Swiss bank accounts, Catalan regional elections

Catalonia is holding elections to the regional parliament on 25^th of this month which the leaders of the regionalist party CiU are trying to make into a plebiscite on independence from Spain.

 

To the great dissatisfaction of the CiU leaders, the questions of corruption, tax evasion and transfer of huge sums of money to accounts in Swiss banks have been brought to attention in information leaked from the Swiss UBS bank, and in a Spanish police report published by the leading newspaper ‘El Mundo’.

 

Last week we wrote about the father of the present President of the Catalan government, Artur Mas, who had an substantial account in Switzerland. He is being investigated for possible corruption connected with the construction of the Palau in Barcelona. This week we can tell our readers about the publication in ‘El Mundo’ of a report from the Spanish police that the Pujol family has 131 million euros stashed away in a Swiss account. Jordi Pujol was one of the founders or the regional party and President of the Generalitat for several years. He was also the founder of the Banca Catalana that was investigated by the Bank of Spain due to heavy losses. The national prosecutors examined transfers to other countries of more than 500 million pesetas, but in 1986 the Barcelona courts of shelved the accusations.

 

The Catalan nationalists are now pretending that the accusations about the Swiss bank accounts are just election rhetoric.

 

In the meantime, President Barroso of the European Commission has confirmed that is a territory segregates from a member state it automatically leaves the European Union, and their citizens will no longer be European Citizens.

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Higher prices electricity in Spain

 

The electricity costs in Spain are among the most expensive in the EU, and was one of three countries where costs increased the most during 2020-2011. The European Commission has asked Spain to change their tariffs to, ‘take into consideration the obligation to provide a universal service and effectively protect their most vulnerable consumers.’

 

For the non-resident property owner, the high standing charges in their electricity bills seems very unfair, as they have to pay for something not being used.

 

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Typewriters reach the end of the line in the UK

It was at 12pm on Friday that the last British-made typewriter was packed into its box at the Brother factory in Wrexham. Its maker, Edward Bryan, 40, has worked in the factory since 1989. When he started, around 30 people were on the typewriter line. By the end there was just him – the team leader – and another worker. The last CM-1000, an electronic typewriter that retails for around £400, was presented to Rachel Boon, a curator of technologies and engineering at the Science Museum, which will keep the machine. Colleagues gathered around, and the MD of Brother Industries, Craig McCubbin, reminisced about how he had started out on the production line in his school holidays.

“I was a bit sad,” says Bryan, who has been building typewriters for Brother for 23 years. “You could have ownership of the machine. From taking a little screw at the start, you end up with a typewriter in a box.” He can build one with his eyes closed – he tried it once. “It took about 40 minutes,” he says with a laugh. (Usually, it would take him just 18.)

The decision was taken six months ago to stop production, says Phil Jones, Brother’s UK head. “Clearly, typewriters have been undergoing a decline in many years. There’s always a point where it’s not economically viable any more, and we always knew that time was coming.”

The factory had been making 300-500 machines a month, accounting for just 0.25% of the company’s turnover. “When a category is such a small percentage, it really isn’t worth doing analytics on it,” says Jones when I ask who was still buying typewriters, but he says he thinks many of their customers were older people who don’t feel comfortable using a computer. “And they’re popular in prisons – it seems they’re still one of the approved technological products that prisoners can use in some prisons.” He also thinks there may be secret government bunkers, where highly classified missives are written on typewriters, “but that’s just speculation”. The international company will still produce typewriters in its Malaysia factory, primarily for the US market and developing countries, “but it is the end as far as UK manufacturing is concerned”.

As typewriters go, it would be difficult to feel too romantic about the CM-1000 – the large greige machine hardly conjures up the same image as Hemingway hammering away at his trusty black Royal, the clatter of the typing pool or William Boot packing his portable typewriter for assignment in Ishmaelia – but it still feels like a heavy-hearted full stop.

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Private security companies to be self-regulated

The statutory licensing of more than 330,000 individual private security workers is to be scrapped under a shakeup of the regulation of the industry proposed by Home Office ministers.

They are instead proposing that private security companies regulate their own staff, with the industry’s watchdog, the Security Industry Authority, moved into the private sector.

Ministers say the phased move to a “business regulation regime” reflects the “maturity of the private security industry” and supports its willingness to take on further responsibility and be more accountable for its actions.

The new regime will shift responsibility for the standards and behaviour of security staff from the SIA to an estimated 4,200 businesses operating in Britain.

This will leave the regulator with the task of targeting companies or employees that fail to meet the required standards with a range of penalties from banning a company from the industry to criminal prosecution. Companies rather than the regulator will in future be responsible for carrying out checks on individual security staff.

The move will involve the repeal of 2001 legislation, which was introduced following concern about widespread criminality among nightclub bouncers and contract security guards. When licensing was first introduced it covered 130,000 individuals. This has now mushroomed to 330,000 private security staff in a wide range of roles, from escorting failed asylum seekers abroad to running police stations.

The minister for criminal information, Lord Taylor of Holbeach, said reform of the industry would improve transparency and accountability. “Our plans will raise standards and free up the SIA to concentrate on stamping out poor business practices and criminality.

“It is also important that legitimate businesses are not overburdened by government regulation and red tape. By lowering the cost of regulation on the industry, savings can be passed on to customers.”

Ministers said that many of the proposed changes can be done without primary legislation but they hope to have the rest of the powers on the statute book by next October. An official consultation will run over the next eight weeks.

Lady Henig, the chairman of the SIA, is due to step down in January, after six years in the role.

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FTSE edges higher after early losses, with InterContinental lifted by hotel sale hopes

On a busy and volatile day, one constant was a strong performance from InterContinental Hotels.

The owner of Holiday Inn and Crowne Plaza remained among the FTSE 100’s biggest risers all day, finally closing 43p higher at £16.33. The impetus for the increase was news that Barclays had moved its recommendation from equal weight to overweight and its price target from £17.30 to £18.25. It said the group was expected to sell around $800m worth of hotel assets with the proceeds set to be returned to shareholders in 2013. On top of that, the bank said the group could announce the sale of further hotels in Paris and Hong Kong by 2014. This could be worth another $1.1bn. It expects an update on strategy alongside February’s results.

Just ahead of Intercontinental was Xstrata, up 29.8p at 986.6p after the mining group’s shareholders approved its long drawn out merger with Glencore, 5.15p higher at 331.75p, while booting out a controversial management incentive scheme at the same time.

Meanwhile Lonmin, where Xstrata has a near 25% stake, added 36.77p to 310.7p in the wake of its investors backing an $817m cash call on Monday.

After starting the day in the red, following Moody’s cutting its Triple A rating on France, the FTSE 100 recovered to close 10.44 points higher at 5748.10. With EU finance ministers locked in talks over Greece, many analysts had expected investors to take some profits after Monday’s rally, which appeared to be based on hopes that the US could overcome its fiscal cliff – the tax rises and spending cuts due to come into force next year. But news of a ceasefire in Gaza helped sentiment towards the close of the trading day.

Angus Campbell, head of market analysis at Capital Spreads, said:

The good news for the bulls is that the move by Moody’s to downgrade their credit rating for France hasn’t caused a knee-jerk reaction from investors and the equity markets have performed well considering one would normally expect a negative reaction to such an event. It indicates that this was already baked into the cake and when Fitch finally fall into line with their own downgrade we could see a similar muted response from the markets.
The rise in London also came despite an opening fall on Wall Street which was partly due to a disastrous statement from Hewlett-Packard. Not only was the computer and printer company’s trading performance poor, but it revealed it was taking an $8.8bn write-down on its purchase of UK group Autonomy and made allegations of accounting improprieties against the business.

Elsewhere in technology chip designer Arm, up 3% on Monday on vague talk Intel could bid after the US group announced a change at the top, lost virtually all that gain, closing 20.5p lower at 726.5p as the euphoria faded.

International Airlines Group, the owner of British Airways and Iberia, climbed 4.2p to 167.6p after bumper results from Easyjet, up 39.5p at 692p.

British Land was steady at 515p as half year profits rose 3.8%. Mark Hughes at Panmure Gordon said:

You own British Land in the current environment because as we have said in the past, “it does what it says on the tin”. Its stable portfolio and predictable income stream continue to deliver…outperformance and a predictable and attractive dividend yield (5.1%). We remain buyers with a target price of 570p.
Tullow Oil added 12p to £13.79 as it said it would buy a 40% interest in assets in Guinea owned by Texas group Hyperdynamics Corporation. Tullow is paying $27m and will carry a share of future expenses up to $100m.

Among the mid-caps, London Stock Exchange lost 1.5p to 985.5p as UBS cut its price target from 990p to 960p, saying the benefits of its diversification and cost control were already fully reflected in the share price.

Paragon, the buy-to-let mortgage lender, fell 9.3p to 240.7p despite record profits of £94.2m and a lower impairment charge. The shares have jumped sharply since May, so investors have used the full year figures as an excuse to take profits. But analyst James Hamilton at Numis issued a sell recommendation on the business.

Finally online market researcher BrainJuicer dropped nearly 30% to 256p after it warned full year profits were likely to be substantially below the £2.8m it reported in 2011.

 

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Eurozone crisis live: Anger in Greece as debt talks fail

Good morning, and welcome to our rolling coverage of the eurozone crisis.

Greece’s international lenders have failed to agree a deal over its bailout package, leaving the country’s future in doubt again.

After overnight negotiations in Brussels, eurozone finance ministers, the European Central Bank and the International Monetary Fund again admitted that they could not reach agreement on how to bring Greece’s debts down to a sustainable level.

Talks broke up around 3.30am GMT, with weary participants telling reporters that some progress had been made.

Not enough, though. Instead, the eurogroup intends to meet again on November 26th for another go.

News that the eurozone had flunked its Greek test, again, sent the euro sliding (down half a cent to $1.275). It has also sparked disappointment in Greece, after it met its side of the bargain by agreeing tough austerity plans.

I’ll be tracking all the news and reaction to this latest setback in the crisis through the day, along with other key events in the world economy.

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Moneysupermarket founder to move to Jersey

Jersey – you’re sooo moneysupermarket.com. The island of Jersey is expected to be the new home of Simon Nixon, the multimillionaire founder of the price comparison site, which would allow him to shelter his £400m fortune from HM Revenue & Customs.

A move by Nixon, who owns just under 50% of the company and who – only two months ago – cashed in some shares to benefit from entrepreneur’s tax relief, is likely to spark fresh concern about tax avoidance by British businesspeople and major multinational firms.

Earlier this week, senior executives from Amazon, Starbucks and Google were accused of diverting hundreds of millions of pounds in UK profits to secretive tax havens during a fraught exchange with a committee of MPs.

All three repeatedly denied accusations that they were engaged in aggressive tax avoidance, but were met with derision from members of the committee.

Nixon’s relocation to Jersey is likely to save the 44-year-old, who currently lives in Cheshire, millions of pounds in tax that he pays on dividends from moneysupermarket.com.

A spokeswoman for the company, where Nixon is now deputy chairman, confirmed he was considering a move to the island, adding: “It’s purely a personal matter where he chooses to live.”

Nixon launched moneysupermarket.com in 1999 after dropping out of university to work as a financial adviser. It floated on the stock market in 2007, instantly turning him into Britain’s richest entrepreneur aged below 40.

On Thursday, the company reported revenues in the third quarter up by 11% and profits ahead by 12%, helped by a surge in customers hoping to beat the rise in electricity and gas prices by switching suppliers.

In June this year the company paid £87m to buy Martin Lewis’s moneysavingexpert.com website. Lewis told the Guardian on Thursday night he had no plans to move to Jersey.

Guy Hands, who once owned EMI, is now based in Guernsey, while Peter Wood, founder of Direct Line, is also understood to be examining a move to Jersey.

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Taxpayers’ £66bn in RBS and Lloyds at risk, say MPs

The £66bn of taxpayer funds used to buy shares in Royal Bank of Scotland and Lloyds Banking Group at the height of the financial crisis may never be recovered, a powerful group of MPs warned on Friday.

As the public accounts committee criticised the way the Treasury handled the nationalisation of Northern Rock, it also called on the government to ensure taxpayers got value for money from the future sale of stakes in the bailed out banks.

The committee urged the government to keep its role as shareholder separate from “wider policy objectives” amid calls from some politicians for RBS to be turned into a small business lending bank. Stakes in bailed out banks are managed at arm’s length by UK Financial Investments.

The committee wants UKFI to publish updates on the costs associated with Northern Rock. The bank was split into Northern Rock plc, which resumed lending and was sold to Virgin Money at the start of this year, and Northern Rock Asset Management, the “bad bank”, which remains in public hands.

The committee had been investigating the National Audit Office report published in May which warned that taxpayers faced losses of at least £2bn on the continued ownership of the so-called bad bank.

With only two bidders for Northern Rock and only one that was really keen to buy – Virgin Money – the committee said this did not bode well for any attempts to sell off RBS, of which taxpayers own just over 80%, and Lloyds, in which taxpayers own just under 40%. At current share prices taxpayers are losing around half of the £66bn investment.

“The lack of competition does not fill us with confidence that the taxpayer will make a profit on the sale of the two banks which remain in public ownership, RBS and Lloyds. There is a risk that the £66bn invested in RBS and Lloyds may never be recovered. It is vital that the final decisions on the wholly owned banks are made with value to the taxpayer taking precedence over speed of exit,” said Margaret Hodge, the MP who chairs the committee.

The report said: “We are not convinced that the taxpayer would be making a profit on these banks any time soon.”

The NAO reported that the sale of Northern Rock was handled well by UK Financial Investments – which looks after the taxpayer stakes in the bailed out banks – but still lost the taxpayer an estimated £469m. “There was little competition to buy Northern Rock. UKFI was fortunate that Virgin Money had a strategic interest in immediately purchasing a small retail banking operation in 2011.”

Hodge noted that when Northern Rock was split in 2009 and the “good bank” given a mandate to start lending it failed to achieve its goal. “Splitting the bank was supposed to generate lending, but the new bank lent only £9.1bn against a target of £15bn,” Hodge said.

The committee concluded the Treasury was “part of a monumental collective failure to understand that the pre-crisis boom could lead to a banking crisis”.

Treasury officials have admitted Northern Rock should have been nationalised more quickly rather than in February 2008, five months after the run on the lender which sparked anxiety across the financial sector and the first run on a bank since the 1866 run on Overend & Gurney.

Hodge called on the Treasury to update the committee on its review into dealing with financial crisis – known as the White review – after finding that it “did not have sufficient capacity or the skills to understand and respond to the crisis when it began”. She said: “This will not be the last banking crisis, and the next one is likely to be different. The Treasury must ensure it retains the right staff with the right skills to understand the risks and respond effectively.”

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UK homeownership falls to lowest level since 1988

Homeownership is “in crisis” in the UK, with owner-occupation falling to its lowest level since 1988, according to a report published by lobby group the HomeOwners Alliance.

The HOA says the owner-occupation rate peaked at 69.7% in the UK in 2002, falling to a current 64.7%. That rate is the 17th highest among the 27 EU countries, and lower than that of Bulgaria, Ireland, Italy and Romania.

There are now about 5 million households locked out of the property market as a result of housing shortages and high house prices. Having been forced into the rental market, sky-high rents mean they are unable to save the funds needed to get a foothold on the property ladder.

The HOA’s report – which uses data from the Department for Communities and Local Government and its counterparts in Wales, Scotland and Northern Ireland – shows that London is the greatest affected, with less than half of properties in the city now owner-occupied, the lowest level since figures for the capital began in 1991.

The latest LSL Property Services buy-to-let index, also published on Friday, shows that the average monthly rent across England and Wales hit an all-time high of £744 in October 2012, the seventh month in a row of rent increases. On an annual basis rents in London have risen by 7% to £1,102 – easily more than double the rate of inflation.

Paula Higgins, chief executive of the HOA, said: “This decline in homeownership is depriving a generation of the chance to own the roof over their head, shattering their dreams and aspirations. It is preventing millions of people from living the sort of lives they want to. Buying your first home is returning to being a privilege of elites.”

She warned that the social consequences were “profound and long-lasting”: poverty among pensioners and children would rise, social inequality worsen, and more people would face life in insecure rented accommodation.

Duncan Stott of pressure group Priced Out said: “The housing market is creating serious difficulties for a generation of priced-out first-time buyers. House prices remain at levels way out of reach, leaving would-be buyers stuck in the rental market, where ever-increasing rents make it a real challenge to save up for a deposit. While house prices remain so unaffordable it is inevitable that homeownership will decline.”

Owner-occupation remains by far the most desired form of housing tenure in the UK. According to the latest British Social Attitudes survey, 86% of Britons want to own their own home, including those who live in social housing.

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Three shrugs off 4G with 1m new mobile phone customers

Three, the mobile phone network owned by Hong Kong conglomerate Hutchison Whampoa, has added 1.04 million customers in the UK in a year.

With 300,000 joining in the last quarter, the country’s smallest network is now also the fastest growing, with 8.8 million customers.

In a trading update, Three said it had added 850,000 contract customers and 192,000 pre-pay customers in the 12 months to 30 September.

Rival network EE has recently launched 4G superfast mobile internet but Three chief executive Dave Dyson said his company was “giving more people in more places” access to “ultrafast” speeds by upgrading its radios to the latest 3G technology.

By the end of 2012, new “dual carrier” radios, which communicate with phones that have two antennas in order to double their speed, will cover half of the UK population, and 80% by 2013.

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