Helen Nugent

Energy profits, pensions, financial education and housing

Energy profits, pensions, financial education and housing
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The Government is to investigate claims that energy providers are pocketing larger profits than they have previously admitted, according to The Sun.

The newspaper says that gas and electricity firms may be netting six times more than they state. But trade group Energy UK rejected The Sun's claims, saying they were 'a misrepresentation of the facts'.

However, using figures published in a report commissioned by Energy UK from the accountancy firm PwC, The Sun says that suppliers could be making a 24 per cent profit margin. This compares to a 4 per cent profit margin on the price of a typical dual fuel bill which has been recorded by the regulator, Ofgem.

Now the business secretary, Greg Clark, will examine the claims.

Pensions

Large number of employers could have been incorrectly issued with hundreds of thousands of pounds worth of auto-enrolment fines, according to new research by payroll and pensions platform, Paycircle.

According to a recent report from The Pensions Regulator, more than eight in ten businesses that sought a review of penalty notices they’d received had them either altered or rescinded completely.

Fewer than one in five of these statutory notices, which include Fixed Penalty Notices (FPN), Compliance Notices and Escalating Penalty Notices were confirmed — or enforced — following the Regulator’s review process.

With nearly 7,000 FPN handed out since the start of the auto-enrolment process, this could mean hundreds of thousands of pounds have been incorrectly paid by businesses since July 2012.

Financial education

Teenagers aged 16 and 17 require financial education before becoming adults, according to research by the Money Advice Service.

Amid fears they are poorly equipped to deal with financial issues, Money Advice Service says that a third of this age group had never put money in a bank account and two-thirds could not read a payslip.

The BBC reports that concerns have been raised as these youngsters are just months away from having access to credit. Financial education is part of the curriculum in schools across the UK.

Housing

First-time buyers continue to be pummelled with higher asking prices, while values in the market as a whole increase at a slower rate, The Telegraph reports.

Asking prices fell 1.1 per cent in November, according to Rightmove, which described the market as 'resilent'. It said that this was a smaller drop than the average 1.8 per cent fall at this time of year.

However, over the past year the average asking price has increased by 4.5 per cent. Price rises were highest for first-time buyers, who typically are looking for homes with two or fewer bedrooms.

Hedge funds

Hedge fund numbers are set to fall in 2016 this year as investors funnel cash into cheaper and more predictable alternatives, according to the Daily Mail.

A study by Singapore firm Eurekahedge suggests that fund closures around the world are on track to outpace openings for the first time in more than 16 years. It said 566 had been shuttered in the first nine months of the year, compared to 518 start-ups.

RBS

The former high court judge who will oversee RBS’s redress scheme for thousands of companies badly treated by its restructuring unit was misled by the bank in a court case over a business grievance, The Times reports.

RBS was criticised by the Court of Appeal in 2011 for providing 'false' information to Sir William Blackburne. Sir William was appointed last week to provide independent oversight of an RBS compensation scheme for small and medium-sized companies who suffered at the hands of the bank’s Global Restructuring Group.

M&S

A list of towns, cities and suburbs where Marks & Spencer stores are thought to be most susceptible to being closed down has been published.

Although M&S has not yet named the stores set for closure, Local Data Company have compiled a list of areas that it thinks are vulnerable.

The Daily Mail reports that the retailer is to close 30 of its large stores in what will be a devastating blow to the communities involved. Another 45 will be downsized or replaced by small Simply Food outlets.

Savings

If the revised Bank of England inflation and interest rate forecast published this month proves accurate, £10,000 saved in a typical high street two-year deposit account today — paying 0.76 per cent — will be worth £331 less in real terms two years later: just £9,669.

The research, by asset-backed peer-to-peer lending platform, Octopus Choice, also shows that deposits made today of £1,000 and £5,000 will be worth £967 and £4,835 respectively in real money when withdrawn two years later.

Fraud

‘The full scale of fraud committed by staff at Britain’s banks is being swept under the carpet because the financial giants can simply dismiss the culprit and never tell the police, a senior detective warns,’ The Sunday Times reported yesterday.

A Freedom of Information request found that the total lost from 39 frauds reported to seven police forces was £5.4 million. ‘However, these figures are probably just the tip of the iceberg, because the 37 other forces in the UK said they were unable to provide the data.'

Finally...

As companies plan their Christmas bonuses, new research may cause a rethink of who should get a bit extra in their December pay packet.

According to a study of 1,000 UK workplaces conducted by the Prepaid International Forum, the not-for-profit trade body representing the prepaid financial services sector, rewarding younger, less well-paid workers is the best way to boost overall productivity and morale.

According to the study, approximately 700,000 UK businesses plan to pay out a Christmas bonus this year and yet almost half will exclude their more junior employees from this reward.