Business confidence on the up, Lloyds survey finds

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Business confidence has jumped to an 18-month high, but companies are having trouble recruiting skilled workers, according to a survey.

The Lloyds Bank Business in Britain report’s confidence index rose to 24% – double the level immediately following the EU referendum last year.

The index is a measure of expected sales, orders and profits.

A separate survey by the British Chambers of Commerce forecast weak economic growth for the next few years.

Outlook ‘mixed’

The Lloyds Bank report surveyed the views of 1,500 UK companies in May, after the general election was called.

The average for the confidence index in the 25 years the report has been compiled is 23%.

The net balance of companies that said they had found it difficult to find skilled labour in the past six months hit a 10-year high of 52%.

That was up from 31% in January when the last report was released.

The share of firms facing similar issues with unskilled workers also rose to 26%, up from 14%.

Tim Hinton of Lloyds Banking Group said: “Although challenges remain in recruiting both skilled and unskilled labour, businesses are anticipating higher sales, increased profits and staffing levels to rise.

“However, the outlook remains mixed at best.”

According to the survey, four out of six business sectors reported higher levels of confidence since January.

That was attributed mainly to increased demand from UK customers, which Lloyds said suggested was due to factors other than the help that weaker sterling had given to exporters.

Hann-Ju Ho, senior economist at Lloyds Bank Commercial Banking, said: “Although the pound’s value is seen as nearer ‘fair value’, currency volatility remains a big concern for some UK businesses that trade internationally.”

Inflation fears

Meanwhile, the British Chambers of Commerce (BCC) says that economic growth will remain anaemic over the next few years.

The business group, which represents thousands of small and medium-sized companies, says annual GDP growth will not exceed 1.5% by 2020 and inflation could end up being higher than expected.

The BCC expects inflation to average 2.9% this year and peak at 3.4% in the last three months of 2017, which it says will hit consumer spending.

The group raised its forecast for economic growth from 1.4% to 1.5% for this year, but expected GDP to increase by just 1.3% next year.

Adam Marshall, director-general of the BCC, said: “Over recent months, many of the businesses I speak to have expressed cautious optimism for their own prospects, but remain wary about the growth prospects of the UK economy as a whole.

“In the wake of an inconclusive general election, that wariness is set to increase.”

The group has urged the government to spend more on infrastructure, particularly broadband and mobile phone connectivity, while it has described the UK’s road network as sclerotic.

In May the Office for National Statistics said the economy expanded by 0.2% in the first three months of the year, down from its first estimate of 0.3%, as the key services sector lost momentum.


Parliament hit by ‘sustained’ cyber-attack

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Parliament has been hit by a cyber attack, officials at Westminster say.

The “sustained” hack began on Friday night, prompting officials to disable remote access to the emails of MPs, peers and their staff as a safeguard.

The parliamentary authorities said hackers had mounted a “determined attack” on all user accounts “in an attempt to identify weak passwords”.

Government sources say it appeared the attack has been contained but it will “remain vigilant”.

A parliamentary spokeswoman said they were investigating the attack and liaising with the National Cyber Security Centre.

She said: “We have discovered unauthorised attempts to access accounts of parliamentary networks users…

“Parliament has robust measures in place to protect all of our accounts and systems, and we are taking the necessary steps to protect and secure our network.

“As a precaution we have temporarily restricted remote access to the network.”

‘Not a surprise’

IT services on the parliamentary estate are working normally and a message sent to MPs urges them to be “extra vigilant”.

But a number of MPs have confirmed to the BBC they are not able to access their parliamentary email accounts outside of the Westminster estate.

It comes just over a month after 48 of England’s NHS trusts were hit by a cyber-attack.

International Trade Secretary Liam Fox said: “We have seen reports in the last few days of even Cabinet ministers’ passwords being for sale online.

“We know that our public services are attacked so it is not at all surprising that there should be an attempt to hack into parliamentary emails.

“And it’s a warning to everybody, whether they are in Parliament or elsewhere, that they need to do everything possible to maintain their own cyber security.”

The latest attack was publicly revealed by Liberal Democrat peer Lord Rennard on Twitter as he asked his followers to send any “urgent messages” to him by text.

Henry Smith, Tory MP for Crawley, later tweeted: “Sorry no parliamentary email access today – we’re under cyber attack from Kim Jong Un, (Vladimir) Putin or a kid in his mom’s basement or something…”

The government’s National Security Strategy said in 2015 that the threat from cyber-attacks from both organised crime and foreign intelligence agencies was one of the “most significant risks to UK interests”.

The National Cyber Security Centre, which is part of intelligence agency GCHQ, started its operations in October last year.

The National Crime Agency said it was working with the NCSC but the centre was “leading the operational response”.


Building society’s account deadline axed

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A deadline for the closure of current accounts with the Norwich and Peterborough (N&P) has been cancelled, with 30% of customers still to receive letters explaining the move.

It was announced in January that the building society’s brand is to be abolished, some branches closed, and current accounts shut down.

The plan was for customers to move or close accounts by the end of August.

But its owner, the Yorkshire Building Society, now says there is no deadline.

The Yorkshire – the UK’s second biggest mutual – said that about 35% of the 100,000 customers affected had already closed their current account, switched to another bank, or was in the process of doing so.

It was staggering the flow of letters to affected customers to avoid a rush of inquiries, and has now written to 70% of those affected.

The remaining letters will be sent by the end of July.

‘Real shame’

The Yorkshire will close 28 N&P branches this year. The remaining branches will be rebranded as Yorkshire Building Society branches.

A spokeswoman for the Yorkshire said: “We are continuing to work closely with other financial providers in assisting customers to switch or close their account. We’re writing to customers with details of what they need to do next, and asking that customers complete the closure or switch of their account within six months of receiving their letter. We have not set a final date for closure.

“If a customer has not taken steps to close or switch their account within six months of receiving of their letter, we will work closely with the customer on a case-by-case basis to facilitate a switch or closure.”

In the meantime, no customers would be blocked from depositing money or conducting any normal banking transactions via their current account, she said.

The N&P is not part of the Current Account Switching Service so the process will be slower than could have been the case, taking about 12 days.

It was feared that some cash incentives to switch offered by rivals would not have applied, but many providers are now offering the perks to customers moving from the N&P.

Mike Regnier, chief executive of the Yorkshire Building Society, told BBC Radio 4’s Money Box earlier this year that it was a “real shame” that the accounts had to close. He said that too much investment would be required to keep the current accounts compliant with regulation if offered by the mutual. Instead it is to concentrate on savings and mortgage products.


Watchdog clamps down on online gambling

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The competition regulator is to take action against some online gambling companies which it suspects of breaking consumer law.

The Competition and Markets Authority (CMA) said some punters did not get the deal they expected from sign-up promotions offering cash bonuses to attract them to gaming websites.

The CMA also said the firms were “unfairly holding onto people’s money”.

Online gambling companies should “play fair”, said the CMA.

Nisha Arora, CMA senior director for consumer enforcement said: “New customers are being enticed by tempting promotions only to find the dice are loaded against them.

“And players can find a whole host of hurdles in their way when they want to withdraw their money.”

The CMA launched its investigation into the gambling sector in October 2016. It has since heard from about 800 “unhappy” customers and has “demanded companies answer questions about how they operate, and closely examined the play on a range of websites”.

As a result it has identified “a number of operators engaging in practices likely to be breaking consumer law”, which is why it is taking enforcement action.

Initially the CMA is talking to the companies, which it says it cannot name, demanding that they change their practices.

The firms can offer undertakings about how they intend to do that. If they do not meet the requirements, the CMA can take them to court. The court could fine the companies or ultimately revoke their licences.

The online gambling sector has grown by about 150% since 2009 and is worth £4.5bn. The CMA said more than 6.5 million people regularly use the sites.


UK holiday fraudsters could face jail

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UK holidaymakers who make bogus food poisoning claims could go to prison, warns travel trade organisation Abta.

A huge rise in false claims has left travel bosses “embarrassed” by a trend which they say is a “British problem”.

Abta chief executive Mark Tanzer said the fraud is “one of the biggest issues that has hit the travel industry for many years”.

He added that tourists chasing false or exaggerated claims “risk ending up in jail either in the UK or abroad”.

Tens of thousands of UK tourists have put in for compensation in the past year, even though sickness levels in resorts have remained stable.

Clampdown call

Abta says the cases usually involve holidaymakers who have been abroad on all-inclusive deals, who argue that because they only ate in their hotel, that must have been the source of their alleged food poisoning.

It has launched a campaign called Stop Sickness Scams, asking the government to clamp down on the issue.

It says laws designed to stop fraudulent claims for whiplash have instead pushed the problem of false insurance submissions on to overseas holidays instead.

This is because of a cap on the legal fees that can be charged by law firms pursuing personal injury cases at home.

Mr Tanzer added: “The government must urgently address this issue. The legal loophole that is allowing firms to unduly profit from these claims must be closed.

“This would allow people with genuine claims access to justice but make this area less attractive to claims firms.”

Travel firm Tui said it had experienced a 15-fold rise in holiday sickness claims in the past year, costing between £3,000 and £5,000 a time, which was often more than the value of the holiday itself.

Tui’s UK managing director Nick Longman and Thomas Cook UK’s managing director Chris Mottershead both warned that if the problem continued, it could spell the end of the all-inclusive holiday for UK travellers.

Mr Mottershead said: “It has the potential of putting hoteliers out of business. They will stop British customers coming into their hotels.”

‘Touts’

Joel Brandon-Bravo, managing director of Travelzoo UK, told BBC Radio 5 live’s Wake Up To Money that the upward trend was being driven by claims management companies.

“People are being called when they get back from holiday and encouraged to make claims and we’ve also seen evidence of them employing touts outside resorts encouraging people to make a claim and walking them through the process to make it easy for them,” he said.

Mr Brandon-Bravo added that he felt people who were trying to cheat the system were not aware of the consequences if they were caught.

“Generally it is not made clear that if a claim is found to be fraudulent the individual could have a criminal record.

“In fact, there is one case going through right now with a Greek hotel, who is counter-suing a couple who made a claim for sickness three years ago for £10,000 and the hotel is counter-suing them for £170,000.

“They tried to withdraw their claim but they are seriously worried they could lose their house.”

The Foreign Office has also advised tourists against making any fraudulent claims.

“If you make a false or fraudulent claim, you may face legal proceedings in the UK or Spain,” the FCO warns.

“There have been reports of an increase in holidaymakers being encouraged to submit a claim for personal injury if they have experienced gastric illness during their stay,” says the FCO website.

“You should only consider pursuing a complaint or claim if you have genuinely suffered from injury or illness.”

The Alliance of Claims Companies told the BBC it was hoping to establish industry best practice principles that would help drive out rogue companies.

It wants to work with the travel industry to ensure genuine claims are dealt with effectively.



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