Ofgem Plan 'Will Cut Energy Bills By £12 A Year'

Energy regulator Ofgem has announced plans to control electricity pricing for the next eight years from April 2015.

The watchdog says the move will lead to a £12-a-year reduction in household bills.

The proposals, which will be consulted upon for eight weeks, will affect five out of the big six energy companies: UK Power Networks, Northern Power Grid, SP Energy Networks, SSE Power Distribution and Electricity North West.

Ofgem said in a statement: "Today's announcement is all part of our consistent drive to get the best deal for consumers while maintaining a stable regulatory regime which attracts investment as cheaply as possible."

The regulator said the cut was achieved by savings of £2.1bn from the redrafting of the companies' business plans last year.

Initially the five companies' proposals were returned after Ofgem deemed they failed to give customers value for money.

The sixth company, Western Power Distribution, was the first to have its price control agreed after the regulator approved its business plan last November.

Under the proposals £17bn will be spent on upgrading and maintaining Britain's local electricity network.

Ofgem said that in addition to investment it had "challenged the companies to improve customer service and take a more active role in helping vulnerable customers."

It added companies that fail to do this will face penalties.

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Barclays Ups PPI Mis-Sell Provision By £900m

Barclays bank has announced it is making a further £900m provision for mis-selling of payment protection insurance (PPI) to consumers.

The announcement comes as the lender released its latest half-year results, which showed a 7% drop in adjusted pre-tax profit to £3.35bn.

The firm, which has sought to overhaul its internal cultural ethos in the wake of the PPI and Libor-fixing scandals, also saw a drop in some divisional revenue.

Its investment bank saw total income decrease by 18% to £4.26bn, in the six months to the end of June.

Barclays has launched a major restructure of its high risk, high return investment bank as it seeks to improve its retail arm.

The banking giant said its statutory profit - a different measure to adjusted profit - was £2.5bn, up from £1.67bn in the same period last year.

Good returns were seen in its personal and corporate banking and its credit card units.

"We committed to simplify, focus and rebalance the group to deliver higher and more sustainable returns across the cycle, while structurally reducing our cost base and strengthening our capital position," chief executive Antony Jenkins said.

"We are making encouraging progress in executing this plan. Profits before tax in personal and corporate banking and Barclaycard were up 23% and 24% respectively."

In February, there was widespread shareholder concern about the contentious issue of bonuses at the bank.

The bonus figure for 2013 went up by 10% - despite both revenue and profit falling.

Of the £2.38bn "incentives" for staff, two-thirds went to investment banking staff.

The bank also revealed thousands of UK job cuts would occur this year - with 19,000 jobs set to be shed globally over the next two years.

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Russia Sanctions 'Will Hit UK Economy'

Economic sanctions targeting Russia in the wake of the downing of flight MH17 will hit the UK economy, Foreign Secretary Philip Hammond has warned.

Mr Hammond was speaking to Sky News after Europe and the US agreed new measures against Vladimir Putin following the disaster, which has been blamed on Moscow-backed rebels in Ukraine.

New European Union restrictions include an arms embargo, a ban on the sale of bonds and equities in European capital markets by state-owned Russian banks and a ban on the sale of dual use and sensitive technologies.

Four key members of the Russian president's inner circle are among eight officials who are expected to face asset freezes and travel bans as part of the EU sanctions package.

Russia has warned the sanctions will lead to higher energy prices and hit Poland with a potentially damaging ban on fruit and vegetable imports.

BP was one of the first City firms to warn of the impact of sanctions

Mr Hammond told Sky's Sunrise programme that the measures had been "designed to maximise the impact on Russia and minimise the impact on EU economies".

He said: "It will affect our economy... but you can't make an omelette without breaking eggs, and if we want to impose economic pain on Russia in order to try to encourage it to behave properly in eastern Ukraine and to give access to the crash site, then we have to be prepared to take these measures."

He added: "We have spent a lot of time making sure the package is balanced so the pain is fairly shared across the big EU economies, but we can't expect to be able to do this without any impact at all on our own economies." 

The White House followed up the EU sanctions with a fresh round of measures targeting three Russian banks.

One of them, VTB Bank, has responded by claiming it is confident it will still be able to raise capital despite the new sanctions.

Russia's stock exchange rose on Wednesday following the announcement of the latest action against Moscow.

Russia also announced plans for a ban on most fruit and vegetable imports from Poland for "sanitary reasons", which it said could be extended to the entire EU.

Poland's agriculture ministry amounted to "political repression" in response to the sanctions imposed by Europe. 

Signs of concern have already emerged in the City about the possible blowback of Russia sanctions on the UK economy.

Energy giant BP - which owns a 20% stake in Russian oil firm Rosneft - warned that further international sanctions could have a "material adverse impact" on the company's business in Russia and its own financial position.

The sanctions were agreed as aviation bosses set up an international task force to deal with the risks of flying over war zones following the downing of flight MH17.

A safety conference involving more than 190 nations will take place in February under the auspices of the International Civil Aviation Organisation (ICAO).

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BA To Be Sued Over Pilot Child Abuse Claims

A number of young girls and women are taking British Airways to court over allegations that one of its pilots sexually abused children in African schools and orphanages.

First Officer Simon Wood, 54, died last August after being hit by a train near the Hertfordshire town of Potters Bar.

An inquest into his death found on Wednesday the pilot had killed himself.

Graham Danbury, deputy coroner for Hertfordshire, said: "I'm satisfied that, as a result of having been charged with offences, he was in a state of considerable distress which would have been understandable.

"He felt that his only way out was to take his own life."

The girls and women suing BA claim the airline has responsibility because Wood was working for them when he carried out the alleged attacks during flight stopovers.

BA says the work was outside of his employment with the company

Law firm Leigh Day, representing 16 alleged victims, says Wood molested the girls - some of whom are as young as eight - while on stopovers in Kenya, Uganda and Tanzania.

"We allege that Wood was able to abuse the victims by reason of his employment with the airline, in particular through his involvement with the airline's community relations work," said lawyer Nichola Marshall.

"The schools and orphanages that our clients attended were all in receipt of charitable donations from the airline, and Wood played a key role in administering those donations, on behalf of British Airways.

"Our team will be travelling overseas over the coming weeks to meet with other potential victims in Nairobi and Uganda that have come forward more recently."

A British Airways spokesman said: "We were shocked and horrified to hear the allegations against Simon Wood, which appear to relate to his involvement in child-related activities entirely outside the scope of his employment with British Airways.

"Our sympathies are with the victims and it is disappointing that the conduct of one person has caused so much distress to the many thousands of decent people who engage in charitable works on a regular basis."

At the time of his death, Wood had been due to appear in a UK court on separate charges of indecently assaulting a young girl and making indecent images of children.

It was revealed that he was first arrested in November 2001 over an indecent allegation assault but prosecutors decided there was not enough evidence to charge him.

Wood was among 20 BA crew members who worked in 2002 as volunteers at a Kenya orphanage.

He said at the time: "We play, sing, organise activities and generally entertain them. We become very close to the children."

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Bank Of England Gets Tough On City Misconduct

By Mark Kleinman, City Editor

The Bank of England (BoE) has rewritten the City rulebook, introducing tough new restrictions on bankers' bonuses and the threat of stringent penalties including jail terms for errant executives.

Announcing proposals for measures aimed at strengthening accountability in the industry, the Prudential Regulation Authority (PRA) said on Wednesday that the new regime would make London one of the most closely-regulated financial centres in the world.

The reforms include eye-catching plans such as an annual MOT for senior bankers - a ban on discretionary payments to individuals who work for banks bailed out by taxpayers - and longer deferral periods for variable pay of up to seven years for top executives.

If implemented, there will also be a ban on bankers transferring their bonus pots from one firm to another when they change employer, which has in the past enabled individuals to escape financial penalty for wrongdoing exposed after they have left their previous firm.

The BoE also confirmed new rules that will oblige the biggest banks to claw back bonuses for up to seven years after the money has been awarded, as Sky News revealed on Tuesday.

Where probes into an individual are already underway at the end of the seven-year period, there is an option to extend the term by up to three years.

The clawback rules will come into effect at the beginning of next year, while the other measures announced by the PRA are subject to a consultation period and will be finalised in the autumn.

They come in the wake of a litany of crises which have shaken public confidence in the banking industry, including the Libor rate-rigging scandal, an ongoing probe into the possible manipulation of foreign exchange rates, and consumer mis-selling episodes in payment protection insurance (PPI) and identity theft cover.

Last year's report by the Parliamentary Commission on Banking Standards called for some of the measures announced on Wednesday to be even tougher, but they nevertheless represent a significant strengthening of watchdogs' powers.

The PRA, which has drawn up the new rulebook in conjunction with the Financial Conduct Authority (FCA), wants to oversee the creation of two new frameworks for holding bankers to account.

A Senior Managers Regime will clarify lines of responsibility so that executives cannot abdicate responsibility for misconduct which takes place in the area of their bank that they supervise.

There will also be a Certification Regime, which will oblige banks to conduct annual assessments of the fitness and propriety of staff whose decision-making status means they could pose harm to customers.

A proposed ban on discretionary payments to employees at firms bailed out by the taxpayer will include pensions and other payments, which would have affected a payout to Fred Goodwin, former chief executive of Royal Bank of Scotland, when he left in the wake of its £45.5bn bail-out in 2008.

PRA chief executive Andrew Bailey said: "We believe that enhancing individual accountability and improving the alignment of risk and reward should have a positive impact on behaviour and culture within banks and will help to ensure that they are managed in a way that promotes the safety and soundness of individual institutions."

However, the CBI, Britain's most influential business group, sounded a note of caution about the new rules, saying the UK's competitiveness as a financial centre remained of paramount importance.

"We need to be careful we don't create uncertainty which might make it increasingly hard to attract talent to London," it said.

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Travis Perkins First-Half Profit Soars By 20%

Travis Perkins saw a surge in the first half of the year as it reported a 19.4% rise in its pre-tax profits.

Britain's biggest supplier of building materials said the increase was boosted by improving market conditions and increased customer confidence.

The company, which also trades as Wickes, City Plumbing, Keyline, Tile Giant and BSS, made a profit of £162.5m before tax in the six months to June 30.

It also saw revenue grow by 11.5% to £2.73bn.

Chief executive John Carter said: "Trading is consistent with our expectation and with lead indicators in our different markets encouraging, the group is expected to show continued solid growth for the remainder of the year."

It comes as Britain's housing market has seen strong recovery this year, benefiting supply firms such as Travis Perkins.

On Wednesday, British housebuilder Taylor Wimpey said it would return more money to shareholders as a result of strong demand in the property market.

Recent figures from Land Registry showed that during April the number of completed house sales in England and Wales increased 29% to 66,659, compared with 51,022 in the same period last year.

The data also revealed that properties sold in England and Wales for more than £1m in April increased by 39% to 1,028 - from 740 in April 2013.

However, on Monday, mortgage lender Halifax said Britons are feeling much less positive about buying a house, adding to some suggestions that the housing market is slowing.

Travis Perkins entered the FTSE 100 in June last year.

Shares in the company rose by more than 3% during afternoon trading.

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US Economy Bounces Back After Harsh Winter

The US economy bounced back this spring after enduring a winter of discontent, the latest GDP figures have revealed.

In the quarter between April and June, GDP grew at an annual rate of 4% as the economy saw an increase in consumer and business spending.

The Commerce Department said the rebound came after a crippling 2.1% drop between January and March.

Despite being revised up from a previous estimate of a 2.9% fall for the quarter, the winter period still saw the biggest contraction since early 2009.

On top of higher consumer and businesses spending, the housing industry is also said to have boosted the economy in the last quarter.

The strong growth is welcome news following the dismal start to the year and reinforces some views that the US economy is gaining momentum which will continue into the second half.

US growth fuels speculation that the Fed could raise interest rates sooner

Some analysts have predicted that the back half of the year will see an annual growth rate of around 3%.

The latest GDP figure is the best since the period between July and September last year, when it saw an increase of 4.5%.

Mark Zandi, chief economist at Moody's Analytics, believes growth could accelerate to above 4% in 2015.

He said: "I think we are finally going to start seeing more wage growth and that should kick the economy into high gear by late 2015."

It comes as many economists have been predicting that the Federal Reserve is likely to wait until mid-2015 to start raising interest rates.

But on news of the latest growth, Paul Ashworth, chief US economist at Capital Economics, said he expects the Federal Reserve will now be inclined to start raising rates early next year.

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Wagging Tails For Pets At Home As Sales Rise

Pets at Home has revealed quarterly revenue growth of more than 10%, amid an ambitious expansion plan.

In an interim management statement, the pet food and accessory retailer said total revenue grew by 10.4% to £210.8m in the 16-week period to July 17.

It said like-for-like sales were up 4.1%, boosted by its VIP Club membership scheme and a growing presence in veterinary practices.

It saw merchandise revenues rise by 9% to £192.5m.

This included an 8.8% growth in food and 9.2% in accessories.

Its VIP loyalty scheme saw a rise from 2 million members at the end of the 2014 financial year to 2.4 million at the end of FY2015 Q1.

Pets at Home Chief Executive Nick Wood said: "Looking ahead, we will continue to seize opportunities to grow and develop Pets At Home and focus on the delivery of our strategy.

"Given the strong first quarter performance, we remain confident in our expectations for the full financial year."

It said 45 new outlets were opened in the quarter.

It currently operates from 386 UK stores as well as almost 300 small veterinary surgeries.

The company plans to grow to over 500 UK stores, with more than 700 veterinary practices.

Pets at Home was one of a host of retailers to take advantage of a buoyant stock market earlier this year.

The company floated on March 12 - on the same day as the discount retailer Poundland.

Although the pet retailer's share price has fallen around a fifth since flotation, investors were buoyed by Wednesday's statement, with shares up more than 5% in midday trading.

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Twitter Share Price Soars As Popularity Grows

Twitter shares have soared after the social network reported rapidly rising user numbers.

In its quarterly report, it said the number of monthly active users had hit 271 million - up 24% year-on-year.

However its quarterly loss widened to $145m (£85.6m) from a $42m (£24m) loss in the same period last year.

Despite this, stock rose by more than 30% in after-hours trading to $49.61 (£29.28).

The results showed that Twitter's income from advertising is up 129% to $277m (£163m).

Chief Executive Dick Costolo said the results were strong

Ads served up on mobile devices accounted for 81% of that revenue.

Adjusted results - which exclude certain expenses and stock compensation - showed a small profit of $15m (£8.8m).

Twitter's chief executive, Dick Costolo, said: "Our strong financial and operating results for the second quarter show the continued momentum of our business.

"We remain focused on driving increased user growth and engagement, and by developing new product experiences, like the one we built around the World Cup, we believe we can extend Twitter's appeal to an even broader audience."

It was the first Twitter earnings call for new chief financial officer Anthony Noto, who is replacing Mike Gupta.

Mr Noto said: "I came here with one belief, that we can build the largest audience in the world."

Twitter's Wall Street debut in November saw stock rise from its $26 (£15) offer price to more than $70 (£41), but the company has been hurt by concerns about slowing growth and doubts on profitability.

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Directors Lobby To Keep Film In Hollywood

Top Hollywood directors are backing a bid to keep celluloid film alive in the movie and television industry.

Kodak is aiming to strike a deal with all of the major studios as it faces stiff competition from digital technologies.

Christopher Nolan, JJ Abrams and Quentin Tarantino are among those lobbying for motion-picture film to still be used.

Abrams is currently shooting the new Star Wars: Episode VII on celluloid and Nolan also used it on Interstellar, which stars Matthew McConaughey.

Kodak is "very hopeful that an agreement will be put into place," Kodak spokesperson Louise Kehoe told The Hollywood Reporter.

The company filed for bankruptcy protection from its creditors in January 2012, after 131 years in business, as the company fell behind rivals in digital photography.

Tarantino and Abrams are backing the deal

It emerged from the protection in August last year but has still seen a huge drop in the amount of linear print film it is manufacturing.

The Wall Street Journal reports that sales have plummeted 96% since 2006, from 12.4 billion linear feet to an estimated 449 million this year.

It has few competitors now after Fujifilm left the business behind last year.

Abrams has previously said that film sets the standard for the "best quality".

The negotiations with studios would involve studios committing to purchasing a certain amount of film without knowing how many, if any, of their movies will be shot on the medium over the next few years.

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