Tag: Asset-Based Finance (page 11 of 13)

Farmer insurance scheme could be an option

21st November 2013 / / Comments Off on Farmer insurance scheme could be an option

A RADICAL new approach to agricultural insurance could provide an alternative to the Single Payment Scheme (SPS) in the UK.

That was the message from George Eustice, Parliamentary Under Secretary for Farming, Food and Marine Environment.

Mr Eustice said the UK could learn from Canada and the USA which have their own successful national agricultural insurance schemes, which are paid for both by farmers and the Government.

“The USA has a flagship agri-insurance scheme,” he said. “If a farmer’s income drops significantly below a certain level, due to crop failure for example, they can call on the insurance fund to top their income up.”

Farmers pay in to the system, explained Mr Eustice, and the American government helps support it by paying some of the administration costs and helping the insurance scheme pay for the gap in farm income.

He said: “Canada also has a similar system, known as agri-stability, whereby if the farmer’s income drops below 70 per cent of their average income for the previous five years, they are eligible for the insurance.

“The Canadian Government has a bigger financial input, contributing between 60 and 80 per cent of the insurance cost, with the industry paying the rest.

“The NFU has previously asked us to consider such a scheme and in 2009 Defra commissioned Prof Berkeley-Hill to look at its potential in the UK.

“He concluded if done correctly a national agri-insurance scheme could provide an alternative exit strategy to the SPS we currently have.

“Prof Berkeley-Hill also said it could be on way of reducing the long-term cost of the CAP.”

However, he also highlighted several big drawbacks to this kind of insurance system.

“Both Canada and the USA do not have a SPS, so the insurance scheme which NFU has previously advocated would have to be in place of a SPS, rather than an addition to it.”

He also said the cost of such schemes, which cost more than the UK currently pays to administer CAP, were also a drawback.

#YorkshireHour

20th November 2013 / / Comments Off on #YorkshireHour

#YorkshireHour is open for business once again this evening 8pm-9pm.

A virtual place – but a real time – to promote your Yorkshire Business. Will you be participating this evening? We certainly will be!

When it gets to 8pm tonight start tweeting about your Yorkshire business and add the hashtag #YorkshireHour – it’s that simple!!

For example:

  • “We’re an independent finance brokers based in Leeds, West Yorkshire #Yorkshirehour”

You can also search for #YorkshireHour on Twitter to see what other Yorkshire folk are promoting. This way you can then follow, say Hi and build connections that might be relevant to you business, or if the tweets are just interesting to yourself. It’s a great tool to use to market your Yorkshire Business are also find other business’ that you could benefit from.

After, don’t forget to check your account for new followers and say thanks – see if you want to follow them back and start up new connections with them as well. You’ll be  amazed and surprised how many new followers you’ll get and business contacts you can make in an hour.

New Tractors for Landini Range in 2014

18th November 2013 / / Comments Off on New Tractors for Landini Range in 2014

The all-new Landini Series 4 will have power outputs from 61hp to 101hp channelled through a new Argo Tractors 12×12 transmission with synchro shuttle, power shuttle creep and two-speed powershift options.

Italian agricultural engineering firm Argo Tractors presented its biggest ever collection of new models at the Agritechnica exhibition in Germany as a major investment in product development bears fruit.

High quality materials and design are evident in the new cab built by Argo for the new Landini Series 4 tractors, and it is reckoned to be one of the most spacious in the class.

Previewing more new tractors than any other manufacturer at the event, in preparation for their commercial launch in 2014, Argo’s Landini exhibit included the Series 4 livestock tractor, which features a new-design cab with a more up-market and spacious interior and mechanical controls.

The Landini Series 4 is a new class of stockman’s tractor for the Italian-built range. This all-new range of tractors from 61hp to 101hp that will comprise six models powered by either 2.9-litre or 3.6-litre engines. It has a new Argo Tractors synchro shuttle 12×12 transmission that can be enhanced by creep, power shuttle and hi-lo powershift options.

The new Argo-built cab, with an interior design using materials to automotive standard, is said to be the most spacious low-profile design available in this class.

When it is introduced next year, the new Landini Series 4 range will slot in beneath the newly launched 85-113hp Landini Series 5-H T4i, which is a little larger and heavier, with power outputs up to 113hp: www.farminguk.com/news

The Series 4 will be ideally suited to livestock farms and other operations wanting a light, highly manoeuvrable and well-equipped tractor of this size and power.

Barclays to move four bank branches to Asda

8th November 2013 / / Comments Off on Barclays to move four bank branches to Asda

Barclays is to close four branches and move staff and banking services to nearby Asda stores.

It said it then wanted to open another four branches in Asda supermarkets by early next year in an attempt to make banking more convenient.

The initial four branches will swap locations to make parking easier, and sees branches with relatively low footfall being moved to the stores.

Asda said that access to banking services was vital for communities.

Bank staff will work at the new supermarket-based branches during normal bank opening hours, with cash and cheque machines accessible during the supermarkets’ opening hours.

The first branch will be opened in an Asda store at Birchwood in Cheshire in February.

Three more will later be opened at Asda stores in Pudsey in West Yorkshire, North Watford in Hertfordshire and Broadstairs in East Kent.

The additional four stores for new branches will be chosen later.

Bank branches in supermarkets are common the US.

Business costs rising 3.5pc ahead of inflation

8th November 2013 / / Comments Off on Business costs rising 3.5pc ahead of inflation

Business costs continue to rise, with inflated energy prices proving the most burdensome for small firms in 2013, according to research from the Forum of Private Business.

Small businesses are struggling to make ends meet despite positive signs of an economic recovery, the latest Cost of Doing Business report from the Forum of Private Business has found.

According to the 4,000 respondents to the survey, 94% of businesses have seen an overall increase in their business costs. Of these, the cost of gas and electricity are the biggest bugbears with 87% reporting an increase in energy overheads. However, 83% also saw a rise in transport costs, 78% are spending more on marketing and 69pc have experienced a rise in the cost of raw materials/stock.

The cost of petrol, rising transport costs and the spiralling price of energy are proving extremely challenging for small businesses. These, coupled with the continued weakness of sterling, are putting downward pressure on balance sheets. And these firms are unable to simply pass on these costs to customers. Despite evidence of a muted economic recovery, 41pc of small business owners said that they were absorbing the costs themselves. Just 2pc were able to pass on costs in full.

Annual inflation may have fallen from 3pc to 2.7% but this research shows that prices have continued to rise for micro, small and medium-sized employers, increasing by 6%. This is less than the 6.7% figure reported by the Forum last year, however, suggesting that the environment for SMEs is gradually improving. Nevertheless, 83% of those surveyed expect the situation to worsen next year.

Credit restrictions are also an issue, with 26% of businesses reporting less leeway in coping with business costs than they had last year.

The report has found that 81% have experienced a detrimental effect to their business as a result of these rising business costs. 73% have had cash flow issues and 51% of firms have struggled to to invest in new training or plant. 51% also reported that these sky-high overheads have prevented them from employing new staff and 63% feel that it has hampered their growth plans.

More worryingly, the most frequently cited factors exacerbating the problem of rising costs were customers paying late (59%) and competitors offering products below cost price (51%). Excessive administrative demands forced on businesses by the government, banks and customers meant that 35% of businesses have not been able to focus on business activities. Changing payment terms has been a problem for 24% of businesses in dealing with suppliers, and 26% in dealing with customers.

“As well as positive action on late payment we’d like to see further steps to help small firms with business overheads,” said Alexander Jackman, the Forum’s head of policy. “We’d like a freeze on business rates and small business multipliers next year. An extension of small business rates multipliers until the end of the current parliament would also be welcome and we’d like to see the government commit to undertaking independent research into business rates.

“While the Chancellor’s announcement of a fuel duty freeze at the Conservative Party Conference was a welcome move, we feel that further action should be taken to investigate where further savings could be made across government to ensure that fuel duty is not raised again before the end of this parliament.”

The Housing Bubble

8th November 2013 / / Comments Off on The Housing Bubble

The Bank of England must find a way of slowing demand without bringing the economic recovery to a halt.

Of the Ten Commandments of central banking, the most important is to take away the punch bowl before the party gets started. Perhaps inevitably, few manage to obey. Central banks are invariably too slow to cut rates when circumstance demands – the European Central Bank has waited until the eurozone is almost in deflation before taking action – and too slow to raise them when the economy starts to overheat.

So it appears with the Bank of England, which despite a quite pronounced bounce in the economy, and accompanying recovery in the housing market, has committed itself to not raising interest rates for at least three years – subject to inflation and unemployment thresholds.

Margaret Thatcher’s favourite theorist, Friedrich Hayek, was by no means right about everything. But one of his central insights contains a great deal of truth. It is that expansionary policies in a recession will only postpone the necessary adjustment – and that creating more credit makes the eventual return to reality more painful still.

Today, Britain is being cynically frog-marched into a pre-election credit boom, for which there may eventually be a quite heavy price to pay.

Now, it would be wrong to exaggerate the current state of play. Despite the positive news on growth, the economy remains some distance below pre-crisis levels of output. In some parts of the country, it still feels like a depression. It can therefore be reasonably argued that the Bank of England shouldn’t even consider taking its foot off the monetary accelerator, at least until the economy is back to where it was.

But here’s where the debate gets really interesting. Why is it that output here has come bounding back, even as the world economy slows and the eurozone sinks ever further into the doldrums?

Certainly it has got nothing to do with the Government easing back on its austerity programme; to the extent that there ever was austerity, it is continuing at roughly the same pace as before. Nor has it got much to do with our moving towards a more balanced economy, less reliant on consumption and more driven by exports and investment. In fact, consumption today has an even bigger share of GDP. No, the true explanation is that the credit cycle has turned. Consumers are more confident, so they are borrowing more and saving less.

Behind this turnaround lie three key policy initiatives. Help to Buy has provided crucial support for the housing market. Funding for Lending has hosed the banks down with cheap money, giving them the capacity to start lending again. And the Bank of England’s “forward guidance” has offered households and businesses a degree of confidence that they are not about to be hit by a precipitous rise in interest rates.

As engineered, politically driven recoveries go, it’s quite clever. But it won’t be sustainable much beyond the election unless there is a pretty dramatic pick-up in business investment from here on in. So far, there is very little sign of it.

Having largely lost the argument over austerity, Labour has switched tack to the “cost of living crisis”. This may or may not be politically astute, but unfortunately it is a problem that is even less easily magicked away than a flatlining economy.

Certainly it is not going to be solved by Labour’s economically illiterate mix of price controls on energy and tax incentives to create higher wages. This will only succeed in raising unemployment. Similarly, reversing the Coalition’s attack on benefits, which is also depressing overall household income, would have to be paid for – and negated by – higher taxes.

In truth, there are no easy fixes for falling real incomes, since the underlying cause is endemically poor productivity. In recent years, Britain has become substantially less productive. Output has fallen, but employment has risen; ergo, output per worker – which was already quite low even before the crisis – has been badly eroded.

You cannot spend what you don’t earn unless you borrow the difference. Policy-makers have therefore returned to the old palliative of compensating for stagnating incomes by encouraging an expansion of credit.

Both the Bank of England and the Government believe that with a recovering economy will eventually come an improvement in productivity, real wages, and therefore living standards.

Believe it if you will. An alternative view is put by Fathom Consulting’s Danny Gabay, who thinks there is very little spare capacity in the economy. If that’s true, then Britain’s credit-led recovery will soon cause inflation to spike higher again.

So how could the Bank of England remove the punch bowl without bringing the recovery to a screeching halt? Raising interest rates is not the only tool available. The Bank could also act directly to prick the nascent housing bubble via its newly formed Financial Policy Committee. Some of the committee’s members, alarmed by the speed of the recovery in house prices, are already determined to act, by increasing capital requirements on mortgage lending, or recommending the imposition of tougher loan-to-value and/or loan-to-income criteria. Alternatively, they could simply embarrass the Chancellor by recommending that Help to Buy be scrapped.

A rather better solution all round, though one with few immediate political dividends, is the deregulatory and planning shake-up necessary to bring about a genuine improvement in supply and productivity. Unfortunately, such a course requires a rather braver Government than this one.

Alternatives to payday loans

6th November 2013 / / Comments Off on Alternatives to payday loans

If you’re struggling with your finances, a quick and easy payday loan can seem like a good option. But there are many other far cheaper alternatives.

Payday loans have been heavily in the spotlight this week. First, Wonga went on a PR offensive, premiering a film called 12 Portraits which featured 12 of its customers. Then there was a string of interviews in which the company’s Niall Wass told anyone who would listen the majority of Wonga’s customers were happy with its service.

Then representatives of three of the biggest payday lenders were grilled by a committee of MPs and naturally defended the industry and its practices.

While the industry may have cleaned up its act compared to a year ago, the simple fact remains that payday loans are an extremely bad way to borrow. Several mortgage brokers have also spoken about the detrimental effects using payday loans can have on any future mortgage application, as lenders see them as a sign of desperation and an inability to manage money.

But if money is really tight, what are the alternatives?

First steps

Cut your spending and budget

This should be the first thing you should do.Just looking at your monthly spending habits can make you realise you need to cut some things out completely. And if you’re using payday loans to pay off for nights out and new clothes then you’re already in deep trouble.

A budget can get you back on track so you have enough for both bills and treats.

Why not check out our free, secure Money Track budgeting tool?

Take out a 0% credit card

If you have a good credit rating but your debts are slowly mounting up and you’re only able to make the minimum payment on your credit card or you have a large overdraft, a 0% credit card could give you some valuable breathing space.

If you have card debts you want to transfer, you could get up to 30 months with no interest to pay using a 0% balance transfer credit card. All you have to pay is a fee, which is a small percentage of the debt you’re transferring.

If you have an overdraft, you can take a card that offers a 0% money transfer period. This allows you to transfer money into your current account and it will just cost you a percentage of the amount you’re borrowing (usually 4%). At the moment, you can get a 0% money transfer for 27 months with the MBNA Platinum and Fluid 27-month cards. Compare 0% credit cards

Ask for a pay advance

The best payday loan could come direct from your employer.

Asking for an advance on your wages could mean you meet the shortfall an unexpected bill or car repair causes, without the risk of falling into a pit of debt. Companies with a good cashflow may be willing to pay an advance on your wages and usually take the amount out of your next payslip.

Another way your employer may be able to help is by allowing you to do some overtime to boost your pay.

Turn to friends and family

Turning to your family or even your friends for a loan could prevent you from falling into a spiral of debt. They may even be able to lend you the money interest free.

Just remember to treat paying back a friend or family member as seriously as you would an official lender. After all, you don’t want them to fall into debt because you haven’t lived up to your side of the deal. If you want to make it official and reassure those close to you that you will repay, write down an agreement clearly marking the exchange as a loan not a gift.

Sell some old stuff

From CDs to DVDs, games to gadgets, if you have things you don’t use that could be cashed in then now is a good time to do it.

You could sell them online on sites such as eBay or Amazon or in high street shops such as Cash Convertors or Cash Generator.

Ask your bank for an authorised overdraft

An authorised overdraft with your bank is an alternative form of borrowing that is far more affordable than a payday loan.

Overdrafts that are agreed formally, rather than used accidentally, which are known as unuathorised overdrafts and can cost a small fortune, typically have rates between 12% and 20% AER. However, the Nationwide FlexDirect account offers a fee- and interest-free overdraft for a year, so long as you pay in £1,000 a month to the account.

Next steps

If money is still tight after you’ve exhausted all the options above, then find out if any of these are viable.

See if you’re entitled to benefits

The benefits system in the UK is highly complex, so many of us are unaware of the benefits we may be entitled to.

If you are pregnant, on a low income, caring for someone, have been bereaved, aged 60 or over, ill or disabled or even if you are unemployed then there is a chance that you could be entitled to a range of benefits such as Working Tax Credit, Child Benefit, Income Support, or Jobseeker’s Allowance.

Use this handy benefits checker on the Gov.UK website to double check you are claiming all the benefits you qualify for.

Apply for a credit union loan

Credit unions are not-for-profit, community-based organisations that provide transparent savings accounts and affordable loans to its members. Credit unions have a common community bond, so you could find yours where you live or where you work.

Many of them now offer payday loans at far lower rates than payday lenders. The only catch with credit unions is you often need to be a member before you can borrow.

To search for your nearest, use the Find Your Credit Union website.

Look into a budgeting loan

A budgeting loan is available from the Government to those on income support, income-related employment/support allowance, income-based jobseeker’s allowance and pension credit and is available if you need to pay for a particular range of expenses.

The loans are between £100 and £1,500, are interest free (so you only pay back the amount you borrowed) and you have two years in which to pay them off.

Seek free debt advice

If your finances are out of control and you consistently turn to payday loans, you should seek advice. There are a number of charities that are dedicated to helping those in financial difficulty such as StepChange Debt Charity, National Debtline and the Citizens Advice Bureau.

A Guide to Bridging Loans

1st November 2013 / / Comments Off on A Guide to Bridging Loans

Bridging loans are a short-term funding option. They are used to ‘bridge’ a gap between a debt coming due – and we’re talking primarily about property transactions, here – and the main line of credit becoming available. Or they can simply act as a short-term loan in pressing circumstances.

They can be invaluable in facilitating a property purchase that otherwise would not be possible. But as you might expect with a stop-gap measure, they can be significantly more expensive than a ‘normal’ loan.

What are bridging loans and how do they work?

Bridging loans are designed to help people complete the purchase of a property before selling their existing home by offering them short-term access to money at a high-rate of interest.

As well as helping home-movers when there is a gap between the sale and completion dates in a chain, this type of loan can also help someone planning to sell-on quickly after renovating a home, or help someone buying at auction.

As banks and building societies have grown more reluctant to lend in the wake of the financial crisis, there has been an influx of bridging lenders into the market.

Who are bridging loans aimed at?

Generally speaking, bridging loans are aimed at landlords and amateur property developers, including those purchasing at auction where a mortgage is needed quickly.

They may also be offered to wealthy or asset-rich borrowers who want straightforward lending on residential properties.

When should you use bridging loans?

Bridging loans can be used for a variety of reasons, including property investment, buy-to-let and development.

However, more recently, there has been a growing trend among borrowers to use bridging loans because high street and private banks are taking longer to process applications for larger home loans.

Some borrowers are also viewing bridging loans as a simple alternative to mainstream lending.

While a bridging loan may sound tempting, if you’re thinking about taking one out, you need to think carefully about your exit strategy. This might, for example, involve getting a mainstream mortgage or a buy-to-let mortgage, or selling the property altogether.

Crucially, if you’ve not used this type of finance before you need to tread carefully and get all the facts before hand and figure out if it’s the right sort of lending for you.

Put simply, bridging loans should not be viewed as an alternative to mainstream lending.

Where can you get a bridging loan?

Bridging lenders can come in all shapes and sizes, ranging from one-man bands up to professional outfits regulated by City watchdog, the Financial Services Authority (FSA).

Non-bank lending to small businesses at highest level since 2008

28th October 2013 / / Comments Off on Non-bank lending to small businesses at highest level since 2008

Non-bank lending to small businesses has hit a five-year high, as more enterprises turn to alternative sources of credit such as peer-to-peer lenders and invoice financing.

With traditional bank lending in its fifth year of decline, the UK’s commercial finance brokers say they have arranged £10.5bn of credit for small and medium-sized enterprises in the past year. This marks the highest figure since 2008 and an annual rise of 17 per cent.

Meanwhile, asset-based lenders, who advance money against equipment or invoices, also reported their biggest annual total since 2008, rising 10 per cent to £17.4bn in the year to June.

The data, from industry associations, highlight the shift away from traditional bank lending to small business, which has shrunk by a quarter since 2011. SME funding through leasing and asset finance has more than doubled in the same period, according to the National Association of Commercial Finance Brokers .

Its members also arranged £501m worth of loans through innovative channels such as peer-to-peer lenders, which match individuals to companies that want to borrow, a rise of 80 per cent.

Adam Tyler, chief executive of the finance brokers association, said that while the government’s Funding for Lending and Help to Buy schemes have eased credit conditions in the property market, small businesses were still being neglected by mainstream lenders.

“Alternative finance is providing life support to the sickly SME market and will be vital to give it extra impetus to boost the economic recovery,” he said.

“These figures show that alternative options from leasing and asset finance to peer-to-peer lending are increasingly taking up the slack and plugging a vital gap.”

The commercial finance brokers’ association, which compiled the data from its 1,000-plus members who arrange loans for businesses, will join the British Bankers’ Association to brief MPs on Monday on the use of alternative finance.

A BBA spokesman said banks were working with brokers to help customers gain access to alternative sources of credit. “While banks are open for business there are other ways to get finance. Bank finance is not always right for companies.”

Bank of England figures for the second quarter of 2013 showed that, excluding overdrafts, SMEs paid back £600m more than they borrowed from banks, although gross lending rose slightly to £10.2bn. The BBA said fewer than three in 10 applicants were turned away and total SME bank borrowing stood at £114.9bn.

The Asset Based Finance Association, which represents lenders rather than brokers, said last month that its advances rose from £15.8bn to £17.4bn in the year to June.

Mr Tyler said there was still a lack of awareness among small businesses and their advisers on alternatives to bank loans.

Even after the recent increases, brokers remain far short of the £19.7bn of finance they arranged in 2006-7.

Copyright The Financial Times Limited 2013.

UK car production continues to strengthen

24th October 2013 / / Comments Off on UK car production continues to strengthen

UK car production continued to strengthen last month, industry figures have shown, with output now having passed the one million mark this year.

The Society of Motor Manufacturers and Traders said production rose to 140,888 in September, up 9.9% from a year ago.

The figures means output for 2013 so far has now reached 1,125,433.

In addition, car production for the 12 months to September hit 1.5 million, the highest rolling 12-month total since October 2008.

The number of cars produced for export rose 9.3% from a year earlier, helped by high demand in China, Russia and the US for luxury British brands.

Mike Hawes, chief executive at SMMT, said the sector was “one of the UK’s biggest success stories in recent years”.

“This long-term financial commitment and robust demand for UK-built products show the global appetite for high-quality, desirable products borne of the UK’s world-class design, R&D and engineering,” he added.

However, while car output rose, production of commercial vehicles (CV) – lorries, buses, trucks and vans – fell 27.6% from a year earlier to 6,963.

“CV production remained subdued in September, with continuing uncertainty in the EU and restructuring of UK operations,” said Mr Hawes.

Bank acknowledges ‘contactless’ card problems by changing rules

23rd October 2013 / / Comments Off on Bank acknowledges ‘contactless’ card problems by changing rules

First Direct has told customers who want to pay with contactless cards that they must remove them from their wallets – in an apparent admission that the technology can go wrong.

The introduction of controversial “contactless” payment cards – where customers make payments of up to £20 by briefly touching their card to a reader and do not enter a Pin number – has caused at least one bank to alter its customers’ terms and conditions.

First Direct, the offshoot of HSBC, has written to its customers saying “we have made changes to clarify that if you have a contactless debit card you must remove it from your wallet or purse before using it to make a contactless payment.”

This change seems a response to the reported cases of mistaken payments, where money has been taken from peoples’ accounts without their knowledge but where they think they brushed against a reader by accident.

First Direct offered no further written explanation to customers. But a spokeswoman for the bank admitted the change was being brought in to prevent payments being made accidentally. She said: “If you don’t remove cards from your wallet there is a danger the payment may be taken from the wrong card. It could be a bit of a nightmare if it came from a card where there wasn’t enough money.”

The banking industry has previously downplayed such fears. Around 40million contactless cards are in issue and an estimated 100million payments will be made using them this year. Almost all banks are rolling the technology out automatically, as and when customers’ cards are renewed. Cards with the “wave” logo pictured above are enabled for these types of “one-touch” transactions.

Fears of the safety of the technology surfaced in May this year when customers of Marks & Spencer claimed payments were taken without their knowledge. M&S was one of the first large chains to deploy the technology en masse at its checkouts. Many others have followed suit including sandwich chains and restaurants.

There were also fears the cards were vulnerable to fraudsters carrying readers which, if placed near enough to the cardholder’s wallet or pocket, could capture data.

UK Cards Association, the trade body for the payments industry, said: “Problems are exceptionally rare, with only a handful of cases reported where the wrong card has been debited when accidentally placed very close to a contactless card reader.”

The spokesman added: “The technology is extremely robust, has been thoroughly tested and is working as expected. Payments can only take place where the card is placed within 5 cm (2 inches) of the terminal.”

Website helps farmers in fight against rural crime

22nd October 2013 / / Comments Off on Website helps farmers in fight against rural crime

The Ulster Farmers’ Union has welcomed the launch of a new rural crime website

www.thefarmnet.com aimed at helping farmers quickly raise the alarm about stolen goods via digital and social media.

UFU Deputy President Barclay Bell said: “Rural crime continues to be a significant issue for farmers. The unfortunate reality is that farmers and producers throughout the island of Ireland are having valuable livestock and machinery stolen on a regular basis which has a devastating impact on farm families and businesses. There is evidence that one of the most powerful tools in fighting and preventing crime is communication and the new website www.thefarmnet.com has been designed to create a network of communications using web and smartphone technology.

“We suspect that many items are being ‘stolen to order’ and that there is a very real issue of items being stolen in Northern Ireland and then crossing the border into the Republic of Ireland and vice versa. There is evidence that often stolen items are stored for a while before possibly being shipped out of the country. It stands to reason, that this storage period presents the best window of opportunity for recovery, which is why it is vitally important to raise awareness of stolen goods as quickly and as widely as possible.

Cross Border

“The beauty of the Farmnet website is that it takes a cross border approach which, given that there is undeniable evidence of movement of stolen goods between North and South, means that farmers can raise the alarm and reach a large audience quickly. It also complements local rural text alert schemes and allows information to be shared without individuals being bombarded by text messages.”

The website is very easy to access and easy to use. Farmers throughout the island of Ireland can log onto the blog site and enter details of stolen items at anytime of the day or night to tell the entire rural community what they have lost. The website is easily viewed on a computer, tablet or smartphone.

These details can include a photograph, any distinctive markings or numbers and when and where the stolen property was last seen. The information can be viewed by all users who register and all entries are automatically posted to The Farmnet Facebook and Twitter accounts.

Anyone who believes they have seen any suspicious activity, such as vehicles and livestock being moved, can add their comment. Historic thefts can be put on retrospectively to encourage reports of possible sightings and share information after the incident.

There are also a number of recovered items in storage which need to be returned to their owners and the site will carry details of any unidentified property which is currently held by authorities.

Barclay Bell concluded: “The Farmnet website allows farmers to take advantage of advances in technology and become part of a virtual anti-crime network. The Ulster Farmers’ Union continues to work with the PSNI, NFU Mutual and other stakeholders to address this important issue and this new website is another useful tool to have in our rural crime fighting arsenal.”

Register on www.thefarmnet.com and be a part of this anti-crime network.

An early Christmas present for farmers

22nd October 2013 / / Comments Off on An early Christmas present for farmers

Twitter and Facebook this week have been highlighting a house in West Belfast with a Christmas tree and lights in the garden.

A resplendent tree it certainly is – but the middle of October is nonetheless a bit early to be getting into the Christmas mood. However farmers received a nice early Christmas present this week, in the shape of a reduction in the financial discipline penalty on single payments. This was initially to be close to five per cent, then the figure moved to around 4.5, per cent, but now the final figure has been cut to 2.45 per cent. This is because the overspend of the CAP budget will be 903 million euro rather than the 1.5 billion originally forecast.

This may not sound a lot – and at the end of the day a cut is still a cut. However direct payments will be increasing by around 5 per cent because of the euro to sterling conversion figure. With financial discipline at 2.45 per cent that will still be a net gain of around 2.5 per cent – and in today’s tough financial climate a lot of people in 9 to 5 jobs would be delighted with a pay increase that almost matches inflation. On those grounds, early as it may be, this is a welcome Christmas bonus on single farm payment cheques that should be going out in December.

Inevitably in Brussels good news is offset by less positive events. That comes in the shape of a blow to something farmers have wanted for a long time, and which they believed was on its way. This is the extension beyond beef of country of origin labelling, dubbed COOL. The need for this was given a boost when farm lobby groups from Europe and North America discussed trade issues when they met last week in Mexico. These underlined that trade goes beyond the basic issue of price, with European environmental and welfare standards very different to those elsewhere. On that basis it is only fair that farmers delivering the higher standards should be rewarded for them, and that means consumers knowing the origin of products.

COOL moved up the Brussels agenda in the wake of the horsemeat scandal. There was a growing confidence that legislation would be in place next year. The UK government has always been a rallying point against this plan, claiming it represented additional red tape for food companies, because it would restrict their ability to source ingredients where they wanted. There are also claims that COOL is difficult to police when batches of product are combined for ready meal type products. However the horsemeat scandal proved that those who had good traceability standards could stand over mince used in burgers – not down to the individual animal but to the day and the herd numbers of cattle from which it was produced.

Now in a surprise move a report prepared by the European Commission has undermined the thinking behind COOL, deeming it potentially costly and cumbersome for food companies. This has to be music to the ears of the food industry, which lobbies against any labelling regulations. It will also be applauded by the UK government, as many will view it as no coincidence that the report was leaked at a crucial stage of the negotiations. It claims costs could rise for food manufacturers by between 5 and 15 per cent. This is because they would have to source EU origin ingredients, because anything else would not look good to consumers. In an amazing leap of economic logic the report then concludes that since prices would have to increase on the supermarket shelf demand would fall, meaning the COOL plan would have a negative impact on the meat industry.

The report then gilds the lily by making much of additional inspection costs if the legislation were in place, and its conclusion is that COOL is a bad idea. While what has emerged are leaks of the report it certainly seems to have been heavily influenced by the food industry, with the views of farmers and others pressing for COOL largely ignored. The commissioner responsible, the food safety commissioner Tonio Borg, says he has an open mind on this issue. One way to show that would be to take this report as a first draft – and to tell those who prepared it to think again, and not to be so influenced by the arguments of the food industry’s lobbyists.

Co-op Group to lose control of Co-op Bank

21st October 2013 / / Comments Off on Co-op Group to lose control of Co-op Bank

Co-op Group’s hopes of retaining control of Co-op Bank after its £1.5bn rescue have been dashed by opposition from creditors, led by a duo of hedge funds, I understand. But Co-op Group hopes the bank’s co-operative ethos can be protected.

Co-op Bank is also expected to announce later today that its provisions for the costs of compensating customers for mis-selling PPI insurance or for flaws in lending documentation, inter alia, will be around £100m greater than it expected.

Or to put it another way, a bank that has taken itself to the brink of collapse because of the scale of losses, from loans going bad and an expensive IT project that had to be written off, turns out to be even more loss making than was thought.

However I am told that the banks’ supervisor, the Prudential Regulation Authority, has concluded that the amount of new capital needed by Co-op Bank to remain viable does not need to be increased from the £1.5bn agreed in the summer.

So the challenge for Co-op Bank of staying alive remains what it was (and see what I wrote here a couple of days ago for more on this).

However, after a weekend of intensive talks with Co-op Bank’s creditors, Co-op Group, owner of Co-op Bank, has conceded – or so I am told – that its own plan for rescuing the bank has to be torn up and replaced.

Co-op Group’s original plan involved it putting in £1bn of the capital needed by Co-op Bank, with bondholders and owners of preference shares contributing the remaining £500m.

Under this proposal, Co-op Bank would have been floated on the London Stock Exchange, but Co-op Group would have retained control of it with a 70% stake.

This deal cannot go ahead without the agreement of the bondholders and owners of preference shares, and they’ve told Co-op Group they reject it.

The most important opposition to what Co-op Group wanted came from owners of 43% of “lower-tier-two-capital” bonds – or lenders to the bank with greater rights over Co-op Bank’s assets than other bondholders.

The leaders of these opponents were a couple of hedge funds, Silver Point and Aurelius, advised by investment bank Moelis.

These hedge funds favoured a plan in which their bonds would be converted largely into Co-op Bank shares, which would give the bondholders ownership and control of the bank. Under this alternative rescue, the banks would still be listed on the London Stock Exchange.

The hedge funds are getting their way.

Under a revised rescue plan, it is the bondholders – which also include insurers and pension funds – which would end up controlling Co-op Bank.

At the time of writing, that revised plan has not been formally agreed. But I am told it is likely to be finalised over the coming week – with an announcement on the detail likely next Monday.

Under any new rescue deal, Co-op Group would retain a stake, but it would be less than the 50% necessary for Co-op Group to boss the bank.

Institutional investors, led by hedge funds, would collectively be the majority owners.

This conversion of Co-op Bank into just another bank owned by professional investors has the potential to fundamentally alter the bank’s ethos and culture.

I am told that the hedge funds recognise that such perceived cultural change would be a bad thing, because they see there would be a risk of Co-op Bank being deserted by hundreds of thousands of customers who choose it because they see it as a more ethical bank than the others.

So as part of any rescue, the bank’s co-operative and ethical underpinnings are expected to be written into the bank’s governing principles.

Meanwhile it is hoped that the structure of the new deal will placate another group unhappy with Co-op Group’s original proposals, namely thousands of individuals who invested in the bank’s preference shares and perpetual subordinated bonds.

Under the Co-op Group’s rescue plan, holders of these perpetual subordinated bonds and preference shares would have received ordinary shares in the new bank in exchange for their bonds and preference shares – because that was the conventional way of forcing a financial sacrifice on investors very low down the food chain of creditors (the perpetual subordinated bonds and preference shares have less claim on Co-op Bank’s assets than the lower-tier-2-capital holders).

This would have caused considerable hardship for many of these individuals, because their existing Co-op Bank investments pay a handsome income, whereas the new Co-op Bank shares would probably pay little or no income for many years.

So there has been a pubic campaign against what Co-op Group was proposing by these small investors, co-ordinated by Mark Taber.

Co-op Group has been insisting it has been trying to protect the interests of the retail investors. And it looks as though they have won some kind of victory, because the revised rescue deal will – breaking with convention – offer them income-paying bonds.

Meanwhile the hedge funds and lower-tier-2-capital owners will receive mainly shares, because they want direct ownership of a bank that they believe can be restored to health and turned into a valuable business over three to five years.

The hedge funds and other institutional investors are also expected to invest tens of millions of pounds of their own money in Co-op Bank, to boost its capital and reinforce their control of the bank.

As I wrote on Friday, however, if no rescue can be agreed voluntarily, control of the bank would temporarily be seized by the Bank of England, under a process called resolution.

The Bank would then protect the interests of depositors by forcing big losses on Co-op Group and obliging the bank’s bondholders to convert their loans to the bank into loss-absorbing shares on terms regarded by the Bank of England as fair.

UK economic growth hits fastest pace since 2010

21st October 2013 / / Comments Off on UK economic growth hits fastest pace since 2010

Official figures this week are expected to confirm that the recovery gathered speed over the summer as the economy grew at its fastest pace in more than three years.

GDP in the three months to September is estimated to have surged 0.8%, according to economists. It would be the UK’s best performance since the second quarter of 2010, beating the strong 0.7% growth between March and June. The Office for National Statistics (ONS) will publish the official data on Friday.

The pace of Britain’s recovery since March has taken forecasters by surprise and triggered a surge in consumer confidence, surveys have found, despite falling real household incomes.

According to Deloitte’s consumer tracker survey, published today, households have become more positive about job opportunities and job security and are less worried about spending money on holidays and nights out. The accounting firm’s confidence index rose to -25% in the third quarter, the strongest reading in the two years it has been running.

Part of the improvement was due to an expected increase in property prices, which is raising perceptions of wealth.

Ian Stewart, chief economist at Deloitte, said: “Overall confidence is growing and has been for the past year. Less downward pressure on incomes, combined with renewed economic optimism and an improving housing market make for a story of gradually recovering confidence – notwithstanding the fact that the level of real incomes is continuing to fall.”

Average pay is rising at just 0.7% a year compared with the 2.7% rate of inflation, according to the ONS. However, house prices rose 3.8% in the year to August, lifting the average value of a home to a new UK record of £247,000.

Paul Tucker, the deputy governor of the Bank of England who retired last Friday, said he believed the recovery had gained traction because the £375bn quantitative easing programme was finally working. Previously, the stimulus was being smothered by fears about the eurozone crisis.

“I felt that as soon as [fears] receded, spirits would revive and the existing monetary stimulus would gain traction. And I think that’s what has happened,” he said.

Separate public finance figures on Tuesday will show that the recovery is helping the Chancellor make inroads on the deficit. Higher tax revenues and lower benefit spending has meant borrowing this year has been coming down faster than expected. Economists reckon this week’s figures will confirm the trend, putting the Government on course to borrow about £10bn less than the £120bn originally forecast for this year.

Household confidence has improved despite a tightening in living standards. Asda’s Income Tracker found that household spending power, at £157 a week, is currently £2 a week less than this time last year and £8 less than at its peak in February 2010.

“Weak wage growth was a key factor, up just 0.8% over the past year – the smallest year-on-year rise on record,” Asda said, while “the rising cost of energy continues to put pressure on household budgets”. British Gas and Scottish and Southern Energy have just increased fuel bills by more than 8%.

Weak levels of household income may prompted more shoppers to stay home in September as retail footfall last month fell 2.4% compared with last year. Springboard and the British Retail Consortium, which compiled the survey, said the decline may be explained by the warm weather, which “held consumers off from shopping for winter clothes” and as families saved up for “the Christmas rush”.

ONS figures on retail sales last week showed that there had been a 19.1% surge in online shopping in September, which does not show up in the footfall index.

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