cathay Pacific, Rupert Hogg, has resigned in the wake of the protests in Hong Kong.

Mr Hogg said he was taking responsibility as these had been “challenging weeks” for the airline.

Last week, some of its employees took part in the protests in Hong Kong, but China ordered the Hong Kong-based airline to suspend staff who did so.

Cathay's chairman, John Slosar, said it was time to put “a new management team in place who can reset confidence”.

Paul Loo is also leaving as chief customer and commercial officer.

Mr Hogg said: “These have been challenging weeks for the airline and it is right that Paul and I take responsibility as leaders of the company.”

‘Reputation and brand under pressure'

Last week, Cathay Pacific had told its staff it would not stop them joining the pro-democracy demonstrations currently sweeping Hong Kong.

But on Monday Mr Hogg warned staff they could be fired if they “support or participate in illegal protests”.

Cathay faced pressure online after China's state-run press fuelled a #BoycottCathayPacific hashtag, which trended on Chinese social media.

Beijing's aviation regulator, the Civil Aviation Administration of China (CAAC), required Cathay to submit lists of staff working on flights going to the mainland or through its airspace.

It also had to submit a report on planned measures to “strengthen internal control and improve flight safety and security”.

Cathay Pacific said that Mr Hogg had been replaced by Tang Kin Wing Augustus and Mr Loo by Ronald Lam.

Mr Slosar said that while Mr Hogg and his team had carried out a three-year turnaround plan, “recent events have called into question Cathay Pacific's commitment to flight safety and security and put our reputation and brand under pressure”.

“This is regrettable as we have always made safety and security our highest priority,” he said.

The new bosses “have the experience and depth of knowledge of aviation and our people to be strong and effective leaders of Cathay Pacific at this sensitive time”, he added.

Hong Kong International Airport was closed at times this week in the wake of the massive anti-government protests that have paralysed one of Asia's key transport hubs.

UK retail sales unexpectedly rise in July helped by strong growth in online spending

( via — Thur, 15th Aug 2019) London, UK —

LONDON, Aug 15 (Reuters) – British retail sales edged up unexpectedly in July, helped by the strongest growth in online spending in three years, suggesting consumers continued to support the economy ahead of the Oct. 31 Brexit deadline.

Monthly retail sales volumes rose 0.2%, the Office for National Statistics said on Thursday, compared with a median forecast for a 0.2% decline in a Reuters poll of economists and following a 0.9% surge in June.

Compared with July 2018, sales were up by 3.3%, slowing from robust growth of 3.8% in June. The Reuters poll had pointed to annual sales growth of 2.6%.

Consumers have so far largely taken Brexit in their stride, helped by modest inflation and wages growing at their fastest rate in 11 years.

That has aided the world’s fifth-biggest economy at a time when many companies have been cutting back on investment because of escalating uncertainty about Brexit.

The figures contrasted with a British Retail Consortium survey that showed spending fell in the year to July at the fastest pace on record for that month.

The ONS said retail sales grew 0.5% in the three months to July, the smallest increase this year and reflecting a drop in sales volumes in May.

“Although still declining across the quarter, there was an increase in sales for department stores in July for the first time this year,” ONS statistician Rhian Murphy said.

“Strong online sales growth on the month was driven by promotions.”

Online sales jumped 6.9% on the month, their biggest rise in volume terms since May 2016. Amazon (AMZN.O) held its annual “Prime Day” sales promotion last month, a major driver of sales for the company.

However, household goods stores reported their biggest monthly drop in sales in two years, down 5.4%, with anecdotal evidence that warm weather had kept shoppers out of furniture and lighting stores.

Stable inflation, the strongest rise in wages since 2008 and some of the lowest unemployment rates since the mid-1970s have continued to boost household incomes, although after inflation wages are still below their peak before the financial crisis.

But there have been signs that consumers could turn more cautious as Britain’s political crisis drags on.

The amount households are saving relative to their income is not far off record low levels.

News from retailers has been mixed of late. Fashion chain Next (NXT.L) shrugged off Britain’s retail gloom on Wednesday and has also reported a surprise rise in full-price sales.

But baby products retailer Mothercare (MTC.L) blamed an uncertain and volatile home market coupled with fragile consumer confidence as reasons why it will not report a rise in annual profit.

Reporting by Andy Bruce and David Milliken

Digital bank Monzo to offer short-term loans a year after Wonga’s collapse

( via – – Thur, 15th Aug 2019) London, Uk – –

Challenger bank offers short-term loans but says it is not targeting customers who use payday lenders

Digital bank Monzo is dipping its toes into the short-term loans market a year after Wonga’s collapse, but insists it will not target customers who usually turn to payday lenders.

The challenger bank formally launched loans for its 2.5 million customers on Thursday, following a trial with around 4,000 of its users. Those who qualify will be able to borrow as much as £15,000 for up to 60 months, or take loans as small as £200 for as little as 90 days.

That kind of wage top-up has been the hallmark of short-term or payday lenders, whose customers borrow an average of £300 over three months.

But while payday lenders usually hit customers with interest charges equal to an annual percentage rate (APR) of 1,000%, Monzo is charging a maximum 24% APR on loans up to £7,500. Loans worth between £7,500 and £15,000 are charged as low as 3.7% APR.

Founder and chief executive Tom Blomfield said Monzo, which is favoured by young customers especially in the south-east, is not trying to appeal to those with low credit scores. “These aren’t targeted at the sub-prime end of the market at all. You have to pass a relatively stringent credit check.”

Last year Blomfield told the Telegraph that Monzo was considering launching loans targeting “the Wonga segment” of the market. He said he didn’t want to expand into that area solely for profit, and suggested there could be a more ethical approach to payday loans.

He was forced to backtrack on those comments and days later said Monzo was “categorically not working on a high-cost credit product.” But he said that helping people with spiralling debt and poor credit scores was an area the company still planned to move into.

Blomfield explained Monzo’s new smaller loans will appeal to customers who, for example, need an emergency boiler repair but don’t want to charge it to their existing credit card or dip into expensive overdrafts.

“I don’t think you should force people to borrow thousands of pounds if they don’t need thousands of pounds. They just need £200 for a short-term need for three months and it’s a flexible tool. I don’t think it’s for everyone.”

Monzo recently doubled its value to £2bn after closing a fresh round of investor funding. The bank raised £113m from a group of investors led by Y Combinator, a US-based investment firm best known for backing holiday letting platform Airbnb, file hosting service Dropbox and online forum Reddit.

By Kalyeena Makortoff

UK Rail fares set to rise further by up to 2.8%

( via – – Wed, 14th Aug 2019) London, Uk – –

Rail users in the UK will be hit by a further rise in ticket prices which will come into effect next year.

The increase will be based on the Retail Prices Index (RPI) inflation measure for July of 2.8%.

The figure is likely to lead to an increase of more than £100 in the annual cost of getting to work for many commuters.

Passenger groups urged a change in the way ticket prices are calculated, as RPI is no longer a national statistic.

The cost of most train fares are set by train companies themselves, but about 40% of fares in England, Scotland and Wales are regulated so that they are only allowed to rise by an amount pegged to the RPI rate of inflation in July the previous year.

These regulated fares include annual season tickets.

The government's preferred measure of inflation, the Consumer Prices Index (CPI), increased to 2.1%.

The Campaign for Better Transport (CBT) has repeatedly said that CPI, the most widely watched and used measure of inflation, should be used instead of RPI.

Last month this was 2% and it is typically lower than the RPI rate of inflation.

CBT chief executive Darren Shirley said the expected ticket price rises were “exorbitant”.

“The government should commit now to January's fares rise being linked to CPI,” he added.

Rail Minister Chris Heaton-Harris said: “It's tempting to suggest fares should never rise. However, the truth is that if we stop investing in our railway, then we will never see it improved.”

The TUC trade union renewed its call for the railway to be renationalised, arguing it would lead to lower ticket prices.

“We're already paying the highest ticket prices in Europe to travel on overcrowded and understaffed trains.

“The number one priority should be running a world-class railway service, not subsidising private train companies,” said TUC general secretary Frances O'Grady.

Analysis: Tom Burridge

The bitter irony for rail passengers is that the quality of service in Britain is all too often undeserving of the price.

After a cataclysmic year on parts of the network last year, punctuality was generally on the up this year before the hot, and then wet and windy weather caused significant disruption this summer.

The promise (via an ongoing Government-commissioned rail review) is that our train companies of the future will only make money if they run trains on time.

In principle that sounds good for passengers but we still don't know how it will work in practice and when such a system will actually arrive at a station near you.

The wider financial dilemma for Government is that our rail network is in large parts ageing and in need of a refit.

Infrastructure upgrade work costing the taxpayer billions is ongoing or planned.

Government sources point out that a relatively small proportion of public transport journeys are made by train (roughly 17%).

Therefore, they argue, a rise in ticket prices, however painful for passengers, is a necessary evil to meet the rising costs linked to running the railways.

More train delays

At the start of this year, train fares went up by an average of 3.1% in England and Wales and 2.8% in Scotland.

The rise in England and Wales – the highest since January 2013 – meant the price of some annual season tickets rose by more than £100.

In Scotland, peak-time season tickets and anytime day tickets became 3.2% more expensive, while the capped increase of off-peak fares was 2.2%.

Rail passengers have had to endure more delays on the network this year.

Last week was particularly bad, with thousands of people affected by a signal failure, which led to the suspension of all services out of London Euston, on Thursday.

And then trains were also affected in Friday's power cut, with many stranded across the network

Delays also happened during July's heatwave, while in January, London Overground commuters were given a month's free travel after delays to the delivery of new electric trains.

TUI reports strong growth in revenues despite grounding of its Boeing 737 MAX jets

( via– Wed, 14th Aug 2019) London, Uk – –

Shares in TUI rose by more than 3% as the company stuck to its previous guidance but remains down by 45% over the past year.

Tour operator TUI has reported strong growth in revenues despite the grounding of its Boeing 737 MAX jets.

It follows the global suspension of Boeing's flagship aircraft after two fatal crashes forced airlines to rely on older and less-efficient planes as replacements.

The pan-European travel company, which has a fleet of 15 jets that remain grounded, said it anticipated a total €300m (£279m) charge for the year over the issue.

Boeing said it assumed the 737 MAX would return to service in the US and other countries in the autumn but could not give an exact date.

TUI said while replacing the grounded jets in the busy summer period was costly, it expected the situation to become more manageable during the winter lows.

Shares in TUI rose by more than 3% as the company stuck to its previous guidance but remained down by 45% over the past year.

The Germany-based firm said earnings declined by 46% year-on-year to €100.9m (£93.6m).

Chief executive Fritz Joussen cited efficiency drives and cost reductions, but noted uncertainty around Brexit, aviation overcapacity to Spain and delayed bookings in the summer.

Mr Joussen also said a fall in sterling since Boris Johnson became UK's prime minister discouraged British customers from travelling abroad.

In stark contrast to its UK-based rival Thomas Cook, which faces a risk of bankruptcy, the world's largest holiday company said it was in a “robust financial position”.

By Ganesh Rao

British retailers urge government to freeze business rates

( via — Tue, 13th Aug 2019) London, UK —

LONDON (Reuters) – More than 50 British retailers, including Sainsbury’s (SBRY.L), Marks & Spencer (MKS.L), Asda (WMT.N) and Morrisons (MRW.L) have urged the government to freeze business rates to help out the struggling sector.

In a letter to the new finance minister Sajid Javid, published on Tuesday, the retailers called on the government to take action to “fix the broken business rates system”.

Business rates are taxes to help pay for local services, charged on most commercial properties, including shops, warehouses, pubs, cafes and restaurants. They are currently calculated according to the rental value of properties and have an annual inflationary uplift or multiplier.

The letter asks for a freeze in the business rates multiplier to stop another tax rise.

The retailers’ letter was coordinated by lobby group, the British Retail Consortium (BRC), which has for years complained the current system is unfair.

It points out that the industry is the largest private sector employer in Britain, employing about three million people. While it accounts for 5% of the UK economy, it is burdened with 10% of all business taxes, and 25% of business rates.

“This disparity is damaging our high streets and harming the communities they support,” said BRC chief executive Helen Dickinson.

The letter comes a day after BRC-Springboard data showed 10.3% of shops in Britain were vacant, the highest rate in four years, adding to the growing gloom in the sector.

Another survey from the BRC published earlier this month showed British retailers reported the weakest July sales growth since records began.

Last month new prime minister Boris Johnson announced a 3.6 billion pound fund to support town centres.

Javid is due to set out his spending for the 2020-21 financial year next month.

Reporting by James Davey

National Grid ‘had three blackout near-misses in as many months’

( via – – Tue, 13th Aug 2019) London, Uk – –

Exclusive: Industry sources say system operator aware of growing potential of blackouts ‘for years’

  • What are the questions are raised by the UK’s recent blackout?

National Grid had experienced three blackout “near-misses” in as many months before Friday’s major outage left almost a million homes in the dark and forced trains to a standstill around the UK.

The system operator, already under investigation by the energy watchdog, faces criticism from within the industry that it has not done enough to guard against the risk of blackouts.

National Grid blamed the “incredibly rare” nationwide power cut on a severe slump in the grid’s frequency – a measure of energy intensity – following the unexpected shutdown of two power generators.

It will face an investigation into its handling of the energy system after the first blackout in more than a decade following the shutdown of a gas-fired power plant in Bedfordshire and the Hornsea windfarm in the North Sea at about 5pm of Friday.

It said it would work with the regulator and energy companies to “understand the lessons learned” after two power plants shut down unexpectedly within minutes of each other, causing severe rush hour travel disruption across the country.

But industry sources claim National Grid has been aware of the growing potential for a wide-scale blackout “for years”, and has suffered a spate of near-misses in recent weeks.

The Guardian understands that in every month since May there has been a severe dip in the grid’s frequency from its normal range around 50Hz. Industry sources have confirmed that the grid’s frequency has fallen below 49.6Hz on three different occasions in recent months, the deepest falls seen on the UK grid since 2015. On Friday the blackout was triggered when the frequency slumped to 48.88Hz.

In June, the frequency of the grid plummeted to within a whisker of National Grid’s legal limit of 49.5Hz after all three units of EDF Energy’s West Burton gas-fired power plant in Nottinghamshire tripped offline without warning.

The unexpected outage triggered an emergency call for backup electricity supplies which stabilised the energy grid’s frequency before a blackout was triggered.

In addition, the grid’s frequency fell to 49.55Hz on 9 May, and 49.58Hz of 11 July.

A spokesman for National Grid said these events were “independent”. He added that there was “no trend or prediction of more frequency excursions”.

“Over the past four years frequency has regularly fluctuated between the agreed limits, as part of the normal day-to-day operation of the electricity system,” he added.

Steve Shine, chairman of Anesco, a battery company, said: “It would be easy for National Grid to write this incident off as a fluke event, but they have actually been aware of this potential issue for many years.”

National Grid has managed to avoid wide scale blackouts by triggering last-minute contracts to help it stabilise the grid and avoid breaching the crucial 49.5Hz limit set by the regulator.

It contracts energy suppliers to ramp up their output from generators and batteries to make up for an outage, and offers contracts to companies such as factories and supermarkets, which can temporarily cut their energy demand to help stabilise the frequency of the grid.

But many of the companies tasked with supplying the “safety net services” – such as batteries and diesel farms, which are banks of small-scale generators – have warned that National Grid is not doing enough to safeguard the system against blackouts.

The UK’s booming renewable energy output can make it more difficult for National Grid to balance the frequency of the grid, which was originally built to accommodate fossil fuel power plants, which generate more intensive energy.

National Grid said it had embraced the UK’s renewable industry by developing “frequency response” tools – such as quick-fire back-up supplies of extra electricity – which should make it technically possible to run the energy system without any fossil fuels by 2025.

Shine said: “What is needed is a greater volume of faster response services, which can be called into action when the frequency drops. This would have prevented the need to turn the power off.

“It’s worrying that with just two generation sources dropping out of the supply mix, National Grid was still unable to deliver power to all areas, with no proper contingency plan in place,” he said.

“It’s exactly this kind of scenario the UK needs to be prepared for – these recent events demonstrate how important it is to have more, faster response services available, which can be called into action when the frequency drops,” he said.

Steven Meerman, the founder of battery firm Zenobe, called on National Grid to “update its old rules of thumb” to determine how many reserve services it kept on standby in the future.

“It may be the energy system is changing faster than expected,” he said.

John Pettigrew, National Grid’s chief executive, defended the grid’s response in a post on social media site LinkedIn entitled “there is never a good time for a power cut”.

He said: “Contrary to some erroneous media reports, I am not on holiday – indeed, I’ve been at my desk all weekend.

“As CEO of National Grid plc ultimately the buck stops with me.”Topics

By Jillian Ambrose Energy correspondent

Thomas Cook shares plunge after request of additional £150m from investors

( via – – Mon, 12th Aug 2019) London, Uk – –

Travel operator, which had already asked for £750m, wants to stave off winter cash crunch

Shares in Thomas Cook have slumped after the troubled travel operator said it was seeking to raise another £150m from investors – after already asking for £750m – to stave off a Christmas cash crunch.

Thomas Cook said it was in advanced discussions with its banks and Fosun, the Chinese conglomerate and its biggest shareholder, over the “substantial new capital investment”.

The British travel company, which traces its history to 1841, has struggled in recent years due to a large debt pile, intense competition and structural change to a travel industry lumbered with large branch networks. In recent months unseasonable weather and the impact of Brexit on consumers’ travel plans have added to its woes, pushing it to a £1.5bn loss for the six months to 31 March.Quick guide

Thomas Cook shares fell by a fifth on Monday to 6.2p amid questions of whether the company would survive. The price was a far cry from highs of 140p reached as recently as May 2018. The former FTSE 100 blue chip company was worth only £147.9m before the latest fall in its value.

The latest cash injection comes a month after Thomas Cook revealed it was in talks over a £750m rescue deal with Fosun, a Shanghai-based company with diverse interests that include Wolverhampton Wanderers football club, insurance and property businesses and the Club Med tourism brand.

Thomas Cook said the extra £150m would provide it with liquidity headroom during the winter months, when travel operators generally ran low on cash after bulk buying hotel space before a surge of bookings for the next summer. It expects the bailout to be concluded in early October.

Those shareholders who have remained with Thomas Cook are expected to have the value of their shares “significantly diluted” by the bailout, which will result in about £1.7bn in debt converted to equity alongside the £900m cash injection.

The plans would also involve splitting its profitable airline from the tour operator business, which Fosun would essentially take over. Fosun would then have to decide on any reorganisation, prompting concern about the future of the 21,000-member workforce. The company has 563 high street branches in the UK.

By Jasper Jolly

High Street shop vacancy rate in town centres at its highest for four years

( via – – Mon, 12th Aug 2019) London, Uk – –

The number of empty shops in town centres is at its highest for four years, industry figures show.

The vacancy rate was 10.3% in July, its highest level since January 2015, according to the British Retail Consortium and Springboard survey.

Footfall also fell by 1.9% in July, the worst July performance for seven years.

Diane Wehrle, Springboard insights director, said July had been “much more challenging” for shopping centres and High Streets than out of town stores.

The survey showed that High Street footfall declined by 2.7% in July, and shopping centre footfall declined by 3.1%.

In contrast, footfall in retail parks increased by 1.2%.

‘Enhanced experience'

Ms Wehrle added: “Consumer demand is ever-more polarised between convenience and experience, and the stronger performance of out of town destinations where footfall rose by 1.2% in July reflects the fact that retail parks are successfully bridging the convenience-experience gap.

“They not only offer consumers accessible shopping environments with free parking and easy click and collect opportunities for online purchases, but many also combine this with an enhanced experience that includes coffee shops and casual dining restaurants, and some also have leisure facilities.”

The town battling the High Street blues

Chris Vallance, BBC's The World At One

In a shopping arcade in Stockton-on-Tees, the loudspeakers are playing Empire State of Mind. “Bright lights will inspire you,” goes the chorus, but the canned music isn't inspiring all the shoppers.

“It's getting like a ghost town really,” one says. “They've made it nice, the area, but the shops are going one by one.”

In 2018, data from the Centre for Retail Research found more than 2,500 mostly medium or large retail businesses failed, and the organisation's Joshua Bamfield now expects 2019 to be worse.

Stockton-On-Tees has also faced losses.

“Marks & Spencer, they closed and now Debenhams is going to close,” Labour's Nigel Cooke, the borough council cabinet member for regeneration and housing, told Radio 4's World At One.

Stockton's response to High Street closures has been to try to “reinvent” the High Street.

The BRC said there was concern about the rise in empty store fronts.

“If the government wishes to avoid seeing more empty shops in our town centres then they must act to relieve some of the pressure bearing down on the High Street,” said BRC chief executive Helen Dickinson.

“Currently, retail accounts for 5% of the economy, yet pays 10% of all business costs and 25% of all business taxes. The rising vacancy figures show this is simply not sustainable.

“We need an immediate freeze in rates, as well as fixing the transitional relief, which leads to corner shops in Redcar subsidising banks in central London.”