Posted by Hari on Thursday, June 12, 2014 with No comments | Labels: Roundup
In a speech to the GMB union, Sadiq Khan said the rise in inequality under the coalition is a "stain" that is getting worse, especially as senior Tories such as Boris Johnson have argued that greed is a good thing. But he also acknowledged that the rise in inequality did not start under this government. Khan will say the share of income going to the richest 1% has risen from 8.2% to 9.8% over the past year, with the 100 wealthiest individuals seeing their assets increase in value by £40bn. He pointed out that Britain had the fastest rise in inequality in any developed country between 1985 and 2008. Before the speech, Khan said: "Over 13 years of government, we did many amazing things – from the national minimum wage to investing in education – but we also have to have the humility to admit that we weren't able to do enough to tackle rising inequality – and that it continued to rise under our watch." GUARDIAN
European commission to investigate tax affairs of Apple, Starbucks and Fiat
European regulators have launched formal inquiries into the tax affairs of Apple, Starbucks and Fiat, probing alleged sweetheart deals negotiated between the corporations and national governments in Ireland, the Netherlands and Luxembourg. Calling for multinationals to "pay their fair share of taxes", the European commission's top competition regulator, Joaquín Almunia, said he was concerned that special tax treatment may have been granted that breached state aid rules. Business leaders across Europe have complained that some corporations, particularly those operating online or from US headquarters, compete unfairly by exploiting loopholes. Europe's state aid laws ban tax breaks if they risk distorting competition, and business leaders in Britain and on the continent have complained that the negligible tax paid by some rivals puts them at a disadvantage. "In the current context of tight public budgets, it is particularly important that large multinationals pay their fair share of taxes," Almunia said. Regulators may expand their investigations to other nations and corporations. Almunia told a press conference on Wednesday: "It is well known we contacted Belgium and the UK, in particular the UK in the case of Gibraltar, and maybe we will open a new investigation." GUARDIAN
Osborne to lay out plans to clean up Wild West foreign currency market
Chancellor George Osborne is asking regulators to lead a review, including crucial benchmarks used to set everything from currency rates to the price of oil. The aim is to then introduce statutory regulation to keep traders and brokers in check. With the general election fast approaching, Osborne is anxious to appear tough, particularly after lambasting the previous government for being lax on regulation and asleep at the wheel during the financial crisis. Regulators have predicted that allegations traders have rigged the foreign currency markets could – if proven – be an even bigger scandal than Libor, when traders fixed the inter-bank lending rate. David Buik from broker Panmure Gordon said forex could make Libor and PPI look like a ‘vicarage tea party’. Regulating this sprawling market will be a Herculean task. The forex, or FX, market is the biggest in the world, with an estimated £3trillion changing hands each day. Yet it is not regulated, with one market insider who blew the whistle on foul play by corrupt traders memorably comparing FX to the Wild West. Prices tend to be set by traders involved in the deals, allowing plenty of scope for manipulation by those wanting to rig their bets and boost their bonuses. The global investigation into allegations traders rigged foreign currency markets strikes at the heart of the City of London – still reeling from the Libor scandal. London accounts for 40 per cent of the FX market, with Deutsche Bank, UBS, Citigroup, and Barclays the dominant players. It has been reported that 15 banks around the world are involved in wrongdoing, with around 40 traders suspended so far. DAILY MAIL
Amazon “Living Wage” campaigners place dummy protest book on online retailer’s site
Campaigners who have been calling on Amazon to "end poverty pay" for months have brought their battle directly to the internet retailer's front doorstep with the launch of a "book" on Amazon's own website slamming the way it treats its workers. The title, A Living Wage for All Amazon Workers, says in its Amazon product description: "Over 62,000 people have called on Amazon to end poverty pay in 2014 – but Amazon has yet to take our demand seriously so we've brought it direct to Amazon.co.uk", asking readers to "review this product below and let Amazon know that it's time to pay the human cost of its operations". The "product" was made available for sale this morning for £7.65 – "the living wage rate across the UK outside London where most of Amazon's warehouses are located", says its product description. Amazon states on its website that "in the UK, permanent associates start at a minimum of £7.10 per hour increasing to a median of £8.00 per hour after 24 months". The stunt is masterminded by Amazon Anonymous, a group of campaigners who have garnered over 62,000 signatories to their change.org petition which says that "with UK sales in 2012 of £4.2bn, you'd think Amazon could afford to pay its workers [both permanent and contracted agency staff] enough to be able to feed and clothe themselves and their families". GUARDIAN
Energy firms under pressure to cut bills after sharp drop in wholesale costs
The regulator Ofgem said that at the start of this month gas prices for next day delivery reached their lowest level since September 2010 and were 38% below this time last year. Prices for electricity reached their lowest level since April 2010, and are currently 23% lower than June 2013. Despite that, the regulator said that the suppliers – SSE, EDF Energy, Scottish Power, E.ON, npower and British Gas – were showing no signs of reducing prices, or even of explaining to customers why they were not doing so. The regulator said that while there were upward pressures on energy costs from government schemes to support environmental objectives and network renewal, the costs of wholesale power and gas, which account for half the prices paid by consumers, "dwarfed" these. The letter is expected to add credence to the view that Britain's energy firms are quick to put prices up when wholesale bills rise, but slow to cut them when the reverse happens. Ofgem proposed referring the retail market to the Competition and Markets Authority after a joint report with the Office of Fair Trading and the CMA confirmed that competition was not working as well as it could be. Data published by Ofgem last week showed dual-fuel suppliers were poised to make an average profit of £96 per home over the next year, compared with an estimated £44 over the past 12 months. GUARDIAN
Number of households with serious debt is on the rise despite the so-called recovery
While loan and credit card debts are proving less of a worry for many families, calls for help with basic household bills have shot up since 2007. Water rate arrears have gone up by 305 per cent since 2007, with telephone arrears up 230 per cent and energy arrears have risen by 171 per cent. More people than ever before now need help with energy debts, water debts, telephone debts, council tax debts, and catalogue shopping debts, the charity Money Advice Trust warned. Recent inflation rises have been felt far more keenly by those on lower incomes than higher, while headline figures can hide the difficulties suffered by the poorest households. Although inflation factors in rises to basic bills such as energy and food, these payments take up a considerably higher proportion of incomes for those on lower wages so they feel the effects of inflation more keenly. Another wave of debt concerns could have started as young homeowners take on too much debt, a second report has warned this week. Almost half of young homeowners who relied on extra help to get onto the property ladder are now worried about the level of debt they have taken on, the consumer group the HomeOwner’s Alliance warned. DAILY MAIL
Britain's two-tier property market: London alone has prices above pre-slump peak and more than double the rest of the country
House prices in London are nearly 25 per cent higher than their pre-recession peak and more than double the average for the rest of the country. The Office for National Statistics said a typical home in the capital is worth £459,000 – 24.8 per cent more than in January 2008. But prices across the rest of the UK are still 2.4 per cent lower than they were before the crisis, at £195,000, despite a rise of 5.1 per cent in the past 12 months. Prices across much of the North are still around 8 per cent lower than they were before the recession. The ONS warned rising prices could mean ‘rising levels of indebtedness’ as buyers are forced to take on bigger mortgages, leaving them ‘vulnerable’ to higher interest rates. It said this could make the economy less able to ‘withstand further shocks’. Experts said the figures highlighted the divide between London and much of the rest of the UK, with a ‘two-speed’ housing market developing. DAILY MAIL
REVEALED: How 6 in 10 won't get the full £155-a-week new flat-rate state pension they expect
Despite Government promises that anyone who stayed in employment their whole working life would be able to get the full state payout, official figures show that just 250,000 men and women will receive the maximum weekly amount. Pensions Minster Steve Webb said: ‘I am sorry if the message people have been getting has not been clear enough. For the sake of simplicity and to help people get a grasp of the issue, I have been saying everyone will qualify for the full flat-rate state pension if they had paid 35 years of National Insurance contributions... Perhaps what I should have made clear was that they should have paid 35 years of National Insurance contributions at the full rate.” Women will be worst affected and anyone who spent years saving into a final-salary pension. Teachers, nurses, servicemen and civil servants could also be hit by the shortfall. Essentially, it could mean someone who worked for 35 years, but spent 20 years at a company that had a final-salary scheme, being left with just 15 years of qualifying National Insurance contributions for the new pension. How much this would reduce the full £155-a-week pension is not yet clear. In total, 58 per cent of workers retiring in 2016 will get less than £155. More than two decades after the scheme is introduced, one in five will still fail to qualify for the full weekly payout. DAILY MAIL
Parking fine profits soar to £350million: Councils accused of targeting motorists after raking in 11% more in just two years
Drivers were forced to pay out a record £350million in parking tickets last year. The 11 per cent increase in just two years came as local authorities were being forced to freeze council tax and trim spending in line with Coalition austerity demands. And the rapid jump in parking penalty revenues immediately led to accusations that councils target motorists to raise cash. The figures, from the Department for Communities and Local Government, show that councils make almost as much from fines as they do from meters, permits and other parking fees, which brought in £369million. Peter Box, of the Local Government Association, the umbrella body for councils, said: ‘All income from charges and fines is spent on running parking services and any surplus goes on essential transport projects such as tackling the £12billion bill to repair our dilapidated road network and providing subsidised bus travel for children or elderly residents.’ Last month it was revealed that as many as 75 councils use spy vehicles fitted with cameras and numberplate recognition systems to patrol the streets gathering evidence to hit unsuspecting motorists with fines. Figures showed that between November 2012 and October 2013, the use of more than 110 council spy vehicles in England and Wales resulted in 330,000 penalty charge notices for parking offences and ‘moving traffic violations’. DAILY MAIL
Fashion brands violate “cheap labour” laws in eastern Europe
Adidas, Primark and Zara are among a host of western brands accused of profiting from a supply chain that pays garment workers in eastern Europe and Turkey poverty wages and tramples over their labour rights. About 3 million workers in countries from Slovakia to Georgia are part of "the cheap-labour sewing backyard for western European fashion brands", the Clean Clothes Campaign has claimed, in a damning indictment of some of the fashion world's leading brands, including luxury labels Prada and Hugo Boss. A largely female workforce stitching designer dresses and tops for big brands are often forced to do unpaid overtime or give up holidays to guarantee their basic salaries, which are well below subsistence levels, according to the NGO. Bettina Musiolek, a co-author of the report, said the research busted the myth that "Made in Europe" means fair – a perception, she said, that had deepened since the Rana Plaza factory disaster in Bangladesh. The group accuses World Cup sponsor Adidas of profiting from the absence of labour rights in Georgia. The German company, which sold €14.5bn of sports kit last year, is alleged to be sourcing clothes from that country, where workers earn just €5 for an eight-hour day. These workers reported intimidating conditions, where they had to ask permission to go the toilet, and were under pressure not to take sick leave. GUARDIAN
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