LONDON: Basic bank accounts, introduced five years ago to help the poor in the U.K., have failed to accomplish the aim — of closing the gap between rich and poor, says a research report prepared by the National Consumer Council (NCC) and Policis, a research consultancy. The poorest consumers still face financial exclusion and their only resort is high-cost borrowing, says the report.

The study revealed that half of low-income consumers wanted to manage their money in cash as the accounts did not fulfill most of their needs. Those having the accounts have been found to have fallen behind with household bills payments than those without the accounts.

The monthly cycle followed by banks and the hurdles in even opening an account mean that the poor still have problems in accessing affordable financial products, the study said.

NCC’s deputy head of policy Claire Whyley said there is a mismatch between the needs of the poorest to keep close track of their income and spending and to avoid debt, and the existing basic bank account design, which does not help them achieve this.

NCC said the lack of flexibility in automated payments could lead to problems for those with unpredictable circumstances. Penalty charges levied by banks and building societies, when there are no funds in accounts, to meet a direct debit often lead to serious short-term financial pressures.

Several mainstream banks like HSBC, Lloyds TSB and Nationwide building society offer basis bank accounts and by end-2004, there were some 5.7 million account holders.

Nationwide said it offered the same facilities under the basic bank account as it had for a standard current account, except for overdraft facility and debit card. Customers, however, enjoyed a 30-pound overdraft “buffer”.

The study covered 1,520 people with low incomes.

NCC recommends that the basic bank accounts should be more flexible, like offering weekly direct debit facilities and small free overdrafts to fit in with low-income budgeting cycles and even payment holidays.

The study also revealed that some eight million low-income consumers have no access to mainstream credit, while many use high-cost lenders as the government’s safety-net interest-free loans scheme for the poorest is not working effectively. One application in every five for social fund loans is rejected and one in four of those refused approach high-cost doorstep lenders or even unlicensed loan providers.

NCC and Policis will work with the Treasury’s Financial Inclusion Taskforce and other such organisations to address the problem and find out a solution.

LONDON: Statistics can sometimes be disturbing. The British home office has been found to be paying as high an amount as 2,700 pounds a night to the police to keep an immigrant detainee in the police cells. This amount is higher by 2,300 pounds for a superior room in a starred hotel in London.

The rates, however, varied by police stations but the average has been calculated at 360 pounds a night. The immigration service does not have adequate facilities and often it has to rely on police cells. For the year 2003-2004, it paid 11.17 million pounds for the police cells.

These details have been brought out in a government report, Review of Resourcing and Management of Immigration Enforcement, compiled by civil servants. It reveals that at least two forces in England and Wales charged more than an average of 1,000 pounds for a 24-hour period.

The report said: “Not only is the variance in costs striking, but the average cost compared to that paid by HM Prison Service is also remarkable.” The Prison Service, under an agreement with the police, pay 110 pounds for 24 hours.

“Some police authorities do not charge at all but these represent a very small proportion of the overall police cell usage,” the report said.

If the immigration service is charged at the rates paid by the prison service, it would have saved 7.75 million pounds a year.

The report went through invoices raised by police cells between December 2002 and May 2003. It was found that Essex Police charged between an average minimum of 1,500 pounds to a maximum of 2,700 pounds, while Sussex Police charged 1,700 pounds and North Wales police charged 900 pounds.

The report urged provision of more temporary holding facilities for the immigration services, in order to reduce the reliance on the police cells.

A Home Office spokesperson admitted the figures are correct and said talks are going on between the police and immigration service for a possible understanding on a uniform rate.

The report also found that immigration officer teams from the removals and enforcement directorate were not being efficiently used. An average of 7.2 officers were involved in detection work on a Sunday yet only an average of 1.5 illegal immigrants were found, compared with an average of five officers on Monday when an average of 2.5 illegal immigrants were discovered.

ATLANTA: Whirlpool Corporation is buying out rival appliance maker Maytag Corporation in a $1.7 billion cash and stock deal. Once completed, the unified entity will be the world’s largest appliance maker.

Maytag was under an earlier buyout agreement with equity firm Ripplewood Holdings and it paid $40 million as break-up fee to end the $1.1 billion deal. Whirlpool has reimbursed this amount to Maytag, the companies announced in a statement.

Maytag’s share has been priced at $21and the deal also involves Whirlpool assuming $977 million of the former’s debt. The acquisition is subject to shareholders’ and the regulator’s approval and could close in early 2006. There could be intense antitrust scrutiny as Benton Harbour, Michigan-based Whirlpool is the No 1 in its domain and Maytag the third largest.

The ailing Maytag has been on the block for months and Ripplewood had offered $14 a share. Whirlpool had made an initial offer of $17 per share and raised the price three times. Apart from the two, Chinese appliance maker Haier too had eyed Maytag, but withdrew subsequently.

Based on 2004 results, the deal will create a powerhouse with sales of $17.9 billion. Whirlpool, known for its brands like KitchenAir, Roper and Inglis has an estimated 35 per cent domestic market share while Maytag with its Hoover vacuums and Jenn-Air and Amana appliances holds about 15 per cent. The acquisition will see Whirlpool ahead of Sweden’s Electrolux as the No 1 in the world.

Whirlpool’s chief executive officer Jeff Fettig was confident that the Whirlpool-Maytag combination will secure regulatory approval. He said the the unified company will create substantial benefits for consumers, trade customers and shareholders.

LONDON – Scottish brewer Belhaven is all set to be acquired by Suffolk-based Greene King in a deal worth £187 million (€275.5 million). Dunbar-based Belhaven has recommended that its shareholders accept the offer.

However, the deal was concluded in the looming shadow of the smoking ban that is to come into effect in Scotland early next year. In fact the company released a statement acknowledging that it was aware of the ban, “Greene King has concluded that the Scottish smoking ban due in 2006 may result in a significant reduction in Belhaven’s short-term profitability.” This deal will now add 300 Belhaven pubs to Greene King’s existing ones taking the total up to 2,334. This number means that Greene King is now Britain’s third-biggest pub owner.

The 625 pence-per-share agreement also allows Belhaven to retain its brand name as well as East Lothian brewery. “It is a unique opportunity for us to gain immediate scale in the important Scottish market,” said Rooney Anand, Greene King Chief Executive. “Belhaven will retain everything at the heart of its success, including its name, its brands, and its brewery, but will also benefit from being part of a larger group opening up new markets for its products,” he added.
Founded in 1719 by John Johnstone at Dunbar, Belhaven was the oldest independent brewery in Scotland. The company makes Belhaven Best, St Andrew’s Ale and Belhaven 80 Shilling and distributes Tennent’s and Stella Artois. Commenting on the cash offer from Greene King, Belhaven chief executive Stuart Ross said, “Today’s cash offer reflects the quality of our business and our board unanimously recommends that it is in the best interests of our shareholders.

In Scotland, we can look forward positively to the future and we are confident that our assets, including our people, will make a meaningful contribution to the future growth and prosperity of the enlarged group.”

LONDON: Home buyers in the U.K. have been advised not to postpone their decisions on mortgage deals in the hope of getting cheaper fixed rate deals. It is possible that the rates may in fact go up in view of a surprise disclosure by Bank of England that core inflation in the country was at its highest for a decade.

Some of the lenders have already raised rates on their best buys while some have withdrawn them in the light of the central bank’s announcement, which almost made it clear there will not be any more rate cuts in the immediate future. The bank had brought the base rates by a quarter of a percentage point to 4.5 per cent.

Banks have said swap rates (rates banks charge to lend money to each other) have risen in recent weeks, which affected the price of some fixed rate deals. Swap rates had come down before the interest rate cut, but in the light of concerns over inflation, these have climbed again. Lenders are therefore forced to revise their best deals.

Newcastle building society this week withdrew its market leading two-year fix at 4.22 per cent, while Abbey replaced its two fixes with deals that were 0.1 to 0.15 percentage points higher. Among other firms, Northern Rock and West Bromwich building societies notified that the deals based on fixed rates can be withdrawn and Portman raised its five-year fix from 4.45 per cent to 4.59 per cent.

The changes may appear inconsequential, but experts pointed out over two years the repayments on a 200,000-pound loan at 4.59 per cent could become more expensive by 1,000 pounds than those on a 4.22 per cent deal.

Savills Private Finance’s director Simon Jones told prospective home buyers: “If you want a cheap two-year fix, buy it now. If you wait a few weeks, it could be more expensive.”

As of now the cheapest two-year deal on the market comes from West Bromwich Building Society, with a rate of 4.15 per cent. However, there is a 599- pound arrangement fee that goes with it and a stipulation that homeowners must buy buildings insurance for two years.

The minutes of the last meeting of the MPC reveal that the governor of the central bank had voted against the rate cut along with Mervyn King, Rachel Lomax, Sir Andrew Large and Paul Tucker. The minutes also indicate that there will not be any further cuts in the near future. The minutes said: “The Committee’s latest projections did not support the current market view that a sequence of interest rate cuts was likely to be needed to meet the [government’s] inflation target in the
medium term.”

The central bank said consumer price inflation rose 2.3 per cent in July from a year ago, the highest annual growth rate since the data series began in 1997. This is the first time that inflation had exceeded the Bank’s 2 per cent target since it adopted the consumer price index as its main inflation measure in December 2003.

150 .uk domain names added every hour, says Nominet

Published : Fri, 19 Aug 2005 13:05
By : Andrew Stead
Print this Story

AddThis Social Bookmark Button

LONDON: As many as 150 domain names with .uk extensions are created every hour, indicating that the domain name business in the country is thriving, a study by Nominet, which manages the .uk domain
registrations, says.

The study also indicated that nearly half the web users queried said they were more confident in dealing online with companies which have a U.K. presence.

There is a total of four million .uk web addresses, with 110,000 added every month.

Nominet’s chief executive Lesley Cowley said the U.K. internet industry is experiencing substantial growth and the combination of greater broadband take-up and the established popularity of .uk domain
names demonstrates that the U.K. internet industry is more buoyant than ever.

There is, however, no let-up in the popularity of .com extension, which constitutes majority of web addresses. Verisign, which manages the .com domain registration, said .com constituted 47 per cent of all registered domain names.

It said the total number of .com and .net domain names grew to 44.2 million by the end of the second quarter of 2005. Collectively, country-specific extensions like .de, .uk and .br accounted for 35 per cent of all domain names. As much as 75 per cent of all domain names were registered by businesses and 22 per cent by individuals.

According to a study by the Office of National Statistics, 52 per cent of British homes had access to the internet from home by the end of 2004. Nearly 30 per cent of all net users — about 8.1 million — had broadband connectivity.

MELBOURNE: Australia’s Multiplex Ltd., which is redeveloping Wembley stadium in London, posted a less-than projected profit of A$148.1 million before inter-group accounting transfers for the year ending 30 June up from A$119.8 million for the corresponding previous year.

Profit after the distributions on its SITES hybrid securities was A$132.7 million, against analysts’ projection of $140.7 million.

The company cut its 2006 forecast by 8.5 per cent and made a provision of A$8.6 million on its A$1.2 billion stadium project for fear of running into delays or cost hikes.

Describing the Wembley project as its only remaining loss-making construction project, the company’s chief executive Andrew Roberts said the result is very disappointing and the main cause has been the losses at Wembley. He said: “We had never had an experience where we’ve seen a cost movement like we’ve seen in relation to this project, and we’ve been in the business for 40 years.”

Roberts said despite the losses, the project is very much on track and the company would complete the stadium in time for the March 2006 FA Cup final. The company said it incurred a total loss of A$50 million after tax on Wembley while the development and construction unit had a net loss of A$17 million.

The company had reinforced its bottomline spending A$2.3 billion in November last year to buy office building owner Ronin Property Group and some assets of U.K. property company Chelsfied. This increased its rental income and helped it to offset the losses in the construction unit.

Multiplex said the problem at Wembley has been mainly on account of delays and cost overruns. It needed an extra A$8.6 million to complete the project on time. The project has already cost the company its founder and executive chairman John Roberts, who resigned earlier this year.

NEW YORK: Microsoft Corporation’s web browser Internet Explorer has gained market share it had lost to open source Mozilla Foundation’s Firefox in July, according to Website monitoring firm NetApplications.

NetApplications disclosed Friday that Firefox’s market share fell for the first time since its launch in 2004 from 8.71 per cent in June to 8.07 per cent in July while the share of Internet Explorer grew to 87.2 per cent from 86.56 per cent. Firefox has been gaining strength throughout last year, increasing its share between 0.5 per cent and 1 per cent at the expense of Internet Explorer.

NetApplications collects data on browser usage patterns from nearly 40,000 websites monitored by its HitsLink.com service. The findings have come as a surprise for NetApplications and the company’s chief operating office Dan Shapero said he did not expect the browser’s market share would slow down before it shrunk. He added that Firefox’s growth has been extremely impressive and he cannot tell whether the July fall is indeed the beginning of a downward trend or a one-time anomaly. NetApplications at one time had expected Firefox to command a 10 per cent market share, which it said, will be a milestone for the open source platform.

The third place in the browser market went to Apple’s Safari, which improved its position from 1.93 per cent to 2.13 per cent. Netscape, once the leader in the browser market, had only 1.5 per cent share against an earlier 1.55 per cent. Opera came fifth with a 0.49 per cent share.

Another monitoring firm, W3Schools.com, too recorded a drop saying he number of its visitors using Firefox has went down from a high of 21 per cent in May to 19.8 per cent in July. Internet Explorer versions 5 and 6 together commanded a share of 73.8 per cent in July, up from 71.4 per cent.

In the last few months, Firefox had brought out several security patches to correct some of the flaws and analysts feel these flaws could have damaged the reputation of this open source browser.
However, Internet Explorer had several serious flaws, including the way the browser handles JPEGs and a bug that could allow arbitrary code execution.

Microsoft has revealed that there will be quite a few security updates in its IE version 7, but this is not available to users of Windows 2000. This could prove to be advantageous to Firefox.

LONDON: InterContinental Hotels Group, the world’s largest hotelier, said yesterday it had agreed to allow rival Queens Moat Houses to use its brand name under a franchise agreement for 20 years.

The owners of Queens Moat Houses – US-based investors Goldman Sachs, said half of its 32 Moat Houses will be franchised to InterContinental in line with the new corporate strategy of the group. InterContinental will use its Holiday Inn and Crowne Plaza branding on the 16 Moat House properties in exchange for a royalty fee estimated between 3 and 5 percent of profits.

Although it effectively means the end for the brand ‘Queen Moats House’, it is expected to bring in more revenues from the franchise than while being run as Moat Houses.

The ‘Queens Moat House’ brand was in the 70’s and 80’s a very successful brand. However, the fortunes of the UK hotel group changed and a downturn began which led to the near collapse of the business in 1993. With debts having mounted to Ł630 million, the management had no option but to put up the 32-strong estate for sale. Goldman Sach’s property investment wing Whitehall Partners took over the group for around Ł54 million last year.

There is also good reason to believe that the group has put up another 8 Moat Houses for sale and is considering options for the remaining 8. Queens Moat Houses have only two options before them – a franchise similar to the InterContinental deal or a sale of the properties to independent operators.

11 of the franchised Moat Houses will be refurbished and converted into Holiday Inns and two into Crowne Plazas. IGH have yet to decide about the remaining three. The franchised establishments will continue to be managed by Queens Moat Houses.

The Moat Houses on Doncaster, Harrogate and Stratford are among those slated to become Holiday Inns.

For IGH the deal is similar to Stardon Hotels whose five establishments were last month franchised to IGH bringing the total number of InterContinental brand establishments to 227 in the UK.