Energy Debts: Amount Families Owe Mounts

The number of families in debt to their energy supplier is rising, with around one in five households owing money, a study suggests.

Collectively, Britons are estimated to owe £637m to energy firms, which is £159m more than last year's projections, comparison website uSwitch said.

Some 20% of bill payers surveyed by the website, equating to more than five million households nationally, are in debt to their energy supplier after falling behind with payments or due to discrepancies between estimated bills and actual amounts.

This figure is up from 14% when similar research was carried out last year.

The latest survey of more than 2,000 bill payers in February found that the typical amount owed is £8 less than it was a year ago, at £123.

But a recent string of price hikes by energy companies combined with the unseasonably chilly weather could see the size of people's energy debts shooting back up again, the study warned.

The average annual household energy bill has risen by almost £100 in the space of a year, adding to the pressure on families as wages remain stagnant.

The website said the typical bill now stands at £1,353 a year, which is around £830 higher than it was in 2004.

This sum is based on a consumer who uses a medium amount of electricity and gas on a standard dual fuel bill, paying quarterly by cash or cheque.

Just over one fifth of those in debt to their supplier said they were turning a "blind eye" to what they owe in the hope that the amount will go down naturally over time.

A similar proportion plan to pay off a big lump sum, while one in 12 people in debt said they would need to try and agree a repayment plan with their supplier.

Ann Robinson, director of consumer policy at uSwitch, said: "The soaring number of households in debt to energy suppliers is a clear indication of the pressure people are coming under just to meet the cost of their basic bills."

She said ways that people could cut down on their costs included paying by direct debit as suppliers tended to offer discounts for paying in this way.

And consumers should also make sure that someone was taking regular meter readings, as relying on estimated bills can be a "shortcut to debt".

A Green Deal scheme has recently been launched by the Government, which allows people to make energy efficiency improvements such as loft insulation or double glazing at no up front cost. Repayments are then to be added to the property's energy bill over a period of time.

Last week, utility giant SSE was handed a record £10.5 million fine by regulator Ofgem for "prolonged and extensive" mis-selling.

SSE provided "misleading and unsubstantiated statements" to potential customers about prices and savings that could be made by switching to SSE, according to Ofgem.

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Hi-Tech Firms Join Forces Against Google

A group of companies led by Microsoft has asked European officials to investigate Google over alleged unfair practices in the mobile smartphone market.

"FairSearch" - which consists of 17 hi-tech firms including Microsoft, Nokia, Expedia, TripAdvisor and Oracle - has claimed that the internet giant acted unfairly with its Android operating system.

"We are asking the commission to move quickly and decisively to protect competition and innovation in this critical market," Thomas Vinje, Brussels-based counsel for FairSearch, said in a statement.

"Failure to act will only embolden Google to repeat its desktop abuses of dominance as consumers increasingly turn to a mobile platform dominated by Google's Android operating system."

FairSearch said it had filed a complaint with the commission, charging that the internet giant wanted Android operators to use its leading applications such as Maps or YouTube.

It said Google's Android is the dominant smartphone operating system, accounting for 70% at the end of 2012, while it had 96% of mobile phone search advertising.

Samsung's S4 is the flagship Android smartphone device

A spokesman for Google told Sky News: "We continue to work cooperatively with the European Commission."

Google has been under investigation by the commission for practices related to its dominance of online search and advertising markets since 2010.

Last week, six European countries including France and Britain, launched joint action against Google to try to get it to scale back new monitoring powers that watchdogs believe violate EU privacy protection rules.

The European Commission is not obliged to take any action other than reply to the complaint.

Android operating systems have the largest share of the smartphone market, followed by those made by Apple. Blackberry, Microsoft and others are far behind.

The European move comes as Taiwain's HTC saw its shares rise 1.5% even though the smartphone maker posted a record-low quarterly profit.

HTC's first-quarter net profit slumped 98% from a year earlier after sales suffered from the delayed launch of the company's new flagship smartphone.

The phonemaker saw its net profit fall to 85m New Taiwan dollars (£1.85m) for the quarter ending March 31, down from NT$4.47bn (£97m) a year earlier.

:: During 2010 HTC was the biggest seller of smartphones in the US operating on the Android system.

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Baby Formula Rationed In UK Over China Demand

Supermarkets in the UK are rationing infant formula due to rising demand in China for foreign-made baby milk.

Danone, the maker of the Aptamil and Cow & Gate brands, said a limit of two packs per transaction had been adopted by retailers "as a precautionary measure to prevent some individuals from bulk buying baby milk formula from retail outlets for commercial purposes".

In a statement, the company added: "We understand that the increased demand is being fuelled by unofficial exports to China to satisfy the needs of parents who want Western brands."

Last month, the Chinese government said nearly 300,000 children had been poisoned by tainted milk products and that six children had died since 2008.

Supermarkets Asda, Sainsbury's, Tesco and Morrisons said the purchase of certain brands would be limited to two units per customer per day.

The scandal in China has led to an increase in demand for imported baby milk, while raising safety fears around the world.

Chinese-made dairy products were banned or recalled from supermarket shelves in several countries.

In February, officials in Hong Kong imposed limits on the amount of formula travellers can bring back to China.

Danone has apologised to British parents for any inconvenience and said it was taking measures, including increasing production of milk, as a result of the situation.

The company also said it would increase supply in China, where many of its brands are available, to meet the rising demand in that market.

Some retail experts believe the baby milk limit is good for British consumers.

The British Retail Consortium director-general Helen Dickinson told Sky News: "I think what we're seeing here is a responsible measure just to make sure milk is available to their typical customers in the UK,  and that is exactly what they've done."

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Cold Weather Affects Retail Sales Figures

The coldest March in 50 years saw sales of clothing and footwear freeze but it boosted demand for food and drink, according to new figures.

The British Retail Consortium (BRC) said sales grew by 1.9% in March on a like-for-like basis, weaker than February's 2.7% surge but a performance described as "encouraging" given the weather impact.

While clothing and footwear retailers endured a "dismal" month, food sales were up as families treated themselves over Easter.

BRC director general Helen Dickinson said: "Snow and the prolonged cold were not ideal, but not a disaster. They brought mixed fortunes for different categories.

"2013 has got off to an encouraging start for the market as a whole.

"Retailers are now hoping for a boost in consumer confidence and the general mood to lift performance across all, not just some sectors, as we head into the second quarter."

Across the whole of the January to March quarter, like-for-like retail sales increased 2.2%, with 1.9% non-food growth offset by 2.5% food growth.

Continued expansion by the retail sector will add to hopes the UK economy managed to eke out growth in the first quarter, thus avoiding a feared triple-dip recession.

KPMG head of retail David McCorquodale said it may be the start of a positive trend for retailers, adding clothing and shoe stores will be "desperate for a change in weather in April".

The BRC said clothing and footwear were the worst-performing non-food categories in March and the only ones where sales declined, but did not break out specific figures.

Marks & Spencer, one of the UK's biggest clothing retailers, is likely to be a major casualty of the big chill, and is expected to report falling clothing sales for the three months to the end of March on Thursday.

However, the retailer's food sales are forecast to grow by around 3%, as consumers continue to treat themselves and opt to eat in rather than dine out.

Roasts and oven chips were popular categories, the BRC said - while beer and ready meals were also big sellers, which it put down to people stocking up for the Six Nations rugby tournament.

House textiles were the best-performing category, as sales of duvets increased and Easter boosted table cloth sales.

Furniture and flooring was the second-best category, helped by a gradually improving housing market.

Online sales were up 6.6%, but that growth was much slower than the 13.9% increase recorded in March 2012.

That was the slowest online growth since August, and the BRC said it may suggest shoppers are searching out items online but completing the purchase in-store, as well as spending less time online over Easter.

:: House sales have been lifted to a three-year volume high in March, according to the Royal Institution of Chartered Surveyors.

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UK Manufacturing Output Gets February Boost

UK manufacturing output rose 0.8% in February as it rebounded from a snowy January, according to official figures.

The increase was almost double economists' forecasts and comes after a 1.9% drop in the previous month.

The Office for National Statistics (ONS) said overall industrial output in Britain rose 1%, which was also above forecasts.

The encouraging February figures come as concerns continue about the risk of Britain sinking into a so-called triple-dip recession.

However, the balance of trade in February reached £9.41bn as imports exceeded exports of British goods.

The imbalance was up 15% on January's trade figure and the lowest value of goods exported since June.

Sky News Economic Editor Ed Conway said: "The trade deficit has deteriorated over the course of the recession.

"The concern is the UK's recovery has not been allowed to fully take place, partially because there isn't an appetite in Europe for Britain's goods."

The ONS figures also showed the smallest year-on-year fall in manufacturing output since July and the biggest quarter-on-quarter rise in industrial production since September.

James Knightley, from ING, added: "With the UK's largest oil and gas field coming back on-stream in March, likely leading to another positive gain in output, we are more optimistic that the UK can avoid its third technical recession in five years.

"Unfortunately, February's trade numbers were not as good with the trade deficit posting a sharp widening, largely due to disappointing trade with the eurozone."

The overall industrial production increase was led by the mining and quarrying sector, which rose by 2.8%.

Gas and electricity were up 1.3%, boosted by an increasing demand on energy during cold weather, as temperatures lingered well below the monthly average.

It was the biggest month-on-month rise in the production of electricity and gas since October.

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Diesel Fuel Price War Gives Motorists Hope

A new diesel fuel war is being unleashed on supermarket forecourts, just weeks after a squeeze was put on petrol prices.

Morrisons said its diesel would be reduced by up to 2p a litre from Wednesday morning.

The announcement was followed by Sainsbury's revealing a similar diesel reduction - also taking effect from tomorrow.

Britain's largest supermarket chain Asda subsequently said it was also cutting its diesel by up to 2p a litre.

Morrisons petrol director Mark Todd said: "A drop in wholesale prices combined with an improved exchange rate has provided us with an opportunity to pass a saving on to customers and continue to offer some of the lowest prices on the market."

Morrisons has 314 petrol stations across the UK.

Sainsbury's fuel buyer Chris Biggs said: "We're always looking at ways to help our customers save money which is why we're pleased to announce that from tomorrow we will be reducing diesel prices by up to 2p per litre across our 280 forecourts."

Andy Peake, Asda's petrol trading director, said: "From tomorrow, everybody filling up at an Asda fuel station will pay no more than 137.7p a litre for diesel."

According to Autocar editor Jim Holder, diesel drivers have increasingly been hit in the pocket and may gain true benefits.

"A diesel-focused price war will highlight the cost advantages of the fuel once again, and it has to be good news for long-distance drivers who have been hardest hit by recent price rises," he told Sky News.

"However, new car buyers need to be mindful of doing their sums carefully before plumping for a diesel-engined car, to ensure they actually see the benefits of the price cuts at the pump."

On March 12, a petrol price war started after one supermarket announced it would slash the cost for hard-hit motorists.

Traditional branded forecourts have struggled against supermarket equivalents in recent years, which can offset costs from elsewhere in their businesses.

Although some motorists may think a move to diesel will guarantee benefits, according to Mr Holder there are several factors that need to be considered.

"In recent years hard-taxed motorists have increasingly turned to diesel as one way of cutting their day-to-day motoring costs, with sales of diesel cars subsequently booming to the point that, in recent years, they overtook sales of petrol cars for the first time."

"However, the higher purchase cost of a diesel car, coupled with the higher price of diesel at the pump, has not always made opting for diesel as straightforward a decision as many imagine - unless you are a high mileage driver the cost benefits do not always pay back.

"As a rule of thumb, motorists who drive less than 12,000 miles a year won't travel far enough to see any savings from opting for a diesel powered car."

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Insurer RSA Braced For Revolt Over CEO Lee

By Mark Kleinman, City Editor

The FTSE-100 insurer RSA is moving to head off an investor revolt against its chief executive at next month's annual annual meeting following a swingeing cut to the company's dividend.

I have learnt that RSA board members and advisers have been reaching out to leading shareholders in recent days to try to shore up support for Simon Lee, who sparked anger earlier this year when he slashed the company's dividend.

The move highlights a growing expectation that RSA could emerge as one of the victims of another round of what was last year dubbed the "Shareholder Spring".

That wave of revolts prompted the resignations of bosses at companies including Aviva and Trinity Mirror.

RSA's broker, JP Morgan Cazenove, is understood to have enquired about some major investors' voting intentions in relation to Mr Lee's re-election at the company's AGM, which takes place in mid-May.

Such a question is unusual ahead of a blue-chip company's annual meeting, particularly for such a recently-appointed chief executive, and reflects the nervousness within RSA's boardroom about the extent to which Mr Lee has alienated shareholders.

The brokers have also been offering to arrange meetings with RSA's new chairman Martin Scicluna and Edward Lea, its senior independent director, before investors make their voting decisions.

An RSA spokeswoman said its brokers "have not been proactively canvassing opinions on voting intentions. However, we naturally have regular dialogue with all our shareholders, both directly and through our corporate brokers, as every company does and it is normal practice to discuss voting intentions in the run-up to the AGM each year."

However, several investors in the company said they had been explicitly asked by RSA's brokers whether they would vote in favour of Mr Lee's re-election. Of these, one said it had yet to make a decision.

Mr Lee took over from the widely-respected Andy Haste in November 2011. In February, the group announced a one-third cut to its dividend, prompting the biggest sell-off in RSA shares in nearly a decade - since when they have recovered some of those losses.

Some shareholders were angered not only by the decision to cut the dividend, but also remarks made by Mr Lee several days later to The Sunday Times.

In an interview with the newspaper, he implied that investors should have seen the cut coming, and said: "It's like an operation. It hurts at the time, but three months later you are glad you had it."

"It's hard to think of a more crass, careless comment by a serving FTSE chief executive than that one," one of RSA's top ten shareholders said on Tuesday.

Investors are not only wavering in their support for Mr Lee. Another big shareholder told Sky News it was likely to vote against RSA's remuneration report because the company had not followed the dividend cut by axing executive bonuses for last year altogether.

RSA did cut the bonus of Mr Lee in line with the dividend reduction but declined to follow the example of rival Aviva, which cut its payout to shareholders but paid no bonuses to executive directors.

Last week, the Financial Times also reported that some RSA shareholders were unhappy about the level of fees paid for non-audit work to Deloitte, the company's auditor, because of the concerns it raised about the firm's independence.

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RBS Investigated By New Watchdog Over IT Woes

The newly-formed Financial Conduct Authority has started an investigation into the Royal Bank of Scotland group's computer failure last year.

The FCA, which has recently replaced the Financial Services Authority as the City watchdog, launched the "enforcement" following the group's widespread IT outage.

RBS CEO Stephen Hester apologised

The glitch affected millions of people with bank and online accounts at RBS, NatWest and Ulster Bank.

RBS chief executive Stephen Hester was forced to apologise repeatedly for the problem, and the group subsequently set aside tens of millions of pounds to deal with customer complaints.

In a statement, the FCA said: "The Financial Conduct Authority has started to conduct an enforcement investigation into the IT failures at RBS which affected the bank's customers in June and July 2012.

"The FCA will reach its conclusions in due course and will decide whether or not enforcement action should follow that investigation."

Customers were affected across the United Kingdom and southern Ireland, along with residents of other countries using web services.

A spokesman for RBS told Sky News: "Last summer's IT failure was unacceptable.

"We have already made significant improvements and over the next three years will invest hundreds of millions in our systems.

"We will be working closely with our regulators in the UK and the Republic of Ireland.

"Our customers deserve a service they can rely on 100% of the time and that's what we want to provide."

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Network Rail Directors Get £600k Bonus

Four top Network Rail bosses have been awarded bonuses totalling more than £600,000 despite concerns over the company's performance.

The long-term incentive plan payments, including £168,000 to finance director Patrick Butcher, come at a time when rail regulators have been critical of the company's performance on the railways.

Under the plan, network operations managing director Robin Gisby and infrastructure projects managing director Simon Kirby both get £158,400, while group strategy director Paul Plummer picks up £148,400.

The payments, reflecting the company's performance in 2009-2012, could have been higher but Network Rail (NR) said 20% had been cut "to take account of specific safety and train performance issues".

NR also said the payments would be phased, with 60% paid now and the balance to be reviewed at the end of the 2013/14 financial year.

The awards have already been delayed by a year.

Finance Director Patrick Butcher received £168,000

The Office of Rail Regulation (ORR) has repeatedly expressed dissatisfaction with NR's performance, particularly on long-distance routes.

Recently there have been a series of overhead line problems that have caused serious delays on some busy routes, including the East Coast main line where punctuality figures have fallen.

Bad weather also caused flooding and landslides in December and January which affected services.

NR said on Tuesday that under the terms of the 2009 long-term incentive plan (LTIP), the four directors had qualified for a 100% payout, but that the company's remuneration committee had decided to reduce the award by 20%.

Of this figure, 10% reflected "workforce safety, level crossing safety and enforcement notices over the period" while the other 10% took into account the fact that train performance targets were not met.

NR chairman Richard Parry-Jones said: "The railway today is considerably more efficient, carries more passengers and freight, and is in a much better state than it was in 2009.

"Taxpayers have benefited from very significant savings, with a further £526m saved over and above our tough targets.

"Not everything has been perfect - and the 20% reduction we have made reflects that.

"But it would be flying in the face of reality not to acknowledge the real progress NR has made in this period, and these payments reflect and recognise that success."

NR added that from 2009-2012, the number of passengers arriving on time had risen 13% and projects worth £12bn had been completed.

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Sir James Crosby: Ex-HBOS Chief Forgoes Title

Former HBOS chief executive Sir James Crosby will ask for his knighthood to be removed and give up 30% of his pension after last week's damning report into the bank's collapse.

The 57-year-old said he was "deeply sorry" for what happened at HBOS and the "ensuing consequences" for the bailed-out bank's staff, shareholders and taxpayers.

He had stepped down from his job with private equity firm Bridgepoint on Friday.

The bank's former boss was given a knighthood after leaving HBOS in 2006, but said he believed "it is right that I should now ask the appropriate authorities to take the necessary steps for its removal".

The Parliamentary Commission on Banking Standards had described Sir James as the "architect of the strategy that set the course for disaster" and held primary responsibility for the collapse along with former chairman Lord Stevenson and fellow chief executive Andy Hornby.

The report blamed the trio's "toxic" misjudgments for the bank's downfall and £20.5bn taxpayer bailout at the height of the financial crisis.

It also said the financial regulator should consider whether the three should ever be allowed to work in the financial sector again.

Sir James said the report made for "very chastening reading".

"Although I stood down as CEO of HBOS in 2006, some three years before it was taken over by Lloyds, I have never sought to disassociate myself from what has happened," he said.

"I would therefore like to repeat today what I said when I appeared in public before the Commission in December; namely that I am deeply sorry for what happened at HBOS."

His decision to forgo 30% of his pension will still leave him with an annual pay-out worth £406,000.

He said he was also standing down from his voluntary position as a trustee of Cancer Research UK with "great personal sadness".

But it is understood he remains a senior independent director at catering giant Compass and also chairman of the car credit company Money Barn.

The Honours Forfeiture Committee is responsible for considering cases where people could be stripped of awards.

It can look at cases where individuals are found guilty of criminal offences, or reprimanded by a regulator. However, it has scope to take into account other factors.

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