There’s a lot of sighing going on out there. Big sighs. Little sighs. And the barely discernible, whispered sigh. The sigh of despair.
Did I hear the chap who runs Mykonos, the little Greek taverna at the bottom of my street, mournfully deliver one of the latter the other day?
He looked forlorn. Possibly a little haunted. Standing outside the restaurant, looking in at the empty tables. It was lunchtime.
While competition in the restaurant trade down here is tough, I rarely see anyone tucking into a kofta in Mykonos. Back in the day it was the go to place. No longer.
As sure as the drachma will return to his homeland, my money is on an early exit for the taverna. A metaphor, perhaps, for the state of the proprietor’s home country: lots of things on the menu, but struggling to raise any interest.
We are, I know, all Greek-ed out.
You don’t have to watch the news to get an idea of how tough it is. Shops closing left, right and centre. Workers being laid off. Crisis piling on top of crisis. It’s no wonder the far right is taking hold in Greece. The conditions we are currently experiencing were an ideal breeding ground for Nazi ideology. Likewise with Franco in Spain and the lardy one, Mussolini, in Italy. The country’s in a mess, the economy has gone to pot –let’s get heavy, throw our weight around.
Even better, let’s get our factories mass producing military hardware and create a full employment economy. And go to war! Cue high fives all round.
Except the world has changed and it is not that simple any more. Real crises call for real solutions. The exasperation with Brussels, exasperation with the intransigence of politicians in countries now on their knees because nothing was done to enforce tax collections and properly run exports and imports when it mattered, is now evident everywhere I go.
Sometimes that exasperation turns nasty – I have witnessed several incidents in recent months in public places where I suspect the stresses of daily life have played a major part. The muttering and swearing builder in Tesco Express, vainly counting out pennies for a pack of ten fags, looking embarrassed and saying he didn’t know how the family was going to get through to pay day. The pensioner in the bank, shaking his head and asking anyone who would listen why he can’t afford his electricity bills any more. The dazed, tired looking woman in the local garage wondering how she is going to pay for her ancient Corsa to get through the Mot.
Masses of unemployed kids roaming the shopping malls up and down the country, looking bored and angry. And who can blame them? There is no work, and they feel cheated.
When will it all end? Will it end?
The short answer is yes. And of course any Conservative politician will tell you that they inherited a mess, that Labour allowed us to get fat off the back of an economy propped up debt. And to an extent that is correct.
We did overspend. We did over borrow.
Lecturing at the University of Sussex recently, on the MA Journalism course (yes, students are getting younger), I referred to an old front page story of mine – from 1999 – which warned on the fact that Northern Rock’s 125 per cent mortgage deals were flying off the shelf so fast they could not keep up with demand.
But the bank kept lending. Often to homebuyers in their early 20s who used the additional money above the mortgage to furnish their homes – and even that was on the never never.
Now multiply this scenario thousands of times, hundreds of thousands of times, and you have a recipe for catastrophe. The bank, in common with many others, lent money it did not have. It depended on other banks within the system playing the same game. Sooner or later the money was going to run out. Game over.
I wrote that story 13 years ago. It took a further 8 years for the money to properly run out, but when it did, boy did we know about it.
But, rather than keep picking over the disastrous errors of the past, let us look to the positives of the future. And remember that every generation goes through several painful economic cycles, some worse than others.
Economies do recover. Eventually. As Vince Cable keeps saying, we need to manufacture and export goods that people want. Germany does it, so do the French.
We do it too. But just not enough of it, although some of our companies are doing incredibly well. Look at Rolls Royce. It’s British, and actually makes things. And lots of other countries want the things it makes.
Last year the company quietly generated £7.8 billion of our GDP. It employs 22,000 people in the UK, almost the same again overseas, and 85 per cent of its sales are in exports. Profit in 2011 was £1 billion. And not an investment fund manager or paper pusher in sight. The company’s order book now stands at £62 billion — nearly four times the value of RBS. What’s not to like?
There are many other success stories out there. Our coach, train and boat manufacturers, like our carmakers, continue to do well. So do our IT and hi-tech industries. The UK has always been at the technological forefront in aviation, motor and sea faring hardware. We punch above our weight. But we need to get back to those golden times when order books were bulging and it was hard to find enough skilled labour to do the job.
The fly in the ointment, and the real impediment to recovery is, by and large, the banks. Not lending to smaller firms, which need capital investment to grow, is putting the brakes on the wider economy, and until the banks free up more money – and God knows they make enough of it – then progress will be slower.
It would also be good to see more investment in our film and television industry. I’m a fan of the French cop drama Braquo. It’s sexy, cool, shot in Paris, with a good sized budget – and it is all home made.
It makes the likes of Spooks – which we pay for courtesy of our TV license fee – look like it was made in Jeremy Paxman’s backyard.
A bit of Gallic know how goes a long way. But I still wouldn’t want to be on the same plane as Gerard Depardieu.
C David Andrews June 2012
Extraordinarily few’ IFAs aware of outgoing FSA financial crime replacement service coming into being in 2013
May 28 2012
‘Extraordinarily few’ IFAs aware of outgoing FSA financial crime replacement service coming into being in 2013
- SanctionsSearch.com reveals wide levels of ignorance about incoming Financial Conduct Authority
just two thirds, around 73 per cent, knew that the FSA was being replaced by the new watchdog next year (2013)
less than 5 per cent, could name new Financial Conduct Authority division correctly.
Only 20 per cent – correctly understood implications of sanctions checking as part of tackling the proceeds of crime
Independent financial advisers (IFAs) are at ‘grave risk’ of being heavily penalised by the new Financial Conduct Authority when it comes into being next year following the break up of the Financial Services Authority (FSA).
Advisers are especially vulnerable when it comes to requirements to carry out sanctions checks on clients to comply with anti-money laundering and anti-terrorist activity, according to Sanctions Search, which has just carried out a telephone survey (1) with 100 small and medium-sized IFA firms.
“Next year the FSA will be scrapped and replaced by two authorities – the Prudential Regulation Authority for supervision of banks and insurers, and the Financial Conduct Authority to monitor financial firms and markets,” said Chris Clare, director of Sanctions Search.com.
It is the latter, the Financial Conduct Authority, that will be responsible for making sure IFAs have adequate systems and controls to curtail the proceeds of crime, particularly screening thoroughly for sanctions imposed by the HM Treasury.
Under the new regime, fines are likely to be exceptionally punitive if IFAs are proved not to be operating correct and appropriate screening, as the replacement for the incumbent FSA they will need to raise significant revenue to help underpin its government funding.
SanctionsSearch.com asked IFAs three key questions regarding the incoming administration to gauge whether companies are geared up for the change in approach from the new regulator:
|Question 1 – do you know when the new watchdog is due to replace the outgoing FSA?|
|Question 2 – Do you know the name of the new division which will be responsible for monitoring financial crime?|
|Question 3 – Do you understand what is meant by sanctions legislation?|
For Q1, just two thirds, around 73 per cent, knew that the FSA was being replaced by the new watchdog next year (2013)
For Q2, less than 5 per cent could answer correctly.
And for Q3, around 20 per cent – correctly understood the implications of sanctions checking.
SABIEN TECHNOLOGY SUPPORTS CALL FOR GOVERNMENT TO MOVE SWIFTLY ON MANDATORY CARBON REPORTING
Reporting enables businesses to identify and performance manage significant cost savings as well as measure and mitigate environmental impact
Sabien endorses calls by big business and CBI urging Government to act quickly as Climate Change Act deadline passes
London – Sabien Technology Group plc (AIM: SNT)
Sabien Technology, the manufacturer and supplier of M2G, a patented energy efficiency technology, is not surprised by UK businesses’ demands for the Government to expedite plans for mandatory carbon reporting (MCR) rules for large companies*.
In the wake of an influential group of leading companies – including M&S, National Grid, Philips, and Sky – taking the Government to task for delaying its long-awaited decision on emission reporting rules, Sabien Technology chief executive Alan O’Brien said he supported the view that reporting would have “a wide range of benefits”.
He added “We can understand the frustrations of our clients and UK business over the continuing delays in this matter,” he said, however I don’t expect to see guidance from the Government on this issue until at least the end of this year or early 2013. The major sticking point on issuing MCR guidelines is the cost of implementation and administering the scheme of which DEFRA has based its cost assumptions on those applied to the carbon reduction commitment (CRC), a scheme we now know will be watered down and simplified later in the year. So we’ll probably have to wait for this revision first before we see any further clarity and guidance on MCR from the Government”
He added: “Self-regulation” and thus “self-determination” is the preferred approach by responsible business, so why do you need the Government to legislate for good housekeeping practices anyway?
“The Government doesn’t legislate in other dimensions to optimise efficiencies and thus profit margins.”
O’Brien added that, working closely with partner organisations such as the Carbon Disclosure Project (CDP), it was patently clear that an efficiently run, mandatory carbon reporting system would facilitate and promote change for the good of both the economy and the environment. Read more >>
Are IFA networks taking Treasury sanctions seriously? Sanctions Search survey reveals major IFA apathy
Temporary annuity solutions are an increasingly attractive option as depressed gilt yields and high inflation continue to subdue annuity rates
Gallagher Employee Benefits
May 8 2012
FALLING annuity rates as a direct result of lower gilt yields and high inflation have led to a significant rise in clients arranging temporary annuities, according to new research by Gallagher Employee Benefits.
The retirement planning specialists’ Stuart Grennan said more and more clients were either taking up or considering taking up a temporary annuity option in order to put off annuitising for life in the currently poor market conditions.
“We believe that the take up of temporary annuities will continue well into 2012 and perhaps beyond, as we think it unlikely that annuity rates will rise anytime soon, as gilt values are likely to remain low given the current austerity measures and fall out from the EU-zone.
“Added to that we have EU legislation Solvency 2 looming, which will in all probability further dampen the chances of rates rising – so for those in or approaching retirement, there are many attractions to taking an annuity now with the option of moving to a different product a few years down the line when rates have hopefully improved,” he added.
A temporary annuity can be bought for a fixed period, usually with a minimum of five years and a maximum of the period until age 75 is reached.
“A temporary annuity allows people to avoid making a one-off decision, perhaps if they feel it is too soon into their retirement,” said Grennan.
* for full press release plus data research, please contact DAM PR email@example.com