Commuters crawling to a standstill as city speeds fall

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If it feels like your daily commute is taking longer and longer it’s probably because it is.

New data shows that average driving speeds in many of Britain’s major cities are falling, adding time and frustration to the daily slog to and from work. In London, Glasgow and Manchester average speeds within a mile of the city centres have dropped by more than 1mph since last year.

Speeds in the capital are the worst in the country at just 5.13mph within a mile of the centre and 8.34 within five miles but other major cities are almost as bad.

Edinburgh motorists achieve an average of just 6.64mph within a mile of the centre and just 12.38 within five miles, and those in Glasgow and Manchester also plod along at an average well below 7mph. The latest Department for Transport figures show that traffic volumes across the country rose 1.7 per cent between April 2016 and March 2017 to a total of 324.3 billion miles.

With such rises it’s perhaps unsurprising that journeys are taking longer for the estimated two-thirds of us who commute on a daily basis.

The figures were revealed by analysing data from 400,000 journeys gathered over three months by telematics firm In-Car Cleverness. Its head of sales, Paul O’Dowd, commented: “The figures paint a stark picture of how everyday commuters, drivers and even businesses are struggling to get around or operate in some of the biggest hubs in the UK.

“It is likely down to a few factors. Overall traffic volumes are higher and this increase will be most noticeable in urban areas. As well as more traffic on the roads, major cities are increasingly introducing tighter speed restrictions while adopting more bus lanes, as well as cycling and pedestrian infrastructure.”






HSBC profits rise as it prepares for UK ringfence

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HSBC has reported a rise in its first half profits and announced a share buyback as it prepares to ring-fence its UK retail arm by 2019.

Europe’s biggest bank reported a 5% rise in pre-tax profit of $10.2bn (£7.8bn) for the first six months of 2017, up by about $500m.

As widely expected, the bank has also announced a share buyback of up to $2bn which it expects to complete by the end of 2017.

HSBC shares rose 3% on the news.

The bank’s shares fell back later but its share price has rallied over the past year, helped by the weak pound which makes profits earned abroad more valuable when repatriated to the UK.

Since the 2008 financial crisis, HSBC has been cutting jobs and selling assets to make the group more profitable, while still making dividend payments to shareholders.

“In the past 12 months, we have paid more in dividends than any other European or American bank and returned $3.5bn to shareholders through share buybacks,” HSBC’s chief executive Stuart Gulliver said.

The bank has used share buybacks to offset the impact of shares being paid out as dividends.

The announcement takes the total of HSBC share buybacks since the second half of 2016 to $5.5bn.

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.

Carmakers call for transitional EU deal

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The government must secure a transitional Brexit deal to protect the future of the UK car industry, a trade group has said.

The Society of Motor Manufacturers and Traders (SMMT) said Britain was highly unlikely to reach a final agreement with the EU by the March 2019 deadline.

That meant carmakers could face a “cliff edge”, whereby tariff-free trade was sharply pulled away.

It warned the industry would suffer without a back-up plan in place.

The EU is by far the UK’s biggest automotive export market, buying more than half of its finished vehicles – four times as many as the next biggest market.

UK car plants also depend heavily on the free movement of components to and from the continent.

The SMMT said any new relationship with the EU would need to address tariff and non-tariff barriers, regulatory and labour issues, “all of which will take time to negotiate”.

“We accept that we are leaving the European Union,” said chief executive Mike Hawes.

“But our biggest fear is that, in two years’ time, we fall off a cliff edge – no deal, outside the single market and customs union and trading on inferior World Trade Organization terms.

“This would undermine our competitiveness and our ability to attract the investment that is critical to future growth.”

He called on the government to seek an interim arrangement, whereby the UK stayed in the single market and customs union until a new relationship was brokered.

UK car manufacturing generated £77.5bn of turnover last year and accounted for 12% of all goods exports, according to the trade group.

It added that almost a million people were employed across the wider automotive industry.

RBS chief’s talks with investors fail to produce settlement

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Fred Goodwin could still be required to give evidence in a trial relating to the near-collapse of Royal Bank of Scotland (RBS) amid a continuing stalemate between the lender and thousands of small shareholders.

Sky News has learnt that a meeting between Ross McEwan, RBS’s chief executive, and directors of the RBoS Shareholder Action Group took place on Friday aimed at reaching a final settlement between the two sides.

Insiders said that the talks, which took place at RBS’s London offices, concluded without an agreement after Mr McEwan declined to increase a financial offer to the remaining claimants.

The action group, which indicated at the beginning of the week that a majority of its 9000 members had backed an 82p-a-share deal, is now scrambling to raise £7m to fund itself through the anticipated 14-week trial – which is due to kick off in five days’ time.

Sources said it had raised roughly £4m so far from unidentified contributors.

RBS had hoped that at least 70% of the claimants by value would accept the settlement, which would have made it binding upon all of the participants.

It was unclear exactly what proportion of the claimants by value had indicated their willingness to accept, with the trial due to begin next Wednesday.

The judge in the case has already adjourned it three times amid ongoing settlement talks.

While an 82p-a-share deal with the outstanding claimants would have cost RBS more than £200m, some observers believe the bank should have offered a higher sum in order to draw a line under the case.

If the trial does go ahead, it would be among the most keenly awaited events to follow on from Britain’s banking crisis of 2008, with former RBS boss Mr Goodwin expected to spend two days in the witness box.

Mr Goodwin, who was ousted as RBS’s boss as it was being bailed out with £45bn of taxpayers’ money in 2008, has never given a full public account of the crisis at the bank.

Earlier that year, he oversaw a £12bn rights issue aimed at shoring up the bank’s balance sheet – a fundraising that investors claim was based on misleading information.

Many of the former shareholders, some of whom rank among RBS’s current workforce, have accepted an 82p-a-share offer made last month, while a number of other claimant groups had settled for just over 40p-a-share.

Others, however, are determined to see Mr Goodwin and his former senior colleagues appear in court.

Mr Goodwin, along with Sir Tom McKillop, the former RBS chairman, are named alongside the state-backed bank as defendants in the case.

The Government continues to own more than 70% of the bank, and there is little prospect of it ever recouping the money it paid to avert its outright collapse.

To date, more than £100m has been spent by the bank defending the claims, a bill which includes the legal costs of Mr Goodwin and other former directors.

Those legal fees have drawn criticism from investors and politicians, but were defended by Sir Howard Davies, RBS’s chairman, at its annual meeting earlier this month.

Sir Vince Cable, who was business secretary in the 2010-15 coalition government, described the legal bill as “obscene”.

RBS and a spokesman for the action group declined to comment.

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