Graphs at a glance: How re-mortgaging covered up the theft of Britain's growing wealth in the boom, and helped cause the bust.

In Douglas Adams’ excellent Hitchhiker’s Guide To The Galaxy series there is a scene where an animal, the Ameglian Major cow, has been bred to want to be eaten. It meanders around the restaurant and persuades diners to partake of pieces of itself:

'Good evening', it lowed and sat back heavily on its haunches, 'I am the main Dish of the Day. May I interest you in the parts of my body?'

'Something off the shoulder perhaps?' suggested the animal, 'Braised in a white wine sauce?'

The Ameglian cow had been persuaded to feel good about being eaten. Once the diners had decided to feed on its rare steaks the animal

staggered to its feet. It gave a mellow gurgle. 'A very wise choice, sir, if I may say so. Very good,' it said, 'I'll just nip off and shoot myself.'

An equivalent scam was pulled off on us ripped-off Britons in the years leading to the Credit Crisis that kicked off in 2008. Britons were persuaded to turn their assets into spending money, consuming themselves. Banks offered cash and other companies selling anything from cars to cupboards offered easy credit. Whatever was necessary was provided to get Britons to consume more.

A favourite path into debt was “Housing Equity Withdrawal” (HEW): the process of converting housing assets into spending money. Frequently done by increasing the mortgage on your house.

Data from the Bank of England shows how HEW boomed in the years of the Labour government leading up to the Credit Crisis:

Particularly after the Conservatives deregulated financial services in 1986 ordinary Britons have been regarded as fresh meat. First by the banks, and then by every other sector: energy; transport; supermarkets etc striving to keep their bonuses up with the banks. The conundrum for these companies was how to extract bigger profits. To do this Britons needed to spend more, but the companies didn't want to have to pay higher salaries to the hoi-polloi to give them the money to spend. The salaries of 90% of Britons have stagnated for decades.

http://topincomes.g-mond.parisschoolofeconomics.eu/#Database:

In order to provide Britons with more money to spend, to generate the profits to feed top executives their puffed up pay and bonuses, Britons were persuaded to eat themselves. To be precise, they were persuaded to consume their own assets. A report by the Centre for Research on Socio-Cultural Change (part of the University of Manchester and the Open University) observed:

"the remarkable result is that under Mrs Thatcher from 1979-90, just as under Tony Blair from 1997-2007, the real value of Housing Equity Withdrawal is larger than the real value of GDP growth"

The economic growth in GDP was snatched from the 90%, whose incomes had stagnated. The 90% were persuaded to borrow on their own assets.

2013 Signs Of Economic Recovery

There are those who blame ordinary Britons for recklessly taking credit. These critics forget that it was highly qualified bankers pushing the loans watched by government regulators. 

The ripped-off Britons' biggest mistake was to trust those qualifications and trust those regulators. The ripped-off Britons made the mistake of believing the nonsense spewed to justify excessive pay: that the reason bankers are paid so much is because they are brilliantly competent at being bankers. They believed that if the brilliant banker assessed the risk and decided to offer the loan, then the loan was not unduly risky.

The Governor of the Bank of England at the time, Mervyn King, was very clear that ordinary Britons were not responsible for the crisis:

"The price of this financial crisis is being borne by people who absolutely did not cause it…..Now is the period when the cost is being paid, I'm surprised that the degree of public anger has not been greater than it has."

Mervyn King, at the time Governor of the Bank of England, in evidence to the UK Parliament’s Treasury Select Committee, March 2011.

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One in five British workers now earn below the living wage

Chris is with one of our top CEOs...

SOURCE SKY NEWS: 20% of British Workers earning 'Below Living Wage'The think tank The Resolution Foundation said it meant that a total of 4.8 million Britons, 20% of all UK employees, were paid at a level below the rate deemed necessary for a basic standard of living, an increase from 3.4 million in 2009. They said: "Britain has a sorry story to tell on low pay. Only a handful of our close competitors do worse and the large majority have much lower rates of low pay - sometimes half as much."

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Rip-off News round-up. Our pick of the last week's media (Thu 5th September)

20% of British Workers earning 'Below Living Wage'

The think tank The Resolution Foundation said it meant that a total of 4.8 million Britons, 20% of all UK employees, were paid at a level below the rate deemed necessary for a basic standard of living, an increase from 3.4 million in 2009. They said: "Britain has a sorry story to tell on low pay. Only a handful of our close competitors do worse and the large majority have much lower rates of low pay - sometimes half as much." SKY NEWS

Bank of England: consumers turn to loans, credit cards and overdrafts

Data from the Bank of England, released on Friday, show that the 3.5% annual increase in consumer credit, which includes borrowing on overdrafts, credit cards and unsecured loans, was the most rapid increase in four-and-a-half years. The fresh evidence of consumers' willingness to turn to costly borrowing on personal loans – which charge average rates of more than 7%, compared with the Bank's base rate of 0.5% – will increase fears that the UK is experiencing an unsustainable, "Alice in Wongaland" recovery, a phrase coined recently by the economist Ann Pettifor. GUARDIAN

Wonga profits leap 35% as demand for loans increases

Wonga, the short-term loans provider, has reported pre-tax profits of £84.5m for 2012, an increase of 35% on the previous year. In its annual statement, Wonga reported £1.2bn in lending, an increase of 68%. Wonga has also opened a business lending arm, and expanded abroad. So called "payday loan" firms, which often lend to those who cannot get a loan from a High Street bank, are currently the subject of a Competition Commission review. BBC NEWS

G20 summit: states chase tax evaders with plan to swap data globally

World leaders attending the annual G20 summit are expected to promise to develop powerful tools to help the authorities combat international tax evaders, with a deadline of next June. New treaties will require financial institutions to automatically disclose customer assets to overseas tax bodies. This bold approach has been pioneered by the US and has attracted accusations from tax havens of human rights abuses and economic imperialism. But the G20 nations will all sign up to the measures. Meanwhile, the G20 heads of state are also expected to give their formal backing to an unprecedented programme of tax reform designed to curb widespread tax avoidance strategies pursued by multinational corporations. GUARDIAN

Mis-sold Payment Protection Insurance complaints about finance firms push total to record high

Complaints about financial firms have surged to a record high as a huge insurance mis-selling scandal continues to weigh on the industry. The ombudsman said some lenders continue to drag their heels on repaying mis-sold PPI, causing "long waits and unnecessary delays" for customers. Complaints about Lloyds Banking Group were almost five times higher than a year earlier, at 129,293. They also rose 38% on the prior six months to make the part-nationalised lender the most complained-about group. The compensation payout, first estimated at around £9bn, has now doubled to over £18bn. STANDARD

Postcode divide in state pension, says TUC

A study of England by the TUC showed that women living in East Dorset - which has the longest life expectancy for men and women - could expect to live nine years longer than a woman in Corby, the area with the shortest female life expectancy. It worked out that, because they lived longer, they receive £67,000 more in state pensions over a lifetime. The difference for men living in East Dorset and in Manchester - the area with the shortest male life expectancy - would be £53,000. BBC NEWS

First pay-outs for small businesses mis-sold “rate-swap” loans by banks

So far, 10 firms have agreed to accept payments, averaging £50,000 each. Up to 25,000 more businesses could be in line for compensation, according to the Financial Conduct Authority (FCA). It is thought about 40,000 small businesses were sold the products in the years between 2001 and 2008. Those affected include vets, care home operators, hauliers and pub owners. BBC NEWS

Owners of empty properties offered £15k loans to bring UK's uninhabitable homes back to life

Loans up to £15,000 will be provided to homeowners to help bring some of England’s 710,000 empty properties back to life under a new scheme announced today. The scheme, which aims to tackle Britain's housing shortage, is a joint initiative between the charity Empty Homes, Ecology Building Society, central government and 39 participating local authorities. Owners of empty properties are often unable to access funds to bring them back into use, creating a vicious decline in areas with a high number of empty properties.

The intention behind the fund is that the empty property must be let at an affordable rent level that will have been agreed at the time of the application once it has been refurbished. DAILY MAIL

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Vodafone to pay no UK tax on £84bn Verizon sale

SOURCE INDEPENDENT: Vodafone's £84bn tax avoidance bonanza: Nothing for taxpayers in Verizon deal while bankers share £500m in fees
The Treasury is under pressure to review tax rules as public spending watchdogs claim the UK-based phone company has a moral duty to hand over some of its gains to taxpayers.

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Simple, blatant, classic tax dodge: how Npower "loans" itself money via Malta to dodge tax

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How the rich and their servants in government blamed every body else for the excesses of the rich

Liebrary: Is Corporation Tax being cut to make us more competitive? Or is there another reason?

A breakdown of the trillions dodged in tax globally

Tax Dodging in Britain is a government regulated sport

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Employee Shareholder Contracts: destroys employees' rights to save good companies 83p a week for each employee (but saves dodgy companies much more)

In October 2012 Eric Pickles, Secretary of State for Communities and Local Government, introduced a new bill. The “Growth and Infrastructure Act 2013” sounded like a good thing. Who wouldn’t want some growth and some infrastructure? However, hidden in the bill is “Employee Shareholders” legislation that destroys employees' rights. We wrote about it back then when the bill was first introduced, and are disappointed none of the 'great and good'  of our nation managed to strangle it.

Why these fundamental changes to the “Employment Rights Act 1996” were implemented by Pickles’ Department for Communities and Local Government and not by Iain Duncan-Smith’s Department for Works and Pensions perhaps exposes a low Duncan-Smith was not prepared to go down to. In April 2013 the bill became law, and from September 2013 these new employment contracts can be written and employees’ rights endure the following beating:

Among the rights lost are the right to training; the right for flexible working; protection against unfair dismissal; the right to redundancy payment:

An employee who is an employee shareholder does not have—

(a)         the right to make an application under section 63D (request to undertake study or training),

(b)         the right to make an application under section 80F (request for flexible working),

(c)         the right under section 94 not to be unfairly dismissed, or

(d)         the right under section 135 to a redundancy payment.

In return, the employer is supposed to give the employee between £2,000 and £50,000 (can be more, but tax protection is limited to £50k) of “shares”. However, these aren’t shares as we know them. The employer can decide whether these pieces of paper do or do not have the rights shares usually have:

• Voting rights.
• Rights to dividends.
• Rights to a share of surplus assets if the company is wound up.
• Right to be sold (the employer can place restrictions on who can buy the shares – e.g. they can only be sold back to the employer. And whether the shares have ‘drag along’ or ‘tag along’ rights when the company itself is being sold)

Quite apart from not having rights to vote, dividends, etc. this creates another key weakness for these ‘shares’. Because they have fewer rights than real shares they can’t be valued against real shares. So they are worth pretty much whatever the employer says they are worth when he takes them back (at the time of your sacking).

In short, what do you call a share that has no votes, no dividends, and can only be sold to whomever the employer says? Answer: bog-roll.

The prime beneficiaries of this change in employment law will be companies that tend to get into hot water with current employment law. The Department’s own impact assessment states that the cost benefit for companies that don’t have to pay out for breaching employment law is just £43 per year per employee – that’s 83 pennies a week:

"Not including tribunal awards and settlement payments, our estimated  expected avoided cost per individual that a company employs as an  employee shareholder rather than an employee is around £43 each year.  This avoided cost is related to the fact that an employee shareholder does not have certain statutory employment rights."

“Not including tribunal awards and settlement payments” means the sort of companies that do habitually have to pay tribunal awards and settlements for breaching workers’ rights will save much more because their workers won’t have those rights anymore.

And of course employers tend to lay off people when their company is in trouble. Which is when the shares are most worthless. So, for the employer it is a win-win, and for the employee a lose-lose.

Further abominations from this change in legislation include:

1) Can companies advertise jobs only on an ‘employee shareholder’ take it or leave it basis? Yes they can, as clarified by Lord Younger:

Viscount Younger of Leckie: 

"It should be up to employers to recruit as they see fit. If a company wants to recruit an employee shareholder, as companies already do with employees and workers, it should be able to do so in its own way. Taking the argument further, if an employer wishes to post a notice for, or advertise, an employee shareholder position, they should be free to place this as one role, just as they would be able to do in an advertisement for any other role."

2) Can you lose unemployment benefits if you refuse to apply for an ‘employee shareholder’ job? After much pressure the government conceded to amend the guidance stating that you cannot lose benefit. But ‘guidance’ is just guidance, and unlike the law changes at a whim.

Mr Chuka Umunna (MP for Streatham) (Lab)

"Whether or not JSA claimants could lose their benefit if they refuse to accept job offers carrying the employee shareholder status was an obvious question. I first asked it in November [2012], when the Government ignored it. I repeated it, and the Government said that they could not lose their benefit. When they were mauled on the point in the other place, they effectively admitted that they could. In order to get the proposal through in the face of opposition from several former Conservative Cabinet Ministers, the Government had to come to the House last week and agree to amend the guidance for Department for Work and Pensions Jobcentre Plus advisers to state explicitly that a jobseeker cannot be mandated to apply for an employee shareholder job."

3) If you have been unemployed, is it really an option to refuse to take an ‘employee shareholder’ job? For many people it is not:

John McDonnell (MP for Hayes and Harlington) (Lab)

"There are more than 2.5 million unemployed, and it is rising. People are desperate for work and will do anything they possibly can to find a job. The pressure to take the shares or perhaps lose the job—that informal pressure—will ensure that this is not voluntary. It is like putting food on a plate in front of a hungry person and saying that it is voluntary to eat it."

Another step eroding employment rights in Britain, when according to the OECD we already have close to the weakest employment rights in the developed world:

http://www.oecd.org/employment/emp/oecdindicatorsofemploymentprotection.htm

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Rip-off News round-up. Our pick of the last week's media (Thu 29th August)

Furniture and carpet retailers investigated over bogus “bargain” claims

Carpetright and ScS are among six chains accused of inflating prices for short periods in order to mislead shoppers into believing they are getting a bargain during sale periods. Typically, just 5% of products were sold at the artificially inflated reference price, while a significant number of products were found to have never been sold at that price level. GUARDIAN

Employers who pay below minimum wage to be actively named and shamed, at last

Minister says the current system of issuing financial penalties, without naming the offending employer, has not sufficiently deterred companies from underpaying staff. The policy could embarrass hundreds of companies which pay below the minimum wage of £6.19 for people over 21. In the last tax year HM Revenue & Customs, which enforces minimum wage laws, found 736 employers who were paying staff too little, leading to the recovery of £3.9m in unpaid wages for more than 26,500 workers. Since 2011, when rules were first relaxed to allow officials to name and shame the worst offenders, just one company – a hair and beauty salon in Leicester – has been exposed. GUARDIAN

Police called in over alleged fraud by Serco staff

A government audit has shown that some Serco staff were recording prisoners as having been ready for court when in fact they were not. This data is regarded as a key performance measure for the £285m contract with Serco that could determine whether or not it is terminated. Last month the Serious Fraud Office launched an investigation into potential overcharging by tens of millions of pounds by the private security company G4S on a £700m contract for the electronic tagging of offenders. GUARDIAN

Private patients 'paying too much' through lack of competition

Most patients in UK private hospitals are paying more than they should for treatment because of a lack of local competition, says the Competition Commission. More than 100 private hospitals around the country are in areas with little rival healthcare provision, and many of these hospitals are owned by three major groups. The Competition Commission said it believed that the lack of local choice pushed up health insurance premiums for all patients. BBC NEWS

New rules mean fraudsters could be "tipped off" about inspections by trading standards officers

The proposed legislation includes a plan which would require officers to give a warning of at least two days for routine inspections, and explain the reason for the inspection. The government says that this is part of a policy to reduce the burden of regulation on businesses. However, Andy Foster, of the Trading Standards Institute, said: "the only people that gain from this are the fraudsters and the conmen". He said fraudulent businesses, such as counterfeiters, would be able to get rid of evidence before inspectors arrived. INDEPENDENT

Workless households at record low, says ONS

A workless households is one where no adult aged 16 to 64 is in work. The Office for National Statistics said there were 3.5 million such households in the UK between April and June this year, about 17.1% of all households including a working age adult. This was down from 3.7 million, or 17.9%, a year earlier. The highest percentage of workless households was in north-east England. But Stephen Timms, Labour's shadow employment minister, said: "Underemployment is at record highs, long-term unemployment is at its highest level for 17 years, the number of young people out of work is edging back towards a million, and millions are working harder for less. It is becoming harder and harder for millions to make ends meet." BBC NEWS

Help To Buy scheme will create another house price bubble, warn banks

A body representing some of Britain's biggest banks has warned the government Help to Buy scheme could create a bubble.  House prices could rise more than 11% in three years due to government stimulus, according to a report by the Intermediary Mortgage Lenders Association. The new housing bubble will also make life even more difficult for those trying to buy their first home. Lenders say the government's Help to Buy scheme, which is designed to allow more people to buy property, could easily push average house prices up to £180,265 by the end of 2016. TELEGRAPH

Energy bills set to be 'simple and fair'

By the end of this year each supplier will offer no more than four core tariffs for electricity and four for gas. All will have a standing charge and a singe unit rate - rather than several. This will dramatically slim down the previous tariff ranges where individual suppliers offered hundreds, if not thousands, of tariff types. But consumer champion Which? says this doesn’t go far enough.  They argue that the big energy firms conceal their true profitability within their parent companies. Which? wants OFGEM to require energy businesses to separate their retail/supply operations from their "upstream" generating divisions. Which? said: "We want the Government to ring-fence energy supply from generation businesses to increase confidence that there is effective competition in the energy market.” TELEGRAPH

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Badger cull: government promises it will be safe, humane and effective

SOURCE GUARDIAN: Badger cull: only small proportion of shootings to be monitored for humanenessThe government was accused of not properly assessing the animals' suffering after a freedom of information (FoI) request revealed that as few as 120 shootings will be independently observed, out of about 5,000 badgers set to be culled.

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House of Lords refuses to block bill forcing NHS to tender services, and taking away their right to reject dodgy providers

Graphs at a glance: See how the government caps benefits for the poor but subsidises "affordable housing" for people on £80k

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Graphs at a glance: Are cuts to incomes and services really necessary? Are Britons really too expensive for Britain?

In August 2013 the Office for National Statistics (ONS) revised the second quarter growth figure from a spongy 0.6% to a strident 0.7%. This allowed George Osborne and the Tories to trumpet that the economy was "moving from rescue to recovery". Recovery will happen eventually, maybe sooner, maybe later. 

But just as it is hard to say whether the man running in front of a raging bull is leading it or being chased by it, it will be hard to say what role the Chancellor's policies have in our economic recovery.

The banker induced economic crisis, like all busts and all booms, is transitory. Governments are using a transitory crisis to inflict permanent pain including cuts to pensions, pay and benefits, the proliferation of 'zero hour contracts', and changes to employment law eroding workers' rights. What we sacrifice in the bad times will not be returned to us in the good.

It is not because our economy can't afford the costs of health, education, pensions, workers rights etc. While the banker induced crisis knocked us back for awhile, the medium term GDP forecast shows a very healthy growth trend (see graph of government forecasts below). 

The economy is strong enough to support us. The Credit Crisis is being used as cover to increase inequality.

The underlying reason we ordinary Ripped-off Britons are becoming too expensive is that our share of our nation's wealth is being reduced. The national pie is getting bigger but our share is being cut down faster:

The TUC report, from which this graph is taken, explains:

1. 1961 to 1981: during this period the wage share was relatively high (always above 58 per cent) and income inequality was relatively low (Gini always below 0.28).
2. 1982 to 1987: over this six-year period, the wage share fell below 58 per cent and income inequality grew rapidly (with the Gini rising from 0.26 to 0.31).
3. 1988 to 2010: during this period the wage share was relatively low (between 51 and 56 per cent) and inequality relatively high (always above 0.32)."

The Nation has the money to maintain pensions and services. However, those who hold the ladle, those in government and in the company boardrooms, choose to serve themselves more by giving the rest of us less. If the head of a household decides to cut the milk-money from 5% to 3% of household income, then milk becomes unaffordable not because people drink more milk but because the share going to milk has been cut.

We are bamboozled into letting go of our rights as an act of "we are all in it together" solidarity to help the nation recover from the banking crisis. But we will not easily recover those rights when the recovery comes. Even then we will be left with less salary, less pension rights, less workers' protections, less health and less education. All so that those with the most can take more. To be fair to the Tories this is not new - it's been happening for years.

http://topincomes.g-mond.parisschoolofeconomics.eu/#Database:

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Graphs at a glance: Are cuts to incomes and services really necessary? Are Britons really too expensive for Britain?

In August 2013 the Office for National Statistics (ONS) revised the second quarter growth figure from a spongy 0.6% to a strident 0.7%. This allowed George Osborne and the Tories to trumpet that the economy was "moving from rescue to recovery". Recovery will happen eventually, maybe sooner, maybe later. 

But just as it is hard to say whether the man running in front of a raging bull is leading it or being chased by it, it will be hard to say what role the Chancellor's policies have in our economic recovery.

The banker induced economic crisis, like all busts and all booms, is transitory. Governments are using a transitory crisis to inflict permanent pain including cuts to pensions, pay and benefits, the proliferation of 'zero hour contracts', and changes to employment law eroding workers' rights. What we sacrifice in the bad times will not be returned to us in the good.

It is not because our economy can't afford the costs of health, education, pensions, workers rights etc. While the banker induced crisis knocked us back for awhile, the medium term GDP forecast shows a very healthy growth trend (see graph of government forecasts below). 

The economy is strong enough to support us. The Credit Crisis is being used as cover to increase inequality.

The underlying reason we ordinary Ripped-off Britons are becoming too expensive is that our share of our nation's wealth is being reduced. The national pie is getting bigger but our share is being cut down faster:

The TUC report, from which this graph is taken, explains:

1. 1961 to 1981: during this period the wage share was relatively high (always above 58 per cent) and income inequality was relatively low (Gini always below 0.28).
2. 1982 to 1987: over this six-year period, the wage share fell below 58 per cent and income inequality grew rapidly (with the Gini rising from 0.26 to 0.31).
3. 1988 to 2010: during this period the wage share was relatively low (between 51 and 56 per cent) and inequality relatively high (always above 0.32)."

The Nation has the money to maintain pensions and services. However, those who hold the ladle, those in government and in the company boardrooms, choose to serve themselves more by giving the rest of us less. If the head of a household decides to cut the milk-money from 5% to 3% of household income, then milk becomes unaffordable not because people drink more milk but because the share going to milk has been cut.

We are bamboozled into letting go of our rights as an act of "we are all in it together" solidarity to help the nation recover from the banking crisis. But we will not easily recover those rights when the recovery comes. Even then we will be left with less salary, less pension rights, less workers' protections, less health and less education. All so that those with the most can take more. To be fair to the Tories this is not new - it's been happening for years.

http://topincomes.g-mond.parisschoolofeconomics.eu/#Database:

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Rip-off News round-up. Our pick of the last week's media (Thu 22nd August)

David Cameron condemned over ‘ridiculous’ reforms to the £2bn lobbying industry

The head of the Commons committee scrutinising David Cameron’s flagship law to end Britain’s lobbying scandals called it a “useless dog’s breakfast” and said the Government should urgently postpone its current fast-tracked progress through Westminster. Research published last month by the Association of Professional Political Consultants (APPC) showed ministers in the Department for Business held 988 meetings with lobbyists in 2012. But, under the new law, just two were with consultant lobbyists who would have been obliged to declare the meetings. INDEPENDENT

Jeremy Hunt plans sale of confidential patient medical records to private firms

Confidential medical records may be offered to private companies for as little as £1, according to plans drawn up by officials. The new General Practice Extraction Service will consolidate NHS patient records sent to a central database by GPs around the country. The project has been described by campaigners as an "unprecedented threat" to medical confidentiality. The records will be anonymised but will include details of medical conditions. Private firms such as Bupa are able to purchase the records for research by applying to the Health Service. DAILY MAIL

Credit card protection compensation package set to total £1.3bn

Around 7 million people are set to share up to £1.3bn in compensation after 13 high street banks and credit card companies agreed to offer redress for mis-sold credit card and identity theft protection. They contracted card insurer CPP to sell the policies. The watchdog criticised them for promising customers up to £100,000 of insurance cover for their cards - something they did not need because they were already covered by their banks. GUARDIAN

Average earners 'will be £1,500-a-year worse off' under the new flat-rate state pension

Someone earning £26,000-a-year with a full employment record could lose out to the tune of £29-a-week when the new single-tier state pension is introduced, the TUC has claimed. The report says that anyone with a long working history is likely to lose out, sometimes by as much as £2,000 a year. The second state pension will be abolished when the new single-tier pension begins in April 2016. But the government said the changes will make most people better off. The Trade Unions support the principle of the single-tier pension, but want it to be raised from the current notional level of £144 a week. DAILY MAIL

Worst UK pension annuity providers named: Scottish Widows, Clerical Medical and Royal & Sun Alliance

Britain's worst pension providers have been named for the first time in official tables that reveal how some insurers are paying annuities 30% below the best deals on the market. Scottish Widows and Clerical Medical, part of the government-backed Lloyds Banking Group, have emerged as the worst providers of retirement incomes for the mainstream market. Many savers in pension schemes are unaware and not told that when they retire, they can shop around with the pot of money they have accumulated. GUARDIAN

Hovis bakery workers vote to strike over zero-hours contracts

The Bakers, Food and Allied Workers Union (BFAWU), whose members make up 230 of the 357 employees at the Hovis bakery, said agency workers had been brought in almost immediately after the redundancy of nearly 30 workers in April. It said those workers were on contracts which did not specify set working hours and gave limited guarantees on conditions. GUARDIAN

SSE halts cold-calling after record fine

Scottish & Southern Energy has axed all cold calling by telephone sales staff just months after being fined £10.5 million by regulators for "prolonged" mis-selling. Will Morris, SSE's group MD, said: "Nobody likes receiving a sales call out of the blue and so we are stopping it. It doesn't matter that other energy companies still do it, or other industries for that matter, cold calling is not something that a company like SSE - committed to providing an excellent customer experience - should be doing any longer." TELEGRAPH

Male bonuses double those of women

Male managers' average extra payments were £6,442 last year compared with £3,029 for women. The CMI said their salaries were already almost 25% higher than women's. Its study, of 43,000 managers, showed that men would earn £141,000 more in bonuses over a lifetime. At more senior levels, the pay gap for both basic and bonuses, increased. Women directors' average bonus is £36,270, while men receive £63,700. Mark Crail, from salary specialists XpertHR who assisted the study, said "While women are generally getting lower bonuses than men, especially at senior levels, they may be entering occupations where there is less of a culture of bonus payments. The question for employers is why that's the case." BBC NEWS

The cost of bringing up a child has risen to £148,000

The report, co-funded by the Joseph Rowntree Foundation charity, says costs have risen by 4% over the last year. At the same time, it says the value of benefit payments fell in real terms. But the government said it was helping families by cutting income tax for 25 million people. BBC NEWS

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