Month: September 2013

Barclays reviews overdraft fees…

…in bid to break from ‘sins of the past’

Barclays is launching an unprecedented review of the overdraft fees and charges faced by nearly 12 million of its current account customers in a bid to make a decisive break from the “sins of the past”.

Just days after Barclays admitted it was likely to suffer a £50m fine for the handling of its Qatari bailout, the bank will this week reveal it is pushing ahead with eight commitments to improve service after asking customers what they should do better.

The key part of the campaign will be a complete review of Barclays’ overdraft pricing. Ashok Vaswani, Barclays’ retail and business banking chief executive, told the Daily Telegraph the bank was already trialling a text alert service where tens of thousands of customers are warned they are about to go into the red. This has so far cost the bank £1.5m in lost fees and is likely to be extended. But Barclays is also considering ways it may be able to allow customers with multiple accounts to offset money in one against an overdraft in another to prevent them from being charged.

Mr Vaswani said: “I’m going through the business with a fine toothcomb. We want to de-risk the business and clean up any sins of the past. We really, really have to put customers at the centre of everything we do.”

Barclays’ reputation tumbled through the credit crisis, with last year’s Libor fine followed in the past week by confirmation of the likely penalty it faces for failing to declare it paid £322 million to the Qataris for bailing the bank out in 2008. Barclays also last week admitted that it may have to compensate 300,000 personal loan customers who were given the wrong paperwork for five years. And it came bottom of an ethical poll by campaigners Move Your Money, scoring just four out of 100 for its honesty and service. Each of Britain’s big five banks have vowed to improve service in the past year after the fallout from the credit crisis and the mounting bill from the Payment Protection Insurance (PPI) scandal.

Mr Vaswani joined the bank in 2010 and stated earlier this year that the bank would only succeed if customers were content, and therefore came back to the business during the times of their life when they need financial help, be it a mortgage or sending their child to university. Barclays launched its “Your Bank” initiative earlier this month, asking customers to tell them what they should improve and what other ideas they had for the board. So far received some 250,000 people have got in touch and Mr Vaswani insisted that “for the most part” they were constructive. Some ideas ranged from putting umbrella stands in branches or letting customers use the branch toilet.

But of the eight suggestions Barclays is working on straight away, one will see coin deposit machines introduced in branches to allow customers to pay loose change into their accounts. Barclays is also looking to extend its “PingIt” mobile payment service to 11 to 15 year-olds while the bank also wants to allow mortgage customers to access their accounts online and on their mobile phones.

A new overdraft policy will be worked on over the next 90 to 120 days. Currently Barclays charges as much as £88 for savers that persistently fall into an unauthorised overdraft during the month. The more common charge is £22, where a payment takes a customer into their unauthorised “Personal Reserve” and another subsequent payment is made.

Mr Vaswani said: “The biggest one for me is overdrafts. I’m going to do a full grass roots review of our overdraft proposition. We know that this has been a problem which is why we have already launched the text alert systems in real time.

“I firmly believe that once a customer has been given the opportunity to save £22 they will say to themselves: “This bank is looking out for me”.

UK borrowing less than expected in August

The government borrowed less than expected in August, official figures

Public sector borrowing for the month was £13.2bn, the Office for National Statistics (ONS) said, lower than the £14.4bn recorded in August 2012. The UK’s net public debt pile stands at £1.19 trillion, which is equivalent to 74.6% of GDP. The government is aiming for a deficit of no more than £120bn this year. Efforts to reduce UK borrowing and cut the country’s debts are central to the government’s economic, helped by a fall in spending by government departments.

But Chancellor George Osborne has faced criticism as the deficit reduction plan has stalled, thanks in part to weak economic growth.

‘Painfully slow’

The government’s latest target is to eliminate the structural deficit by the end of the 2017-18 financial year – three years behind the original schedule. The government hopes that a recovery in the economy will boost tax receipts, helping it meet its borrowing targets.

According to the ONS, tax revenues so far this tax year have been 2.8% higher than the same period of 2012. The UK economy grew by 0.7% in the second quarter of this year, and is widely forecast to continue growing for the rest of the year. The August figures also suggest the public sector finances were being helped by the government’s austerity measures.

Total spending by central government – excluding investment – fell by 2.2%, led by a sharp drop in departmental spending.

“The improvement in economic growth seen in recent months will help to reduce the deficit further, but progress remains painfully slow,” said David Kern, chief economist at the British Chambers of Commerce.

“Our ability to generate tax revenues will struggle to return to pre-recession levels, even when the pace of growth picks up. As a result, the government must continue to make cuts in current spending in order to reduce the deficit further.”

Free business event for young farmers

Farmers Weekly in association with Tesco has launched a free one-day business event for young people who are hungry for success in agriculture.

Fertile Minds 2013 will bring together 150 ambitious young farmers in the early stages of their careers for one day of non-stop business inspiration at Sheepdrove Farm in Berkshire.

Leading the packed line-up of speakers are:

  • A special guest who is one of the UK’s most exciting young entrepreneurs.
  • Three business-savvy young farmers who have proved it’s possible to build successful farming enterprises completely from scratch.
  • Farmers-turned-sausage entrepreneurs the Keeble family, who have recently launched new sausage brand Heck and are stocked in Tesco.
  • Banking experts who will lead a session on developing and pitching a truly winning business plan.
  • Leading members from Land Partnerships, who will be sharing top legal advice on how to make that vital link between young farmers in need of some acres, and landowners with space to spare.

And Farmers Weekly will be presenting exclusive research on the type of jobs, wages, benefits and workload of those working in UK agriculture. Recruitment experts De Lacy Executive will also be on hand to shed light on what the results mean for the industry.

As well as hearing from established brands and businesses, it will also be a unique opportunity for young farming entrepreneurs to network with their peers – share ideas, discuss problems, talk solutions and possibly even sow the seeds of future business collaborations.

Farmers Weekly editor Jane King said: “There has never been a more exciting time to farm, but the next generation of farmers doesn’t have it easy. Feeding more mouths on less land will take imagination, ambition and lots of thinking outside the box. We hope everyone will leave Fertile Minds buzzing with ideas, and with a much clearer idea how they are going to achieve their business ambitions.”

Places are free but strictly limited to 150, so get your application in as soon as possible. The closing day for registrations is Friday 4 October and we will notify you by the start of November if you have got a place.

  • WHEN: Wednesday 20 November (9am – 5.30pm)
  • WHERE: Sheepdrove Farm in Lambourn, Berkshire
  • WHO: Entrepreneurial young people who are hungry to farm.
  • COST: It’s totally free, and lunch is provided

Something Nice On Your Lunch Hour

Above Agriculture – A Summer In The Skies

Jason Hawkes has been taking aerial photographs from the skies above the UK for more than 20 years. Perched in the open door of a helicopter, hundreds of metres above the ground, his vantage point offers a colourful and striking view of the land below.

Here – with his latest set of images – he explains how he spent the summer of 2013 criss-crossing Britain, snapping the natural and manmade patterns and shapes that dominate our rural landscape.

Just click the link below to view the slideshow.


All photographs subject to copyright. Aerial images courtesy Jason Hawkes. Music by the Steve Miller Band, Paul Weller and KPM Music.

Slideshow production by Paul Kerley. Publication date 17 September 2013.

Inflation pressure eases on households

Households have been promised a long-overdue improvement in living standards after inflation eased in August, taking some of the pressure off family finances.

The consumer prices index (CPI) dipped to 2.7%, from 2.8% in July, taking it below the Bank of England’s own forecasts and putting inflation on course to hit 2% at the end of the year, economists said.

A slowing in the pace of clothing and petrol price rises, as well as air fares, kept a lid on inflation last month, the Office for National Statistics (ONS) said. Petrol prices increased just 2% between July and August to £1.37 a litre, compared with 3.5% in 2012.

Michael Saunders, UK economist at Citi, said: “We expect CPI inflation will fall further in coming months, and our base case at present is for the rate to be … 2pc in December.”

He added that the Chancellor’s recent hint at plans to reduce or cap regulated prices, such as train fares and utility bills, posed “a possible downside risk to our forecasts”.

A 25% fall in global wheat prices over the past year, in sterling terms, is expected to put more downward pressure on inflation over the next six months.

The prospect of declining inflation will come as welcome news to households, who have suffered a 7% fall in real average earnings over the past five years – making the current household squeeze the second deepest since 1860. Average wages are rising at just 1% currently, two-thirds less than prices. Labour has seized on the drop in living standards as evidence that the recovery is not being felt by most families.

“With prices still rising much faster than wages the cost of living crisis under David Cameron continues,” Cathy Jamieson, Labour’s shadow Treasury minister, said.

“Working people are worse off by almost £1,500 a year. But rather than helping ordinary families David Cameron is so out of touch he has given a huge tax cut to millionaires instead.”

A Treasury spokesman said: “Inflation has fallen, and is nearly half of its peak of 5.2%. The economy is turning a corner, but the recovery is in its early stages and risks remain. The only way to deliver a sustained improvement in living standards is to tackle the economy’s problems head on and deliver a recovery that works for all.”

Signs that inflation is falling were underpinned by the month-on-month rise in CPI. At 0.4%, it was the lowest August rise since 2009. However, the retail prices index (RPI), a separate measure that includes housing costs, rose from 3.1% to 3.3%.

Economists said the figures were unlikely to have much impact on when the Bank of England will start to raise interest rates from 0.5%, which the markets expect to be in early 2015. “We judge there to be relatively few policy implications from today’s numbers,” Philip Shaw at Investec said.

A separate release by the ONS on producer prices suggested that there is little inflationary pressure brewing. Input prices fell in August by 0.2%, and output prices rose by just 1.6%. “Falling factory gate price pressures bode well for inflation at the high street level,” Mr Shaw added.

Compensation for 300,000 after loan rate error

Barclays miscalculated personal loan interest rates over five years. Barclaycard customers could also be affected.

Around 300,000 Barclays customers are to receive compensation after the bank miscalculated the interest owed on personal loans. The total cost is estimated to be at least £100m after mistakes were made on paperwork since October 2008. The compensation paid could be an average of £330 per borrower.

The total bill for the bank, and the number of people affected, could be higher. Other divisions – Barclaycard, Barclays Wealth and Barclays Corporate – are now undertaking a review to see if customers were short-changed by the errors.

A spokesman described the latest problem, which relates to arrears notices and statements, as “technical documentary errors”. The errors on statements and arrears notices were mentioned in annual results in February, when it reported that income had declined “due to provisions taken to remedy historical interest charges incorrectly applied to customers”.

The company has now said it will write to customers while more detail was published in a wider 185-page document yesterday. Barclays said it had “identified certain issues with the information contained in historic statements and arrears notices relating to consumer loan accounts. It is therefore implementing a plan to return interest incorrectly charged to customers”.

A spokesman for the bank said: “Barclays has proactively reviewed information it has historically sent to its customers relating to interest charges, where we have found technical documentary errors. As a result Barclays has identified certain issues with the information contained in some statements and arrears notices relating to consumer loan accounts.

“Due to these notification errors, interest was not due on certain accounts during the period that Barclays made this mistake, and whilst no one has been mis-sold to, customers are entitled to have their interest payments returned. No customer will pay more than they were ever contractually expected to.

“Barclays has notified the Office of Fair Trading (OFT), which is responsible for consumer credit issues, and is implementing a plan to return interest payments to customers as swiftly and efficiently as possible. Barclays is undertaking a review of all its businesses where similar issues could arise to assess any related issues.

“Any affected customer will be contacted by Barclays and customers do not need to take any action.” Letters will be sent out next month to affected customers.

The error was revealed in a prospectus for Barclays’ £6bn 1-for-4 rights issue, which was launched yesterday to plug a regulatory capital shortfall.

It also admitted that it was facing a £50m regulatory fine for failing to disclose payments made to Qatar which it dressed up as fees for “advisory services”. Barclays paid Qatar £322m in hidden fees to secure the gas-rich Gulf state’s support for its rescue fundraising at the height of the financial crisis and keep the bank out of UK taxpayers’ hands.

Barclays also faced stinging criticism in a new ethical scorecard of banks, published yesterday. Barclays’ 12 million current account customers have been urged to switch to other banks and building societies after the bank scored just four out of 100 points in a test for honesty and customer service.

Campaign group Move Your Money said Barclays was the lowest scoring financial institution out of 70 assessed. The findings were published amid the launch of the industry’s new Current Account Switching Service, which promises to transfer accounts hassle-free within seven working days.

Anthony Jenkins, who last year replaced controversial chief executive Bob Diamond, has gone to great lengths to underline a new era for Barclays, promising to make it a “valuable and sustainable institution”.

Construction output rises in July, raising recovery hopes

Britain’s struggling construction sector beat estimates for its latest monthly performance, as the Government-backed housing recovery helped to increase new business.

Output from the construction sector grew by 2.2pc in July against the previous month, official figures showed, driven by new business placed at firms. Growth in private housing led this, with activity up 14.7pc on a year earlier. The data raised hopes that building firms are finally “turning a corner” and helping the wider recovery to pick up speed.

“This suggests that the recovery in the housing market seen in recent months, supported by schemes such as Help to Buy and Funding for Lending, is starting to translate into a recovery in house building,” said Scott Corfe, managing economist at the Centre for Economics and Business Research. “The strong growth… may alleviate concerns in some quarters that schemes such as Help to Buy are going to merely inflate house prices while doing nothing to increase the stock of housing in the UK.”

However, he cautioned that the “tentative” signs of housing supply responding to demand were unlikely to stop property becoming even less affordable in coming years.

Building firms are bouncing back from a very low base as activity grew to a near halt during the financial crisis. Last year, output was still almost 14pc off its level in 2007.The latest headline month-on-month growth seen in July came after a 1.1pc fall in June. The improvement meant that the industry’s output was in August 2pc higher than a year ago, the strongest annual gain since 2011.

In a further positive sign, the figure for the second quarter of the year was revised from 1.4pc to 1.9pc, the Office for National Statistics said. Over that quarter, construction orders for new housing were up by 19.4pc, the biggest rise seen since autumn 2010. The data helped push sterling to a seven-month high against the dollar, hitting $1.5872 in afternoon trade.

Economists said the positive contribution from construction put the UK economy on track to beat the 0.7pc growth achieved in the second quarter of this year. While the sector’s output accounts for just under 7pc of the UK’s total gross domestic product (GDP), its volatility means it can have a large impact.

“The surge in UK business optimism is feeding through to the hard data now,” said Robert Wood, chief UK economist at Berenberg, predicting GDP growth of 0.9pc in the third quarter of this year, and 0.7pc in the fourth.

Alan Clarke at Scotiabank was still more bullish, forecasting GDP growth of 1pc for the third quarter. “So far, so good,” he said. “The key thing that we are waiting for is the monthly services output data.”


We here at Richmond Asset Finance are Backing British Farmers! We understand the hardship that today’s farmers face, and we want to help as much as we can!

The population of Great Britain is growing rapidly with the country experiencing the biggest baby boom in 40 years! Did you know that British food supplies would have ran out on August 14 if all the food produced in Britain in a year was stored and eaten from January 1 onwards.

But our British farmers are determined to reverse this trend and produce enough food for the needs of generations to come – but we need politicians, supermarkets, retailers, food processors, restaurants and cafes to play their part to let them do their job.

The National Farmers’ Union have created a charter calling for a commitment to put British farming at the heart of the challenge of feeding us all in the future – and they need OUR support!

Sign the Back British Farming charter now and show them your support!

So far they have now got over 1250 signatures on the #BackBritishFarming charter.

And don’t forget to tell your friends to sign the charter too! Make it British, Make it local, Make it Happen.

How to value your manufacturing business

Putting a price tag on a manufacturer is a rather complicated business. Hi-tech machinery, strong supply contacts, and a diversified risk profile can all add millions to a market cap.

Manufacturing output in the UK surged upwards by nearly 2% in June according to the Office for National Statistics. This is the strongest monthly increase since the end of 2010. This is important – changes in manufacturing output are often a useful barometer for economic growth for the UK as a whole. Given the improvement in manufacturing prospects, owners of manufacturing companies should be thinking about the impact on the value of their businesses.

A key consideration for value is the volume and value of supply contracts. Manufacturing output is driven by contracts to supply. Very few manufacturers produce on a speculative basis, preferring to produce volumes on the basis of orders. If the associated revenues of a manufacturer are not secure, in that there are few contracts in place, or the product itself has a limited or uncertain future, then it is likely that an investor will demand a higher return on any capital invested in return for a shorter business life.

Providing certainty over future revenue generation is positive for valuations. One way that investors will assess the predictability of revenue is by analysing the terms of the existing contracts, looking particularly at size, length and the contractual renewal terms of contracts. Historical, together with current performance may also provide a useful guide when considering the likelihood of renewing contracts, customer churn and the ability to secure new custom.

Clearly, manufacturing businesses with greater certainty over cash flows and long term contracts will be valued more favourably than those that lack this certainty.

‘Concentration risk’ is also a key valuation consideration for prospective buyers. Certain manufacturers, such as apparel manufacturers supplying large retailers, may have it as a condition of their contract that they are exclusive suppliers and, therefore, are not able to supply anyone else in order for them to guarantee supply lines. While contracts may be lucrative and the association with the likes of M&S or Next provide profile, losing a contract would jeopardise the business. Such a risk could weigh heavily in the mind of a prospective investor. This is a particular issue for manufacturing businesses making generic products which could be easily produced by another supplier, and in a cheap labour economy.

As with many other industries, customer relationships may also have an influence on the value of a manufacturing business. A solid relationship with key buyers within large retailers can positively impact value because of the possibilities for future contract wins and the implied stability of existing arrangements.

Investors will also analyse the other major contracts of the manufacturing business, such as operational leases. For example, the business may have a long term lease over its manufacturing premises representing a significant overhead. If there are high costs present within a business alongside uncertain or poor revenue prospects investors will steer well clear.

As one would expect within a manufacturing business, property, plant and equipment usually represent some of the largest items on the balance sheet. Aside from property, these assets typically include all machinery used in the manufacturing process as well as storage, transporting equipment and other assets.

As such, when assessing the value of a manufacturing business overall, plant and machinery is often a major consideration, in particular the maintenance and replacement costs. For example, an investor will need to assess whether and for how long the plant and machinery will suit the business’s needs and strategy. If the underpinning technology of the plant and machinery is dated or soon-to-be obsolete an investor will have to consider the amount of capital expenditure required to keep the business competitive and revise the value downwards.

Understanding the asset base is a key consideration for any prospective investor (who ultimately is the person who determines values.) The intangible assets such as contract values and customer relationship, provides a good indication of a business’s prospects and assessment of existing plant and machinery will provide a useful basis for considering future capital expenditure requirements.

Wonga posts £84.5m profit as one million people draw payday loans

Wonga, the highly controversial payday lender, made a profit of £84.5m last year as the business continued to grow in the UK as well as overseas.

The company, which has been criticised by the Archbishop of Canterbury over the summer, saw profits rise by 35% as customer numbers boomed. They releasing their annual accounts this morning, Wonga said it made a pre-tax profit of £84.5m last year, up from £62.4m in the previous year. Net profit rose 36% to £62.5m.

The increase came on the back of a 68% increase in lending, to £1.2bn. More than one million customers borrowed from Wonga, whose annualised percentage interest rate is above an astonishing 4000%. Turnover rose 67% to £309.3m in the year. In an attempt to deflect some of the negative comments the profits are likely to draw, Wonga highlighted that it paid more than £21m in corporation tax in the UK last year.

In addition to the UK, where it made 3.8m loans last year, its consumer business has expanded in to South Africa, Poland, Spain and Canada. As well as its consumer loans business, Wonga expanded by opening a loans for business arm last year. The company also launched a product for the online retail payments market.

Chairman Robin Klein said: “Wonga’s profitability during 2012 was the result of the large scale of our operations and an unflinching commitment to provide a flexible and convenient service designed around customers.”

British Farming Awards 2013

The Business of Farming 5-6 November 2013

The British Farming Awards celebrates creative thinking, innovative approaches and the relentless hard graft by farmers working across the industry. The awards are a great way to celebrate something that we Brits should be more thankful for, which is of course, British Farming. It’s great to recognise farmers hard efforts, especially with the troubles they now face today. We should all be proud to be British, and farming is a huge part of this.

They reward the extraordinary farmers who have made their business a success through sheer determination, grit and foresight. Whether you have grown your farming business through an innovative approach, re-invented your business, developed a new agricultural input or piece of machinery, have thought-out a new approach to livestock or crop production, or adopted and adapted new research and technology, they want to hear from you.

The Farmers Guardian, Arable Farming and Dairy Farmer pride themselves on understanding its farming readership. They focus on British farmers, understand their needs and discover inspiring stories of people who have changed what they do and how they do it. Everyone knows climate change is happening, the global population is growing, the amount of red tape increasing and the amount of financial support is decreasing. Farmers farm within some of the most frustrating conditions around which is why – now more than ever – we need to keep British farmers farming.


  • Arable Innovator of the Year?
  • Beef Innovator of the Year
  • Sheep Innovator of the Year
  • Dairy Innovator of the Year
  • Renewables Innovator of the Year
  • Machinery Innovator of the Year
  • Farm Retail Innovator of the Year
  • New Entrants Award: Against the Odds
  • Family Farming Buisness of the Year

Visit the link to see How to Enter :