BANKING & INSURANCE
‘Unlawful’ penalty charges put banks in the spotlight
Banks have come under fire over claims that customers are being charged 30 in penalties for a service costing just 4.50 to administer (The Scotsman). An edition of BBC2’s The Money Programme, to be screened tonight, will look into allegations that banks are overcharging customers who default on payments. It is widely claimed banks are breaking the law. Stephen Hone, campaigner and founder of www.penaltycharges.co.uk, said: “It clearly shows the banks have been scamming people for years on these charges and they are totally unlawful, so its shows people that they can go back and claim their money back.” Disgruntled customers are increasingly taking banks to court, keen to overturn the penalty charges. Some 180,000 template letters from www.MoneySavingExpert.com were downloaded in less than a month for claims purposes. In every case banks were keen to settle.
Lloyds TSB on track to deliver 3.7bn profits
Lloyds TSB is on course to deliver a 7% growth in underlying profits it was announced yesterday, as the bank said Edinburgh-based life arm Scottish Widows was not for sale (The Herald). In a trading statement ahead of full-year results due in February, the bank said that pre-tax profits for 2006 would hit 3.7 billion, up from 3.5 billion in 2005. Britain’s fifth biggest bank also dismissed claims that Scottish Widows would be sold, following a rumoured bid from French insurer Axa and Swiss Re. Helen Weir, the bank’s financial director said: “Scottish Widows is a fundamental driver to improved performance at the bank. We are seeing real benefits in the work we’ve been doing between retail and Scottish Widows. We see it as a core business and important to Lloyds TSB. So it does look like it’s not for sale.” The bank also said it has reigned in the level of bad debts during the past six months. However Ms Weir said the future of individual voluntary arrangements (IVAs) would be critical to the control of bad debts next year (The Times). Shares closed 3p up at 558 p.
Polish workers targeted by Lloyds TSB
Lloyds TSB has introduced account opening forms and brochures in Polish across 130 UK branches, with 12 of those in Scotland (The Scotsman). The bid to cash in on the increasing number of Polish workers moving to the UK is based on research which claims 80% open a bank account when they arrive.
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Bright economic outlook for Scotland
House prices in Scotland will rise by 7% next year - meaning every town in Scotland will break the 100,000 mark for the first time - according to the Bank of Scotland (The Herald). The rise north of the border will exceed the UK average for the fourth year in a row, which is expected to reach 4%. Economic growth in Scotland is also tipped to be above average in 2007, and will be matched by a buoyant labour market. Tim Crawford, group economist at Bank of Scotland, said: “A healthy Scottish economy and a growing labour market continue to provide a very solid base for the Scottish housing market, while the relatively affordability of Scottish house prices compared with the rest of the UK remains a strong point.”
New business figures criticised
The Scottish Executive has come under fire after figures showing a relatively insignificant rise in the number of new business start-ups were published (Aberdeen Press & Journal). The number of private sector enterprises rose by just 0.1% to 265,435, prompting the SNP to claim the executive had failed Scotland. The statisticians said: “Scotland lacks a critical mass of larger businesses, and a key challenge is growing and sustaining business of this scale. The 2,255 large enterprises operating in Scotland accounted for just over 56% of turnover.”
Scotland to miss the boat on red tape war - FSB
The Federation of Small Businesses (FSB) claims that Scotland could miss out on vital measures introduced south of the border to reduce red tape (Aberdeen Press & Journal). Niall Stuart, head of press and parliamentary affairs for FSB Scotland, praised Prime Minister Tony Blair’s efforts to cut the impact of regulation on businesses, individuals and charities - but warned that the Scottish Executive needs to implement a clear plan to deliver similar change. More than 520 measures have been flagged up by Whitehall departments, designed to cut burdens by 25% by 2010.
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ENERGY & UTILITIES
Revised windfarm plan to be submitted
Revised plans for what is set to be the UK’s largest onshore windfarm project in the Western Isles have been unveiled by Lewis Wind Power (BBC Scotland Online). The reworked proposals, which have been opposed by environmental and anti-windfarm campaigners, will comprise of 181 turbines rather than 234 - reducing the site’s generating capacity from 702 megawatts (MW) to 652MW. Western Isles Council backed the 500 million plan despite more than 4,000 objections. Lewis Wind Power claims some 400 jobs would be created throughout the manufacturing phase, with more in the pipeline after its completion. The Arnish manufacturing plant on Lewis, which last week went into administration, stands to win contracts for turbine components. “We have a range of economic challenges here,” said head of economic development for the council Calum Ian McIver. “The project has to stay at a certain scale to deliver the benefits to the local community, to deliver manufacturing to the local Arnish plant and to allow the interconnector to come in.” The interconnector is required to transfer power to the mainland - vital for Western Isles Council’s plans to turn Lewis into a centre for alternative energy. The revised proposals will be submitted to the Scottish Executive today.
Energy firms increasingly focus attentions on North Sea
A survey carried out by the Scottish Council for Development and Industry (SCDI) has found that oil and gas service and supply companies north of the border are concentrating activities in the North Sea to a larger extent (Aberdeen Press & Journal). According to the research carried out on behalf of Scottish Enterprise, total sales hit a record 11.7 billion in 2005, with domestic sales rising much more sharply than international revenue. This compares to sales of 10.1 billion the year before. The figures show the US is Scotland’s top international market, rising by 13.9% last year to 915 million. Nigeria is ranked second, despite its tumultuous political climate, increasing 67% to 185 million, while Russia is Scotland’s third most important market. Sales in the country rose 35% to 155 million in 2005. High oil prices have been cited for the increased activity, as domestic reserves become more attractive. SCDI north east manager Ian Armstrong said: “The industry is extremely stretched in manpower, equipment and resources in handling this volume of business, and it seems possible that this explains the slowdown in the international growth rate. While interest in the North Sea remains strong, these constraints make it hard to predict whether there is capacity to grow domestic sales significantly in the coming years.” He added that Aberdeen’s wealth of expertise within the sector strengthens the case for the city to host the UK Energy Technologies Institute.
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FOOD, DRINK & AGRICULTURE
Dram plan for the Borders
A business consortium is looking at the possibility of creating a 1 million whisky distillery and visitor centre in the Borders (BBC Scotland Online). The project could see a lowland dram being produced as early as 2008. Advisor to the group, Dr Alan Rutherford said: “The idea was very much to boost tourism and to capture the tourists as they came up into the Borders.” A feasibility study has been commissioned by Scottish Enterprise Borders.
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MEDIA & LEISURE
SMG resumes talks with UTV
Talks between Scottish TV owner SMG and Ulster TV are back on, with the search for a new chief executive said to be ‘suspended’ as the Glasgow-based group holds discussions over a near 400 million merger deal (The Herald). SMG confirmed the approach: “The board of SMG confirms that it has received a further approach from UTV regarding a possible nil-premium merger of SMG and UTV, based on relative market values. As a result SMG has entered into discussions with the UTV board which may or may not lead to a merger.” An initial approach in August saw SMG reject a proposal which would have given shareholders 52% of a merged entity. SMG is thought to have been hankering after 55%. The Scottish group is now expected to emerge a junior player in the revised deal, based on terms of stock market worths.
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