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The Sunday Times Business - 11 March 2018

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BUSINESS
&MONEY
March 11, 2018 ╖ thesundaytimes.co.uk/business
thesundaytimes.co.uk/money
THE MARCH OF THE
SILVER STRIVERS
MONEY, PAGE 11
WE DON?T FEAR
AIRBNB, SAYS
HOTELS BOSS
INTERVIEW, PAGE 6
The embattled outsourcing
giant Capita is plotting a
г700m fire sale of assets
alongside a heavily
discounted rights issue
intended to raise a similar
sum.
The new chief executive
of the former FTSE 100
favourite is understood to be
working on a more aggressive
than expected review that
could lead to the sale of six or
seven businesses.
Jonathan Lewis, who
overhauled the oil services
company Amec Foster
Wheeler, admitted in January
that Capita needed a rescue
cash call.
Delivering a profit warning
that almost halved the market
value to г1.1bn, Lewis said
Capita had underinvested
and relied on acquisitions to
fuel growth.
The company has
contracts ranging from army
recruitment to customer
services for Tesco Mobile. It is
wrestling with a debt pile that
totalled г1.2bn at the end of
last year and a reported
г381m pension deficit.
Capita has hired the
consultancy McKinsey & Co
to work on its strategy and
Bain & Co to help scythe
through costs.
Lewis said in January that
two businesses would be sold
? Constructionline and
ParkingEye ? as part of
non-core disposals. It is
understood Capita has now
identified six or seven
Melrose to
raise stakes
in battle
for GKN
Raider to sweeten
offer for FTSE 100
engineering giant
Ben Harrington and
John Collingridge
Melrose will raise its г7.3bn offer for GKN
this week in an effort to clinch the hostile
takeover of the FTSE 100 engineer.
The buyout firm is expected to offer
GKN investors a bigger slice of the
enlarged company rather than increasing
the cash payout. Melrose has until Thursday to beef up its offer, under the terms of
the Takeover Code.
Last week, GKN attempted to thwart
Melrose?s advances by striking a $6.1bn
(г4.4bn) deal to sell its Driveline division,
GKN chairman
Mike Turner:
urged investors
to dismiss the
initial offer
which makes car powertrains, to the
American engineer Dana. If the sale goes
ahead, GKN will be focused exclusively
on aerospace.
Melrose?s last-minute sweetener could
prove decisive in the most fiercely contested takeover battle for years. The buyout firm pounced in January while GKN,
previously known as Guest, Keen & Nettlefolds, was at a low ebb after a string of
profit warnings and the sacking of its
chief executive designate.
The proposed deal, which would be
Melrose?s biggest to date, has divided politicians, provoked a volley of insults from
both sides and hastened a plan by GKN to
break itself up.
Under the current offer, GKN shareholders would get 57% of the enlarged
company while their Melrose counterparts would hold 43%. GKN investors
would also get 81p for each of their
shares, worth a total г1.4bn.
Increasing the cash portion of the offer
would pile more debt on to the company,
something that has already come under
fire from MPs and unions.
Melrose is likely to increase the value
of its bid by at least 5%, which could add
г300-г400m more to its offer price.
That would be a partial vindication for
the engineer?s chairman, Mike Turner,
who slated the initial offer for significantly undervaluing GKN. The share
price has leapt 30% since the Melrose
approach was revealed.
Midlands-based GKN makes components, including wing tips and engine
casings, for planes such as Boeing?s 737
Max and the Airbus A380 superjumbo. Its
automotive division is a leading supplier
of powertrains to companies including
Mercedes-Benz and Jaguar Land Rover.
GKN?s deal with Dana, which was confirmed on Friday, propelled shares in the
259-year-old business to 435.1p, valuing it
at г7.5bn.
The Ohio-based suitor, which makes
parts for lorries and vans, argued that
merging with GKN?s car parts division
offers greater industrial logic than a
tie-up with Melrose.
The agreed deal would give GKN?s
shareholders 47.3% of the American engineer. That would not go down well with
all of them, though, as a big chunk of the
pension fund investors are unable to hold
US stocks, or are tracker funds that must
invest in FTSE 100 shares.
Shareholders have until March 29 to
decide whether to accept Melrose?s offer.
Should it fail to win enough support, the
buyout firm would be unable to bid again
for six months.
Agenda, page 4
businesses, worth up to
г700m, that could be sold in
stages. With the rights issue,
this would allow Capita to
raise up to г1.4bn of fresh
capital. The company has had
more than 120 approaches
from potential bidders
interested in its offshoots.
Capita has delayed
publishing its 2017 results
until it finalises the rights
issue, which could be
launched within weeks.
Lewis is expected to reveal a
cost-cutting plan that will
SILICON VALLEY
FACES EU TAX GRAB
PAGE 5
APPOINTMENTS
PAGE 7
PUZZLES
PAGE 18
AJ Bell fires
starting gun
on г500m float
12
14
Capita in г700m fire sale to slash debt pile
John Collingridge
TECH
strip hundreds of millions
of pounds from its overheads.
The turnaround drive
comes amid a toxic climate
for outsourcing companies,
illustrated by the collapse of
Carillion in January.
Interserve is trying to
refinance its г513m debt. The
share price leapt last week on
hopes that a deal with lenders
may be agreed within days.
Lewis has insisted Capita
is not in the same position as
Carillion, pointing out it has
г1bn of cash and bank
facilities. Its shares closed last
week at 168p. A year ago they
were trading at 518.6p.
6 Advisers to Carillion were
handed г6.4m just before its
collapse. Law firms including
Clifford Chance and Slaughter
and May and the investment
bank Lazard were among the
firms that were paid fees on
January 12, an inquiry by MPs
has found. Carillion went into
liquidation 72 hours later.
Capita: we?re not marching
over a cliff, page 8
FRANCCESCO GUIDICINI
MINNOWS SHAKE BACARDI
Rosamund Urwin
AJ Bell, one of the UK?s largest
investment platforms, has
appointed advisers to pursue
a listing on the London Stock
Exchange that is expected to
value the company at
upwards of г500m.
The firm?s 172,000
customers are to be offered
the chance to buy shares at
the time of float ? possibly on
better terms than
institutional investors. The
float is likely to be launched
later this year.
Andy Bell, who founded
the business 23 years ago,
said the listing was motivated
mostly by a desire to raise the
profile of the brand. He is
selling only an additional 3%
of his personal holding, and
will retain 25%.
However, it can be
revealed that Neil Woodford,
the beleaguered fund
manager, has already
offloaded his 8% stake in the
company. Woodford
Investment Management sold
its shares in late February to
AJ Bell?s management and
Invesco Perpetual.
The firm has chosen Numis
Securities as banking adviser,
with KPMG as the reporting
accountant and Pinsent
Masons as its lawyers.
?This is not a big
management sell down ? it?s
as small as is respectable to
get the free float,? said Bell,
52. He added that
management had initially
intended to list the company
about six years ago.
?Every year we addressed
the question and said why
would we do it?
?The company didn?t need
money, and the shareholders
didn?t need money. We had
bought the car, the
Continued on page 2 ?
Boss of failed broker
Beaufort hits back
Tommy Stubbington
and Ben Harrington
The boss of Beaufort
Securities claims he pumped
more cash into the broker
only two days before it was
shut down by the City
watchdog over concerns it
was insolvent.
Tanvier Malik, speaking for
the first time since the broker
collapsed, said the Financial
Conduct Authority (FCA) had
given him no indication it had
serious concerns over its
finances ? leading him and
other directors to inject ?a
decent amount? of capital
into the company this month.
The FCA secured a High
Court order to close Beaufort,
which was announced on the
same day that US prosecutors
indicted it for running a stock
scam and attempting to
launder the proceeds.
Malik, who wasn?t named
in the US indictment, said:
?We are all in shock. We still
can?t get our heads around it.
Not at one time have they said
to me as CEO in the past three
months ?we have concerns
with your balance sheet ? you
need to strengthen your
balance sheet?. There?s no
shortage of cash. There?s over
г2m there.?
The FCA declined to
comment, but sources close
to the regulator said a judge
would not have agreed to the
closure unless its report on
the firm?s finances ? carried
out by the accountants PwC ?
had shown it to be insolvent.
The broker, the Picasso
and the FBI, page 7
Ethnic minorities
paid less at KPMG
Rosamund Urwin
George and Jane Rowley blocked Bacardi from registering the name Angel?s Envy in Europe
A spirits maker who counts
Johnny Depp among his
customers has won a
trademark battle with the
liquor multinational Bacardi,
writes Sabah Meddings.
George Rowley and his
wife, Jane, said they were
forced to take action to
protect their Envy range of
drinks after Bacardi tried to
trademark a bourbon called
Angel?s Envy. Rowley, 53, of
Bayford, Hertfordshire,
claimed the brands could be
confused, and moved to stop
Bacardi registering the name
in the UK and on the
Continent. Bacardi sells
thousands of cases of Angel?s
Envy in America every year.
The UK and EU intellectual
property offices agreed, and
blocked Bacardi?s application.
The drinks giant was ordered
to pay the couple?s legal costs.
?They are attacking my
rights on all fronts and trying
to wear us down,? said
Rowley. Bacardi is understood
to have lodged an appeal.
Rowley gave up a career as
a Lloyd?s broker to establish
La Fщe, which makes absinthe,
and the Envy range, which
includes gin and vodka.
KPMG pays its white staff and
equity partners 34% more
on average than colleagues
from ethnic minorities, the
accountancy giant has
revealed.
In a voluntary disclosure
designed to improve
transparency on pay gaps,
the firm ? which has more
than 15,000 staff in the UK
? also admitted that white
partners were paid 9% more
on average than peers from a
minority background.
The pay gap reflects a lack
of ethnic minority staff in
senior roles: 92% of KPMG?s
partners are white ? against
70% of its employees.
The data was released as
thousands of businesses
scramble to meet a
government deadline for
revealing the gap between
what male and female
employees are paid.
Rival EY last week reported
an ethnicity pay gap of 38.1%
including partners. Deloitte
revealed a 12.9% gap in
December, but this only
included salaried partners,
not equity partners.
2
The Sunday Times March 11, 2018
BUSINESS
DIGEST
NO BONUS FOR
DEUTSCHE CHIEFS
SATCHELS
CUT LOSSES
Higher sales helped
traditional bag maker
The Cambridge Satchel
Company to halve its losses
last year.
The company, founded
by Julie Deane, above, in
Cambridge in 2008,
brought down pre-tax
losses to г746,000, from
г1.4m the year before.
It was the third
successive loss-making
year, following a г12.7m
investment from Index
Ventures. Turnover was
up г634,000 to г11.7m,
according to documents
filed at Companies House.
Celebrities including Rita
Ora and Alexa Chung carry
Cambridge Satchels.
BERKELEY?S
HOME COMFORT
Berkeley
г44
40
36
32
28
MAM J J A S ON D J F
Source: Thomson Reuters
Berkeley is expected to
strike an upbeat tone in its
trading statement on Friday
? after upgrading its longterm profit guidance in
December. Taylor Wimpey
said customer demand and
pricing in London were
stable, leading investors to
expect a similar update
from Berkeley.
The most senior managers
at Deutsche Bank will forgo
their bonuses for a third
year in a row in response to
the German bank?s ?497m
(г442m) loss for 2017.
Deutsche has, however,
upped its rewards for
traders and bankers in an
effort to cling onto its
best-performing staff. The
bonus pool is reportedly
more than ?2bn ? up from
total payouts of ?546m for
the previous year.
With revenue at a sevenyear low, investors have
called on chief executive
John Cryan to cut costs. He
said last month that this
year?s ?generosity? would
not be repeated next year.
г8.7bn
г10bn windfall for chancellor
? but austerity far from over
Hammond unlikely
to take risks in
spring statement
Tommy Stubbington
Philip Hammond is set to bank a г10bn
windfall this week as he announces Britain?s smallest budget deficit since 2002.
A recent rebound in productivity,
plus better-than-expected tax receipts
at the start of the year, mean the Treasury
is expected to undershoot the previous
borrowing projection for the 2017-18
financial year by several billion pounds.
The improvement in the public finances,
to be announced in the chancellor?s
spring statement, will bring welcome
relief after the bloodbath of November?s
budget, in which longer-term borrowing
forecasts climbed as the Office for Budget
Responsibility slashed the outlook for
productivity growth.
Even so, Hammond is likely to resist
calls from Tory MPs to boost spending on
public services as the Treasury sticks to
plans for a ?no-frills? statement.
The chancellor, who last week called
for the inclusion of financial services in
Britain?s EU trade deal, is expected to
keep some spending in reserve to help
the economy weather the Brexit process.
?The Tories are not behind in the polls
and Brexit brings risks, so the chancellor
will bank the windfall,? said Samuel
Tombs of Pantheon Macroeconomics.
Borrowing during the current financial year may come in below г41bn,
according to Carl Emmerson, deputy
director of the Institute for Fiscal Studies.
?This year we should get close to the
first current budget surplus ? borrowing
just for investment ? since 2001?2,?
Emmerson said. ?This is good news.?
However, borrowing will still be much
higher than forecast two years ago, when
George Osborne was committed to delivering a budget surplus in 2019-20.
?On current policy ?austerity? is far
from over,? Emmerson said. ?Higher
YEO?S BAD MOOS
Economic Outlook, page 4
Adam Boulton, News, page 24
Student loans
sale faces Audit
Office probe
Britain?s trade deficit in the
three months to January ?
г3.4bn wider than the
previous three months. The
growing trade gap was
mainly down to higher fuel
imports and lower exports,
possibly as a result of the
closure of the Forties oil
pipeline.
Sabah Meddings
PAYDAY FOR
PROPERTY FIRM
Three property
entrepreneurs are set to
share an г18m payday after
agreeing to sell 75% of their
business to a European
company backed by a
Swedish billionaire.
Catella, chaired by Johan
Claesson, is expected to
buy Apam, a regional
property manager. David
Russell, one of Apam?s three
founders, will leave as part
of the deal, but Simon
Cooke and William Powell
will stay and keep a 25%
stake. Cooke said the move
would allow Apam to grow,
with Catella?s backing.
Philip Hammond:
improved finances
inflation means that this April the freeze
in the nominal value of many workingage social security benefits will bite much
harder than before.?
Philip Shaw of Investec said the government?s wider objective of balancing
the overall budget during the next parliament continues to ?look ambitious, given
numerous pressures on spending?.
The chancellor is facing growing calls
from party colleagues to pump more
cash into beleaguered public services,
particularly the NHS. Others are pressing
him to borrow more to invest in housing
and infrastructure.
Rising costs have dented
profits at the family-owned
dairy giant Yeo Valley,
writes Liam Kelly.
Best known for its
organic yoghurts and milk,
Yeo Valley farms 1,400
acres in Somerset. Sales
climbed 4.3% to г284.9m
in the year to last May, but
profits fell to г10.3m from
г11.9m. The fall in the value
of sterling after the EU
referendum meant fruit
and packaging costs rose.
Tim Mead, 54, Yeo
Valley?s owner, said:
?Turnover is vanity, profit
is sanity. Profit?s down, so
we?re vain and mad. We?re
slow and steady.
?We?re not particularly
adventurous, but we do the
hard yards.?
The government spending
watchdog is to investigate
the sale of a г1.7bn student
loans book that has
reportedly led to an г800m
loss for taxpayers.
It was the first of a
four-year sell-off of loans
made to students before 2012.
The first clutch of debt,
which had a face value of
г3.7bn, was sold to specialist
investors including pension
funds and hedge funds via a
securitisation process ?
where assets are packaged
together and sold as bonds.
Now the transaction is
subject to a probe by the
National Audit Office (NAO),
which will consider whether
the government ?achieved
value for money from this
sale?.
Offloading г43bn of
graduate debt ? currently
valued at just under г30bn ?
is part of a government
attempt to reduce its own
borrowing. Loans totalling
about г12bn are expected
P&G to slash ?spray
and pray? online ads
Simon Duke
The world?s largest advertiser
has warned that it may cut its
online budget this year,
turning up the heat on
YouTube and Facebook.
Marc Pritchard, chief
brand officer of the consumer
goods giant Procter & Gamble
(P&G), said he was planning
to run fewer digital
commercials due to concerns
that they are not reaching
their intended targets.
Last year, the maker of
Ariel detergent and Crest
toothpaste slashed its
internet budget by $200m
(г145m) after it emerged that
some of its adverts had
appeared alongside
unsavoury YouTube videos.
The furore forced
Facebook and YouTube
owner Google to disclose in
much greater detail where
adverts appeared, how long
they were viewed for and
whether they were even seen
by consumers.
?Once we saw all that data,
we realised there was a lot of
waste . . . and that it [internet
advertising] was not all it was
cracked up to be,? Pritchard
told The Sunday Times.
The marketing chief said it
was ?likely? that P&G would
reduce social media spending
this year, as it retreats from
the ?spray and pray?
approach of the past.
?There is still plenty of
waste out there to eliminate.
We?ll have fewer ads . . . but
will reach people more
precisely,? said Pritchard.
The 57-year-old American
oversees an annual marketing
budget of $7bn ? a third of
which is spent online.
In a shot across the bows of
the large advertising
agencies, including Britain?s
WPP, he vowed to ?take back
control? of devising online
marketing strategies and
Cuts: Marc Pritchard
bidding for online ad slots.
P&G is beefing up its team of
number crunchers and media
buyers and planners, instead
of hiring WPP or one of its
rivals to do the work.
?The agency [business]
model is being disrupted and
it is time. We know how to
analyse data and we do a lot
of our own buying [directly
from publishers],? he added.
to be sold over the next
five years.
The first transaction, in
December last year, was
made up of 1.2m loans
issued to more than
400,000 students between
2002 and 2006.
Repayments are linked to
income and about half of the
graduates who borrowed
during that period had
already repaid their loans
by the end of the 2015-16
financial year.
It meant the remaining
debt was likely to be of a
poorer credit quality.
Graduates are not required
to start making repayments
until they reach the necessary
income threshold. Of
the graduates with
outstanding loans, only 60%
had made any payments in
the same year.
The NAO study will assess
how the Department for
Education, with advice from
UK Government Investments,
prepared for the sale, the
process that was followed and
the proceeds it achieved.
3D print
firm lines
up г10m
A university spinout that is
behind a 3D printer which
could one day repair vital
organs has raised г10m from
investors such as fund
manager Neil Woodford,
writes Sabah Medding.
OxSyBio, which shares a
founder with biotech
?unicorn? Oxford Nanopore,
hopes it can help solve the
donor organ shortage. The
3D printer works by using
tiny droplets of biological
material to build up complex
tissues ? much like ?spare
parts? ? which can be used in
regenerative medicine.
Hadrian Green, chief
executive, said: ?Instead of
having to wait for a donor, we
could manufacture in a much
more affordable way.?
Research behind OxSyBio?s
technology came from the
Oxford University laboratory
of Hagen Bayley, the founding
academic of gene-sequencing
company Oxford Nanopore.
Cast a vote for
the Maserati 100
AJ Bell readies plan
for г500m listing
Andrew Lynch
?Continued from page 1
racehorse, and everything
else by then.?
Having witnessed the
publicity that rival platform
Hargreaves Lansdown
enjoys on the back of its
public listing, he believes the
move can help the company
grow.
Counterintuitively, Bell
said that selling some shares
is partly intended to ward off
unwanted suitors.
?I want to make a
statement to the market that
we?re not for sale ? saying to
companies ?don?t come and
try to buy us? ? so the only
real alternative is an IPO,?
said Bell.
?Our brand awareness
levels are nowhere near those
of our two main competitors
? Hargreaves [Lansdown] on
the direct-to-consumer side,
and Standard Life on the
The Maserati 100 ? our
annual list of inspiring
entrepreneurs ? will this year
be accepting nominations
from the public.
This year?s Maserati 100,
the fourth supported by the
Italian luxury-car maker, will
be dedicated to innovators ?
those entrepreneurs who
take a big idea and make it
work.
The public nominations
will be judged by a panel of
experts at The Sunday Times
and those that are chosen
will be included in the
Maserati 100, which will
be published on April 29
inside Business.
Last year?s Maserati 100
of disruptors featured
inspirational entrepreneurs
such as Tim Warrillow,
co-founder of the premium
tonic brand Fever-Tree; Paul
Lindley, the creator of the
Ella?s Kitchen range of
children?s foods; and Sophie
Cornish and Holly Tucker of
the online retailer
notonthehighstreet.com.
Nominations close on
March 26 at midnight.
To nominate an
entrepreneur or group of
entrepreneurs, visit the
nominations page at
maserati.co.uk/Maserati100.
advisers side. Being a listed
company gives a boost and
some people feel safer
investing their money.?
Bell has twice received
takeover offers in the past,
from a ?big insurance
company and a big
investment trust?.
In 2017, AJ Bell?s revenues
grew 17% to г75.6m. Bell said
the firm was anticipating
?another good year? in 2018.
Total assets under
administration have reached
г42bn.
AJ Bell employs more than
700 staff, with offices in
Manchester and London.
About 150 employees have
shares in the business.
Andy Bell launched AJ Bell
in August 1995 with Nicholas
Littlefair, who left the
business seven years ago.
Agenda, page 4
3
The Sunday Times March 11, 2018
BUSINESS
Saudis eye
drones in
Typhoon deal
John Collingridge
Britain and Saudi Arabia have
discussed co-investing in
developing a next-generation
fighter jet and drone, as part
of a г5bn Typhoon deal.
On Friday, defence
secretary Gavin Williamson
and Crown Prince
Mohammed bin Salman
agreed the outline of a deal
for Saudi Arabia to buy 48
Eurofighter Typhoon jets.
That deal, which would
follow the kingdom?s
purchase of 72 of the aircraft
in 2007, would help preserve
skills at BAE Systems? Warton
factory in Lancashire.
Talks are also understood
to have focused on
developing aircraft that will
eventually replace the
Typhoon. A joint statement
from the two governments
said they had agreed a
number of defence
collaborations to ?deepen
and broaden co-operation?.
Britain?s defence
aerospace industry is
desperate for a government
MIKE MARSLAND
BOOST FOR BANNATYNE
commitment to build a nextgeneration fighter, but the
Ministry of Defence is
wrestling with a г20bn black
hole in its budget. Hopes of a
Typhoon replacement were
stoked recently when
Williamson launched a
combat air strategy.
Few expect Britain to go it
alone, however, and France
and Germany are already
collaborating on a new jet.
Saudi investment would
help spread the multibillionpound burden of developing
a new aircraft. It would also
help the kingdom develop
indigenous skills ? a key pillar
of bin Salman?s ?Vision 2030?
plan to modernise and reduce
the country?s reliance on oil.
The Saudi ?memorandum
of intent? ? which is not yet a
firm deal ? is likely to entail
assembling a significant
number of Typhoon jets in
the Gulf. Final assembly
would gradually be shifted
from Warton to Saudi Arabia
? although it would help
sustain skills at the plant well
into the next decade.
Chip giant may go
after Broadcom
in battle to control
smartphone market
Simon Duke
Unions urge Ford to
plug into electric cars
John Collingridge
Car giant Ford has held talks
with unions about converting
its engine factories in
Bridgend and Dagenham to
building electric cars.
Unite has been lobbying
the American car maker
about switching the factories
in south Wales and east
London away from diesel and
petrol engines.
?These sites must be
repurposed for new electric
models or battery
technology,? it said.
Unite?s plea is part of a new
manufacturing strategy for
the automotive industry
being drawn up by the union,
due to be launched
imminently. It urges the
industry and government to
embrace electric and
autonomous vehicles,
arguing that the state must
pump funds into research
and infrastructure.
Bridgend employs 1,744
staff, but last year unions
warned that 1,160 jobs could
be cut. The site has been
losing work as Jaguar Land
Rover and Volvo pull work
out of the factory. Dagenham,
which employs 1,795 staff
making diesel engines, is at
risk as drivers switch away
from diesel cars.
Ford said that ?the auto
industry is undergoing rapid
change? and that ?together
with our union partners, we
continue to look at other
opportunities for the future?.
Intel mulls
$100bn bid
for rival
Profits rose 57% at the gym chain founded by Duncan Bannatyne, pictured with his wife Nigora
Women inspired to lift
weights by the celebrity
fitness fanatic Jodie Marsh
have boosted sales at
Bannatyne Health Club,
along with flexible contracts
and ?virtual classes?, writes
Sabah Meddings.
Profits at the chain of clubs,
founded by the recently
remarried Dragons? Den star
Duncan Bannatyne, jumped
57% to г14.3m in the year to
December 31.
The company has
responded to competition
from low-cost rivals by giving
members flexibility in the
length of their contracts. Four
new gyms were added to the
group ? taking the total to
71 and helping turnover rise
4.8% from г112.2m to г117.6m.
Responding to the increase
in women who want to bulk up
has boosted membership
numbers, according to chief
executive Justin Musgrove.
More weights were added
to the gym floor, while spas
have been installed in nine
gyms . ?A few years ago, free
weights were only used by
men,? said Musgrove. ?But
Jodie Marsh has made [them]
popular for women too.?
The company has also
introduced ?virtual classes?,
where gym-goers can take
part in a class held remotely.
Bannatyne Health Club
opened its first gym in
Teesside in 1997. It had touted
a stock market float in 2016,
but later aborted the plan.
Intel is weighing a $100bn-plus swoop on
rival chip giant Broadcom in a move that
would escalate the battle for dominance
of the booming industry.
The Silicon Valley giant ? founded 50
years ago by one of the inventors of the
microchip ? has been considering the
move since late last year. Its interest was
spurred when Singapore-headquartered
Broadcom tabled a $117bn (г84bn) bid
for the US smartphone microchip
designer Qualcomm. The offer was
rejected out of hand.
Feeling threatened by the potential
tie-up of two of its main rivals, Intel
started working on plans to gatecrash the
deal. Intel is said to be willing to table a
bid for Broadcom if there is any prospect
of that company succeeding with a fresh
approach for Qualcomm, according to
The Wall Street Journal.
The news brings an intriguing new
angle to the increasingly acrimonious
power battle among the world?s chip
makers. At stake are the tens of billions of
dollars that smartphone makers, such as
Apple and Samsung, spend on semiconductors every year.
Intel has been caught flat-footed by its
younger rivals in recent years, having
failed to anticipate the explosion in
smartphones and other mobile devices.
Since Qualcomm spurned Broadcom,
hostile words have been exchanged, with
both sides accusing the other of misleading investors. American regulators are
considering whether to block a deal on
national security grounds. To assuage
these concerns, Broadcom has proposed
redomiciling in the US.
Intel, valued at $240bn, has been on
an acquisition spree in recent times. Last
year it spent $15bn on Mobileye, which
designs chips for car sensors, and in 2015
it paid $17bn for Altera, which makes
processors for servers and is a big player
in the booming ?internet of things?
industry. Qualcomm supplies wireless
communication chips for most Android
mobiles and several iPhone models. It
also earns royalties from nearly every
smartphone sold worldwide thanks to its
vast portfolio of patents.
However, Intel has been slowly eating
into Qualcomm?s smartphone business,
elbowing the company out of some
iPhone models and hoping to win more
business from the world?s largest company. Apple and Qualcomm are locked in
a dispute over licensing fees. It is thought
Broadcom would seek to call a halt to the
hostilities with Apple if it buys Qualcomm, which could end Intel?s hopes of
making further inroads into the iPhone.
?This is a defensive measure from
Intel, aimed at preventing competitive
losses,? said Neil Campling of the broker
Mirabaud Securities. ?If it bought Broadcom, I would expect to see a massive
wave of deals. The chip industry is a scale
business.?
SOFTBANK EYES CHARTER
SoftBank has laid the groundwork
for a $100bn (г72.7bn) merger of
its US mobile phone company with
Charter Communications by secretly
buying a stake in the cable TV giant,
writes Ben Harrington.
City sources said SoftBank, led
by the billionaire dealmaker
Masayoshi Son, had in recent weeks
bought nearly 5% of Charter, whose
largest shareholders include John
Malone, the tycoon dubbed the
Cable Cowboy.
The covert stake-building by the
Japanese conglomerate raises the
possibility of a media mega-deal.
SoftBank controls the US mobile
phone network Sprint and held talks
with Charter about combining the
two last year.
Reports suggested Charter?s
largest shareholders ? including the
Newhouse family, owners of Condщ
Nast ? were in favour of a deal while
the management team, led by
Thomas Rutledge, were opposed.
Barrowman investment
firm rapped by watchdog
Jon Ungoed-Thomas
Part of the financial empire
headed by the co-founder of a
new ?British bitcoin? was
criticised by a regulator for
?misleading or deceptive?
practice.
The censure of Creechurch
Capital came after a
whistleblower claimed that
the investment company had
falsified client records.
Creechurch is part of the
financial group led by Doug
Barrowman, who is about to
launch a digital currency with
his partner, the lingerie
entrepreneur Baroness
Mone. Regulators and MPs
have warned that investors
could lose significant sums in
such crypto ventures.
Mone said the couple
enjoyed ?incredible?
reputations and would work
hard to ensure the success of
their scheme, to be launched
Hotels back
on sale after
Tchenguiz
sues Hilton
Oliver Shah
Administrators to 10 Hilton
hotels previously owned by
the property tycoon Vincent
Tchenguiz are set to put
them back on sale after he
launched a legal action over
the portfolio?s collapse.
AlixPartners has appointed
the agencies JLL and Savills
to find buyers for the hotels,
which include the London
flagship site in Kensington
and Puckrup Hall in the
Cotswolds, after a failed
auction led Tchenguiz?s
lenders to put them into
administration in January.
Tchenguiz took a stake in
the hotels through a sale-andleaseback deal in 2002 and
later bought them outright.
Hilton agreed to keep
to the public on Thursday.
Barrowman, 53, is a
chartered accountant who
previously worked for the
private equity firm 3i. He now
heads Knox Financial Group,
which includes Creechurch,
where he formerly served as
director and non-executive
chairman.
Creechurch was alleged to
have been involved in
?potential criminal
misconduct? in a recent
employment tribunal on the
Isle of Man. The claim has
been strongly disputed by the
firm. Barrowman was not
made aware of the regulatory
concerns at the time and was
not called as a witness at the
tribunal.
A source close to the
tycoon said there was no
evidence of criminal
behaviour, the staff had since
shown their fitness and
propriety and no concerns
operating the sites on leases
until 2029.
Tchenguiz has accused the
American hotels giant of
trying to wriggle out of the
leases on the properties,
most of which are said to have
fallen into a state of disrepair.
He believes Hilton received
confidential information on
their financing from two
hedge funds, Fortress and
Hayfin, and frustrated a sale
in the hope of buying back
the freeholds cheaply via an
administration, in order to
escape liabilities of г1.6bn for
the leases.
It is understood Hilton
rejects the claims.
Previously, the portfolio
attracted bids totalling
г510m, which would have
paid off the debt but left no
equity value. This time, the
asset manager DTZ Investors
is said to have signalled an
interest in paying up to
г300m for the nine regional
hotels, which could push the
total to г560m as the
Kensington hotel is valued at
about г260m.
Barrowman: ?no concerns?
had been raised by the
regulator on its latest visit.
Robert Sutton was dismissed
for gross misconduct in 2016
after alleging that records
involving a client and a third
party had been falsified.
The tribunal ruled that
Sutton had been unfairly
dismissed for whistleblowing,
Mayfair flats
go for г100m
to mystery
Gulf investor
Iain Dey and Oliver Shah
A Middle East buyer has spent
more than г100m on two
penthouses in a new
development in Mayfair,
defying London?s cooling
prime property market.
The mystery buyer is
understood to have bought
two flats in British Land?s
Clarges Mayfair scheme on
Piccadilly. The development
offers views over Green Park
and Buckingham Palace.
He is said to have bought
one from British Land and
the other from Lawrence
Stroll, the Canadian
billionaire and father of the
Formula One driver Lance
Stroll, with a view to
knocking them together.
The blockbuster purchase
and published the findings of
a report on Creechurch by
the Isle of Man Financial
Services Authority, which
found a series of breaches of
its rules. The tribunal said in
its judgment that it was
?entitled to consider the
misconduct had been viewed
by the FSA as potentially
criminal behaviour as well as
a regulatory breach?.
Creechurch said no FSA
findings suggested
criminality and no formal
action had been taken against
the firm.
Boardman and Mone?s
equi tokens will go on sale to
the public at 50 cents (36p)
each. The couple hope to
raise up to $80m (г57.7m),
which will be invested in
venture capital projects.
@JonUngoedThomas
Busting to make you rich,
News Review, page 29
comes despite the waning
appetite of overseas investors
for luxury London property
amid increases to stamp duty
and the uncertainty over
Brexit.
Knight Frank?s Prime
Central London Sales Index
recorded a dip of 1% for the
year to last month, which was
less dramatic than the 7.9%
slump between the last
peak in August 2015 and
February 2017.
However, anecdotal
evidence suggests prices are
still being cut aggressively in
some areas. Cresswell House,
an extravagantly renovated
mansion in Chelsea, recently
had its asking price slashed
from г37.5m to г20.1m.
British Land set a record
price for a Mayfair
penthouse, thought to have
been close to г7,000 per sq ft,
when the 34 units at Clarges
went on sale in 2014. The
scheme includes a cinema
room, swimming pool and
spa, and the walls of the flats
have been reinforced to take
the weight of heavy art.
Have we reached
peak ?woke??
How one word became ubiquitous.
Pick up your copy of The Times tomorrow.
4
The Sunday Times March 11, 2018
BUSINESS
Whatever happens, GKN will be broken up
Iain Dey Agenda
I
nsults have been traded, union
leaders riled, and a pointless
parliamentary committee
convened. Yet one could be forgiven
for having lost track of the
acrimonious and increasingly
complicated tussle for the future of
the engineering giant GKN.
Cutting through the noise, though,
two things are clear:
6 Whatever happens next, GKN is being
broken up ? ending 259 years of history.
6 Melrose Industries is almost certain to
win the acquisition battle, especially if it
sweetens its offer a little.
Status quo is not an option. GKN
announced a deal on Friday to sell its
automotive business to its American
rival Dana. It was in talks with the Ohio
company before Melrose made its move.
GKN has also received approaches for its
aerospace business, and has put its
powder metallurgy business up for sale.
It is breaking itself up, in spite of the
misty-eyed jingoism in parliament.
Melrose would also break up the
company, but only after stretching the
margins a little over the next five years
or so. Ultimately, it will find new homes
for the respective parts of the business.
Once Melrose has been through those
operations, I suspect it would take a
trade buyer with synergies to extract
further value. And the likely buyers are
all foreign; GKN has no peers in the UK.
Thus, fast forward to 2023 and the
end result will be broadly the same. The
constituent parts of GKN will be in
foreign ownership ? though most will
presumably retain a big presence in
Britain. Whoever wins the battle, jobs
will be lost. That has little to do with
ownership ? it?s about automation.
Robots will replace much of GKN?s
workforce over time.
That?s the long-term view. As a listed
company, however, most of GKN?s
?owners? have little interest in what
happens beyond the next quarter. About
20% of the shares are now in the hands
of merger arbitrage funds ? hedge fund
dealers who make money by simply
voting through takeovers.
And possibly 30% or more of GKN?s
shareholders are also Melrose investors.
Asset strippers or not, Melrose?s backers
like the firm?s track record and the huge
returns they have generated. The
overlap investors seem likely to back
chief executive Simon Peckham & co, in
my view. That?s why my money is on a
Melrose victory.
With a little help from Neil?s friends
Neil Woodford has just been helped out
of a spot of bother by his old mates at
Invesco Perpetual ? through a quiet side
deal that has gone unnoticed.
Until a few weeks ago, Woodford held
an 8% stake in the Salford investment
firm AJ Bell ? which, as we report today,
is planning a stock market float later this
year. Yet Woodford could not wait until
the fourth quarter to sell his stake; he
needed cash now.
The once-legendary stock-picker saw
his main Equity Income fund lose
investors 9% of their money last year. In
the first five weeks of this year, about
г1bn of client money walked out the
door in frustration. Through the drop in
performance and the impact of investors
leaving, the fund has shrunk from a peak
of г10.2bn last May to г7.2bn this year.
GKN
440p
400
360
320
280
M A M J J A S O N D J F
Source: Thomson Reuters
Most of GKN?s
owners have little
interest beyond
the next quarter
All this poses a curious problem. One
of Woodford?s signature money-making
schemes is backing private companies. It
was one of the reasons he quit Invesco
Perpetual 4╜ years ago ? he wanted to
do more off-market investing.
The Patient Capital Trust he created at
Woodford Investment Management is all
about investing in start-ups ? especially
in biotech. Yet the flagship Equity
Income fund also makes private
investments ? capped at no more than
10% of the fund, to make it marketable to
mainstream investors.
Those private investments have been
a success. My Woodford moles tell me
the Equity Income fund has invested
г742m in unlisted companies since it was
launched, and made a return of 57% on
those investments. That?s been a
counterpoint to some disastrous listed
investments by Woodford, such as
Northwest Biotherapeutics, Capita, the
AA, Allied Minds, Provident Financial,
Circassia . . . the list goes on.
The collapse in value of all these listed
shares has pushed the fund close to
breaching the 10% limit on its private
holdings. So Woodford raked in maybe
about г40m by selling his AJ Bell stake.
The buyer? Mark Barnett, Woodford?s
old No 2 at Invesco, bought most of it. AJ
Bell management picked up some, too.
The deal looks a little bit cosy, but it
proves a point. The argument against
conventional fund managers holding too
many unlisted shares is one of liquidity;
if the investors take fright, can you sell
shares in a private company? Woodford
has just proved you can.
I meet a lot of bosses of private
companies who have been backed by
Woodford. They remember the day he
declared faith in their idea. They see him
as a partner, not just a cash machine. If
Woodford were to ask other companies
to buy back a few shares from him to
help out, I?m sure most would agree.
I doubt it comes to that, however.
Autolus, a London-based gene therapy
firm, announced plans to list on Nasdaq
last week. I have a hunch that a lot of
Woodford?s long-term bets in areas such
as cancer research will pay off in a big
way. It may just need a bit of patience.
iain.dey@sunday-times.co.uk
Hammond can?t go on a spree
? even with a lower deficit
Trump?s bad bet
at bad odds
David Smith Economic Outlook
Irwin Stelzer American Account
I
f I were to allow a robot to take over
the writing of this column,
something I am gradually working
towards, it would take previous
known patterns and run with them.
So a piece starting with the words:
?The chancellor will this week make
a statement on the economy . . .?
would be followed by: ?. . . and we can
expect more bad news on growth and
borrowing.?
The robot would be blameless. I have
written that so often that, even under
human control, I am struggling to
prevent the keyboard doing so again.
But not this week. On Tuesday, Philip
Hammond will deliver his spring
statement. Briefing suggests it will be
short, 15 minutes or so. Though it is
roughly on what used to be budget day, it
will lack the usual paraphernalia. It will
not, the Treasury says, be a ?fiscal
event?, so no important tax and
spending decisions (though the option
to include some exists). That is why my
inbox, usually creaking with budget
submissions, is empty of such things.
The spring statement, nevertheless,
will contain good news. Growth this year
and next will be forecast to be a bit
higher than the Office for Budget
Responsibility (OBR) predicted in
November. Instead of the 1.4% growth
for this year and 1.3% for 2019 predicted,
consensus forecasts point to figures of
1.6% and 1.5% respectively, perhaps even
a little higher. Growth over the next few
years is still likely to be a little weaker
than the OBR predicted last March, but is
heading in the right direction.
Even more dramatic will be the
figures on government borrowing ? the
budget deficit. Instead of the г49.9bn
the OBR expected for this year, 2017-18,
in November, and the г58.3bn predicted
a year ago, the deficit is likely to come in
at about г40bn.
The greater significance of this is that
it will show the deficit is at 2% of gross
domestic product or below, a level not
seen since 2001-02. The current budget
deficit ? borrowing excluding public
investment (spending on the
infrastructure) ? has been eliminated.
Achieving that, which again has not
happened since the early 2000s, was
George Osborne?s original aim in 2010. It
has come about three years too late, and
it was superseded by a tougher target of
getting to an overall budget surplus ? but
it is a milestone nonetheless.
It raises a couple of questions. Was the
austerity needed to reduce the deficit
worthwhile? And, with it down to a level
that bothers nobody very much, is it
time for the government to start
spending a lot more?
First, for those who are unaware of
the history and wondering why it is
necessary for the chancellor to be on his
feet at all this week, a brief recap. For the
past 40 years or so ? since the 1975
Industry Act became law ? the
government has been required to
publish two economic forecasts a year.
One occasion has been provided by
the budget, though its timing during the
year has varied. The other has come
under various guises. Initially it came in
what was called an economic progress
report. That gave way to the autumn
statement, which was abolished in
favour of a single autumn budget, with
effect from 1994, so the then Tory
government published a separate
summer economic forecast.
Under Gordon Brown in 1997, the
budget shifted back to the spring, but the
autumn pre-budget report provided an
The Treasury
fears, rightly, what
lies ahead for the
public finances
opportunity to publish the forecast.
Osborne renamed that the autumn
statement before Hammond went back
to the Kenneth Clarke model of a single
autumn budget. This week?s is the first
spring statement but, given the
penchant for rearranging the fiscal
furniture, there can be no guarantee that
the musical chairs will stop here.
That the deficit is down to levels
considered appropriate by Osborne in
2010, after a lot of pain, has renewed the
debate about whether it has been
worthwhile. Some say that austerity
should have been delayed until the
economy was on the sunlit uplands of
significantly stronger growth; some say
there should have been no austerity at
all. Both arguments, it seems to me, are
flawed. Delaying would have taken us
not into the sunlit uplands but into the
uncertainties of Brexit. Doing nothing
against the backdrop of a budget deficit
of г153bn, 9.9% of GDP, was never an
option. The growth numbers for 2010-15,
averaging just over 2% a year, were
perfectly respectable and compared well
with other countries. Employment grew
well and unemployment fell.
During the Osborne years it was
common, particularly among some
American economists, to see austerity as
a kind of mad British exceptionalism.
There may be a mad British
exceptionalism but it was not that:
America?s growth over the same period
was barely any different from that in
Britain. Both did a lot better than
Europe, weighed down by the eurozone
crisis and recession.
Is now the time to abandon austerity?
Local authorities are creaking under the
strain and the cash freeze on most
benefits and tax credits, set to last until
2020, is biting hard. The National Health
Service, missing its targets, is
experiencing the slowest spending
growth in its history.
Sometimes, the Treasury?s
determination to avoid extra spending
leads to convoluted policy, such as the
THE BUDGET DEFICIT IS BACK AT PRE-CRISIS LEVELS ...
Public sector net borrowing
160 гbn
120
-80
40
0
-40
93-94 95-96 97-98 99-00 01-02 03-04 05-06 07-08 09-10 11-12 13-14 15-16 17-18
Source: ONS
... AND GOVERNMENT DEBT IS FINALLY LEVELLING OFF
Public sector net debt
PSND including Bank of England term funding scheme
2,000 гbn
1,600
1,200
800
400
0
1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017
Source: ONS
latest damp squib on housing a few days
ago. I have long argued that if the
government is serious about addressing
housing shortages, and wants to get
anywhere near its target of 300,000 new
homes a year, it should take a leaf out of
Harold Macmillan?s book and fund the
building of a lot more council houses.
The Treasury, however, appears
determined to hold the line, and has
good reasons for doing so. Though
this year?s borrowing undershoot will
carry through to future years, we are a
long way from a balanced budget on a
sustained basis, or a reduction in
government debt, currently
г1.74 trillion, or 84% of GDP. Even if you
say it quickly, that is a lot of debt.
The Treasury also fears, quite rightly,
what lies ahead for the public finances.
The OBR has long highlighted the
upward pressures on borrowing from
the early 2020s, largely due to the
impact of an ageing population on
health, pensions and other spending.
The government?s Brexit impact
assessments, now published, show that
annual borrowing will be between
г20bn and г80bn higher than under the
status quo by the early 2030s,
reinforcing the Treasury argument for
caution. That red Brexit bus could hardly
have been more misleading.
PS
I gave a talk to the Bank of England?s new
graduate recruits a few weeks ago. It was
about communicating more clearly.
There is, as a speech by its chief
economist, Andy Haldane, recently
noted, work to be done.
Seventy years ago, the Bank uttered
publicly fewer than 5,000 words a year;
one speech. Last year, its public output
exceeded 4.5m words. But, Haldane
suggested, 95% of the words spoken or
published by the Bank and other central
banks are inaccessible to 95% of the
population, a ?stylised fact? he said
could be generous to central banks.
This is not, mainly, because central
banks adopt the Alan Greenspan
approach ? ?If I seem unduly clear to
you, you must have misunderstood what
I said? ? though a lot of their language is
unnecessarily obtuse.
It is because of what Haldane
described as ?a yawning understanding
deficit on the part of the general public?.
I know this. Though I try to
communicate clearly, and hope I get a
better rating than central banks, there is
sometimes an understanding deficit
even for some Sunday Times readers.
When there is an understanding
deficit there is also, as Haldane pointed
out, often a trust deficit. Generally,
people do not trust economic experts
because they do not understand what
they do. One misunderstanding is that
the only thing economists do is forecast.
Economists do not always help
themselves by disagreeing at every
opportunity. Keynes hoped they could
come to be regarded as humble,
competent, ?on a level with dentists?.
He, however, was the butt of Churchill?s
joke that if you have two economists in a
room you get two opinions, ?unless one
of them is Lord Keynes, in which case
you get three opinions?.
People want to know more about
economic issues. Between 80% and 90%
of people think they should be covered
more comprehensively in the school
curriculum. Haldane and the Bank think
some study of economics at school
should be compulsory. They are right.
david.smith@sunday-times.co.uk
M
oving forward while backing
down is no small feat ? but
Donald Trump managed it
last week. On live TV. The
president pushed ahead
with plans to impose tariffs
of 25% on steel and 10% on
aluminium, sounding as
injured by the trade practices of
our partners as at any time in his
grievance-strewn presidency, and as
tough as his core supporters could want.
?If you don?t have a steel industry you
don?t have a country,? he proclaimed,
which will come as a surprise to a lot
of countries.
It was great television from someone
who knows how to use that medium
and is unburdened with excessive
fidelity to the facts. Although talking
tough, the president showed what he
called ?great flexibility?. What was said,
in fact, was a climb-down.
No, the tariffs will not apply to Mexico
and Canada: that can be handled by the
renewal of the North American Free
Trade Agreement (Nafta), which he
expressed confidence would be
successfully negotiated. Yes, other
countries can file for exemptions and
those that can show they are our friend
on ?trade and security? will get them.
Countries that don?t treat us fairly and
don?t pay their fair share of defence
costs will not. Australia probably will be
exempt; China certainly won?t.
The president read out a tweet from
Elon Musk pointing out that Beijing
taxes imports of cars from the US at a
25% rate, while we tax their cars at only
2.5%. That will end. Whether the EU,
which has not honoured its commitment
to devote 2% of its GDP to the Nato
budget, and taxes imports of American
cars at 10%, will end up in the ?friends?
column remains to be seen. If the EU
mounts more than a token retaliation,
the president threatens to impose
a ?mirror tax? ? a 25% tariff on
European-made cars.
So, with the exceptions, and 15 days
for all affected nations and companies
to appeal for an exemption, or offer an
acceptable alternative to tariffs, it might
seem things are not as bad as everyone
thought. In fact, they are far worse.
Accompanying the president during
his announcement, in addition to several
steelworkers with hard hats tucked
under their arms, were Treasury
secretary Steve Mnuchin, commerce
secretary Wilbur Ross, assistant to the
president Peter Navarro, and US trade
representative Robert Lighthizer. With
the exception of Mnuchin, this is the
triumphant nationalist wing of the White
House staff, long-time protectionists all.
They have routed Gary Cohn?s globalists,
won the war for Trump?s ear and plan
more protectionist measures, not least
among them a 7% fee on all imports.
Equally important is what this
incident tells us about just how policy is
made in this White House. At 6pm on a
cold evening, the nationalists slipped
into the White House, called leading
steel and aluminium executives to a
meeting the following day, and worked
out the president?s surprise
announcement of the tariffs to be levied.
A chaotic way to make policy, say
Trump?s critics.
Hoping to reform Trump policy
procedures by shouting ?chaos? is rather
like hoping to reform a misbehaving
child by offering him more candy. The
president came to his office from reality
TV, where ratings are the measure of
success. Chaos produces ratings, keeps all
eyes on the star of the show. All others are
bit-part players, disposable, as he made
clear when asked if Cohn?s departure
would hurt the administration. ?People
. . . all want to be in the White House, so
many people want to come in. I have a
choice of anybody? ? pace his American
version of The Apprentice TV show, or
the UK version chaired by Lord Sugar.
Then there is the president?s love of
things French. On the theory that
nothing succeeds like excess, he adorns
his clubs and hotels with what are
variously described as Louis XIV, XV,
and XVI, 17th and 18th-century-style
furnishings. No harm in that: chacun
р son go√t, Trump might say. It is his
aping of the mercantilism of Louis XIV?s
17th-century finance minister
Jean-Baptiste Colbert that is so
Trump is willing to
put the growth
rate at risk to save
some steel jobs
dangerous. Colbert believed the wealth
of a nation could be built by selling
abroad and spending at home, running
perpetual trade surpluses. Trump, not
having recently reviewed his dog-eared
copy of The Wealth of Nations, agrees:
he does not understand the
inefficiencies in forgoing the advantages
of an international division of labour.
Finally, it is no surprise he has chosen
hard metals as his first battleground.
He understands steel, aluminium,
concrete ? the stuff of which hotels and
skyscrapers are built. He associates the
workers in those trades with manliness:
note his sotto voce offer, mercifully
declined, to arm-wrestle with a muscular
steel worker imported as a backdrop for
the tariffs press conference.
But those are the industries of a
stagnant present and a dim future. The
industries of the future, the ones China
is planning to subsidise and protect until
they achieve global dominance, are the
ones that require protection from
predatory trade practices. Trump has
asked China to submit a plan for cutting
its record $375bn-a-year trade surplus
with the US by $100bn a year. Or else.
Last week, Trump showed he is
willing to put the economy?s growth rate
at risk to save some steel jobs. A bad bet
at bad odds. The US economy added
313,000 new jobs in February, drawing
thousands back into the workforce.
Enough new jobs were created in 12 days
to replace all the jobs that would be lost
if the entire steel industry disappeared.
Better to bet on growth than on
protection if jobs are what he wants.
irwin@irwinstelzer.com
Irwin Stelzer is a business adviser
5
The Sunday Times March 11, 2018
BUSINESS
France wants to knock out
the City, but does the EU?
Not every European rival is determined to end London?s dominance as a financial centre
idea that the UK ?stole? jobs from Paris in
the 1980s and this is a chance for revenge.
However, southern and eastern European nations are concerned about access
to international capital markets after
Brexit, because London is a global market for liquidity and risk capital. Threequarters of Italian sovereign-debt dealers
are in the capital, for example.
The European Commission has to consider all member states? wishes. ?It wants
financial services spread out through the
EU,? said Andrew Pilgrim, who runs the
government practice at the financial services firm EY. ?That avoids an increased
concentration of risk.?
On Wednesday, Hammond argued for
?mutual recognition?, which means both
sides retain sovereignty and recognise the
quality of the other?s regulations. The
alternative, equivalence, would make the
UK a rule-taker and would come with the
uncertainty that the EU could withdraw
recognition of rules with 30 days? notice.
If trade deals were suits, mutual recognition would be made-to-measure from Savile Row; equivalence is off the peg.
Part of Hammond?s argument for
mutual recognition rests on the EU?s
attempted trade deal with the US, the
Transatlantic Trade and Investment Partnership (TTIP). In a 2014 speech in Washington, the EU?s lead negotiator, Michel
Barnier, argued that financial services
should be part of that deal ? showing that
it is not ?impossible? to include the sector. However, EU sources claim the British
were the drivers of financial services
being in TTIP (Hammond said the French
wanted it too). A further claim is that it
was put into TTIP as leverage in the belief
that America would reject it and the
EU could show it was making concessions.
The euro-denominated
derivatives market, and
the clearing and settlement systems that
underpin it, are the
jewels in the crown
sought by the French.
About 98% of cleared
swaps in euros are
processed in London
? a market dominated
by the company LCH.
London also clears
contracts denominated
in the dollar and 15 other
currencies,
but
the
French insist that euro
clearing must move postBrexit.
By running virtually all
ROSAMUND
URWIN
C
ome to France, it?s less
French than you?d think.
That?s the pitch from Paris to
the City. Don?t fret about
French labour laws, the officials say ? they are changing.
President Emmanuel Macron
has cut the wealth tax. We
even speak English! Then
they add a sweetener: you
can pay tax on only half your income.
France?s continental rivals are living
up to stereotypes in their own pitches. In
Frankfurt, according to one fund manager, officials talk up the infrastructure
but are not offering special deals. Spanish
officials told a bank they would send documents after a meeting about a move to
Madrid; the papers never appeared.
Theresa May, of course, wants financial services businesses to stay; the sector
accounts for 2.2m jobs and г72.1bn in
annual taxes. However, the gap between
what the UK wants in a Brexit deal and
what the EU wants to deliver was laid
bare last Wednesday.
In a speech last week, chancellor Philip Hammond said Britain would reject
any deal that excluded financial services.
A day earlier, however, the French
finance minister, Bruno Le Maire, had
appeared on BBC Radio 4?s Today, trying
to kill Hammond?s plan before birth.
While the fight has been pitched as a
battle between Britain and the EU, a subbattle is being waged between the other
27 member states. The split lies between
those that accept London?s supremacy, and those that see an opportunity to usurp the City.
The success of Ireland?s
financial centre has been
tied to London?s dominance, and diplomats in
Dublin do not want disruption. Luxembourg,
too, is keen to maintain
the status quo. ?We want
to find a workable solution that will allow us to
continue to do business
with the UK,? said Nicolas
Mackel, chief executive of
Luxembourg for Finance.
Frankfurt is the most logical city to steal London?s primacy. On Friday, the Swiss bank
UBS sent a memo to staff in London
about moving its central risk-management department to the German
financial hub. Yet old tensions in the
country mean that the efforts of local officials are not fully backed by Berlin, which
is being lobbied by corporate Germany to
avoid
catastrophic
disruption
to
Europe?s capital markets.
The French, by contrast, want a fight.
They claim it is impossible to include
financial services in a trade deal because
everything must come under the auspices of EU regulators.
Trying to establish Parisian supremacy
is a national project. Even regulators at
the Autoritщ des Marchщs Financiers
(AMF) are being enlisted. Xavier Parain,
asset management director at the financial markets watchdog, came to London
on Friday to meet fund managers. David
Blanc, a partner at wealth manager LGT
Vestra, said: ?It?s like if you had the Financial Conduct Authority doing marketing.?
Consultants working with the AMF say
firms can obtain approval to operate in
France within three months.
According to City sources, the French
government has asked banks to state how
many jobs they are moving to Paris.
When one bank reported it as jobs ?created?, it was told that this should be
rephrased as jobs moved out of London.
The hardline approach is rooted in the
Silicon Valley
tax grab
threatens to
split Europe
Brussels wants a larger slice of big tech?s
billions. Can it convince all the member
states that a levy on revenue is the
answer, asks Simon Duke
Bruno Le Maire is steeling
himself for a fight. For years,
France?s finance minister has
wanted to slap punitive taxes
on Silicon Valley. His dream
could soon become reality.
Later this month, Le Maire
and his counterparts across
the EU will publish their plan
to rein in tax-avoiding
American technology giants.
The cash grab is set to
inflame tensions between
America and Europe over one
of the world?s richest and
most powerful industries.
Each side lays claim to the
vast profits generated by the
likes of Facebook and Google
from the EU?s 500m citizens.
So far, it has been a war of
words. When hostilities
commence, it could make the
skirmish over steel and
aluminium tariffs look like a
playground spat.
Donald Trump has already
put his stake into the ground.
His overhaul of the US tax
code in December offered
generous inducements to
American companies to
repatriate the estimated
$3 trillion (г2.1 trillion) they
hold offshore.
More significantly,
Washington is reducing the
incentives for US
multinationals to hoard
profits in Caribbean havens.
The aim is to persuade Silicon
Valley to book more overseas
revenues at home ? and pay
more tax to Uncle Sam.
However, many EU nations
saw this as an attempt by
Trump to extend US tax
rights to activity in Europe.
Next week, Brussels will
respond to Trump?s tax cuts.
Its big idea is to hit large
overseas digital companies
with a new levy based on
revenues generated in the EU.
This would mark a radical
departure from the current
rules, where corporation tax
is based on profits.
Britain, somewhat
paradoxically, looks set to
follow Brussels? lead. Mel
Stride, the financial secretary
to the Treasury, recently
declared that a turnover tax
was the ?potentially
preferred route? to clamping
down on footloose tech firms.
?This [debate] is not about
tackling avoidance, per se,
but which governments
should be able to tax the
profits of global digital
businesses?, said Chris
Drive: Margrethe Vestager
Sanger, head of tax policy at
the accounting giant EY.
?Reaching an international
consensus will not be easy.?
With tech beasts such as
Google, Amazon and
Facebook responsible for a
growing proportion of
economic activity, nation
states need to act quickly.
However, there are no neat
solutions to this conundrum.
Silicon Valley has created
elaborate ? albeit legal ?
structures to sidestep the
taxman, with intellectual
property, such as patents and
brands, sheltered in offshore
havens. Profits are siphoned
out of large economies, such
as Britain, in the form of
licensing and royalty
payments. The result is
avoidance on a grand scale.
In 2016, Facebook paid just
г5m corporation tax in
Britain despite having tens of
millions of users here.
Trump?s tax amnesty
promises to deliver sizeable
trades through London?s plumbing,
banks and insurers from across the globe
have been able to reduce their financial
risks. One set of trades often offsets
another group of transactions. The London market allows firms to benefit from
that ?netting? effect, meaning they can
operate with less capital tied up.
Relocation is likely to increase the
costs of clearing. Deutsche BЎrse?s chief
executive, Theodor Weiner, said he
wanted the exchange to claim at least a
quarter of the euro-denominated clearing market by next year. Yet any grander
attempted putsch seems to have been set
aside.
There are murmurs that the regulators
are less keen on being burdened with the
job of monitoring the $1 trillion market.
Catherine McGuinness, chairwoman
of the City of London Corporation?s policy and resources committee, said: ?It
ought to be perfectly possible to reach an
agreement that avoids splitting clearing,
which wouldn?t be in anyone?s interests.?
Breaking up Europe?s financial empire
into different national entities would be
expensive. It would mean having capital
trapped in different countries, and addi-
The French
sweeteners are
artificial as the
cost of employing
someone is so high
tional regulatory burdens. Most institutions are trying to change as little as possible to cope with Brexit.
While many financial businesses with
London HQs have registered in other
countries, this does not necessarily translate into moving staff. The French have
run a more fruitful campaign to persuade
rich French-born citizens to go home
than getting financial services firms to
increase their headcount in Paris substantially. Credit Suisse is said to have
soured on Paris and now plans to move
250 jobs to Frankfurt or Madrid.
?The French sweeteners are artificial
as the cost of employing someone is so
high,? said a fund manager. ?Your income
tax halves, but then you have social contributions and labour law taxes.?
Saker Nusseibeh, chief executive of
fund manager Hermes, predicts a ?seepage? rather than a haemorrhaging of
business from London. ?With asset management, I think Europeans will demand
that some aspects are put in Europe ?
either client-facing or back-office
activities,? he said. Hermes was considering setting up offices in
mainland
Europe
before
Brexit, and is in talks with
Dublin about procuring a
licence.
For
some,
the
prospect of a Corbyn-led
Labour government is
more of a reason to consider leaving London.
?I don?t think Brexit is
an issue for our industry,?
said one hedge fund manager, ?but [shadow chancellor] John
McDonnell is ? he doesn?t believe in capitalism.?
Nusseibeh believes New York will be
the biggest beneficiary of any Brexit disruption to the City. While Donald Trump
may alienate some, his tax cuts and light
touch regulation are appealing. ?Add this
together, and London will sink from No 1
to No 2 in the ranking of global financial
centres,? he said. ?With New York rising
again, people will think Trump?s policies
work. That gives him a second term.?
rewards for the Internal
Revenue Service. In January,
Apple said it would make a
one-off payment of $38bn to
repatriate much of its
offshore cash pile. Also, there
will be a new tax on overseas
profits from ?intangibles?,
such as patents.
However, the more the US
manages to extract from big
tech, the less will be left for
overseas tax authorities ? a
prospect that has alarmed
Brussels. The EU?s long-term
plan is to create a uniform set
of rules for companies
operating in the bloc, with
receipts shared among
member states. Its revenue
tax is seen as a short-term fix.
Even a temporary internet
sales tax could struggle to
garner the approval of all
member states. Emboldened
by the competition
commissioner Margrethe
Vestager?s tax avoidance
crusade, France and
Germany want to hit Silicon
Valley hard. However,
Holland, Ireland and
Luxembourg, which have
?light-touch? tax regimes,
could try to block a revenue
tax. So far, the EU has shown
a united front in negotiations
over Brexit. When it comes to
taxing Silicon Valley, the
cracks are about to open up.
SEASON TWO OF
DANNY IN THE VALLEY
THE LIFE OF A
SILICON VALLEY
ENTREPRENEUR
THESUNDAYTIMES.CO.UK/
DANNYINTHE VALLEY
6
The Sunday Times March 11, 2018
BUSINESS
Airbnb?
It won?t
kill off
hotels
TOM STOCKILL
Keith Barr: ?Home sharing has been
around as long as hotels and it?s not
an existential threat to the industry?
greeting almost every employee. He
proudly shows off the hotel?s latest addition: a Mexican-inspired restaurant
where staff in orange braces (men) and
gold headpieces (women) attend to the
business executives at the tables.
Upstairs, in the club lounge, a colleague strides over and slaps Barr on the
back before giving him a hug. ?He?s the
man!? enthuses Alvaro Rey, general manager of the hotel, who started his career
as a waiter in Colombia. Barr convinced
Rey to move to London from Australia.
Guests in the lounge are greeted by
name. Rey discusses a regular with one of
the waiters; they want to invite him to a
football match. The InterContinental
has a loyal following among business
travellers ? some stay more than 100
nights a year.
Yet few of the staff are British. Finding
good workers after Brexit is a concern
that Barr shares with the rest of the hospitality industry. The UK accounts for only
5% of IHG?s revenues, but with hundreds
of workers needed in each hotel, the
demand for eager young chefs, managers
and waiters is high. If fewer European
workers come to Britain, we will need to
find our own.
Barr has called for more training ? perhaps in the vein of Theresa May?s proposed T-levels. If the UK is to have less
immigrant labour, it has to ?build a better
vocational training environment domestically?, he warns.
The boss of InterContinental
Hotels still wants more regulation
and higher taxes on the website
SABAH
MEDDINGS
W
hen Keith Barr walked
into a new InterContinental hotel in Shanghai, he was horrified.
It was all wrong. The
lobby was too small,
the Italian restaurant
four times too big and
the nightclub was
empty. Nearby staff
bore the brunt of his shock as the American marched through, demanding if they
knew ?how many things were wrong?
with the hotel.
After spending his whole career in the
industry, working in Australia, China, the
Middle East and Africa, the chief executive of InterContinental Hotels Group
(IHG) reckoned he knew his customers.
He set to work. The nightclub was ripped
out and a wedding venue installed in its
place. The lobby, a key meeting space for
Chinese guests, was extended. ?It just
wasn?t right for the Chinese customer,?
insists Barr, a boyish 47-year-old.
He chooses his words carefully, with
anecdotes about loyalty programmes
and mobile check-out, when we meet in a
boardroom in the City.
This is his first newspaper interview
since becoming chief executive of the
FTSE 100 giant in July ? taking over from
Richard Solomons. He now oversees a
workforce of more than 375,000 across
IHG?s branded hotels, including Holiday
Inn, Holiday Inn Express and Crowne
Plaza. It is an empire worth г8.7bn, with
more than 5,300 hotels under its banner
? most of which are now owned by hoteliers who francise the group?s brand.
Barr joined IHG in 2000 and has been
working in the UK for the group for the
past five years ? and, perhaps because of
that grounding, he is nothing like the
straight-talking boss of rival Accor Hotels.
Last month Sщbastien Bazin accused the
accommodation site Airbnb of ?losing its
soul? in chasing volume by letting out
whole apartments, instead of rooms with
a host who can share local tips.
After 25 years in the hotel industry,
Barr is more measured than the private
equity veteran Bazin. His response to the
Airbnb threat?
?Home sharing has been around for as
We?ll have to do
things differently.
Big deals happened
and we weren?t
part of them
long as hotels and it?s not an existential
threat to the industry.?
People arranging corporate travel
don?t want staff in strangers? homes, Barr
adds, though he admits Airbnb has
?taken the cream off some of the biggest
cities?. He is calling for greater regulation
and higher tax on the website.
Barr seems sanguine but he has his
work cut out, amid criticism of IHG for
failing to take part in the series of megamergers that swept through the sector
two years ago. Its rival Marriott, which
owns Ritz-Carlton, bought Starwood in
2016 for $13.3bn. Accor, owner of Ibis and
Sofitel, bought the Fairmont brands for
nearly $3bn in the same year.
Elsewhere, competition is hotting up.
In London, more hotel rooms (9,000)
will be added by IHG and its rivals this
year than before the 2012 Olympics
(8,000), according to the accountancy
giant PwC. Across China, where Barr has
set his sights on expansion, Accor is
growing swiftly, and online travel agents
continue to bite. Airbnb, which has a
presence in 192 countries, is now valued
at 2╜ times IHG?s market capitalisation.
?We?re going to have to do things differently,? admits Barr. ?The big deals happened and we weren?t part of them. Our
competitors are growing faster than we
are.? Instead of a big deal ? which he
claims would be too much for shareholders to swallow ? he wants to buy a couple
of smaller luxury brands. He is also
launching Avid, which will open its first
hotel in Oklahoma City later this year.
Barr, born into an Irish-American family in Boston, has worked his way across
much of IHG?s sprawling international
group of hotels ? joking that he knows the
?plumbing and wiring of this company
better than anyone else?. He could also
claim that he knows the hospitality industry better than most, given that it has
been in his heart from an early age.
His parents were both college professors, but a messy divorce meant he was
parted from his brother when he was 10.
Barr lived with his mother, who ?worked
three jobs? to support them and took on a
role at an all-boys school so Barr could
study there free. It was here he discovered a passion for food. ?It became a bit
of an escape for me,? he explains. ?I
remember when I got my braces off [my
teeth], we celebrated with me making a
Chinese banquet.?
Food provided an income, too. ?We
had no money so I worked full-time in
restaurants during the summer,? he says,
speaking in an American accent dotted
with the odd English pronunciation. His
family mock him for sounding ?more like
a Brit than a Bostonian?.
After being accepted into Cornell University?s school of hotel administration in
New York, lack of money was a stumbling
block. Even after being awarded a scholarship, a fellowship and a student grant,
he worked 30-40 hours a week in restaurants and hotels to pay his way. How did
he fit in the hours? Class in the morning
and work in the evening.
?I actually think it benefited me to this
day because it taught me discipline and
focus,? he says.
The next day we meet again at the flagship InterContinental hotel on London?s
Park Lane ? and he sweeps through it
If the UK is to have
less immigrant
labour, it needs
better vocational
training
THE LIFE OF
KEITH BARR
VITAL STATISTICS
Born: July 16, 1970
Status: married,
two daughters
School: St Sebastian?s
Catholic school in
Needham, Massachusetts
University: Cornell
University school
of hotel administration
First job: dishwasher in a
restaurant in Boston
Pay: г2.1m from July,
when he took the job, to
December 31
Car: Audi A5
Homes: Virginia Water,
Surrey, and Hawaii
Favourite book: The Count
of Monte Cristo by
Alexandre Dumas
Film: Forrest Gump
Music: Pink Floyd ? Wish
You Were Here
Gadget: kitchen blow torch
Last holiday: Hawaii for
Christmas
Charity: British Heart
Foundation
WORKING DAY
The chief executive of IHG is
Film favourite: Tom
Hanks in Forrest Gump
up at 5.30am and exercises
at home on his spin bike. He
tries to have breakfast with
his daughters before he
leaves for work at 7.10am.
He is in the office for 8am
and works until 6pm6.30pm, before heading
home. He has dinner with
his children and helps with
homework before working
again in the evening. He
often travels overseas.
DOWNTIME
Barr likes to go fly fishing in
his spare time, and wants to
start gardening with his
girls. He tries to cook dinner
for his wife every night he is
at home, and always cooks a
roast on Sundays. Friday
night is Italian night ?
home-made pasta or pizza.
There are other pressures outside
Barr?s control, such as terrorism, consumer spending and political uncertainty. He had the chance to raise some of
them personally when he joined political
and business leaders in decamping to the
InterContinental in Davos, Switzerland,
for the annual meeting of the World Economic Forum. Most of his time, however,
was spent dealing with the VIPs, all of
whom wanted special treatment. ?One
prime minister pulled up outside the
hotel and they tried to leave the car running outside. It was a case of them thinking, ?Do you know who I am?? We had to
say, ?Do you know who else is coming?? ?
Terrorism is having less of an effect on
revenue than it used to, says Barr. Have
we become desensitised? ?People decide
to keep living their lives,? he answers.
Holiday Inn and its lower-cost cousin
are key to IHG?s future growth. There are
already 2,600 Holiday Inn Express hotels
and a further 766 to come. America?s
army of ?road warriors? ? sales reps and
regional managers who travel for 100
nights a year ? form its core customer
base. However, Barr reckons IHG has
been missing a trick. His new brand,
Avid, will be 10%-15% cheaper than
Holiday Inn ? a move, he insists, that will
not cannibalise his existing hotels.
?There?s a set of customers in the US ?
14m of them ? who are incredibly valueconscious. They aren?t paying for anything they don?t want.? Avid?s rooms are
smaller, breakfast is grab-and-go.
Barr knows these customers: ?My
cousin is one of them. He?s reasonably
well off but will spend an inordinate
amount of time trying to find a deal.?
His other big reveal is a new ?conversion brand? ? ?awful? corporate jargon,
he admits, for the practice of bringing
independent hotels under the IHG banner. He sees this as a way of increasing
IHG?s foothold in Europe, where the
industry is fragmented. About 60% of
hotels on the Continent are unbranded,
he says, and it?s harder for smaller groups
to compete ? leaving them ?struggling to
be good investments for their owners?.
IHG is also close to signing a deal to buy
another luxury brand, costing $50-$100
more a night than InterContinental. Last
week, during a conference in Berlin, Barr
said he hoped to have ?more news in a
short period?. No comment yet on the
rumours that this brand is Belmond. Perhaps IHG is about to catch up with its
rivals after all.
Farmers? son pilots the Ryanair of working capital
Aussie Lex Greensill wants to end
the anxiety over unpaid bills that his
parents suffered, says Angela Jameson
The green leather chairs,
mahogany panelling, oil
paintings and antique maps
resemble the headquarters of
most private banks. Yet the
solid respectability of
Greensill Capital?s office
overlooking the Savoy hotel
in London conceals the
workaday reality of the
company, which has more
than 1m small business clients
in 50 countries.
Greensill connects the
businesses to investment
banks and London?s capital
markets. Increasingly, it is
also helping to revive Britain?s
benighted industrial sector
with unconventional
financing deals.
The co-founder and chief
executive understands the
problems of running a small
business when cashflow is
tight. Lex Greensill was raised
on a sugar cane farm in
Queensland, Australia. ?My
parents couldn?t afford to
send me to university
because we had to wait a long
time for big retailers to pay
us,? he said. ?That caused me
early on to have a focus on
how that could be fixed. It?s
an issue that faces people in
every sector in every
economy around the world.?
Greensill, a wiry 41-yearold, is now a British citizen,
with a British wife and family.
He studied law at night school
and started out at a local law
firm. He completed an MBA
before landing a job at
Morgan Stanley in London,
where he established his
debut supply chain finance
team, later taking it to Citi in
the mid-2000s. The Bank of
England was the first thirdparty investor.
One of the British projects
he advised on while at Citi
was a government-backed
scheme to help high street
chemists access г800m of
credit on better terms than
are usually available
commercially. Chemists pay
up front for the millions of
items they dispense every day
and claim back the cost from
the NHS. That can take eight
weeks. He devised a scheme
where chemists were paid
almost a month earlier and
benefited from a lower
interest rate, because the
NHS guarantee was treated as
being government-backed.
Supply chain finance has
also been used by blue-chip
companies, such as
Vodafone, to finance the
purchase of smartphone
stock worth millions.
Yet it is in steel and car
manufacturing that the
farmers? son is making a
difference today. He set up
Greensill Capital in 2011, and
it now has 180 staff in New
York, Chicago, Sydney,
Frankfurt, Bremen and
Mexico City.
The company financed
GFG Alliance?s purchase of
GREENSILL CAPITAL
IN NUMBERS
$19.7bn
Value of the early payments
made to companies last year
1%
Typical interest rate
on the payments
Britain?s last aluminium
smelter from Rio Tinto in
2016, saving 150 jobs at the
site in Lochaber, Scottish
Highlands. As part of the
deal, GFG Alliance?s owner,
Sanjeev Gupta, will set up
Britain?s first alloy wheels
factory at nearby Fort
William. It will supply car
makers such as Jaguar Land
Rover from 2020.
The assets sold by Rio
Tinto included two
hydroelectric power plants.
By securitising the cash
stream from the hydro plants
for 25 years, Greensill was
able to provide both the
acquisition capital and capital
to fund the wheels factory.
?We were able to use our
technology and financial
product to deliver the capital
that ultimately creates many
jobs in Fort William and is
bringing manufacturing jobs
back into the UK,? said the
chief executive.
The Scottish government
underwrote the cashflow.
This was critical to the
financial instrument getting a
sovereign credit rating from
Moody?s. More projects with
GFG Alliance are in the
pipeline, in the British
industrial sector and in
France, where GFG is buying
another Rio Tinto asset.
?We finance the real
economy. The real economy
needs about $3.5 trillion
(г2.5 trillion) at any point in
time. This is just the working
capital trapped within the
system,? Greensill explained.
Last year, his business paid
invoices worth $19.7bn to
small companies around the
world, typically industrial
suppliers. The interest rate is
about 1%, which means he
has to do ?very, very large
volumes?. To a glare from his
PR man, Greensill said the
company aims to be ?the
Ryanair of working capital?.
The latest results showed a
loss of $54.4m on revenues of
$42.1m. The company blamed
the loss on heavy investment
in infrastructure and
operations, and expects to be
profitable this year.
Greensill set out wanting to
solve the problem that made
his parents anxious. Job
done? ?We know every day
we are helping thousands of
small companies succeed in
business by delivering them
cheaper capital than they can
get anywhere else. And that?s
a cool feeling,? he said.
7
The Sunday Times March 11, 2018
BUSINESS
The broker, the Picasso and the FBI
й SUCCESSION PICASSO/DACS, LONDON 2018
Tommy Stubbington
reports on the
undercover
operation that led
to Beaufort
Securities being
closed down
P
eter Kyriacou was unsure at
first. When a wealthy American called his City broker,
Beaufort Securities, in October 2016 to discuss opening a
series of accounts, the investment manager explained the
problem: ?We can?t actually,
um, deal with US citizens,
due to tax laws.?
The investor persevered. He said the
share-dealing accounts would be opened
in the name of offshore companies based
in Belize. The American?s name would
not appear on any of the paperwork. At a
meeting the following month at Beaufort?s offices in the City, the FBI claimed
that the investor elaborated on his plan to
use the accounts as part of a scheme to
manipulate US share prices.
Unfortunately for Kyriacou, his new
client was an undercover FBI agent and
the sting operation is at the centre of an
indictment issued this month by the US
Department of Justice (DoJ).
Beaufort, Kyriacou and a web of
alleged co-conspirators stretching from
Mauritius to Hungary, are charged with
arranging share scams involving at least
10 US companies and worth more than
$50m (г36m).
It doesn?t end with stock manipulation; in a twist worthy of a John Grisham
novel, the DoJ claimed that Kyriacou conspired with his property developer uncle
and a Mayfair art dealer to launder a
chunk of the proceeds by buying and selling a г6.7m Picasso painting.
The US charges were also the backdrop
to the abrupt winding up this month of
Beaufort by the UK Financial Conduct
Authority (FCA) over concerns that it
might be insolvent, leaving 80 staff without a job and at least 14,000 clients waiting to see if they get back their money.
The FCA said it considered shutting
Beaufort as early as December, but
waited to allow the FBI to complete its
investigation. The company was well
known to its home regulator, which had
forced it to shut its discretionary fund
management business in 2016 and has
kept an eye on Beaufort since then.
Even so, the timing of the FCA?s latest
move has raised questions over whether
it was asleep at the wheel, allowing an
international share scam to flourish until
the long arm of US law intervened.
Beaufort?s chief executive Tanvier
Malik ? who is not named in the DoJ?s
indictment ? said the winding up was ?a
complete shock?. ?They have killed our
business. They never asked for our side of
what went on,? said Malik, 54. Asked if
the FCA action was linked to the US charges, he replied: ?That?s the
impression we get.?
Malik said he had no
knowledge of the activities of 26-year-old Kyriacou, as described in
the DoJ indictment.
?None of us were
Shocked:
Tanvier Malik,
Beaufort chief
executive
aware of what he was doing,? he said.
?We have got 14,000 clients and г750m of
client funds. Things, unfortunately, go
through the cracks.?
At first glance, the FBI probe looks like
a speculative exercise in entrapment.
However, the US authorities had been
sniffing around Beaufort for nearly four
years, according to the account given in
the DoJ?s indictment.
The company first came to the attention of the FBI in early 2014, during an
investigation into corrupt brokerages
based in Belize. US agents had tapped the
phone of a broker in the Central American tax haven, who mentioned he was
routing trades of a US company through
Beaufort. The same broker later said he
was shutting his offshore operation and
transferring some clients? accounts to the
London-based firm.
US prosecutors allege that Beaufort
continued to enable market manipulation, even after the FCA forced the company to tighten up its financial crime and
anti-money laundering controls in March
2016, following an investigation. Some of
these alleged scams were ?pump and
dump? ? an old-fashioned fraud, made
famous by the film The Wolf of Wall
Street, which involves artificially boosting a company?s shares in order to sell at
a higher price.
In August 2016, the FBI began its
undercover operation. First, a source
in Belize emailed a generic Beaufort
address asking about opening an
account. Kyriacou responded four
days later with his phone number.
The source called him, saying he represented wealthy US citizens who wanted
to trade through Beaufort. That led to
the October phone call between Kyriacou
and the undercover agent in New York,
and the meeting in the City a month
later.
According to the indictment,
the agent was introduced to a
number of Kyriacou?s colleagues, including ?a senior
member of the compli-
APPOINTMENTS
BEAUFORT SECURITIES
IN NUMBERS
14,000
2014
5%
The number of investors waiting to
see if they get back their money
The year when Beaufort first came to
the attention of US law enforcers
The profit needed on the Picasso to
avoid money laundering questions
ance team? and the boss of clearing at
Beaufort.
The meetings resulted in the agent
opening six accounts with Beaufort in
January last year, all in the name of offshore companies in Belize.
At the same time, Kyriacou allegedly
suggested to the agent that they use
WhatsApp, the mobile messaging service
known for its ?end-to-end encryption?,
which makes it harder for law-enforcement agencies to eavesdrop.
The sting drew in further Beaufort
employees. Kyriacou introduced the
undercover agent to Vinesh Canaye, the
boss of the company?s operation in the
tax haven of Mauritius. Canaye is charged
in the DoJ indictment with offering to
help the setting up of offshore corporations. According to the FBI, the undercover agent repeatedly told Beaufort that
the accounts were to be used for a scam.
At a meeting in London in April last year,
he told Canaye: ?There are so many
opportunities here. As long as you keep
[US financial regulator] the Securities
and Exchange Commission, the FBI, the
Mauritian secret police, keep them off my
back . . . we?re gonna do some serious
business.?
Canaye responded: ?I need to keep
you safe, to be safe myself.?
Loyal Bank, a private lender with offices in Hungary and the Caribbean island
of St Vincent, also allegedly helped the
agent to set up offshore companies and
open bank accounts to be used in the
scam.
In June, the FBI claimed its agent
began to talk to Kyriacou about the
mechanics of the stock-manipulation
deals he had planned. ?Match trades?
were the key. The idea was for the agent?s
Beaufort accounts to buy shares at the
same time as brokers in the US ? also on
behalf of the agent ? were selling.
In effect, a trade would be recorded
without the shares truly changing hands,
in an effort to create the illusion of volume in the market and demand for the
shares. This might lure other buyers and
lift the share price.
?Say if you have your guy on the other
side, who will match with us, we can
match with him from our side,? Kyriacou
explained, adding that it was ?standard
practice every single day?.
For heavily traded companies on the
New York Stock Exchange, match trades
would have to be huge for anyone to
notice. Instead, the scam focused on
?over the counter? markets ? more
lightly regulated than big exchanges and
generally populated by small companies
with very lightly traded shares.
A separate filing by the Securities and
Exchange Commission (SEC) describes
how Kyriacou and the FBI agent targeted
HD View 360 Inc, a Florida-based CCTV
Pablo Picasso?s Personnages, 1965,
was allegedly used as part of a
money-laundering conspiracy
TIMELINE OF A STING
March-April 2014
A wire tap of a corrupt broker in
Belize alerts American authorities to
Beaufort Securities, which was
allegedly executing manipulative
trades of a US stock.
March 2016
An FCA investigation finds
Beaufort?s financial crime and
anti-money laundering processes to
be deficient.
October 2016
An undercover FBI agent calls
Beaufort investment manager Peter
Kyriacou about opening a number of
brokerage accounts with the firm.
They meet in London the following
month and allegedly discuss the
stock-manipulation scheme.
January 2017
Beaufort opens six accounts for the
FBI agent, all in the name of offshore
companies in Belize.
January 4, 2018
On the agent?s instruction, Kyriacou
buys $1,000-worth of shares in
Florida company HD View, the first
of a number of purchases over the
course of the month. HD View?s
share price nearly doubles.
February 2018
The agent and Kyriacou meet art
dealer Matthew Green in London
and allegedly discuss laundering the
proceeds of their stock scheme
by buying and selling a г6.7m
Picasso painting.
March 2, 2018
The FCA declares Beaufort
insolvent. Later the same day, the US
Department of Justice files fraud
and money laundering charges
against Beaufort, Kyriacou, Green
and others.
company. ?What I?d like to do is like kind
of prime the pump . . . there hasn?t been a
lot of liquidity,? the agent told Kyriacou.
The Beaufort investment manager
allegedly replied: ?You need some volume, obviously. You?d like to game the
market.?
In early January, the FBI agent asked
Kyriacou to buy $1,000 worth of HD View
stock with his Beaufort accounts, which
he would match with sell orders from
another broker. Kyriacou placed the
trade and, by the end of the day, HD
View?s shares had nearly doubled.
The SEC complaint goes on to describe
a series of similar trades over the coming
weeks designed to maintain the illusion
of interest in the stock. The SEC ordered
the defendants to ?disgorge the ill-gotten
gains they received?.
Kyriacou had plans of his own for
those gains, the DoJ alleges. His uncle,
Aristos Aristodemou, offered to introduce the FBI agent to Matthew Green, a
London art dealer. He said they could use
the proceeds of the market manipulation
to buy a painting from Green and later
sell it to ?clean the money?. The art business was ?the only market that is unregulated,? Aristodemou explained.
Last month, the agent met Kyriacou,
Aristodemou and Green in London.
Together, they allegedly hatched a plan
for the agent to buy Picasso?s ?Personnages, Painted 11 April 1965? from Green
and wait ? then Green would arrange a
resale. Green said it was important to
make more than a 5% profit on the transaction so he would not be asked why he
was ?in the money-laundering business?.
The SEC claim that Kyriacou later sent
the agent an invoice for г6.7m via WhatsApp. A follow-up contained a screenshot
of a message, allegedly from Green, saying: ?Obviously because of the nature of
this transaction we need to preserve a
certain amount of anonymity, which [the
undercover agent] and I discussed and
clarified at the Arts Club!?
Green?s desire for secrecy now
appears to have backfired.
8
The Sunday Times March 11, 2018
BUSINESS
Capita:
we?re not
marching
over a cliff
RICHARD POHLE
items?. These distractions included
г59.4m of restructuring charges, г10.9m
on a contract dispute with the Co-op,
г8.4m of fees for acquisitions, and
г152.2m to cover amortisation of intangibles. Include these items, however, and
Capita made just г74.8m of pre-tax profits on г4.9bn of turnover.
There were other warnings signs, too.
Support services companies typically
hold a lot of long contracts, which earn
profits throughout their lifetime. Capita
has a huge book of receivables ? money it
claims it is owed but has not yet received
in cash. At the end of 2016, about 53% of
these lower quality assets ? г583.7m in
accrued income and prepayments ? had
not yet been invoiced.
Yet for all the warning signs, dividends
continued to flow. It paid out г214.8m in
2016, and another г137.1m half-year dividend in October 2017.
CAPITA
IN NUMBERS
г700m
73,000
Saving the outsourcing giant will still be
turnaround specialist Jonathan Lewis?s
biggest challenge, writes John Collingridge
W
ould-be soldiers who
want to join the British
Army must first tackle
an unusual obstacle
course: the army?s
recruitment website. It
is not for the faint
hearted.
Applicants
have taken to the Army
Rumour Service web
forum to complain about problems ranging from passwords not working, vanishing applications and being unable to
fill in medical details.
?As a website issue goes, this needs
sorting out,? wrote one. ?Took me about
40 attempts to submit my application
today,? wrote another, ?incredibly frustrating.?
The website is run by the outsourcing
giant Capita which, since 2012, has held
the г1.3bn contract to manage army
recruitment. Some claim it has been an
unmitigated disaster, missing recruitment targets by 30%, hitting a string of
technology glitches and incurring the
wrath of various ministers.
Yet fixing the website is unlikely to be
top of the list for new Capita boss Jonathan Lewis: he has far more pressing concerns. In January, Conservative MP Mark
Francois asked a previously unthinkable
question: whether the government had
contingency plans if Capita were to
become insolvent.
The MP?s fear was stoked by Capita?s
warning that it was scrapping its dividend
and must raise г700m from shareholders
to help repair its heavily indebted balance sheet. Capita?s warning, following
days after the collapse of the construction company Carillion, sent the former
FTSE 100 darling?s shares into freefall.
After falling 86% since the start of 2016,
that values the г4.9bn turnover company
at just г1.1bn.
The outsourcing sector ? the loose
term for companies that do things that
other businesses and governments don?t
want to ? is in crisis. Ministers and Whitehall mandarins are now scrabbling to
avert the collapse of Interserve, another
heavily indebted outsourcer that has
been felled by ballooning costs on a
waste-to-energy plant in Glasgow. It has
just days to persuade its lenders to extend
it credit, but risks being sucked into the
death spiral that swallowed Carillion. At
the very least, it faces the prospect of a
debt for equity swap with its lenders.
For years, Capita had defied gravity,
pulling off a string of acquisitions to grow
into an outsourcing behemoth with tentacles stretching from running London?s
congestion charge to managing call centres for Tesco Mobile. For years it was run
by the same, closed team. Its former chief
executive, Paul Pindar, spent 26 years
there, only leaving in 2014. His replacement, Andy Parker, who was ousted in
2017, spent 16 years with the company.
With that expansion ? including
almost 140 acquisitions since 2006 ?
came hideous complexity. The company
now has 73,000 staff, running contracts
ranging from managing mortgages for
the Co-operative Bank to tagging criminals. Its oft-repeated claim was that, as an
IT specialist, it differed from most of its
fellow listed outsourcing peers who were
fishing for lower margin work such as
cleaning and catering.
That enabled it to claim much higher
margins. In 2016, Parker claimed its success moving up the food chain would
allow it to consistently target profit margins of between 13% and 14%.
Lewis is keen to repeat this message,
although he was unable to say what sort
of margin the new Capita should be earning.
?We shouldn?t be compared to the Sercos, the G4Ss, the Interserves of this
world,? he told analysts in January.
?We?re not a blue-collar, low margin outsourcing business. We?re a tech-enabled
BPO [business process outsourcing] and
software business.?
Yet, as its army recruitment woes suggest, Capita has struggled to keep pace
with technological change. Stephen
Rawlinson, an analyst at the management
consulting firm Applied Value, said Capita failed to spend enough upgrading its
technology. ?It never really invested in
the company or the customer. It was
The amount Capita needs to raise
from its shareholders
The number of staff employed by the
giant outsourcing company
Complaints about its army
recruitment site are just the
tip of the iceberg for Capita
always going to catch up with Capita.
They never kicked the business on from
being a paper shuffler.?
Michael Donnelly at investment bank
Panmure Gordon, reckons Capita has
under-invested by about г250m.
Army recruitment is just one of a host
of Capita?s government contracts that
have gone awry. Last year it was stripped
of its contract to manage the Ministry of
Defence estate, and has been repeatedly
criticised by the National Audit Office for
its work on government contracts.
Working out quite how much profit
Capita really makes has never been
straightforward either, relying on a lot of
trust and assumptions. Take its 2016
?underlying pre-tax profits? of г475.3m.
That sum was reached only after ignoring
г403.4m of ?other non-underlying
Capita
г12
10
8
6
4
2
0
2016
Source: Thomson Reuters
2017
Lewis, the former boss of oil services
company Amec Foster Wheeler, has put a
halt to the dividend and is selling businesses to raise cash, but will it be enough?
He claims that Capita is not in the same
boat as Carillion, as it has a host of assets it
could sell. ?We are not under some existential threat,? he said in January. One
leading investor said: ?There?s no way the
government will let Capita go under.?
Yet there is no clarity on what discount
the г700m rights issue will be priced at.
Some in the City reckon the challenge has
been significantly understated. Even
after selling its asset services business for
г888m in June, the company finished
2017 with net debt of about г1.2bn. Then
there?s a pension deficit that stood at
г381m last summer ? although Capita
says it has shrunk since then. It will not
generate any cash this year, and some
analysts reckon this will drag into 2019.
Lewis said he will sell non-core assets,
such as Constructionline, a database of
construction companies, and number
plate recognition company ParkingEye.
City sources say that is just the beginning.
Lewis is believed to be linng up more than
г700m of desposits
Analysts are concerned that Capita?s
recovery will take a lot longer than
expected, at a time when its markets are
shrinking. ?This is a four-plus year turnaround in our view,? wrote Donnelly in a
note to clients. ?Capita?s pipeline appears
to show zero like-for-like growth and [its]
market appears to have weakened in
recent weeks.?
RBC analysts wrote: ?Unfortunately,
we are not sure what Capita?s core business is any more, and its markets aren?t
growing.? Saving Capita will be Lewis?s
biggest challenge yet.
BUSINESS TO BUSINESS
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9
The Sunday Times March 11, 2018
ENTERPRISE
We should be celebrating Jamie
? not gloating at his misfortune
Luke Johnson Animal Spirits
S
chadenfreude is a German
word, but really the British
should have invented it. I think
we take more delight in the
misery of others than any other
country. Such cheap emotions
might feel satisfying, but envy
is a ruinous trait ? as well as
one of the seven deadly sins ? and a
sordid national characteristic.
The gloating comments online and
in the media at the struggles of Jamie
Oliver?s restaurant business are
unpleasant and unproductive. If
entrepreneurs didn?t take risks, where
would the jobs, exports, tax generation
and wealth creation come from?
Why are we so venomous towards
those who are more successful? Just
look at Oliver?s Wikipedia page: it is
relentlessly nit-picking about his
considerable achievements. The entry
suggests he is no more than a string of
failed restaurants, mouse droppings,
dishonest advertising and unpaid staff.
Which small-minded contributors spend
time on Wikipedia recording such stuff?
In fact, Oliver is a leading light in the
transformation of Britain?s food culture;
the creator of thousands of jobs; and a
tireless campaigner for what he believes
are good causes. As it happens, I
disagree with some of his campaigns,
but I still admire his energy, ambition
and enthusiasm. He is the very definition
of anti-elitism, a dyslexic school leaver
and son of a publican who put in huge
amounts of work to become a worldfamous broadcaster and restaurateur.
As the clergyman and author Charles
Caleb Colton wrote: ?Of all the passions,
jealousy is that which exacts the hardest
service and pays the bitterest wages. Its
service is to watch the success of our
enemies; its wages to be sure of it.?
Unfortunately, the British have always
had mixed views of those who prosper.
Our politics stokes envy. The basis of
socialism has always been hatred
towards the rich and successful.
Resentment is the driving force of
Jeremy Corbyn?s Labour Party: just look
at his threats towards the finance
industry. His recent speech attacked the
City for its ?out-of-control financial
wizardry and gambling? and he stated
that its ?dominance over industry? was
?obvious and destructive?.
Part of the psychology of envy is to
blame others for your own misfortune:
so Corbyn and his cohorts see the City as
the source of all capitalist evil. Another
characteristic of envious people is
ignorance ? demonstrated here
by Corbyn?s profound lack of
understanding of how business actually
functions and what the City does.
Overall, financial services provide
2.2m jobs and generate a г44bn trade
surplus, together with г72bn of taxes. It
is a highly productive and diverse sector,
encompassing areas such as insurance,
foreign exchange trading, shipping
services and asset management. Britain
is a world leader in these areas: if Corbyn
diminishes them, what does he think
will replace their contributions?
Meanwhile, almost two-thirds of
income tax in 2016-17 was paid by the
top 10% of earners, demonstrating that
the British economy is already heavily
redistributive. Yet Oxfam ? the
somewhat discredited charity ? recently
promoted the idea that Britain suffered
from ?an extreme form of capitalism
that only works for those at the top?.
Oxfam has been too busy fomenting
envy and playing politics to keep its
own house in order.
Like so many on the left, they cannot
grasp how incentives and markets work
in the real world. They dream of a utopia
like the one in Alice in Wonderland,
where the Dodo bird says: ?Everybody
has won and all must have prizes.? Such
fantasies disregard human nature and
neglect the importance of differing
talents, ambition and luck.
Busy people have no time for envy.
They participate, rather than peering at
the world as passive observers. Those
who are mere onlookers and critics in
life can grow sour and ill-disposed
towards their active fellow citizens. As
the psychologist Erich Fromm wrote:
PHIL YEOMANS
?There is perhaps no phenomenon
which contains so much destructive
feeling as moral indignation, which
permits envy to be acted out under the
guise of virtue.?
I prefer places where people want to
get ahead by dint of hard work, where
they cheer entrepreneurs. Such an
attitude inspires more individuals to take
the plunge and start a business ? and
that initiative is the chief engine of
innovation and economic progress: not
misguided government intervention, but
a culture that celebrates rather than
denigrates winners, and embraces free
enterprise, diligence and risk-taking.
Luke Johnson is chairman of Risk Capital
Partners and the Institute of Cancer
Research. luke@riskcapitalpartners.co.uk
@LukeJohnsonRCP
Nailed it ? with
his and hers
hammers
HOW I MADE IT
JANE GOKGOZ
FOUNDER OF
PERSONALISED
GIFTS SHOP
?I quite like how
my two worlds
have begun to
converge,? says
the Rev Mark
James
I preach the gospel on
data to the unconverted
Even a vicar is preaching about the new rules aimed at protecting personal information
LIAM
KELLY
T
@iamliamkelly
he Rev Mark James spends his
Sundays preaching to the
faithful at Christ Church in
Portsdown, Hampshire. As
well as discussing the Bible,
he likes to talk about data
security. James?s other line of
work is running MoJoU, a data
consultancy he founded in
2015.
His two vocations are not unrelated.
Churches hold sensitive data about
parishioners ? such as passport details
for newlyweds, information on children
or lists of volunteers ? so making sure it is
kept safe is crucial. ?We have a calling to
TEACH YOURSELF TO . . .
UNDERSTAND AI
Most people will come
across artificial intelligence
(AI) in their daily lives, from
using autocorrect in text
messages or following online
maps on a smartphone to
talking to ?smart assistants?
such as Amazon?s Alexa.
However, there are still
many people who do not
know what AI is. Google
searches for ?what is
artificial intelligence?? have
rocketed six-fold in two
years.
Rather than being the
look after and love people,? said James,
47. ?Their data should be no different.?
It?s not just vicars who need to be vigilant. On May 25, a law will come into force
heralding the biggest overhaul in dataprotection measures in decades. It will
penalise businesses and other organisations that fail to safeguard the personal
information of customers or employees,
or to provide them with that data when
requested to do so.
The General Data Protection Regulation (GDPR) is an EU directive, but its provisions will be maintained after Brexit.
The maximum fine for breaching the
rules will be ?20m (г17m) or 4% of a company?s global turnover, whichever is
higher.
Just 8% of small enterprises are ready
for the regulations, according to a recent
survey conducted by the Federation of
Small Businesses. One in three respondents had not started preparing for the
GDPR and a further third said they were
in only the ?early stages? of planning.
world-destroying stuff of
sci-fi nightmares ? such as in
2001: A Space Odyssey or
The Terminator ? AI has the
potential to help
entrepreneurs be more
productive and do things
more efficiently.
?We need to understand
that AI isn?t a threat to
humanity, it?s an
opportunity to reinvent the
way we do business,? said
Kriti Sharma, vice-president
for AI and bots at software
group Sage. ?The real risk
we face from AI is not
embracing the productivity
it can provide.?
Sage estimates that, since
the turn of the year, the cost
Most worryingly, 18% said they were unaware of it.
Penalties and fines will be administered by a beefed-up Information Commissioner?s Office. Elizabeth Denham,
the information commissioner, has been
at pains to emphasise that May 25 will not
usher in an era of punitive action against
small businesses. ?We have always preferred the carrot to the stick,? Denham
said. ?We will use fines and serious sanctions only as a last resort. Our first resort
is education and support.?
That message, though, has not filtered
down to entrepreneurs ? even those who
have spent time and money preparing for
the GDPR. ?The one thing that terrifies
me is the level of fine,? said Emma Heathcote-James, founder of the Little Soap
Company in Broadway, Worcestershire.
If that fear might be misplaced, the
sheer amount of time spent meeting the
new obligations can feel onerous to many
entrepreneurs, for whom hiring specialist data-protection staff is not an option.
of the time spent by Britain?s
entrepreneurs on
administration ? from
payroll to chasing late
payments ? will reach
г7.5bn by noon today.
AI could prove the tool
that stops the productivity
slide. Computer software
that works and reacts in the
same way as humans can be
programmed to do repetitive
tasks, leaving entrepreneurs
to get on with the important
part of running a business ?
coming up with the next big
idea or product. The more
an AI program is used, the
more it learns and adapts to
a particular business.
AI ?isn?t the future. It?s
right now?, said Sharma.
And the benefits are not just
the preserve of Silicon Valley
titans: she has developed
Pegg, an AI chatbot added to
Sage?s cloud-based software,
to manage firms? finances.
AI programs can help
owners of small businesses
automatically enter data,
predict cashflow and chase
up invoices.
?Entrepreneurs don?t go
into business to manage
taxes and create reports on
Excel,? said Sharma. ?Once
in a generation a disruptive
technology arrives, and it
changes everything. For this
generation, it is AI.?
Liam Kelly
We have
a calling
to look
after
people ?
and their
data
?For small businesses, looked at in isolation, it is a compliance headache,? said
Jonny McDonald, data-protection specialist at law firm Charles Russell Speechlys.
Heathcote-James, who sells luxury
soaps and candles and employs four
staff, spends half a day a week working on
GDPR compliance. ?It?s time taking your
eye off the ball,? she said.
Not surprisingly, business is booming
for James, who has focused his consultancy on the change in the law. ?It?s gone
completely bananas ? we?ve got more
work than we know what to do with,?
he said.
The GDPR has even caused his digital
and spiritual lives to overlap. His consultancy advises more than 4,000 churches
on how to manage data ? from his own
Anglican ministry to Catholic dioceses,
the Salvation Army and the YMCA.
?I quite like how my two worlds have
begun to converge. I feel like I?m singlehandedly uniting different denominations across the country.?
ANGEL Q&A
DAVID GLICK
Every week we talk to a
business angel, one of the
early-stage investors who
collectively inject г1.5bn
a year into British
start-up companies
David Glick is a former
solicitor specialising in
entertainment and media
rights. His clients included
singer Nick Cave and DJ
(Fatboy Slim) Norman Cook.
He advised the late fashion
designer Alexander
McQueen.
The 55-year-old founded
Edge Investments, which
puts money into creative
industry start-ups, in 2005.
It has invested more than
г150m and was an early
backer in AIM-listed podcast
platform audioBoom, which
has a market cap of г33m.
Why invest?
Art and culture move society
When Jane Gokgoz kept
seeing keyrings and cups with
people?s names on them
while out shopping, it
sparked an idea.
?Personalised products
looked interesting,? she said.
?I thought I could do
something like that.?
Gokgoz then discovered
drop shipping ? where
retailers do not hold stock
themselves, but take orders
and have the suppliers deliver
direct to customers. In 2009,
she signed up with a supplier,
spent г5.50 on a website
name and Personalised Gifts
Shop was born.
She worked from her
kitchen table for the first two
years, selling gifts such as
mugs, photo frames and
cufflinks. Today, Gokgoz sells
9,000 products, has 33 staff
and a 10,000 sq ft warehouse
in the Northamptonshire
town of Wellingborough.
Personalised Gifts Shop made
a pre-tax profit of г144,000
on sales of г3m in the year to
the end of last March.
Business was slow at first.
It took months for Gokgoz to
make her first sale ? an
engraved clock that was a
retirement present. ?I went
out and bought a bottle of
wine to celebrate,? she said.
It has not always been
smooth, either. Because drop
shippers supply a lot of
retailers, Gokgoz?s products
were not unique. When she
decided to start making her
own in 2015, it sparked a
dispute with her supplier. She
said it reduced her credit
facility, and asked for
advance payment.
?I had thousands of
products on the website and
took all of them offline,? she
said. ?We had three designers
working 16 hours a day to
create new designs and
products. I lost count of how
many hours I did.?
Looking back, she says
starting up production was
?probably the best decision I
made, because it enabled us
to put out new designs?.
Gokgoz sells everything
from cigarette lighters to
novelty underwear. ?If it has
a surface on it, we can do
forward, and if you don?t
make money out of them,
they won?t continue.
Lessons learnt
Money follows success, not
the other way round. The
best thing I can do is nurture
and support the
entrepreneurs I back.
Just do it
Perfection is the enemy of
growth. If you refine and
refine before you go to
market ? you?ll never get
there.
I?m in no rush
The best time to exit is when
the entrepreneur does.
something with it,? she said.
Some of her most popular
products took her by surprise
? such as his and hers
hammers with messages
engraved on the wooden
handles. ?They just flew out
of the door,? Gokgoz said.
Though she makes her
living from personalisation,
she does not have a house full
of her own products ? that
would be an unprofitable use
of her workers? time. ?If
somebody is doing my
personalised thing, they?re
not doing somebody else?s.
My customers are more
important than me.?
She still owns 100% of
Personalised Gifts Shop,
having remortgaged her
house to fuel expansion. She
has never taken outside
investment ? though is open
to it ? but has taken a
г400,000 cash advance from
PayPal?s working capital
scheme to buy stock. The
money is repaid as a
percentage of her sales.
The businesswoman was
born and raised in Camden,
north London, where she
went to St Richard of
Chichester School. Her father
was a postman and her
mother a clerical worker.
The young Gokgoz worked
in the personnel department
of Xerox, then at Thomson
Financial. Now 52, she lives in
Higham Ferrers,
Northamptonshire, with her
husband, Ali, their two
children and their Labrador,
Oscar.
Gokgoz advises
entrepreneurs to sleep on an
idea before committing to it.
?When you wake up in the
morning, does it still make
sense? If it does, go for it.?
Liam Kelly
Jane Gokgoz?s best decision
was to make her own goods
Following up
When a business is
accelerating we will turn on
the tap as much as we can.
Our job is to make money
work, so why wouldn?t we
put more behind them?
Wish I saw fewer . . .
Want-repreneurs ? people
who have got ideas for a
business but haven?t proven
anything yet.
Next disrupted industry
Content providers.
Consumers have indicated a
desire to unbundle content.
Blockchain might just be the
technology that allows that.
Liam Kelly
10
The Sunday Times March 11, 2018
BUSINESS
Oliver Shah
Babs now life and soul of the party
You have to give Barbara
Judge full marks for
chutzpah, if nothing else.
On Thursday evening,
after a leaked legal report
revealed that she was facing
41 allegations of abusive
behaviour as chairwoman of
the Institute of Directors,
Lady Judge appeared at the
PR firm FTI Consulting?s
annual drinks at Claridge?s.
The party attracted guests
including Jayne-Anne
Gadhia, the boss of Virgin
Money, and Helen Weir, the
outgoing finance director of
Marks & Spencer, but all
attention was on Judge. That
morning, The Times had
reported that she allegedly
made racist remarks and
bullied her assistant, at one
point making her stand on a
staircase for an hour ?whilst
a painter considered the best
light in which to paint a
portrait of Lady Judge?.
The 71-year-old, who
rejected the charges, was
neatly coiffed and dressed in
her trademark ruffled white
blouse and pearl earrings,
but looked under strain.
?More people want to talk to
me tonight than ever before,?
she said, not realising that
this was far from an
unmitigated positive.
Also at the party was
Roger Parry, chairman of
YouGov. The one-time
McKinsey consultant was
nursing a broken rib, having
been whacked by an errant
snowboarder on a recent ski
trip. Undaunted, Parry, 64,
said he was planning a trip to
Whistler soon. To be fair, he
was looking well-padded
enough to absorb the blow.
JUST SAYING . . .
There appears
to be a lack of
competition
in a key
part of the
financial system
Good times
for Morrissey
Murdo Murchison,
chairman of investor
Kiltearn Partners, raising
concerns about auditing to
MPs investigating the
collapse of Carillion
City superwoman Helena
Morrissey has been out and
about to promote her book,
A Good Time to be a Girl, a
manifesto for change that
challenges the ?lean in?
LETTERS
philosophy championed by
the likes of Sheryl Sandberg.
Morrissey, 51, head of
personal investing at Legal &
General, gave a breakfast talk
in parliament last Tuesday.
The keen Brexiteer enthused
about Theresa May?s latest
speech. She also revealed
that some people had
mistaken her book for a
racier memoir ? reading the
title as A Good Time Girl.
Perhaps that?ll be the sequel.
Pitch perfect for
West Ham
The latest accounts for West
Ham paint a rather rosy
picture of the football club?s
fortunes in 2016-17.
They mention the
?retention of FA Premier
League status? (11th place),
the ?highest income in the
club?s history for the fourth
year in succession? and ?a
satisfactory move and first
season in the new London
Stadium?. Baroness (Karren)
Brady, West Ham?s vicechairman, glows about
52,000 season ticket
renewals and says that ?the
management team off the
pitch were able to capitalise
and maximise on all the
opportunities the manager
and the team delivered on
the pitch?.
Some fans might struggle
to recognise that version of
events, given the bumpy
move from Upton Park to the
vast London Stadium in
DATABANK
Stratford, with its corporate
feel and running track
around the pitch.
One fan?s blog, The H List,
has described a ?tinderbox
atmosphere that exists
between us and the owners?.
There have also been online
skirmishes between rival
supporters? groups, one of
which contains elements
from the notorious Inter City
Firm hooligan outfit, ahead
of a mooted protest march.
The accounts show that at
least West Ham?s bosses are
being looked after: the
highest-paid director ?
unnamed ? took home
г868,000 last year.
Barclays drama
that never ends
Philip Augar, the Schroders
banker-turned-City
historian, has penned a new
tome. Augar, 66, is best
known for his story of how
the Big Bang transformed the
Square Mile in the 1980s, The
Death of Gentlemanly
Capitalism.
His latest book tackles
Barclays, which he dubs The
Bank that Lived a Little.
The account of Barclays?
rollercoaster progress will hit
the shelves in July, but there
could be a few more twists to
come: the bank and its
former boss, John Varley,
have yet to stand trial in the
Serious Fraud Office?s
blockbuster case over the
2008 Qatari bailout.
SIGNALS
AND NOISE . . .
Send your letters, including
full name and address,
to: The Sunday Times,
1 London Bridge Street,
London SE1 9GF. Or email:
letters@sunday-times.co.uk
Letters may be edited
Government has a big role
to play in divorce
In his piece about happiness
and its effects on families
(?Don?t worry, be happy ?
even when confidence is
weak?, last week), David
Smith said: ?The break-up of
relationships is a big cause of
unhappiness . . . there is not
much that government policy
can do about it.?
We at the Family Practice
Press disagree: there is a huge
amount that government can
do to stop break-ups, but at
the moment it has charged
the management of family
break-ups to lawyers.
Lawyers require payment
for their services and the
main method by which they
can obtain their fees is by the
sale of the family home,
which, of course, requires the
family to break up.
Family lawyers are
supposed to recommend
mediation before divorce, but
routinely they ignore this part
of the process as it is not feegenerating.
The current no-fault
divorce process is exactly
that: no fault.
Thus any problems within
the family, be it stress,
alcoholism, fatigue or drug
abuse, are left hidden and
After building her fortune in
lingerie, Michelle Mone is
moving into cryptocurrency.
However, it?s not to make
another pile of cash for
herself, says Baroness Bra
NEWS REVIEW, PAGE 29
TWITTER POLL
Yes
No
45% 55%
Should MPs have the
right to meddle in the
takeover tussle between
Melrose and GKN?
@ST_Business
untreated. The divorce puts
more strain on all the parties
including the children, and
the cost to the NHS in
particular is huge.
Lawyers should lose the
franchise to manage family
law and the government
should take this in-house and
use government money to
pay lawyers? fees on a fixedrate basis. This would cause a
rise in spending to start with,
but in time, the overall
savings will be huge,
compared with the estimated
г2.5bn lawyers are making at
the moment.
Keeping families together
and solving problems within
the relationship should be a
major plank of government
policy. If divorce is
recommended then it should
be handled with care and
dignity for all the parties,
particularly the children.
Julian Nettlefold, The Family
Practice Press, London
BESTSELLING BOOKS
The only way is up ? on the
wings of a dove
The Bank?s deputy governor
sees swifter rate rises (?Sir
Dave Ramsden: the dove who
became a rate hawk at
Threadneedle St?, February
25) . Getting real interest rates
to a sustainable level is an
important medium-term
need for the UK economy.
So another few steps in the
right direction would be
helpful. It could even
increase real growth by
helping sterling.
Nicholas Beale, Chairman,
Sciteb, London W1
THE WEEK IN THE MARKETS
INSIDE THE CITY JOHN COLLINGRIDGE
Trump?s trade tussle will
turn into a Chinese burn
So, Trump threatens
European car makers with
trade war (?Trump tariffs will
hurt America, warns USA
Inc?, last week). If Trump
wants to start a trade war
with China he?ll soon find out
who ?wears the pants? when
the Chinese strangle the US.
Paul Morris, Warton, nr
Tamworth, Warwickshire
1
The Chimp Paradox
Steve Peters
Vermilion (6,542)
2
Crushing It!
Gary Vaynerchuk
Harper Business (3,995)
3
4
5
Elon Musk
Ashlee Vance
Virgin Books (3,248)
6
Little Black Book
Otegha Uwagba
Fourth Estate (1,946)
7
Strengths Finder 2.0
Tom Rath
Gallup (1,805)
A Good Time to be a Girl
Helena Morrissey
William Collins (2,500)
Black Box Thinking
Matthew Syed
John Murray (1,962)
Rich Dad Poor Dad
Robert T Kiyosaki
Plata Publishing (1,804)
8
9
10
Principles
Ray Dalio
Simon & Schuster (1,755)
Build It
Glenn Elliott & Debra Corey
John Wiley & Sons (1,734)
Bestseller List prepared by Nielsen
using data supplied by and copyright
to Nielsen BookScan, taken from the
TCM for the four-week period
February 4 - March 3, 2018
THE ECONOMY
Consumer prices index
First
struggles
to stay on
the rails
he tries to tackle this debt
mountain. Refinancing it
gradually at cheaper rates will
help, lopping г14m from its
interest bill, but First is only
just getting started with that.
Trading is hardly helping.
Last month, the company
said that more Americans are
switching from its Greyhound
long-haul coaches to budget
flights, driving the division?s
revenue down almost 3%.
Little wonder, then, that
First?s shares are wallowing at
85.4p, giving a value of just
г1bn. At that level, the
company has attracted an
activist, the Canadian fund
West Face Capital, which
wants to use its 5% stake to
force a break-up.
First?s UK rail operations
look, at first glance, like a rare
bright spot, growing revenues
by 3.2% between September
and January, but even that is
It is almost five years since
bus and rail operator
FirstGroup begged
shareholders for г615m of
cash. The deeply discounted
rights issue in May 2013 was
aimed at repairing a balance
sheet straining under almost
г2bn of debt after a US
acquisition in 2007.
So, how much has
changed? The company has
not paid a dividend since the
issue. Debt still hangs heavily
around its neck, standing at
г1.2bn in September, and is
still the opening topic of
conversation for investors.
That net debt tally does not
tell the full story, as it is
flattered by г384m of cash
that First cannot touch ?
deposits on railway season
tickets. So the real number is
more like г1.6bn.
Tim O?Toole, the chief
executive since 2010, has
been running on the spot as
FirstGroup
160p
140
120
100
80
60
M AM J J A S ON D J F
Source: Thomson Reuters
not fast enough. Handily, it?s
still got the lucrative Great
Western franchise, which
began in 2006. Last year, the
government said First may be
handed a new deal until
2024, without a competition.
The TransPennine
franchise was won in 2016 on
a promise to grow revenues
by 12% a year. First would pay
the government г303m in
premiums over the life of the
deal, and set aside about
г190m capital to cover the
risk that it might fail to deliver
these payments.
Its 70% share of the South
Western Railway operation,
which promised г2.6bn in
premiums, was based on
growth of about 7% a year.
First has about г60m of risk
capital at stake there.
Yet neither route is growing
as fast as hoped ? about 9%
for TransPennine, and about
3% for South Western. New
trains will help, but the recent
East Coast failure offers a
salutary lesson: miss a
compound growth target and
it?s hard to catch up.
Should they fail, that?s
г250m at risk. In that event, I
can?t see shareholders
supporting another rescue
rights issue. Sell.
@jcollingridgeST
FTSE 100
7,224.51
20,085.07
H:7,792.6
L:7,062.1
154.61
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FTSE 250
698.53
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H:20,984.8
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DOW JONES
25,335.74
NASDAQ
7,560.81
302.94
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H:7,560.8
L:5,769.4
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W 0.00
12-month high: $1.43
low: $1.21
7,400
EURO
EUR > GBP
7,200
?1.13
7,000
M A M
J
J
A
RISERS
Interserve: 78.4p, U 41.6% on debt deal
hopes Smurfit Kappa: г32.20, U 32.5%
on takeover bid Spirent Comms: 126p,
U 22.3% on annual results International
Personal Finance: 234.2p, U 17.7% on
sentiment Indivior: 402p, U 16.4% on
broker upgrade
O N
D
J
F
H:33,484.1
L:23,438.9
FALLERS
Luceco: 57.2p, V 25.7% on falling
forecasts Renold: 34p, V 25.3% on profit
warning Alpha Financial Software: 376p,
V 17.8% on slowing growth Moss Bros:
56p, V 13.8% on analyst downgrade
Headlam: 459p, V 13.6% on broker
downgrade
FTSE EUROFIRST
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H:1,588.0
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CAC 40
5,274.40
ALL ORDS
6,069.10
137.82
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DAX
12,346.68
H:24,129.3
L:18,224.7
S
Source: Thomson Reuters
52.64
1.62%
H:2,872.9
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NIKKEI
21,469.20
7,600
412.76
1.35%
S&P 500
2,786.57
95.32
3.54%
$1.39
7,800
HANG SENG
30,996.21
H:26,616.7
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3.25%
DOLLAR
USD > GBP
FTSE 100
432.97
3.63%
H:3,587.0
L:3,016.5
H:5,567.0
L:4,939.9
H:13,596.9
L:11,831.0
739.80
2.17%
40.70
0.68%
YEN
YEN > USD
е106.77
CPI including housing
Retail prices index
Average weekly earnings
12-month high: е115.50
low: е105.23
OIL
DOLLARS/BARREL
$65.49
U 1.12
12-month high: $71.28
low: $44.35
GOLD
DOLLARS/TROY OZ
$1,321.86
г512
H:16,421.4
L:14,785.8
$9,451.67
V 2,042.83
12-month high: $19,497.4
low: $919.5
Price at 5pm Saturday
3.0%
current rate
prev. month
2.7%
2.7%
current rate
prev. month
4.0%
4.1%
U
Unemployment
1.47m
Manufacturing output
Retail sales
0.2%
U
prev. month
4.4%
4.3%
on the year
on last month
2.7%
U
on the year
U
UK trade
balance (гbn)
Gross domestic
product
Budget deficit
(PSNB) in гbn
2.8%
current rate
U
0.1%
on last month
1.6%
U
0.1%
latest 3 mths
prev. 3 mths
latest 12 mths
-8.7
-5.3
-28.8
latest quarter prev. quarter
U
0.4%
U
0.5%
annual change
U
1.4%
latest month
prev. month
year to date
+10.0
8.7
37.7
10-YEAR BOND YIELDS %
variation
12-month high: $1,359.26
low: $1,200.04
BITCOIN
DOLLARS
prev. month
on prev. month on last year
U 1.04
U 1.79
H:6,256.5
L:5,670.7
S&P TSX
15,577.81
193.22
1.26%
H:36,444.0
L:28,815.0
W 0.00
12-month high: ?1.20
low: ?1.07
current rate
3.0%
1.49
UK
12 months
high
low
U 0.02
1.79
0.93
US
2.90
U 0.03
2.96
2.02
JAPAN
0.05
V 0.01
0.11
-0.01
GERMANY
0.65
W 0.00
0.80
0.16
TOP 200 COMPANIES
Rank by Market cap
49
180
87
191
161
24
50
149
43
28
7
115
127
27
122
30
187
15
86
121
139
110
93
18
106
192
4
3
70
188
25
156
67
61
168
44
196
56
128
165
131
45
22
108
29
80
151
78
158
125
6
89
3i Group
3i Infrastructure
Admiral
Aggreko
Alliance Trust
Anglo American
Antofagasta
Ashmore
Ashtead
Associated British Foods
Astra Zeneca
Auto Trader
Aveva
Aviva
Babcock International
BAE Systems
Balfour Beatty
Barclays
Barratt Developments
BBA Aviation
Beazley
Bellway
Berkeley
BHP Billiton
B&M European
Bodycote
BP
British American Tobacco
British Land
Britvic
BT
BTG
Bunzl
Burberry
Capital & Counties Properties
Carnival
Centamin
Centrica
Cineworld
Close Brothers
Cobham
Coca Cola HBC
Compass
Convatec
CRH
Croda
CYBG
DCC
Dechra Pharmaceuticals
Derwent London
Diageo
Direct Line Insurance
Price Change
on week
922.4
199.4
1914.0
717.2
739.0
1752.2
894.4
395.0
2010.0
2607.0
4785.5
391.9
2060.0
519.4
673.4
601.8
277.0
210.8
548.6
338.8
574.0
3191.0
3856.0
1435.8
423.8
946.0
478.2
4273.5
637.6
716.5
239.4
680.0
2040.0
1667.5
270.6
4738.0
151.5
141.8
239.6
1579.0
133.7
2518.0
1551.5
207.5
2445.0
4632.0
315.4
6835.0
2550.0
3025.0
2446.5
390.4
+16.4
+2.2
+69.0
?13.4
+16.0
+64.6
+51.8
?4.8
+11.5
nc
+49.5
+20.2
+234.0
+21.9
+42.0
+25.8
+17.2
+5.4
+16.2
+6.6
+50.5
+115.0
+91.0
+23.2
+8.8
+62.5
+14.1
+53.5
+10.0
+39.5
+3.2
+36.5
+90.0
+33.0
+9.5
+117.0
+0.5
+0.4
+9.6
+64.0
+10.7
+154.0
+27.5
+2.7
+46.0
+176.0
+17.6
+320.0
+2.0
+125.0
+65.0
+16.6
52-week
Yield
high
low
969.5
214.5
2178.0
983.0
769.0
1843.6
1061.0
433.2
2152.0
3371.0
5508.0
435.9
3054.0
543.5
969.5
677.0
307.6
231.9
700.0
368.8
574.0
3792.0
4240.0
1660.0
434.8
1006.0
534.8
5643.0
691.5
820.0
342.5
779.0
2465.0
1985.0
324.8
5380.0
190.5
222.8
245.8
1715.0
148.0
2671.0
1757.6
344.0
2920.0
4632.0
340.3
7755.0
2560.0
3118.0
2725.0
411.3
700.5
188.6
1784.0
695.4
667.0
959.4
748.0
332.3
1542.0
2484.0
4325.0
319.0
1803.0
486.5
626.2
535.5
253.5
178.9
529.0
292.5
425.0
2687.0
2933.0
1117.0
299.3
739.5
439.8
4195.0
590.5
636.0
225.6
565.0
1936.0
1498.0
253.1
4475.0
131.8
124.1
97.9
1316.0
113.4
1948.0
1425.0
182.0
2380.0
3483.0
260.0
6515.0
1624.0
2580.0
2201.5
333.8
2.9
4.0
2.7
3.8
1.8
2.0
1.6
4.2
1.4
1.5
4.3
1.3
1.9
4.1
4.2
3.5
1.0
1.4
4.4
2.9
1.8
3.5
3.5
4.3
1.4
1.7
6.2
4.0
4.6
3.5
6.0
2.1
2.3
0.6
1.8
7.8
8.5
3.5
3.7
1.3
1.5
2.2
0.5
2.3
1.6
1.6
0.8
1.7
2.5
3.7
P/E
Mkt Cap
(гm)
- 8956.3
- 2039.3
24.0 5450.7
15.2 1836.9
- 2531.6
9.7 24611.7
35.5 8817.6
18.8 2815.3
10.2 10034.4
17.2 20638.9
23.0 60605.9
23.5 3739.4
62.4 3320.9
34.4 20844.8
10.5 3404.7
18.1 19161.2
83.9 1910.6
62.0 35961.9
8.9 5524.4
23.3 3495.6
31.8 3017.6
8.6 3918.5
7.0 5215.8
22.0 30324.1
27.7 4238.0
23.3 1811.2
32.7 95308.4
18.8 98018.7
11.0 6566.1
17.0 1889.1
14.9 23753.0
35.8 2623.0
23.8 6854.4
23.8 7310.0
93.3 2294.1
17.9 9847.7
21.7 1745.4
14.2 7788.8
15.0 3281.6
12.4 2395.4
- 3196.8
26.5 9174.0
21.8 25515.8
35.1 4049.3
17.5 20447.2
28.6 6086.1
18.3 2790.0
30.2 6096.9
55.5 2608.1
31.6 3371.4
19.2 60796.7
16.8 5368.0
Rank by Market cap
176 Dixons Carphone
75 EasyJet
153 Electrocomponents
74 Evraz
35 Experian
37 Ferguson
200 Ferrexpo
120 Foreign & Colonial
46 Fresnillo
107 G4S
60 GKN
5 Glaxo Smith Kline
9 Glencore
186 Grafton Group Units
174 Great Portland Estates
147 GVC Holdings
96 Halma
117 Hammerson
53 Hargreaves Lansdown
193 Hastings
152 Hays
160 HICL Infrastructure
177 Hikma Pharmaceuticals
102 Hiscox
167 Homeserve
134 Howden Joinery
2 HSBC
142 IG Group
135 IMI
23 Imperial Brands
144 Inchcape
143 Indivior
83 Informa
185 Inmarsat
52 Intercontinental Hotels
136 Intermediate Capital
54 Intertek
38 International Airlines Group
184 International Public Partnerships
145 Intu Properties
104 Investec
76 ITV
169 IWG
148 Jardine Lloyd Thompson
113 JD Sports
73 Johnson Matthey
166 Jupiter Fund Management
90 Just Eat
109 Kaz Minerals
58 Kingfisher
130 Ladbrokes Coral
63 Land Securities
Price Change
on week
188.3
1563.0
618.2
437.0
1580.5
5318.0
293.0
652.0
1238.5
262.2
435.1
1336.0
369.8
814.5
670.0
945.5
1212.0
455.4
1720.5
273.0
191.9
142.2
898.4
1510.0
743.5
496.2
705.8
803.5
1141.0
2592.0
693.0
402.0
707.8
432.7
4590.0
1051.0
5052.0
624.0
146.6
211.9
645.0
153.2
246.1
1290.0
385.9
3250.0
504.8
788.4
893.0
350.7
167.8
917.1
?1.8
?14.0
+15.4
?7.3
+60.0
+220.0
?11.2
+16.0
+41.0
+7.9
+15.1
+46.0
+5.3
+30.0
+27.0
+73.0
+46.0
+7.5
+63.5
+2.2
+0.6
?0.8
+40.2
+130.0
+38.5
?5.0
+0.8
+11.5
+17.0
+8.0
+18.5
+18.9
+10.2
?22.7
+136.0
+36.0
+179.0
+9.0
?1.8
+8.0
+31.6
?0.7
+17.1
+2.0
+12.3
+220.0
?2.6
?60.6
+52.8
+2.9
+5.7
+4.1
52-week
Yield
high
low
342.0
1696.0
709.0
455.1
1705.0
5702.0
323.2
672.0
1725.0
341.1
447.6
1722.0
415.0
841.0
739.0
982.0
1330.0
609.5
1928.0
325.0
205.0
174.6
2297.0
1510.0
867.0
501.2
796.0
811.0
1443.0
3933.5
880.5
419.5
761.0
850.5
4928.0
1178.0
5425.0
670.0
166.6
289.0
645.0
219.6
365.2
1448.0
456.0
3503.0
631.4
890.0
965.8
368.1
188.0
1208.5
149.1
977.0
471.2
173.2
1446.0
4460.0
137.2
555.5
1189.5
248.8
294.3
1242.8
276.6
652.0
587.5
708.0
959.5
445.8
1266.0
239.1
155.9
141.1
855.6
1078.0
523.0
399.5
620.8
491.9
1103.0
2576.0
674.5
267.6
629.5
426.1
3668.0
700.5
3855.0
523.5
146.6
194.7
461.4
146.9
190.9
1096.0
303.3
2727.0
413.0
556.5
430.5
288.0
111.3
913.0
3.4
2.0
5.0
2.0
1.9
0.9
1.6
1.9
3.6
2.0
6.0
1.4
1.7
1.5
1.1
5.3
1.7
3.6
1.7
5.5
2.8
1.8
2.1
2.2
5.3
4.0
3.4
6.2
3.4
2.7
9.5
1.6
2.4
1.2
3.6
4.5
6.6
3.6
4.7
2.2
2.5
0.4
2.3
2.9
3.0
1.8
4.6
P/E
Mkt Cap
(гm)
Rank by Market cap
8.9
20.4
25.8
12.3
25.6
15.2
6.9
20.9
14.2
14.9
28.2
12.5
18.8
33.0
8.1
36.5
19.2
18.5
16.8
18.5
31.9
17.4
19.9
15.3
20.5
17.6
14.4
47.5
28.3
12.4
20.3
14.1
29.8
7.6
8.5
12.6
13.4
15.2
20.0
23.9
18.8
16.6
16.3
64.1
17.9
13.4
39.8
2171.6
6208.4
2729.7
6258.1
14531.8
13458.7
1724.7
3531.5
9126.4
4068.3
7472.5
65702.5
53342.7
1930.1
2189.1
2842.8
4595.7
3612.3
8160.6
1795.5
2783.8
2561.7
2161.1
4314.6
2310.1
3123.1
141130.7
2956.0
3103.2
24720.9
2890.3
2900.3
5832.3
1973.3
8720.5
3051.1
8153.5
12779.8
1978.8
2871.3
4299.8
6166.9
2250.3
2825.6
3755.7
6289.8
2310.5
5355.6
3989.2
7581.8
3215.3
7252.0
33
11
36
150
98
97
118
101
198
112
129
51
195
62
199
91
182
20
159
66
65
114
40
82
154
175
55
133
162
124
68
13
84
14
170
16
119
94
111
10
140
32
163
17
1
85
123
71
59
92
Price Change
on week
52-week
Yield
high
low
Legal & General
262.5
+9.1 276.8 245.0
Lloyds Banking Group
67.3
+0.3
73.1
62.2
London Stock Exchange
3936.0 +99.0 4085.0 3014.0
Man
172.4 +10.9
217.7
142.3
Marks & Spencer
277.7 ?9.0 395.5
277.7
Mediclinic International
617.4 +43.0 887.0 507.5
Meggitt
463.0 +16.8 526.0
437.1
Melrose
224.7
+9.2
261.2
198.8
Mercantile Investment Trust 2140.0 +75.0 2210.0 1796.0
Merlin Entertainments
373.1 +21.5 537.0
318.4
Metro Bank
4018.0 +62.0 4040.0 3212.0
Micro Focus International
2023.0 +35.0 2739.0 1988.0
Millennium & Copthorne Hotels
548.0 +12.0 625.5
431.9
Mondi
1984.5 +73.5 2130.0 1693.0
Monks Investment Trust
807.0 +29.0 825.0
617.5
Morrison Supermarkets
227.9
+5.2 252.9 207.0
National Express
388.2 +25.0 395.2 340.9
National Grid
783.7 +44.5 1157.5 736.8
Nex Group
676.5
+4.5 684.0 558.0
Next
4772.0 +92.0 5320.0 3617.0
NMC Health
3514.0 +182.0 3524.0 1744.0
Ocado
594.0 +50.8 594.0 238.5
Old Mutual
256.5 +10.5
257.8
188.0
Pearson
751.4 +32.6 753.6 566.5
Pennon
639.2 +30.4 944.0 608.0
Pershing Square
929.0 ?2.0 1250.0 920.0
Persimmon
2597.0 +13.0 2890.0 2073.0
Phoenix Group Holdings
797.5 +23.0
815.0 724.0
Playtech
792.0
+4.6 1016.0
751.8
Polymetal International
785.0 +31.0 1095.0 740.6
Paddy Power Betfair
7885.0 ?410.0 8900.0 6665.0
Prudential
1846.5 +56.0 1981.0 1613.0
Randgold Resources
6034.0 +94.0 8190.0 5766.0
Reckitt Benckiser
5810.0 +120.0 8108.0 5624.0
Redrow
608.5 +30.0 664.5 493.3
Relx
1512.5 +45.0 1782.0 1455.0
Renishaw
4910.0 +310.0 5775.0 3050.0
Rentokil Initial
272.4
?0.1 335.8 237.6
Rightmove
4300.0 +105.0 4573.0 3889.0
Rio Tinto
3726.5 +88.0 4172.5 2910.0
RIT Capital Partners
1930.0 +30.0 2005.0 1815.0
Rolls-Royce
925.8 +108.4
981.0 743.0
Rotork
283.1 ?4.0 304.2 223.5
Royal Bank of Scotland
261.8
+4.2 302.4
224.7
Royal Dutch Shell A
2261.5 +12.0 2573.5 1992.5
Royal Dutch Shell B
2287.5
+8.0 2609.0 2052.5
Royal Mail
566.6 +27.2 570.0 369.9
RPC
831.8 +57.6 993.0 720.5
RSA Insurance
635.2 +21.8 666.5 570.5
Sage
695.8 +33.8
821.4
615.5
Sainsbury, J
243.0 ?10.0
281.7 224.8
P/E
Mkt Cap
(гm)
5.6 8.6 15641.5
4.0 15.6 48496.0
1.1 46.4 13649.4
4.1
- 2808.9
6.7 24.4 4511.9
1.3 66.4 4550.3
3.3 12.4 3591.7
1.0
- 4361.9
2.4
- 1736.8
1.9 18.0 3790.0
- 318.9 3230.2
3.6 39.3 8801.6
1.4 16.0 1779.6
2.5 17.5 7287.9
0.2
- 1736.6
2.4 15.1 5323.0
3.2 16.9 1986.6
5.8 15.8 26373.5
5.7 36.8 2568.9
3.3 11.2 7017.5
0.3 57.1 7178.6
- 3712.5 3750.7
2.4 16.2 12652.6
6.9
- 5888.0
5.6 14.6 2661.9
- 2179.9
5.2 11.6 8022.1
5.8
- 3133.1
3.6 12.7 2513.4
2.6 12.4 3376.4
1.9 48.5 6641.2
2.4 17.3 47774.2
1.2 27.4 5671.7
2.6 19.5 40841.1
2.8 7.8 2250.2
2.5 18.6 31337.9
1.1 26.0 3573.9
1.2 7.3 5004.9
1.2 29.8 3912.6
4.6 10.4 50067.6
- 3001.4
0.5
- 17036.0
1.8 32.5 2463.4
- 31327.0
6.2 23.3 189642.2
6.2 23.6
4.1 15.9 5666.0
2.9 16.3 3393.0
2.5 56.7 6495.5
2.1 29.3 7520.8
4.2 25.3 5320.9
Rank by Market cap
47
69
81
103
138
19
26
88
41
72
171
57
164
132
105
181
39
141
21
79
42
197
157
77
178
31
189
137
126
48
155
116
173
12
194
95
179
172
8
100
64
146
190
183
99
34
Schroders
Scottish Mortgage
Segro
Severn Trent
Shaftesbury
Shire
Sky
Smith (DS)
Smith & Nephew
Smiths
Smith WH
Smurfit Kappa
Sophos
Spectris
Spirax-Sarco
Sports Direct International
SSE
SSP
Standard Chartered
St James's Place Capital
Standard Life Aberdeen
Synthomer
Tate & Lyle
Taylor Wimpey
Templeton Emerging Markets
Tesco
Thomas Cook
TP Icap
Travis Perkins
Tui
Tullow Oil
UBM
UDG Healthcare
Unilever
Unite Group
United Utilities
Vedanta Resources
Victrex
Vodafone
Weir
Whitbread
William Hill
Witan Investment Trust
Wizz Air Holdings
Wood
WPP
Price Change
on week
3404.0
473.6
599.0
1826.0
983.5
3192.5
1338.0
510.2
1331.0
1610.0
2038.0
3220.0
530.0
2633.0
5780.0
367.0
1257.0
626.5
778.9
1153.0
370.4
511.0
563.0
188.1
781.0
212.7
122.1
546.6
1319.5
1532.0
191.2
930.0
889.0
3894.5
795.0
702.6
752.0
2576.0
207.0
2002.0
3932.0
331.7
1054.0
3444.0
656.6
1204.5
+57.0
+22.4
+26.8
+104.0
+21.5
?13.0
?35.5
+50.4
+67.0
+57.5
+54.0
+790.0
+45.4
+13.0
+215.0
+10.4
+43.0
+30.5
?1.1
+44.5
+4.2
+38.4
+8.6
+2.0
+14.0
+10.7
?0.3
+22.8
+46.5
+14.0
+15.0
+10.0
+69.0
+182.0
+29.5
+39.8
+41.0
+96.0
+8.0
+102.5
+133.0
+16.4
+28.0
?89.0
+58.2
?61.5
52-week
Yield
high
low
3773.0
477.0
603.8
2553.0
1055.0
4937.0
1373.5
558.5
1431.0
1685.0
2347.0
3220.0
669.5
2834.0
5920.0
419.5
1551.0
687.5
849.2
1270.5
446.3
513.0
795.0
211.2
825.0
214.4
129.5
553.6
1696.0
1640.5
251.2
930.0
959.0
4548.5
813.0
1056.0
954.0
2730.0
238.0
2305.0
4307.0
338.0
1108.0
3716.0
828.5
1754.0
3030.0
352.2
452.5
1703.0
900.0
2992.0
900.0
418.8
1215.0
1444.0
1664.0
1962.0
263.5
2229.0
4667.0
284.5
1182.0
404.0
685.9
1030.0
360.0
455.3
554.4
174.9
643.0
166.5
84.1
444.8
1273.0
1068.0
145.6
645.0
694.0
3710.5
622.0
659.0
575.0
1832.0
198.8
1727.0
3512.0
240.0
944.0
1615.0
560.0
1204.5
P/E
Mkt Cap
(гm)
2.7 17.8 9018.0
0.6
- 6594.5
2.8 6.1 5980.4
4.5 14.8 4310.4
1.6 9.1 3018.2
0.7 9.3 28979.6
- 28.3 23000.4
3.0 25.1 5444.9
1.7 20.5 11642.5
2.6 11.3 6367.1
2.2 19.7 2245.0
2.2 21.8 7625.6
0.6
- 2442.6
2.0 283.1 3138.9
1.3 32.7 4250.6
- 13.1 1989.0
7.3 9.4 12675.6
1.0 32.6 2977.3
- 45.2 25678.6
2.9 48.7 6094.6
5.5 12.5 11028.2
2.2 16.6 1736.8
5.0 10.6 2621.9
1.5 11.5 6154.5
1.1
- 2114.5
- 38.0 17415.3
0.4 152.6 1875.3
3.1 34.6 3028.9
3.4 439.8 3326.4
3.7 12.5 8993.4
- 2653.9
2.4 26.7 3665.1
1.1 41.4 2207.6
3.2 20.4 47971.2
2.3 9.2 1784.2
5.5 11.2 4791.0
5.5
- 2083.8
1.8 22.2 2210.4
6.4
- 55214.8
2.2 67.2 4369.4
2.4 15.3
7211.1
3.8
- 2848.9
2.1
- 1865.3
- 21.0 1979.5
3.9
- 4449.7
4.7 8.9 15286.7
Price/earnings ratios are based on historic data, with yield and p/e values
calculated from the most recent reported dividends and earnings per share,
using trailing 12-month figures. 52-week highs and lows are end of day.
nc = no change Data provided by Morningstar. Any enquiries please contact:
dataquestions.uk@morningstar.com
MONEY
11
The Sunday Times March 11, 2018
MONEY
?GIVE US OUR
BITCOIN PROFITS?
PAGE 14
DON?T GET BURNT
BY YOUR ENERGY
SUPPLIER
PAGE 12
12
14
THE MASTERCHEF
FRAUDSTER
JILL INSLEY,
PAGE 16
PUZZLES
CROSSWORDS,
SUDOKU & MORE
PAGES 18-19
Follow us on Twitter @ST_Money
The march of the silver strivers
ANDREW FOX
A quiet retirement
isn?t for everyone.
More than 1m
people are working
beyond their late
sixties ? and many
of them are loving it,
says Nicholas Hellen
A
s an architect and town planner, Peter Stanway, 72, is
helping to design a block of
flats overlooking the zebra
crossing that appears on the
cover of the Beatles? Abbey
Road. Although he started
drawing his state pension at
70, he still works between
30 and 50 hours a week and
has no plans to retire until he is 80.
Stanway, who was born a few weeks
after VE Day in 1945, is part of a new
demographic ? the silver strivers. These
are the baby boomers who, when they
reached state pension age, simply kept
on working.
He says he enjoys the best of all worlds.
?Everything?s been paid for. I have some
really interesting friends and I?m still in
good nick healthwise.?
There are about 1.3m silver strivers, up
by 720,000 since the start of the millennium. Their numbers have swelled since
2011 when the government scrapped the
default retirement age. It means about
one in eight people who reach state
retirement age carry on working.
Some are in positions of power and
influence across society. Sir Martin Sorrell, chief executive of WPP, who turned
73 last month, was the highest-paid
FTSE 100 boss in 2017; Lord Hall, 67, is
director-general of the BBC; and Richard
Park, 70, is in charge of programming for
the pop stations Heart and Capital as well
as Classic FM and LBC.
Even Roger Daltrey, 74, lead singer of
the Who, will play in California on Tuesday, 53 years after he first belted out the
line: ?I hope I die before I get old.?
Sir Steve Webb, who as pensions minister oversaw the scrapping of the default
retirement age, said: ?The rise in employment of the over-65s has been absolutely
remorseless since the turn of the century
? apart from the impact of the 2008
financial crash ? especially for men.?
Webb, who is now director of policy at
the insurer Royal London, added: ?The
growth in older workers is not a passing
fad but a major feature of our labour market, and one where policy thinking is not
sufficiently developed.?
Stanway?s father stopped work as an
engineer at the age of 63 ? and indulged
his passion for horse racing and betting
for more than three decades after that.
He and his wife both lived to 96.
As life expectancy rises, that length of
In top gear: Peter Stanway?s work as an architect and town planner helps fund the costs of his two classic Jaguar E-types
Everything?s been
paid for. I have
really interesting
friends and I?m
still in good nick
healthwise
retirement is not sustainable for the public finances. Talk of raising the state pension age to 70 and beyond generates
politically toxic headlines about working
until you drop, yet Stanway and many
others like him are happily continuing
beyond that age.
As policy makers fret about the burdens of an ageing population, the quiet
success of the silver strivers could show
the way forward for many of us.
Stanway, whose wife, Jan, is 70 and
still working part time, bridles at the
word ?striver?. He enjoys his work and
has an active social life, and both his
grandson and an infant granddaughter
come to visit at the couple?s home in
south London. ?My grandson, who is 3╜,
sometimes like to watch me work.?
Carrying on working helps Stanford
afford his hobby of running two classic
E-type Jaguars. ?I?m comfortable, not
complacent,? he said.
Most of those working beyond pension
age are doing so for positive reasons
rather than financial necessity. More
than two-thirds enjoy their job and more
than a third continue in order to keep fit
and active, according to the English Longitudinal Study of Ageing data panel.
Only a little more than a quarter said they
could not afford to stop working.
They tend to be in good jobs: more
than a third are in managerial or profes-
STAYING ON AT WORK?
HERE ARE SOME DOS AND DON?TS
How do I square it
with my employer?
You can usually work on as
long as you want, but your
employer can force you to
retire if the job requires
certain physical abilities,
such as in the construction
industry, or if it has an age
limit set by law, such as in
the fire service.
You can ask your
employer for the right to
work more flexibly or
part time, but they have the
right to reject the request.
Should I draw my state
pension while I am still
in paid work?
You can, but this might push
you into a higher tax band,
meaning some of your
income could be taxed at
40% or, if you are a high
earner, at 45%. The extra
income from the state
payout could also affect
your eligibility for
means-tested benefits.
If you delay taking your
state pension, you will
receive a bigger sum ? the
government increases the
payout by about 5.8% for
each year deferred.
Should I delay drawing
my private pension?
If you have a pension pot
with which you are planning
to buy an annuity, then
delaying the purchase will
boost your annual income
in retirement.
According to the annuity
income calculator on the
Pension Wise website ?
bit.ly/pwcalculator ? if you
have a г50,000 pension
pot and use it to buy a
standard annuity you would
get, at age 65, a tax-free
lump sum of г12,500 and
an annual income of г2,000
a year.
If you delayed buying an
annuity until age 70, you
would receive a tax-free
lump sum of г12,500 and
income of г2,300 a year.
You will also give yourself
more time to build up your
pension pot through further
contributions, tax relief and
employer contributions.
This also applies if you
decide to move your
pension into ?drawdown?
rather than buy an annuity.
Can I continue to pay into
my private pension?
If you have not taken your
tax-free lump sum nor
drawn your private pension,
you can contribute up to
г40,000 a year provided
you have sufficient earnings.
Tax relief is only available
up to age 75.
If you have accessed
your pension, this may
trigger the money purchase
annual allowance, which is
capped at г4,000 a year.
You cannot recycle your
tax-free lump sum by
withdrawing it then paying it
back into your pension pot.
What are the perks of being
a silver striver?
Once past state pension
age, you no longer pay
class 1 and class 2 national
insurance contributions
on your wages, so your
take-home pay is higher.
You will have to pay
class 4 contributions if you
have taxable profits from the
year you reach state pension
age, but the following year
you will be exempt.
There are also transport
freebies on offer. In London,
the over-60s are entitled to
free travel on most public
transport, including buses,
Tube, Docklands Light
Railway, London
Overground and Transport
for London rail, including at
peak commuter hours.
Across England you can
get a bus pass for free travel
when you reach state
pension age. In Wales, you
can get a bus pass at 60. In
Scotland, national and local
bus travel is free for the
over-60s with a national
entitlement card.
In Northern Ireland,
senior citizen smart passes
are available for those aged
65 and over.
sional work. Brian Beach of the International Longevity Centre UK said twothirds were in white-collar jobs and onethird in blue-collar occupations. They
tend to be well-off: almost one-fifth are in
the richest 10th for non-pension wealth.
This population group is concentrated
in southeast England, followed by the
east, with the lowest proportion in the
northeast.
Les Mayhew ? a professor at Cass Business School at City, University of London
? is the author of The Dependency Trap,
which urges the government to do more
to promote active ageing. He points out
that about half of over-70s have a longterm illness or disability, so will struggle
to join the silver striver ranks.
Mayhew has obtained official figures
showing that although two-thirds of men
working past the state pension age are
part-timers, their earnings hold up well
until age 69. They average about г26,000
at 66, г23,000 at 67, г23,500 at 68 and
г22,500 at 69.
Even this understates how well off this
group are, because they do not have to
pay national insurance and more than
90% of them simultaneously draw their
state pension (even though it might make
more sense to defer it). Many also receive
free public transport, although restrictions on peak-time travel vary.
Might the rise of the silver strivers ease
tensions between the generations? The
government insists their progress benefits everyone: countries with higher employment rates for older people also
maintain higher employment rates for
younger. By staying at work, they ease
the tax burden on the young, because
13.5% of silver strivers are higher-rate
taxpayers, about three times the proportion among the retired population.
Yet not everything is rosy. Baroness
Altmann, who served as pensions minister in 2015-6, says the trend to selfemployment among older workers is a
sign of age discrimination by employers.
She points out the pensions system
gives GPs and other well-paid public sector workers an incentive to retire early to
avoid the financial penalties of exceeding
the г1m lifetime saving allowance. The
sum is calculated by multiplying the
annual pension by 20, regardless of the
age at which income is taken. Someone
who retires at 55 on г45,000 a year does
not breach the cap, whereas taking
г50,000 a year from the age of 60 does.
For many women, by contrast, the
idea of working at an enjoyable job in
their late sixties remains a pipe dream.
Women are more likely then men to
take on caring duties in their fifties and so
struggle to hold on to a job until state pension age. If they stay in work beyond
then, their earnings are modest. At 65
they average г14,500 a year, dropping to
about г12,000 a year by 69.
Webb said: ?If there was one single
thing government should do that would
help more older women working, it
would be to support older carers.?
As Mayhew puts it: ?They may still be
striving but for many of them the rewards
will not line their pockets with silver.?
@nicholashellen
YOUR STORY
Will you keep working when
you are in your seventies?
Email money@sundaytimes.co.uk
12
The Sunday Times March 11, 2018
MONEY
BRIEFING
HOUSE PRICE GROWTH REGULATOR MOVES TO TESCO BLOCKS CARDS
AT FIVE-YEAR LOW
REDUCE ENERGY BILLS AFTER HACKING SCARE
If you would like to receive the
free weekly Money email bulletin,
visit thesundaytimes.co.uk/
moneybulletin. The bulletin is
exclusive to digital subscribers.
UK house prices rose by 1.8%
in the 12 months to February,
according to the Halifax
house price index ?the
lowest rate of growth in
almost five years.
The average property
is now worth г224,353,
down from г226,408 in
November.
Halifax said it expected
property price growth to
remain subdued in the
months ahead, but added
that low mortgage rates
and a shortage of properties
for sale would continue to
support prices.
Contact us Money,
The Sunday Times,
1 London Bridge Street
London SE1 9GF
Email money@sundaytimes.co.uk
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buy an advertisement in Money,
email Paul Douglass at
paul.douglass@news.co.uk
or call him on 07917 598 422
The energy regulator Ofgem
wants to cut the amount
paid by consumers towards
network upgrades. This will
reduce bills by an estimated
г15-г25 a year.
WINTER WARMER FOR
BENEFIT CLAIMANTS
About 2m people in receipt
of certain benefits will be
entitled to receive cold
weather payments of г25
each following the recent
cold snap.
Tesco bank cancelled some
customers? credit cards
because of fears their
accounts may have been
hacked by fraudsters. The
bank alerted the customers
by text message, telling
them they will have to wait
up to a week for replacement
cards to be issued.
It is understood that
only about 2,000 of Tesco?s
3m credit card users are
affected. In 2016, it had
to refund г2.5m after a
cyber-attack that affected
about 9,000 current
account customers.
NEW REFUND RIGHTS HOW THE FOOTSIE
FOR RAIL PASSENGERS HAS PERFORMED
Far too many
care home
residents
have been
subject to
hidden fees
Caroline
Dinenage,
minister for
health and
social care
Rail passengers will, from
today, be able to claim
refunds for extra costs they
incur as a result of a delayed
train, such as taxi fares or
hotel bills. Previously, a
clause in the National Rail
Conditions of Travel said
train companies were not
liable for ?consequential
loss?, other than in
?exceptional
circumstances?. This has
been replaced with a line
saying passengers can claim
using their statutory rights
? for example, under the
Consumer Rights Act 2015.
Don?t panic ?
you might not
have to pay that
г1,000 gas bill
Can?t understand
why your energy
supplier is asking
for so much of your
money? Challenge
it, says Ali Hussain
Households are being urged to challenge
unexpected payment demands from
their gas and electricity suppliers as figures show the number of complaints
against energy firms has almost tripled in
the past five years.
Money has learnt 30,800 complaints
were lodged with the energy ombudsman in 2016, up from 12,325 in 2013.
Three-quarters of these relate to bills.
In just over half of the 2016 cases (51%),
customers were found to have been correct in their dispute with a supplier, the
ombudsman said.
A particular gripe concerns ?back billing? ? when consumers are hit with
financial demands dating back some
time. A customer may have switched to
another company believing they have
settled all outstanding debts, only to
receive a payment demand out of the
blue from their former supplier.
Ofgem says such ?shock bills? are
typically about г1,160, but there have
been extreme cases in which suppliers
have demanded up to г10,000, leaving
customers struggling with debt.
Under new rules announced by the
regulator last week, suppliers will be
banned from demanding payments for
energy used more than 12 months ago.
Consumers are being warned to
expect a surge of such demands before
the rules take effect in May ? and urged
not simply to accept them.
?You should always check your bill
carefully and get in touch with your supplier if you notice something that doesn?t
seem right,? said Lewis Shand Smith,
chief ombudsman.
?If you think a bill you receive is incorrect, or it refers to energy use from more
than a year ago, you should speak to your
provider right away.?
There is already a voluntary agreement in place not to back-bill past 12
months, but only the big six suppliers
(British Gas, Eon, EDF, Npower, SSE and
Scottish Power) are signatories.
The FTSE 100 rose 155 points to end the week at 7,225 as
fears of a global trade war receded and the US released
better than expected jobs data.
-1.2%
over a year
(up 2.4% with dividends)
+5.1%
over three years
(up 17.9% with dividends)
+11.4%
over five years
(up 34.4% with dividends)
10 years
+26.8% over
(up 84.4% with dividends)
Inflation: in January CPI was 3% and RPI was 4%
?There was just no way
we could have racked
up such large charges?
A switch away from
the big six was
meant to save my
family money. Then
the extra demands
began to arrive . . .
SIMON
DUKE
Suppliers are being banned from billing for energy used more than a year ago
The new rules will force the 60 or so
smaller suppliers that are not part of the
agreement to fall into line.
The back-billing problem can result
from glitches in a supplier?s billing system or from firms estimating charges
until they have an actual meter reading,
said Ofgem. Suppliers then send a one-off
extra bill to make up the difference.
Under the new rules, suppliers will still
be able to demand payments after a year
in cases where they can show a customer
has actively prevented them from taking
or receiving accurate meter readings ?
for example, by tampering with or
obstructing access to the meter.
While some consumers underpay and
face back bills, others face estimated bills
that are too high, meaning they gradually
build up credit on their accounts.
Scottish Power is the only one of the
big six to offer interest on such balances,
although some small suppliers such as
Ovo and Tonik also pay.
The big six suppliers alone are sitting
on an estimated г1.4bn of customers?
money, according to the price comparison website Energyhelpline.
Mark Todd, the site?s co-founder, said
anyone who had more than about г200
in credit should demand a refund.
The problem of inaccurate billing is
meant to be eliminated by smart meters,
which send information about energy
use in real time straight to suppliers.
The government wants every home
and business to have a smart meter by the
end of 2020. However, the roll-out has
been dogged by delays and cost
increases, so inaccurate estimated bills
could remain a problem for several years.
YOUR STORY
Have you been sent a ?back bill??
Email money@sundaytimes.co.uk
My troubles began with a new year
resolution. It was January 2015 and I
had vowed, as I do every year, to put
my finances in order. This time, it was
going to be different. Really.
As is frequently discussed in the
Money pages, the easiest way to save
money is to switch energy supplier.
Inertia is a money drain for millions
of families, including mine.
For 10 years, my wife and I had been
customers of British Gas, unthinkingly
paying its pricy variable rate tariff. We
were shelling out about г110 a month
for electricity and gas at our
three-bedroom flat in north London.
An internet search revealed a welter
of much more attractive offers, many
from companies I had never heard of.
The cheapest was a г73-a-month deal
from Extra Energy ? a feisty upstart on
a mission to knock the big six off their
perch. The prospect of saving г27 a
month was irresistible; I signed up.
We were not customers of Extra
Energy for long. We moved house in
November that same year and after
providing final meter readings, I
thought little more of the company.
Until May last year. Some 17 months
after cancelling our contract, I
received an email from Extra Energy,
asking for г438.03 to settle our
account. I ignored the request. But it
did not take long for more emails to
arrive, followed by telephone calls.
The demand was plainly
preposterous. The amount of
electricity and gas the company was
trying to bill us for was equivalent to
nearly half of our annual consumption
over the past decade at the flat. There
was absolutely no way we could have
racked up such a large bill, unless we?d
been running a hot yoga studio in our
spare room. Or a cannabis farm.
Extra Energy stood its ground,
insisting our consumption had been
far higher than it had estimated when
we set up our account.
Luckily for us, the energy watchdog
Ofgem has a code that prevents
providers from billing customers for
energy used more than 12 months ago.
This is eminently sensible. Any longer
and it becomes impossible to work out
why a dispute may have arisen.
Yet on one of my many calls to Extra
Energy, a member of staff told me it
had not signed up to the ?back billing?
code. The restriction, she said, was
voluntary and, in any event, had been
designed for the big six, not alternative
suppliers such as Extra Energy.
In June, Extra Energy tightened the
screw, threatening to sue me unless I
paid up. I would be liable for legal fees
if I lost in court, its lawyers warned.
I turned to the ombudsman service
? my final recourse before a legal
showdown. In mid-July, a matter of
weeks after opening my file, the
ombudsman ruled in my favour. It said
Extra Energy should have abided by
the Energy UK Code of Practice for
Accurate Bills, even though it had not
signed up. In September, I received an
apology from the company: ?We agree
that our service has fallen short. It has
taken us too long to put things right
and we?re sorry for this.?
The story, alas, does not end there.
In September and October I received
daily phone calls from two debt
collection agencies and legal letters.
The phone calls have, thankfully,
stopped. But I still receive the
occasional email demanding г438.03
to settle the bill. Extra Energy appears
to have ghosts in its machines.
In total, I estimate that I have wasted
the equivalent of three working days
fending away Extra Energy?s
outlandish demands. It is no surprise
it is being investigated by Ofgem for
exactly the practices I have outlined.
Some of the companies challenging
the big six have excellent reputations
? and beat the established players
hands down on customer service and
price. But there are cowboys out there.
My advice is to venture with care. The
grass is not always greener.
Jill Insley tackles an energy dilemma,
Question of Money, page 16
Forking out more for broadband than
Him Next Door? Here?s how to find out
A new website
uses people power
to expose wildly
varying prices,
writes Ruth Emery
Ever wondered how much
your next-door neighbour is
paying for their broadband?
At a time when customers
can haggle over their bills
and secure a discount ?
perhaps by threatening to
switch to a competitor ? are
you being charged a fair
amount?
New research reveals that
some householders are
paying up to three times as
much as others for the same
services, from broadband to
boiler insurance.
For example, some people
pay just г30 a month for a
Virgin broadband deal,
while others fork out twice as
much for the same package.
This means customers are
overpaying by г360 a year.
Also, some households are
charged г25 a month for a
BT broadband and landline
package, while others are
billed three times as much.
The disparity in pricing
from some of Britain?s
biggest brands has been
unearthed by a new website,
ismybillfair.com. It says it is
the first pricing transparency
site, allowing consumers to
find out if they are paying a
fair rate.
Users input their details
and are told the average,
highest and lowest prices
for the same service, based
on data collected by the
website from other
consumers. About 7,000
people have inserted their
pricing details so far.
The website was founded
by Alex Perrin, a former
pricing director at Virgin
Media who has also worked
at British Gas and the RAC.
It covers energy, telecoms
and breakdown services,
including boiler cover.
If a householder is
unhappy after checking on
ismybillfair.com, the website
will challenge their provider
to reduce their bill. If the user
decides they would prefer
to switch, the site shows them
cheaper alternatives after
searching across the market.
The website makes money
by charging providers for the
personal details of customers
who want a better deal, and
from commission generated
by its switching service ? in
the same way as comparison
sites such as GoCompare
and uSwitch.
?This is a new option for
It?s easier to
have a site
negotiate for
you, rather
than waste
time on the
phone
millions of customers who
simply do not want to move
to a new provider ? they just
want a fairer deal from their
existing company. We will
challenge providers to do
exactly that,? said Perrin.
While some people are
happy to negotiate a better
price with their provider
themselves, the site could be
useful for those who lack the
time or confidence to haggle.
James Daley at the
consumer group Fairer
Finance said it sounded like
?a great service?, but raised
concerns over whether its
revenue model would prove
sustainable.
Research by
ismybillfair.com shows four
out of five customers would
like to have a better deal
with their existing provider
rather than move to a
competitor.
Gordon Smith, 79, from
Edinburgh, used the site to
check how his Virgin Media
bill compared with other
customers? deals. He pays
г143.35 a month for a
Premiere bundle, which
includes unlimited calls
to other UK landlines,
Sky Sports and some Sky
Cinema channels, and fibre
broadband up to 150Mbps.
He discovered he was
overpaying: the website
showed the same package
with Virgin, except with the
added bonus of 300Mbps
broadband, could cost as
little as г94.75 ? giving an
annual saving of г583.20.
Smith said: ?It?s much
easier to have a website
telling you if it?s a good price
and negotiate on your behalf,
rather than waste time
phoning the provider and
being held in a queue.
?I hadn?t thought about
my bills but according to the
website I?m paying a huge
amount, so I would like Virgin
Media to reduce it a wee bit.?
He is expecting a letter
from the company.
13
The Sunday Times March 11, 2018
MONEY
It?s the stock everyone?s raving about . . .
well, that?s a good reason to steer clear
It?s easy to have your head turned by what you read online, but a new study shows the danger of buying into ?hot? companies or sectors
PERSONAL
ACCOUNT
IAN COWIE
I
nvestors can be manipulated by
digital media to overpay for promoted shares. That?s the finding of
new academic research conducted
on both sides of the Atlantic ? but
there is nothing theoretical about
the risk of people being misled
about stocks. Last weekend US
investigators accused the UK stockbroker Beaufort Securities of a
?pump and dump? fraud, which involves
promoting shares to boost demand and
prices before cashing in as clients buy.
(City regulators have closed the firm,
freezing nearly г800m placed with it.)
The research, carried out in London
and Boston and exclusively revealed to
The Sunday Times, shows how prominent placings on Yahoo! Finance can
affect investors? decisions.
Thousands of website users and more
than 300 company announcements
were scrutinised to reveal how share
prices were boosted by the way in which
financial news was presented. Alastair
Lawrence of London Business School
told me: ?A key takeaway from our
research is to be wary of ?hot? stocks and
sectors. So don?t follow the herd, but be
sure to look for good reasons to invest.?
How often do you
think Warren
Buffett looks at
his phone? I?d be
amazed if he has a
hand-held device
James Ryans, also of London Business
School, added: ?Selecting stocks which
are attracting a high level of attention
could mean you get a lower return on
your investment.?
Their field study assessed the share
prices of 169 companies making earnings
announcements over the course of 11
weeks. These businesses were randomly
selected to have news articles about them
shown to financial website users; another
169 companies, selected from a total
group of more than 1,134, were selected
to serve as a control sample.
The effect of media attention on share
prices was found to be more pronounced
for smaller companies ? sometimes
called ?penny shares? ? and those that
normally keep a low profile.
On the day of the earnings announcements, media articles for the random
sample were given prominent positioning on the front page of Yahoo! Finance to
a 1% sample of users, typically boosting
share prices by 2%.
Estelle Sun of Boston University and
Nikolay Laptev of Yahoo! also participated in the research, which was structured so viewers of Yahoo! ? one of the
world?s most popular financial websites
? would not be misled.
Boston
University?s
Institutional
Review Board, London Business School?s
ethics committee and the University of
California?s Office for Protection of
Human Subjects were consulted to
ensure no investors suffered financial
loss as a result of the research. The findings have been presented to the Securities and Exchange Commission, America?s chief financial regulator.
Lawrence urged investors to be wary
TAKE AIM
A WAY TO AVOID
INHERITANCE TAX
? AND SQUABBLES
Anyone who hopes to beat
inheritance tax by giving
away their assets sooner
rather than later should go
and see King Lear first.
As Shakespeare knew,
even apparently doting
adult children may prove
less than grateful once they
have got what they want.
On a brighter note,
you can say what you like
about money, but it does
encourage the kids to keep
in touch.
Another way to avoid this
40% posthumous tax is
provided by a quirk in the
way some shares on the
of having their decisions manipulated by
media coverage, saying: ?Give yourself
time to consider, for example, the company?s profitability, dividend payments
and recent valuations. Although financial
reports are a great source of company
information, they?ve grown enormously
in recent years and the laudable demands
for transparency make them difficult to
digest for the average investor.?
As I have pointed out here before, regulatory requirements for the disclosure
of financial information can have unintended consequences ? and more really
may mean less. Long documents, even
those marked ?Important?, are often
ignored by busy people.
Many reports and accounts may tick all
the corporate lawyers? boxes but be read
by very few shareholders. The 24-hour
news cycle can also present hazards for
investors, as the independent financial
adviser Alan Steel explained: ?We live in
an age of information overload and
knowledge deficiency. How many times a
day do you think Warren Buffett, one of
the world?s most successful investors,
looks at his smartphone? I?d be amazed if
he has any hand-held device apart from
his regular cherry Coke.?
Mark Dampier, a director of the investment firm Hargreaves Lansdown, put it
this way: ?People used to complain about
financial coverage in the newspapers, but
the internet is far worse because the
demand for content is huge and insatiable. There simply isn?t the quality of content to go round. It reminds me of the
launch of satellite TV, which was heralded by some as a great increase in
choice ? until we all realised that most of
the programmes were rubbish.?
The internet is the biggest library that
has ever existed and a great boon for
investors ? including your humble correspondent. When I was a cub reporter 30
years ago, it often took hours to obtain
information that is instantly available
now. However, we live in an era in which
entertainment is valued more highly
than education ? just compare footballers? pay with that of teachers ? and even
some financial media seem to prize
excitement over enlightenment. So it is
vital for investors to remain sceptical
about the information provided, particularly when this appears to be ?free?.
Twits on Twitter sometimes complain
about The Sunday Times?s paywall, but I
always tell them news and views worth
reading are worth paying for; everything
else is advertising. Or, as they say in Silicon Valley: if you don?t pay for the product, you are the product.
Closer to home, common sense
remains the best protection against fraud
and negligent misinformation. Investors
should always ask themselves, ?Who
benefits??, before parting with money.
Steel advises people to do their homework, reading widely to identify profitable trends and to ?ignore the noise
online?. It?s a case of new technology,
same old human nature.
ian.cowie@sunday-times.co.uk
or @iancowie
1,134
2%
Companies studied to see the impact
of media attention on their share price
Typical boost to share prices when
news was placed on Yahoo! front page
ST DIGITAL
Read a breakdown of Ian Cowie?s
?forever? fund
thesundaytimes.co.uk/cowieholdings
Alternative Investment
Market are treated by
HM Revenue & Customs.
AIM companies that are
not involved in agriculture,
financial services or
property can be exempt
from inheritance tax after
you have owned them for
two years, instead of the
usual seven-year
requirement for gifts to
become tax-free.
So people who expect
their estate ? or assets after
all liabilities ? to exceed the
inheritance tax threshold of
г325,000 can shelter assets
from this tax without giving
them away by investing in
AIM shares.
Neil Moles, managing
director of the wealth
manager Progeny Group,
pointed out: ?AIM stocks are
overlooked in inheritance
tax planning because of a
perception problem.
?AIM was set up in 1995 to
help smaller companies
access capital and its 10
stocks had a total value of
г83m. As a result, they
didn?t feature on most
people?s radar.
?Now AIM boasts just
under 1,000 companies
with a total market
capitalisation of г63bn.?
These still tend to be
riskier than those on the
main market but now
include several serious
businesses ? such as the
fashion firm Asos, my
favourite tonic maker
Fever-Tree and the brewery
Young & Co.
So AIM may be worth a
look if you want to have
your cake without worrying
about the taxman eating it.
ILLUSTRATION: VECTOR THAT FOX
14
The Sunday Times March 11, 2018
MONEY
I say pensions
are boggling
? and I?m the
ombudsman
But Anthony Arter
is keen to protect
your pot from scams
and providers? errors,
he tells Ruth Emery
?I find pensions difficult. We all do, don?t
we? There?s just a colossal amount of legislation and so many types of schemes.
It?s a really complicated world.?
It is a surprising confession by
Anthony Arter, a pensions lawyer with
more than 20 years? experience ? and the
person appointed by the government to
investigate complaints about the bewildering and sometimes murky pensions
industry, and to hold companies to
account.
Arter has been the pensions ombudsman for almost three years and runs a
free service with more than 50 staff. It
makes legally binding decisions about
whether savers have been treated
unfairly and awards unlimited compensation.
His role is about to get a lot bigger.
From Friday, the 350-strong complaints
team at the Pensions Advisory Service
(TPAS) will begin to come under the control of the ombudsman.
Essentially, if you have a problem with
your workplace scheme, personal pension or the Pension Protection Fund ? the
government-backed lifeboat for troubled
schemes ? the ombudsman is for you.
The only topics Arter cannot help with is
the state pension (contact the Pension
Service) or the sales and marketing of
a pension (Financial Ombudsman Service).
I meet Arter in his office in Victoria, a
few doors down from the Passport Office
in central London. He apologises for the
draughty setting ? the window is open to
counteract the furnace-like central heating operating on full blast ? and the
cramped conditions. Fortunately, the
team is off to a new office in Canary
Wharf next month.
Most people would agree with Arter?s
description of pensions as difficult, given
that companies operate wildly different
schemes, successive governments have
meddled with legislation, and there are
layer upon layer of tax rules.
Because of the complexity of the complaints, the ombudsman does not promise a quick resolution. Last year the average turnaround time was 10 months.
However, it is now moving towards five
months and, after the merger with TPAS?
complaints team is completed on April 1,
it should become quicker still.
There will be a much bigger workload:
in 2016-17 the pensions ombudsman took
on 1,404 investigations. Arter expects
that to double following the merger.
A number of complaints come from
those with defined benefit pensions who
have decided ? or been persuaded ? to
cash them in for a lump sum and then
come to regret it.
The ombudsman has been flooded
with complaints from members of the
British Steel defined benefit scheme. Last
year Tata Steel offloaded the г15bn
scheme, giving steelworkers in Port Talbot the choice to move to a less generous
plan, fall into the Pension Protection
Fund or cash in their savings.
Arter and his team are investigating
168 cases in which the member is
unhappy with the transfer value calculated by the scheme trustees; this is the
lump sum they can get if they cash in
their pension benefits. Another 54 have
complained about the early retirement
provisions in the new scheme.
So how sustainable are defined benefit
pensions? Nearly all schemes are closed
to new members these days, but they still
dominate the news agenda ? whether it is
lecturers striking over plans to change
the university scheme to defined contribution, in which pensions are subject to
the vagaries of the stock market, or the
construction giant Carillion going bust
last month, leaving an estimated г700m
shortfall in its pension plan.
SIMON CHAPMAN
Bristol lecturers on strike over their pensions. The ombudsman?s office dealt with nearly 1,500 cases in 2016-17, but expects the load to double in the near future
Figures from the Office for National
Statistics last week revealed the total pensions bill for workplace schemes plus the
state pension had risen г1 trillion over the
past five years to г7.6 trillion. Of this,
г900bn is for unfunded public sector
schemes, such as those for teachers and
civil servants, while г2 trillion is for private sector defined benefit plans.
Arter called the numbers ?truly mindboggling?, likening the schemes? ballooning deficits to ?an untamed animal? that
leave an ?enormous pressure on the
Arter: ?When people are promised a 15%
return they tend to have blinkers on?
company?. His solution? ?I personally
would like to see the government taking
away the bells and whistles ? such as the
widow?s pension, children?s protection ?
it?s all a cost. Draw a line and stop the benefits and pay just a basic pension based
on final salary or career average. But I
don?t think it will happen.?
Scams have previously made up a big
part of the ombudsman?s workload, but
last year it received just 35 complaints.
One reason, according to Arter, is that
HM Revenue & Customs is being more
cautious about which individuals it
allows to register pension schemes.
However, the fear is that fraudsters are
coming up with more sophisticated ways
to get hold of savers? nest eggs but, crucially, they stay within the law.
?Savers might go into a scheme that is
within the legal parameters but actually
it?s just as bad as a scam that?s completely
illegal because they?ll never get hold of
their money, or if they do they?ve lost
two-thirds of it or whatever.
?People won?t realise for many years
they can?t access the money. It?s frustrating because I can see exactly what?s going
on, but they?re within the law, so I?m constrained. It could be a big problem in five
to 10 years? time.?
The situation should be helped by a
ban on pensions cold calling being intro-
duced in June, though Arter warns the
British government will have no power to
stop calls coming from overseas, ?of
which there are many?.
?People hear a story where someone
has made some money,? said Arter.
?Their financial adviser warns them it is
not a good investment, but when they
have been promised a 15% or 20% return
they tend to have blinkers on and they
would rather believe the [conman] than
the fussy old adviser who says you?re better off staying where you are, getting 4%.?
He once dealt with a complaint from a
woman who had invested г30,000 in
cryptocurrencies because she had been
promised a 1,000% return. The particular cryptocurrency platform disappeared
and was prosecuted in America for fraud
The woman lost all her money.
As well as a rise in ?legitimate? scams,
Arter predicts he will soon receive more
complaints about the way companies are
automatically enrolling their staff into
pension schemes. Next month the minimum contribution paid by employees
will rise from 1% to 3% of their qualifying
earnings, while employers? contributions will double to 2%.
?It?s another cost for small firms,? he
said. ?It might be something they want to
avoid ? they may ask their employees,
?Do you really need this? You?ve got to
pay a percentage of your salary in. I?ll
look after you?. We?ve had a handful of
complaints but I think we will get more as
people realise they should have been
enrolled and they weren?t.?
There could also be problems with
companies keeping the contributions
and not paying them into a pension
scheme, he added.
Are there any complaints that are
upsetting to deal with? ?Some of the
cases involving death benefits where the
expression of wishes form hasn?t been
updated for years, can be very sad,? he
said. ?[The pension saver] gets remarried
or they live with someone else, and then
they die and the wrong person is getting
the money.?
The ombudsman dealt with 56 disputes relating to death benefits in 2016-17.
?It can be frustrating as I can think personally ?I would give the money to
so-and-so or split it a different way? but as
long as the decision is made in the correct
parameters [by the pension provider or
trustees] there?s nothing I can do.?
Although there are times when Arter?s
hands are tied, he is passionate about his
role in helping people. Unlike claims
management firms that take a hefty commission in trying to resolve complaints,
his service is free. He said: ?I really do try
and protect people as much as I can.?
Platform ?slow to hand over
A leading digital
exchange is taking
months to process
withdrawals,
says Ruth Emery
Investors are struggling to
cash in their profits and
withdraw money from one
of the world?s biggest
cryptocurrency platforms.
Disgruntled users of
Coinbase, billed as ?the most
popular way to buy and sell
bitcoin, ethereum and
litecoin?, complain that the
online exchange instantly
takes their cash when they
want to invest ? but can take
months to process
withdrawals.
Sanjiv Ingle, of Brentwood,
Essex, put г400 into
cryptocurrency through
Coinbase last summer. He
made a profit of almost
г4,500, but hit trouble when
he decided to pull out his
cash in January.
?It?s a little bit of pocket
money for me and my family.
I?ve emailed Coinbase several
times and posted a letter,?
said Ingle, 50, who is head of
client management at a bank.
?It is easy for them to debit
your money and allow you to
purchase more transactions,
but withdrawing money is a
problem. This is a source of
frustration for many
investors.?
Other Coinbase users
voiced their frustration on
Twitter: ?PJ? said he had
been waiting two months to
withdraw his money, while
?Chipsta? tweeted Coinbase
saying: ?When we put money
in, you accept from any
account, when we want to
withdraw we can?t . . . Never
again!?
Coinbase claims to have
more than 10m customers
and is one of the more
reputable names in a market
already notorious for scams.
The problems encountered
by investors raise concerns
over whether it is possible to
make money safely and easily
from this new asset class.
Ben Kumar of the
investment manager 7IM
said: ?Trying to get cash out
of crypto platforms is like
trying to get toothpaste back
into the tube ? not as simple
one way as it is the other.?
Earlier this month Mark
Carney, governor of the Bank
of England, called for
regulation of the burgeoning
sector. ?The time has come
to hold the crypto-asset
ecosystem to the same
standards as the rest of the
financial system,? he said.
The Financial Conduct
Authority has also warned of
the risks of digital currencies,
likening them to gambling
and saying investors
should be prepared
to lose their
money. One
cryptocurrency analyst,
who did not want to be
named, told Money that
Coinbase?s system for
customers to withdraw their
money was ?complicated?
and required ?jumping
through hoops?.
He added: ?The cynic
might conclude that Coinbase
is happy to allow confusion
to reign. No wonder the
authorities are keen to start
regulating crypto exchanges,
given it seems even the most
prominent and respected
presents its customers with
such difficulties.?
Investing in digital
currencies is not for the
faint-hearted. The value of
bitcoin soared to almost
$20,000 (г14,484) in the
run-up to Christmas before
crashing to less than $7,000
last month. Last night it stood
at $9,452.
Last week America?s
Securities and Exchange
Commission issued a warning
about online platforms where
people buy and sell the
currencies, saying some
gave the impression they
were regulated when they
were not.
The hysteria over
cryptocurrency shows little
sign of disappearing, though.
Yesterday fans descended on
the QEII Centre in London for
the Crypto Investor Show,
billed as the UK?s biggest
cryptocurrency event.
Why are Coinbase
customers having trouble
withdrawing their money?
Coinbase uses a two-stage
verification process for
depositing or withdrawing
money. When making
withdrawals, customers must
first send a small ?Sepa?
payment ? say, ?1 ? to
Coinbase?s banking partner
in Estonia to verify their bank
accounts. (Sepa is an EU
electronic payments system.)
Once this is processed,
usually in a few
days, the
customer can take
out their money from
the platform through a
transfer to their bank
account. However, Zeeshan
Feroz, chief executive of
Coinbase UK, admitted some
customers had experienced
delays because of problems
with the verification system.
?Unfortunately, we do not
have access to domestic
[sterling] banking ? such as
Bacs ? and Sepa isn?t
15
The Sunday Times March 11, 2018
MONEY
Investors misled by ?cuckoo in nest? funds
The City regulator
has rapped ?closet
trackers? that do
little to earn their
large fees, reports
Ali Hussain
Santander and Halifax have been
ordered to change the marketing literature for some of their investment funds
after the City regulator ruled they were
misleading investors over the extent to
which they are ?actively managed?.
The move highlights the problem of
?closet tracker? funds that levy hefty
annual management charges yet do little
more than mimic the stock market index
they are paid to beat.
Last week the Financial Conduct
Authority (FCA) ordered the refund of
г34m of active management fees levied
on funds that were simply tracking an
index. The regulator also found that 64 of
the 84 funds it analysed were providing
misleading information and ordered
them to rewrite the paperwork. One fund
manager faces enforcement action
because its marketing material was said
to be ?very misleading?.
The FCA did not identify any of the
firms involved. However, Santander and
Halifax confirmed to Money that they
were among those told to alter their documentation, but not those ordered to
refund fees.
Santander Asset Management, the
investment arm of the high street bank,
said: ?We have taken the opportunity to
clarify to customers how a small number
of our funds operated with reference to a
benchmark and have updated their
investment documentation disclosures
accordingly.? It is unclear how many Santander funds are affected. The firm
declined to name them.
Halifax said only one of its funds had
been identified by the FCA probe: its
г4.7bn UK growth fund.
Last year, the analyst Better Finance
identified 165 potential closet trackers in
a study of 2,332 funds. They included
funds managed by some of the industry?s
big names ? Fidelity, HSBC, Halifax,
JP Morgan, Schroders and Santander.
Money asked the six firms whether
they were among those censured by the
FCA. Only the two high street brands said
yes.
Fidelity said it was ?not one of the
companies that the FCA has focused on
with regard to closet trackers?. Schroders said it was ?not subject to enforcement action or a compensation process?.
JP Morgan Asset Management said on
Friday afternoon: ?As it stands, we have
not been contacted by the FCA.?
The FCA?s move comes amid growing
concern that fund managers are enjoying
lucrative fees while adding little or no
value. This is the first time the financial
watchdog has ordered that fees be repaid
to clients because of a failure to apply
enough active management.
Managers typically charge 0.75% to 2%
a year. By contrast, tracker or passive
funds can be had for 0.3% or less.
Megan Butler, the FCA?s director of
supervision for the investment sector,
said: ?Closet trackers are passive but look
and charge like they are active.? The
difference is not always clear, ?so consumers aren?t getting what they expect?,
Butler added.
Arnaud Houdmont of Better Finance,
which is based in Brussels, praised the
FCA for its ?courageous decision?. He
hopes regulators on the Continent will
follow suit by ordering refunds and
exposing misleading funds.
However, Alan Miller, co-founder of
the wealth manager SCM Direct,
described the FCA?s move as ?too little,
too late?. He said SCM Direct had highlighted the problem of closet trackers in
YOUR STORY
Think you?re
paying too much
to your fund
manager?
Email money@
sundaytimes.co.uk
bitcoin gains?
commonly used by UK
residents,? he said.
Difficulties emerge when
customers attempt to send
sterling instead of euros in
the first stage of the Sepa
process, or bank account
names or numbers are
incorrect, said Feroz.
Also, Coinbase does not
accept deposits from some
British financial institutions,
such as Nationwide building
society.
Ingle said: ?Coinbase kept
telling me to add an Iban
number [an international
method of identifying bank
accounts] to my account with
the platform, but on its app
there is no way to do this.?
He finally received his money
last Thursday.
Coinbase investors have
also complained of a woeful
lack of customer service.
Ingle said he had waited up to
three weeks for the company
to reply to his emails.
Another unhappy user,
?Will Pedley?, tweeted
sarcastically last month:
?Things are looking up. A
complaint I made in early
November just received a
response today from
@coinbase . . . they
apologised for the delay,
made an excuse, didn?t
address my concern,
attached an article that didn?t
help, then asked for an emoji
rating of how satisfied I am.?
Feroz said the platform
was moving to a new deposit
and withdrawal system for
UK users in the coming
weeks, which would speed up
the process, and was working
to resolve its customer
service issues by recruiting
extra staff.
Kumar at 7IM said: ?Aside
from the volatile price issue,
cryptocurrency platforms
suffer from the growing pains
of becoming an asset class
for speculators who need to
realise profits. This means the
customer service, the systems
and, above all, the trust need
to be present.?
INVESTING IN CRYPTOCURRENCIES
Investors can buy digital
currencies on platforms
such as coinfloor. co.uk,
coincorner.com and
coinbase.com.
They usually levy
withdrawal fees and may
take a cut of any exchange
rate, for example when
converting cash from euros
to pounds for UK investors.
It is important to note
that the Financial Conduct
Authority does not regulate
the currencies or any of
the platforms, so there is
nothing to stop fraudsters
setting up sites. Do your
research before choosing
a platform.
There are several tracker
products that follow the
price of digital currencies,
such as XBT Provider AB
Bitcoin Tracker and XBT
Provider AB Ethereum
Tracker. They are available
on investment platforms
such as Hargreaves
Lansdown. ?Rather than
holding bitcoin and
ethereum directly, these
exchange-traded notes
hold certificates and the
provider backs them up by
purchasing the currencies,?
said Laith Khalaf, senior
analyst at Hargreaves
Lansdown. He warned,
though, that ?these
vehicles come with a rather
hefty 2.5% annual fee?.
Last week Coinbase
launched a tracker fund
following bitcoin, litecoin,
ethereum and bitcoin cash.
It is available only to
American investors, but
there are plans to roll out
other funds for all
customers soon.
There is also a Bitcoin
Investment Trust. However,
it is difficult to buy shares
in the trust as it has not
produced a key investment
document (Kid). By law,
certain stocks must make
a Kid available before
investors can buy them.
HOW LOW HAVE THEY GONE?
Average annual return over the past 10 years compared with the benchmark index
HSBC GIF
Chinese Equity
JP Morgan
China
Fidelity
International A USD
Schroder ISF
Emerging Markets
-1.94
-1.58
-1.41
-0.38
percentage points
percentage points
percentage points
percentage points
Source: Better Finance/ Candid Financial Advice/ Morningstar
2013 and again in 2015, yet nothing had
been done.
?Why has the FCA taken so long to act
and why is the derisory sum of г34m
appropriate given the extent of the ?legalised looting? that prevails within the
industry?? asked Miller.
The Better Finance analysis looked at
indicators such as a fund?s ?active share?,
which illustrates how far it diverges from
the stock market index it aims to beat.
The Schroder ISF Emerging Markets fund
claims to be managed and charges an
annual fee of 1.87%, but the researchers
found its portfolio of shares closely
resembles the benchmark MSCI Emerging Markets index. Once charges have
been subtracted, the $5.4bn (г3.9bn)
fund has returned 0.38 percentage
points a year less on average than the
index over the past decade, according to
the analyst Morningstar.
Investors may have done better with
the iShares MSCI Emerging Markets
Equity Index fund, which specifically
tracks the MSCI benchmark for an annual
fee of just 0.25%. Over the past five years,
it returned an average of 0.21 points less
than the benchmark index annually.
?Closet trackers are a cuckoo in the
nest that need to be called out as tarnishing the reputation of funds managed by
teams that take genuine decisions to try
and add value,? said Jason Hollands of the
wealth manager Tilney.
Tracker funds have become more popular amid scepticism over the value of
active fund management. Last year there
was a net rise of г103m in the amount
held in tracker or passive funds, taking
their total assets under management to
г165bn, according to the Investment
Association. However, this represents
just 13.5% of the total under management.
Fund providers are not obliged to publish details of how actively managed their
products are, leaving investors reliant on
third-party analysts such as Better
Finance. The Investment Association
said it was working with the FCA to
improve the language used by the industry to describe funds. ?It is absolutely
right that savers and investors should be
able to see clearly what a fund is setting
out to deliver, what it then does deliver,
and the cost,? the trade body said.
On funds identified by Better Finance
as potential closet trackers, Schroders
said: ?Active share is only one of many
measures that investors can use to judge
the level of active management. Our
funds are designed for long-term performance to help clients meet their goals.?
Fidelity said the funds highlighted in
the Better Finance report offered ?specialist access to thematic or niche sectorspecific investments and have a smaller
universe of stocks available to invest in,
which does result in some overlap with
the comparative index and therefore a
lower active share?.
HSBC said its fund?s ?annualised
net return for the past five years is
11.32%, compared with 10.74% for its
benchmark?.
Santander said: ?These funds are used
as a building block for discretionary
model portfolios that require a small
exposure to certain equities, and they are
designed to be managed to a maximum
tracking error from its benchmark.?
16
The Sunday Times March 11, 2018
MONEY
We?re still
ba?ed by
this switch
glitch
QUESTION
ON
OF MONEY
EY
LEY
JILL INSLEY
Fighting your ?nancial
and consumer battles
M
y daughter is a young
mother on a low, variable
monthly income. On
moving home in 2015
she chose her energy
supplier carefully,
settling on SSE and
paying through direct
debit. This worked fine
until, out of the blue, she
received a letter from Scottish Power
threatening to register a credit default
against her name unless she paid a
gas bill of well over г1,000.
Scottish Power had unilaterally taken
over my daughter?s gas and electricity
supply in April 2016 and caused the
cancellation of her monthly direct debit
with SSE. No reason has yet been given
as to how this occurred.
She went through the complaint
process with Scottish Power and then
the energy ombudsman. But although
the ombudsman found Scottish Power
?at fault? on four counts and ordered
it to apologise, confirm zero account
balances and provide a г150 goodwill
payment, the end result is that she faces
a bill for two years of energy.
Scottish Power should not be allowed
BUY PRINTS OR SIGNED COPIES OF ROB MURRAY?S CARTOONS FROM OUR PRINT GALLERY AT TIMESCARTOONS.CO.UK
HOT TICKETS MAN WHO
SCAMMED READERS
PLEADS GUILTY TO FRAUD
to walk away without taking full moral
and financial responsibility for this.
Jill replies
Your daughter suffered what is known
in the utility industry as an ?erroneous
transfer? ? she was switched to a new
supplier without her consent. The trade
body Energy UK says: ?It is usually the
result of a genuine mistake and suppliers
will always work to fix the problem with
no discomfort to the customer.?
Sadly, this mistake caused your
daughter considerable discomfort. As
she is self-employed and her earnings
are irregular, she did not notice that the
payments to SSE had stopped leaving
her account. Although the ombudsman
found in her favour, she was left with a
huge bill for the gas and electricity she
had used while being supplied, without
her knowledge, by Scottish Power.
Your daughter was not contacted by
either company at the time of the switch.
SSE says it sent a ?We?re sorry you?re
leaving? letter ? and that it issued final
bills and took a final payment. However,
she says she did not receive the letter or
bills and did not spot the payment.
Scottish Power failed to send a
?welcome? letter or provide any tariff
details or advice on the ?cooling off?
period for the new contract. Nor did it
ask your daughter to take meter readings
so the final bill for SSE and the first bill
for Scottish Power could be calculated
accurately.
Scottish Power then compounded
this error by failing to send her any gas
bills for 17 months.
The electricity bills began to arrive
after 18 months, last October. In that
same month, your daughter finally
received a letter from Scottish Power
explaining her new tariff and giving her
14 days to cancel her switch. Sadly, the
offer was 18 months out of date.
?This is what they call a welcome letter?!?
Under the Ofgem code, Scottish
Power would not have been allowed to
backdate the bill by more than 12 months
because it was at fault. This would have
resulted in your daughter?s bill being
reduced by more than г1,000.
However, her supply ? and the debt
for the energy she had already used ?
was transferred back to SSE last
November. The energy ombudsman
did not consider SSE to be at fault, so it
was entitled to bill her as though the
erroneous transfer had never happened.
By the time you came to me for help,
your daughter had been in dispute with
Scottish Power and the ombudsman for
months ? and had not paid an energy
bill for 20 months. Her debt was built up
because of Scottish Power?s actions.
The г150 the company was ordered to
pay in compensation by the ombudsman
was clearly out of all proportion to the
mess it has created. I appreciate that
legally Scottish Power did not have to
do any more, but morally I thought it
should cover the bill your daughter
faced through no fault of her own.
At the same time, I asked SSE to
confirm exactly how much your
daughter owed, as she was still waiting
for a final tally.
As it turns out, Scottish Power had
already sent her a cheque for г318
towards the cost of the gas supply. This
had been done in error but the company
said it would honour the cheque. It also
offered her a further goodwill payment
of г249 for the electricity and a discount
on the amount she owed based on its
cheapest rates. This offer was rejected.
Instead, it was SSE that stepped up to
the plate. It waived your daughter?s
entire bill, which came to г4,093.
It said: ?This was Scottish Power?s
error and the customer?s supply has now
been returned to SSE. Although not at
fault, as a gesture of goodwill SSE has
waived the 20 months worth of energy
used by the customer. SSE understands
the customer is pleased the issue has
been resolved.?
Why won?t they just give
me my deposit back?
I hired a motor home through
unbeatablehire.com last November. As
part of the hire, I had to pay a deposit
of г1,250 for the insurance excess.
Unlike most hire companies I have
dealt with, this had to be an actual
payment rather than a card
pre-authorisation. I was wary, but a
friend had used the company before
with no problems. I paid the deposit
online by credit card on November 8.
The motor home was a bit of a
disaster because of electrical problems
and I ended up returning it a day early.
The fuel level was correct and there was
no damage; this was confirmed by the
depot staff.
The terms and conditions stated that
the deposit would be refunded after
28 working days. This came and went,
so I emailed UnbeatableHire and
received a link to a final statement,
which stated I was due the full г1,250
back. I requested the refund at the start
of January and then waited. And waited.
No refund arrived.
HAVE
YOUR SAY
EDITED BY
RUTH EMERY
Take my adviser
My former financial adviser
put my money into dud after
dud before I eventually
extricated what was left of
my investment portfolio and
self-invested personal
pension (? ?Phoenix firm?
burnt through my savings?,
last week). He also tied my
money into several film
schemes and then washed
his hands of the lot. I
reported him to the
ombudsman but my
complaint came too late
? it was after the six-year
cut-off. The adviser, who was
charmingly persuasive, is
now at another wealth
management firm.
MF, northwest London
A financial adviser was
recommended to me by a
?friend? 19 years ago when I
was looking for funding to
buy my business. She took
г14,000 in fees and lied about
the options available to get
my funding, resulting in a
significant financial loss. The
ombudsman was hopeless.
Always take the advice with
great caution, read the small
print and double-check the
institutions they advise you
to invest with.
Dizzle, via
thesundaytimes.co.uk
I emailed again to no avail and tried
the site?s online chat tool, but found
the staff incredibly unhelpful. I finally
managed to get an email address for the
credit department and contacted it at
the end of January. It replied saying it
had experienced a few problems with
refunds at the end of last year, but it
would chase up my refund with its
merchant provider. This would take up
to 10 working days, it said. If it confirmed
the refund had not been issued, the
credit department would do it manually.
Ten working days came and went ? no
refund. I have since emailed the credit
department twice, with no reply.
It is now three months since I hired
the motor home and I wonder if I am
ever going to see this г1,250 again.
Jill replies
I looked on the customer-review website
Trustpilot and saw 57% of contributors
had given UnbeatableHire one star ? the
lowest rating. Nearly all complained
about exactly the same problem: the
delayed return of a deposit. One
described the company as unbearable.
I called UnbeatableHire, provided
your name and the date of your hire, and
said I wanted to speak to the manager
about your missing г1,250. Within two
hours, you received an email from the
company?s credit department to say
your deposit had been refunded.
CAN WE HELP YOU?
Please email questions to Jill Insley at
questionofmoney@sunday-times.co.uk
or write to Question of Money,
The Sunday Times, 1 London
Bridge Street, London SE1 9GF.
Please send only copies of original
documents. Letters should be
exclusive to The Sunday Times. Advice
is offered without legal responsibility.
We regret Jill cannot reply to everyone
who contacts her.
I have been self-employed for
most of my life; when I made
money I got paid. I have used
two financial advisers who
lost my money but still got
paid. It would seem that
many problems associated
with advisers would be solved
if they received a percentage
of the profits raised using
their clients? money rather
than an upfront reward taken
from clients? investment.
RW, Frome, Somerset
These stories of lost pensions
and savings are sad, but can
any government stop this
happening without the
co-operation of the victims?
Some of these people appear
to have invested without
carrying out the most basic
common-sense checks.
Surely they should check if
the adviser and investment
are regulated? They can also
see another adviser to get a
second opinion. People who
do nothing but hand over vast
sums of money to strangers
will be in grave danger of big
losses and, however harsh
this may seem, they have no
one to blame but themselves.
RC, Wandsworth,
southwest London
Big numbers
Hunter Davies bemoans the
size of the ?dinky digital pad?
he has to use to access his
online banking (?Password?
I can barely remember my
name?, last week). I also
found the First Direct digital
pad difficult to use and made
this point in a phone call ?
and lo and behold, I was
offered a larger version. It
arrived within a few days
and is the size of a calculator.
When switched on, it
welcomes me in a soft voice
and then talks me through
Readers who report suspected
frauds to the police often tell me
they feel no action is being taken to
track down the perpetrators, writes
Jill Insley. So it is a relief to report that
a man who stole money from Sunday
Times readers through a ticketing
scam has been punished.
Jamie Thomas, former chief
executive of the North Wales
Crusaders rugby league team, was
given a 22-month prison sentence,
suspended for two years, after
admitting a number of charges. He
was also ordered to pay г66,000
compensation to his victims.
His lawyer Adam Kane explained
that Thomas had not been in a
position to take on the cost of
running the Crusaders. He said:
?There was no high living ? it was
a misguided venture to keep the
rugby club afloat. He paid the players
when they were up in arms when
they didn?t get their wages.?
Thomas came to the attention of
Question of Money in 2015 when
readers complained about his
agency, Tours Sportif, taking money
for non-existent tickets. One reader
paid the agency г1,140 for tickets
and hospitality at the Wimbledon
championships. Another spent
г1,200 on rugby World Cup tickets.
I spoke to Thomas, who promised
to return the money, and encouraged
the readers to report the loss of their
cash to their banks and Action Fraud.
Thomas actually paid one reader
г800 of the г1,200 he was owed, but
the other reader received nothing
and so pursued a complaint with
the Financial Ombudsman Service
about the way in which the banks
involved had handled his problem.
The ombudsman recommended that
RBS pay г1,140 back to our reader
Jamie Thomas
? pictured on
MasterChef ?
was ordered to
pay г66,000 to
victims of his
ticketing scam
because the bank knew there was
suspicious activity involving Tours
Sportif?s account before he made his
payment. The ombudsman said RBS
?should have made further inquiries?
before allowing any funds to be
removed from the account.
The evening before Thomas
appeared in court, he faced a
different kind of judge on BBC1?s
MasterChef, in which he described
himself as a ?fly by the seat of the
pants? cook. The BBC said the filming
had taken place ?some time ago?.
The MasterChef judges said
Thomas?s food sounded great
before tasting it, but decided his
Asian-inspired concoctions
?completely missed the mark? ?
rather like his imaginary ticket sales.
Hunter on hold: our columnist is not a fan of online banking
what I have to do. The
buttons are nearly half an
inch across (I?m too old for
metric) and easy to press.
JM, Guildford, Surrey
Like Hunter, I have great
difficulty remembering all
my passwords. I did consider
paying for a password
manager, but read some
banks would not reimburse
fraudulent activities if they
found out you had given your
password to a third-party
app. Fingerprint or facial
recognition technology
should be rolled out as
quickly as possible.
IH, Sheffield
I have three A4 pages of
passwords. Yes, three! Most
are for trivial, non-financial
things such as apps. I admit
that for these I do something
that isn?t advised: I use a
password based on a single
word. But it?s a long Welsh
word, with vowels removed,
and a variation of numbers.
My banking and credit card
logins are more complex.
Wyn Ford, via
thesundaytimes.co.uk
Too late by half
We have renewed our
breakdown cover with the
same insurer for the past
nine years. Our renewal
quote this year was г393.69,
which included a г73 admin
fee. I searched the internet
and found equivalent cover
for less than half the price. I
phoned the insurer to say I
did not wish to renew and
was immediately offered a
reduced premium of г150. I
said, ?No, I should have been
offered the best price first
time round? ? and was then
offered 15 months? cover for
the same price. Do these
companies not have any
moral principles at all?
PD, West Kirby, Wirral
We love to receive your
feedback on stories and
your views on any issues
you would like us to
investigate. Always
include your name and
address when contacting
us. Letters may be edited.
WRITE TO
Money, The Sunday Times
1 London Bridge Street
London SE1 9GF
EMAIL
money@sundaytimes.co.uk
TWITTER
@ST_Money
17
The Sunday Times March 11, 2018
MONEY
Best Buys
CURRENT ACCOUNTS
FOREIGN
CURRENCY
CREDIT INTEREST
Provider
Account name
Account fee
Interest rate 1
Balance
Contact
TSB
Classic Plus
None
3% + г10 a month 2 г1-г1,500
0345 975 8758
Halifax
Reward
None
г3 a month
г1+
0345 720 3040
Nationwide
FlexDirect
None
5% 3
г1-г2,500
0800 302 010
Provider
Account name
Account fee
Interest rate 4
0% overdraft limit Contact
First Direct
1st Account
г10 a month 5 15.9%
M&S Bank
M&S Current Account None
These are the interbank
rates at 5pm on Friday,
which show where the
market is trading.
They are not indicative
of the rate you will be
able to get.
OVERDRAFTS *
Post Office Money Standard Account
None
30-Month Purchase Mastercard
Sainsbury?s Bank Dual Offer Mastercard
Fixed to 31.3.20
40%
г745
LV
0345 111 8010
1.39%
Fixed to 31.5.20
20%
г999
LV
0800 494 999
Nationwide
1.89%
Fixed for 2 years
10%
г999
GLV
0800 302 010
Lender
Rate
Scheme
Deposit
Fee
Notes
Contact
40%
г999
LV
0800 494 999
25%
г995
LV
0845 850 1755
14.9%
г0
0345 266 8977
Tesco
2.18%
Fixed to 31.5.21
10%
г995
LV
0345 051 8446
1.12
1.39
1.32
1.77
APR 1
Reward
Contact
0% for 31 months
18.9%
Yes
0808 540 5060
0% for 30 months
18.9%
No
0345 944 4555
0% for 30 months
18.9%
Yes
0808 540 5060
SWITZERLAND
GBP>CHF
Introductory purchase Transfer fee 2
APR
Contact
0% for 36 months
1.85%
19.9%
0800 731 0200
MBNA
Platinum 36 Month Visa
0% for 36 months
2.49%
19.9%
0345 606 2062
Nuba
Transfer Mastercard
0% for 36 months
2.50%
19.9%
0345 606 2062
AUSTRALIA
GBP>AUD
CASHBACK CARDS
APR 1
Cashback
Contact
28.2%
1%-1.25%. Intro 5% for 3 months
0800 917 8047
American Express Platinum Cashback Everyday 22.9%
0.5%-1%. Intro 5% for 3 months
0800 917 8047
0.5%
0800 389 9905
1 APR = annual percentage rate, dependent on credit rating. 2 Fee charged on the amount of each balance transfer during the introductory period.
Source: Moneyfacts.co.uk
Source: timescurrencyservices.co.uk
020 7294 7970
National Savings &
Investments (NS&I) has
reduced the rates on its
three-year guaranteed
growth bonds and
guaranteed income
bonds following a surge
in popularity since their
launch in December.
3-YEAR FIXED RATES
Fixed to 31.5.21
Introductory purchase
21.7%
1.24%
HSBC
Fixed to 31.5.21
Platinum 36 Month Visa
All in One Mastercard
Sainsbury?s
1.64%
Card type
Santander
Contact
1.54%
Barclaycard
Card type
Notes
Skipton
Provider
American Express Platinum Cashback
Fee
HSBC
BALANCE TRANSFERS
Provider
Deposit
0345 900 0900
INTRODUCTORY RATES
Halifax
Scheme
0800 242 424
CREDIT CARDS
Card type
Rate
г100
AMERICA
GBP>USD
Sainsbury?s Bank Purchase Mastercard
Lender
г250
EURO
GBP>EUR
MONEY
MADE EASY
NS&I CUTS
RATES ON BONDS
2-YEAR FIXED RATES
15.9%
1 Based on funding of г1,000 a month. 2 To receive г10 you must have two direct debits and make 20 card payments a month. 3 Introductory rate for one year, then 1%.
4 Equivalent annual rate. 5 Fee waived if minimum funding of г1,000 is met. * Based on overdraft of г500 for 15 days a month.
Some accounts require minimum funding/direct debits to open or receive rates shown.
Source: Moneyfacts.co.uk
Provider
MORTGAGES
LONG-TERM FIXED RATES
Lender
Rate
Scheme
Deposit
Fee
Notes
Contact
Sainsbury?s
1.8%
Fixed to 31.3.23
40%
г745
LV
0345 111 8010
HSBC
1.94%
Fixed to 31.5.23
20%
г999
LV
0800 494 999
Coventry
2.45%
Fixed to 31.3.23
10%
г999
LV
0800 121 8899
First Direct
2.69%
Fixed for 10 years
25%
г0
LV
0800 482 448
Deposit
Contact
What are the new rates?
The growth bonds paid
2.2%, but new customers
will earn 1.95% a year. The
rate for the income bonds
is falling from 2.15% to
1.9%. Rates for existing
customers will not
change.
TRACKERS */ DISCOUNTS
Lender
Rate
Scheme
Fee
Notes
HSBC
1.24%
Tracker +0.74% for 2 years 40%
г999
ELV
0800 494 999
Hinckley & Rugby
1.99%
SVR -3.9% for 2 years
г0
ER
0800 774 499
Nationwide
1.94%
Tracker +1.44% for 5 years 25%
г999
EGLV
0800 302 010
Hanley Economic
1.75%
SVR -3.44% for term
25%
г950
ELV
01782 255 000
Contact
10%
Why are rates being cut?
The bonds were ?best
buys? initially and demand
was high. As a taxpayerbacked savings provider,
NS&I is obliged not to be
too competitive for too
long. It has a ?net
financing target? set by
the government that
determines how much
it is allowed to draw from
savers each year.
FIRST-TIME BUYER / LOW DEPOSIT
Lender
Rate
Scheme
Deposit
Fee
Notes
Yorkshire BS
3.29%
Fixed to 30.6.20
5%
г995
DP
0345 166 9510
Hanley Economic
3.1%
SVR -2.09% for 2 years
5%
г250
PV
01782 255 000
Barclays
2.69%
Fixed to 30.4.21
0%
г0
FP
0333 202 7580
Lender
Rate
Scheme
Deposit
Fee
Notes
Contact
Virgin Money
1.79%
Tracker +1.29% to 1.6.20
40%
г995
D
0345 605 0500
Post Office
1.91%
Fixed to 30.4.20
25%
г995
DV
0800 077 8033
Barclays
2.18%
Fixed to 30.4.23
40%
г1,950
R
0333 202 7580
BUY TO LET
What if my bonds
are maturing?
Your money will
automatically be rolled
over into a new three-year
deal paying the old rates
of 2.2% or 2.15%. The same
applies for those with 65+
guaranteed growth bonds
(also known as pensioner
bonds), which were
available between January
and May 2015 to people
aged 65 and over.
You can ask for the
bonds not to be rolled
over if you want to move
your money instead.
Early repayment charge applies unless otherwise stated. * Most deals track Bank of England base rate. Notes: SVR = Standard variable rate;
D = г500 cashback; E = No early repayment charge; F = Family Springboard, 10% deposit must be in a Barclays Helpful Start account;
G = г500 cashback for first-time buyers; L = Free legal work for remortgages; P = Purchases only; R = Free valuation and legal work for
remortgages; V = Free valuation.
Source: landc.co.uk ? 0800 373 300
SAVINGS ACCOUNTS
INSTANT ACCESS
Provider
Account name
Min deposit
Interest rate
Contact
RCI Bank
Freedom Savings
г100
1.3%
rcibank.co.uk
Virgin Money
Double Take E-Saver Issue 4
г1
1.3%
uk.virginmoney.com
Ford Money
Flexible Saver
г1
1.22%
fordmoney.co.uk
NOTICE ACCOUNTS
Provider
Account name
Notice period
Min deposit
Interest rate
Contact
Secure Trust Bank 1
180-day notice
180 days
г1,000
1.65%
securetrustbank.com
Paragon Bank
120-day notice (Issue 8)
120 days
г500
1.55%
paragonbank.co.uk
120-day notice
120 days
г1,000
1.55%
securetrustbank.com
Term
Min deposit
Secure Trust Bank
1
1 Maximum three capital withdrawals a year subject to required notice.
CASH ISAS
INSTANT ACCESS
Provider
Account name
Min deposit
Interest Transfers in Contact
Nationwide
Single Access Isa
г1
1.3%
Yes
nationwide.co.uk
Virgin Money
Easy Access Cash E-Isa Issue 22
г1
1.21%
Yes
uk.virginmoney.com
FIXED RATE
Provider
Account name
Term
Min deposit Rate
Transfers in Contact
Virgin Money
Cash E-Isa Issue 317
1 year
г1
1.5%
Yes
Paragon Bank
Cash Isa
2 years
г500
1.67% Yes
uk.virginmoney.com
Are there better rates
available?
Yes. Ikano bank, for
example, offers 2.26%
over three years.
paragonbank.co.uk
Source: Savingschampion.co.uk ? 0808 178 5354
FIXED-RATE BONDS
Provider
Account name
Interest rate
Contact
Investec Bank
Fixed Term Deposit
1 year
г25,000
1.9%
investec.com
Ikano Bank
Fixed Saver
2 years
г1,000
2.1%
ikano.co.uk
Vanquis Bank Savings
Fixed Rate Bond
3 years
г1,000
2.3%
vanquissavings.co.uk
DEALS ARE LISTED ONLY IF THEY ARE COVERED BY THE UK FINANCIAL SERVICES COMPENSATION SCHEME (FSCS) OR A EUROPEAN EQUIVALENT
Source: Savingschampion.co.uk ? 0808 178 5354
CHILDREN?S ACCOUNTS
Provider
Account name
Account type
Min deposit
Interest rate
Contact
Halifax
Kids? Regular Saver
Regular saver
г10-г100
4.5%
halifax.co.uk
Santander 1
123 Mini Current Account
Current account
г300
1%-2.96%
santander.co.uk
Cambridge
3-year Fixed Rate Bond (Issue 1) Fixed rate bond
г1,000
2%
cambridgebs.co.uk
1 Interest rates are tiered: 1% on balances of г100-г199; 1.98% on г200-г299; 2.96% on г300-г2,000.
ENERGY DEALS
JUNIOR ISAS
HOW TO
INVEST
Average annual bill
Rate
Contact
Provider
Account name
Min deposit
Interest rate
Rate
Tonik
г835
F
0333 344 2686
Coventry
Junior Cash Isa
г1
3.5%
V
coventrybuildingsociety.co.uk
People?s Energy
г864
V
0131 285 5510
Nationwide
Smart Junior Isa
г1
3.25%
V
nationwide.co.uk
Together Energy
г875
F
0333 150 1699
Tesco Bank
Junior Cash Isa
г1
3.15%
V
tescobank.com
Source: TheEnergyShop.com ? 01259 220 270
г10,000
Just starting your
portfolio? First,
decide how long
you will invest for
Rebecca
O?Keeffe,
Interactive
Investor
Each week we ask an expert
for tips on how to invest
г10,000. Our latest
contributor is Rebecca
O?Keeffe, head of investment
at the online broker
Interactive Investor.
O?Keeffe said people
starting to invest need to
consider how long they
want to invest for and how
much they are prepared to
pay in fees.
?Time is critical to your
choice of investment,? said
O?Keeffe, 47, who lives in
Hildenborough, Kent, with
her husband and two
teenage children.
?Over the short term,
equities are much riskier
than other assets, but over
the long term, not being
invested in equities is a
much greater risk.?
Charges can also have an
enormous impact on your
total returns, ?particularly
in a low-interest-rate
environment where annual
market returns are expected
to be lower?, she said.
Her choices below are a
mix of passive funds ? which
mimic the performance of a
particular market index ?
and actively managed funds,
which pick individual stocks.
Legal & General Global
100 Index Trust
(up 4.1% over a year)
I would invest г3,000 in this
low-cost passive fund. It
tracks the world?s 100
biggest multinational
companies, including Apple,
Alphabet (the owner of
Google) and ExxonMobil.
As a passive fund, it isn?t
trying to shoot the lights out,
but it does offer consistently
good long-term performance
for a low annual fee.
As you might expect for a
fund that holds the largest
companies in the world, it
has a US bias, with a high
proportion of shares in
technology and finance.
Its average annual charge
is 0.18%. (As with all funds
mentioned, this fee is paid
on top of the charge levied
by the investment platform
or broker that you use to
make the investment.)
Vanguard Global
Small-Cap Index
(up 5.7%)
Most passive funds focus on
the biggest companies as
they are easier to track, but
it is good to have exposure
to smaller stocks too. This
fund, into which I would add
г2,000, attempts to track
the MSCI World Small Cap
Index, which is made up of
small companies in
developed markets.
It has a high proportion
of US stocks but is not as
heavily invested in the big
tech and finance giants.
Its average annual fee
is 0.49%, which is still less
than its actively managed
equivalents.
BlackRock World Mining
Trust (up 11%)
After a decade of low
inflation, we are finally
seeing signs of rising prices.
Owning commodities can
help beat the effects of rising
inflation, so it makes sense to
have some exposure to them
in a diversified portfolio.
This fund invests in
mining companies
worldwide. Top holdings
include Rio Tinto and BHP
Billiton, which are both
listed in London.
I would invest г2,500
here. The average annual
fee is 1.67%.
Man GLG Continental
European Growth
(up 16.9%)
For my final г2,500, I would
go for a fund that invests in a
broad spectrum of countries
and sectors across Europe
and has a track record in
active management.
This fund should offer
solid returns in the event
that the European recovery
continues to strengthen ?
and it also provides good
diversification versus the
technology and commodity
companies held by the other
suggested funds.
Top holdings include the
Italian clothing firm Moncler
and the German software
giant SAP. The average
annual fee is 1.24%.
ST DIGITAL
Read our latest advice
for new investors
thesundaytimes.co.uk/
howtoinvest10k
V = variable rate. Source: Savingschampion.co.uk ? 0808 178 5354
Contact
ICONS BY JAMIE JONES
Table shows the cheapest tariff from the 3 cheapest
suppliers.Excludes
suppliers.
Excludesfixed
fixedtariffs
tariffsof
ofless
lessthan
than12
12
months? duration. Excludes tariffs that do not have
national coverage. Excludes tariffs where payments
are taken in advance of the customer coming on
supply. F=Fixed rate
ratesV=Variable
V=Variablerate
rates
Supplier
Top tip
One advantage of NS&I
products is that deposits
are 100% guaranteed by
the state and you can
shelter up to г1m per
bond. Deposits in ordinary
bank and building society
accounts are protected
by the Financial Services
Compensation Scheme,
which caps refunds at
г85,000 if the firm holding
your money goes bust.
Ali Hussain
18
The Sunday Times March 11, 2018
MONEY
Puzzles
FEEDBACK
Comments about our puzzles
can be sent to puzzle.feedback@
sunday-times.co.uk or Puzzles
Editor, The Sunday Times,
1 London Bridge Street,
London SE1 9GF
GENERAL KNOWLEDGE JUMBO CROSSWORD 100
1
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Across
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Down
1 Travelling at over 100 miles per hour (3-2)
4 Virginia county, part of the Washington metropolitan area,
where the Pentagon and a national cemetery are located (9)
9 Island group reigned over by Queen Salote from 1918 to
1965 (5)
12 In county cricket, Warwickshire?s home ground (9)
13 School founded by Henry VI in 1440 (4,7)
14 Founding member of the Football League which won the
European Cup in 1982 (5,5)
15 State capital of Louisiana (5,5)
17 The weight of a merchant ship?s cargo (7)
19 This craftsman may use an agraffe to hold blocks together (10)
23 Isabella, who wrote the Book of Household Management (3,6)
24 Author of the 1687 work The Mathematical Principles of
Natural Philosophy (5,6) (pictured)
26 The only Celtic language spoken on mainland Europe (6)
28 In pantomime, Baron Hardup?s servant, who is often
dressed in a bellboy?s costume (7)
29 Simultaneously or immediately (2,4)
32 Cut of lamb for the Sunday joint (3,2,6)
33 Type of vitreous pottery noted for its strength and
durability (9)
35 Limb of Dover in the Confederation of Cinque ports, and
HQ of Saga (10)
37 Flaring skirts on suits of armour (7)
41 Folk who lead a routine monotonous life (10)
43 Clay extracted near St Austell; its discovery crucially
developed the manufacture of English porcelain (5,5)
47 One of 24 in an octave (7,4)
48 A former lace-making town in the Erewash district of
Derbyshire (4,5)
49 Ben ____?s first TV success was as a co-writer of The Young
Ones (5)
50 Something used to start an explosion (9)
51 Chemical solution which
softens colours in a
photographic work (5)
50
3
4
5
Across
6
7
9
8
10
11
13
14
12
15
1
8
9
10
11
13
15
17
18
20
21
22
Down
Clumsy person (10)
Quirky (9)
Ladder (3)
Piece of poetry (5)
Scent (7)
Arrogance (6)
Grown-ups (6)
Nuisance (7)
Hooded ophidian (5)
Record (3)
Slogan (9)
Relevant (2,3,5)
2
3
4
5
6
7
8
12
14
16
19
21
Ordinary people (5)
Incredulity (9)
Take up (6)
Mate (3)
Large baleen whale (7)
See (10)
Of use (10)
Italian chicory (9)
Darken (7)
Cheerful (6)
Tanned (5)
Share (3)
16
17
18
20
19
Solution to 1563
Across: 5 Kegs, 7 Applause, 9 Idiom, 10 Set out, 11 Emmanuel, 13 Ruby, 15 Chic,
17 Hesitant, 19 Italic, 21 Error, 22 Flambeau, 23 Snog
Down: 1 Tedium, 2 Badmouth, 3 Opus, 4 Master-at-arms, 6 Spinal column, 8 Squib,
11 Etc, 12 Listen up, 14 Yet, 16 Hotel, 18 Narrow, 20 Crew
21
22
EASY
45
?9
MEDIUM
186 OF+ 2/IT3
HARDER
729 OF/3IT
2
CELL BLOCKS
x 4 ў 12 + 89 x 4 ? 54 ў 7 x 20
x 4 + 759
TREBLE ? 4289 3/4
IT
OF IT
+1/4 ? 3889
x 11 + 722 OF
IT
3/4
OF IT
2/3
OF IT
ў 14
1/2
OF IT
x5
ў 18 + 686 ў 14
ANSWER ANSWER ANSWER
BRAIN TRAINER
Just follow the instructions from left to right, starting with the
number given to reach an answer at the end
16
18
19
20
21
22
23
25
27
30
31
34
36
38
39
40
42
NEWS QUIZ
51
Solution to 99
Across: 1 Red Balloons, 7 Dinaric Alps, 13 Transom, 14 Trapezoid, 15 Mid-on, 16 Blears, 17 Omnium, 18 Pharisees, 20 Greg LeMond, 21 Saturn, 22 Tulsa, 25 It?s a Long Way to
Tipperary, 29 King Richard, 30 Waldorf, 31 Tor, 32 Wiz, 34 Leucine, 35 Stipulation, 37 A Chaste Maid in Cheapside, 40 Diego, 41 Bolero, 42 Accountant, 45 Chatty Man,
46 Anorak, 47 Emboli, 49 Libra, 50 Oppenheim, 52 Trade up, 53 East Lothian, 54 Ayrton Senna
Down: 1 Rutabaga, 2 Diane Keaton, 3 Australian rules football, 4 Lima, 5 Ottoman, 6 Spadix, 7 Dreamcast, 8 NCO, 9 Red Dawn, 10 Committee of Ways and Means, 11 Liddell
Hart, 12 Sinus, 18 Paul Tillich, 19 Embouchure, 23 Amy Grant, 24 Yardie, 26 Gracie Allen, 27 Procurator, 28 Skewbald, 30 Wisent, 33 Zaheer Abbas, 36 Indian Ocean,
38 D?Artagnan, 39 Ethiopia, 41 Bumboat, 43 Cranmer, 44 Topeka, 45 Chloe, 48 Otto, 51 Poi
2
10
11
46
48
1
8
9
44
45
47
CONCISE CROSSWORD 1564
6
7
45
46
49
1
2
3
4
5
4
6
2
2
6
3
2
2
2
9
3
6
Divide the grid into blocks.
Each block must be square or
rectangular and must contain
the number of cells indicated
by the number inside it.
2
E XC L U S I V E
R E WA R D S FO R
SUBSCRIBERS
?Cain [...] dwelt in the land of Nod, on ____ of Eden? (Bible) (3,4)
?Burns? and ?Bonfire? can both precede this word (5)
?____ Superbrain?, Annie Jones?s character in Neighbours (5,4)
Ballerina ____ Sibley often danced with Anthony Dowell (10)
Ivan ____ won every tennis grand slam singles title except
Wimbledon, and later coached Andy Murray (5)
Russian for ?no? (4)
?Oh dear! Oh dear! I shall be ____? (The white rabbit, in the first
words spoken in Alice?s Adventures in Wonderland) (3,4)
Magic, supposedly using communication with the dead (10)
In 1841, John ____ became the first US vice president to
succeed to the presidency without election (5)
A birthmark (6)
Liverpool comedian ____ Sayle was the Comic Strip?s first
emcee in the 1980s (6)
Communist state founded in 1922 (6,5)
Savings for a future rainy day (4,4)
Summer outfit for a baby or young child (7)
Steve ____ was the 1980 Olympic 800m champion (5)
____ Hill, 152m above sea level, is the highest point in Greater
London north of the Thames (8)
An instance of sternutation (6)
Type of sculpture originated by Alexander Calder (6)
(pictured)
Cumbrian village on the estuary of the river Kent, in the
northeast corner of Morecambe Bay (7)
Monteverdi opera, the earliest still regularly performed (5)
Advertised aggressively or questionably (10)
Prospector in the Californian gold rush (5-5)
Characteristic of old age (9)
Dismiss a naughty pupil from class (4,3)
Austrian social reformer Rudolf ____ founded an educational
philosophy, still used in schools named after him (7)
The Spanish provinces of Alava and Vizcaya are such (6)
Body of water such as Bass,
Otranto or Torres (6)
Elgar?s Chanson de ___, was
originally for violin and
piano (5)
A serf in ancient Sparta (5)
Dramatist Joe ____ wrote Loot
and What the Butler Saw (5)
John ___, English logician,
best known for diagrams
used in set theory (4)
spawned a 200% price
increase?
1
Who had an apostrophe
catastrophe with a tattoo?
5
Who can?t stop laughing,
despite Amazon?s efforts?
2
How old is old?
6
3
What height is Brandon
Marshall, 16, the world?s
tallest teenager?
Who told office workers
they shouldn?t have their
cake and eat it?
7
4
Which chocolate frog
Whose necks will no
longer look like that of
Brigitte Bardot, pictured?
A message in a bottle
dropped from a German
ship was discovered on an
Australian beach. After
how long?
9
A man in Knightsbridge
can expect to reach 79 in
good health ? but what
about in Blackpool?
10 Why was Sanchez Watt
given a red card?
MARK MY
WORDS 98
Readers are invited to guess
what was said when a topless
protester accosted Italy?s
former prime minister Silvio
Berlusconi at a polling station
in Milan last week.
See below right for how
to enter.
Send your entries to: puzzle.entries@
sunday-times.co.uk by no later than
Tuesday. Entries should include a postal
address and ?Mark My Words 98? in the
subject line of the email. The best entry as
judged by The Sunday Times will win The
Chambers Dictionary of Great Quotations.
TETONOR
MODERATE
Each number in the main grid
can be formed by adding or
multiplying a pair of numbers
in the strip below the grid.
Each pair of numbers should
be used twice: once as part of
an addition and once as part
of a multiplication. For
example, a 10 and 24 in the
main grid may be solved by
the sums, 4 + 6 and 4 x 6,
respectively. Enter each sum
in the boxes below its answer.
Any blanks in the strip must
be deduced, bearing in mind
the numbers are listed in
ascending order.
Last week?s winning caption,
for this picture of a swimmer
on a wintry Biarritz beach,
was: ?All that and she says she
doesn?t even like Milk Tray.?
It was suggested by
Roland Gardner of Highclere,
Newbury.
Terms and conditions: Competition closes at midnight on Tuesday.
Over 18, residents of the UK and ROI only. One entry per person. The
winner will be the best entry as judged by The Sunday Times. No cash
alternative to prize in whole or in part. Prize is non-transferable. Your
information will only be used for the purposes of this competition.
Promoter is Times Newspapers Ltd. Not open to staff of the Promoter
and promotional partner or their families.
12
200
33
27
32
18
34
252
176
36
13
240
225
30
72
32
14 15
24
4 6
8 9
11
POLYGON
From these letters, make
words of four or more letters,
always including the central
letter. Answers must be in the
Concise Oxford Dictionary,
excluding capitalised words,
plurals, conjugated verbs
(past tense etc), adverbs
ending in LY, comparatives
and superlatives.
How you rate
17 words, average; 23, good;
33, very good; 44, excellent.
Private view at
Tate St Ives
Join us on Tuesday, April 24 for an evening private view of Virginia Woolf:
An exhibition inspired by her writings at Tate St Ives. Discover works by modern
and contemporary artists that explore feminist perspectives on landscape,
domesticity and identity.
Book tickets today at mytimesplus.co.uk
Dora Carrington, Spanish Landscape with Mountains c.1924. Tate. This Times+ event is open to UK subscribers only. For full terms and conditions, visit mytimesplus.co.uk
8
19
The Sunday Times March 11, 2018
MONEY
3
4
5
6
7
9
8
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
NAME
29
...................................................................................
ADDRESS ...................................................................................
...................................................................................
Post your solution to The Sunday Times Mephisto 3002,
PO Box 29, Colchester, Essex CO2 8GZ, or email
puzzle.entries@sunday-times.co.uk
The first correct solution picked at random after next
Saturday wins Whitaker?s Concise, worth г25. Four
runners-up will each receive г20.
1 Splash short gaiter (4)
4 Drinks provided by head
over in the mountains (8)
9 Work in progress after
company dance (8)
11 With no accused about,
book mailed before
official?s entry (10, two
words)
12 Who can?t believe theft
taking place in volunteer
service once? (8)
15 Right away tight credit
mentioned (5)
16 Hint that?s going round
about a foreign capital (6)
17 Heads dropping, father
appears and withdraws (6)
18 Odd points in trumpet
part (6)
20 Supplied number to ring
on return (6, two words)
23 After a duck, go to catch a
seal (5)
25 Slide is behind child (8)
26 Poisonous seed able to be
distributed in Oregon
valley (10. two words)
27 Pop into safe
neighbourhood, primarily
for type of collar (8, two
words)
28 Unsafe building? Sack
party from the east (8)
29 Only part of pump? (4)
1 Historically tax covers
European currency (6)
2 White pots yellow with
characteristic artistry (11)
3 Bishop in row that divides
Rome (5)
4 Gore?s overlooking US
President in clover (6)
5 Study high tone in short
musical composition?
They may do (9)
6 Brexiteer finally to be
sacked, chief early issue (6)
7 Rest does improve
strength of field units (8)
8 Tin merchandise not good
for hair bands (6)
10 German philosopher
tackles writer Dickens
about leadership (11)
13 Experience down under
more robust breathing
aid (9)
14 As laid out in two rules for
Indian commander (8)
18 Rod?s on official
leave (6, two words)
19 Develop entire bonded
compound of three
doubles (6)
21 Inattentive when former
PM turned up (6)
22 No Scottish circles study
Amerind languages (6)
24 Big names with time to
become top authorities (5)
The Chambers Dictionary 13th edition is the primary
reference. Readers are invited to visit Tim Moorey?s
website at timmoorey.info
Solution to 3001
Across: 1 Bubkis, 5 Uckers, 10 Perichaetia, 11 Ruderal, 14 Chewet, 15 Oyster,
17 Naysay, 18 Seat rent, 19 Earp, 21 Buns, 23 Resiance, 26 Arcked, 29 Bruise,
30 Herald, 31 Sesotho, 32 Cappelletti, 33 Spayds, 34 Masais
Down: 1 Barcas, 2 Bedeman, 3 Krewe, 4 Scathe, 6 Caryatides, 7 Keksye, 8 ╔tats,
9 Saury, 12 Rearrested, 13 Searce, 16 Beurre, 20 Annatta, 22 Skippy, 24 Schelm,
25 Eddoes, 26 Abacs, 27 Cuppa, 28 Trots
SUDOKU
HARD ? PRIZE 1216
6
5 9
7 4
Hard
1 7
5
6
4 3
3
8
Time Duality
After a good breakfast, Seb
decided on 40 winks. He
noted the time on his digital
clock as he dozed off. When
CODEWORD
In the grid, each number
represents a letter of the
alphabet ? all 26 letters are
used. Use the initial clues in
the code table to work out the
rest of the code.
STUCK? To get four random
extra letter clues, call 0901
322 5309 (ROI 1514 415128) or
text STCLUE to 84901 (UK
only). Calls cost 75p (ROI 75c)
plus your telephone
company?s network access
charge. Texts cost г1 plus
your standard network
charge. SP: Spoke, 0333 202
3390 (Mon-Fri 9am-5.30pm).
11
10
5
25
13
17
10
8
5
10
5
25
23
happened: he fell asleep at
the same time and slept a
little less, but when he woke,
the mirror led him to believe
he had slept for 20 times as
long as he had. (All times
were whole numbers of
minutes after midnight.)
14
17
9
10
2
At what time did he
fall asleep?
Send your solution to: The Sunday
Times Teaser 2894, PO Box 29,
Colchester, Essex CO2 8GZ or email
puzzle.entries@sunday-times.co.uk.
The first two correct solutions opened
after next Saturday win г20.
BRIDGE
14
13
15
O
10
24
15
16
15
26
25
18
10
7
23
3
10
Neither vul, Dealer South
5
L
7
21
15
7
19
20
19
8
11
15
15
1
7
7
1
23
14
24
3
14
20
7
13
10
4
25
3
19
23
8
21
9
20
9
6
24
24
26
3
11
20
24
20
6
24
10
5
20
5
10
1
7
4
23
19
10
3
17
26
9
12
9
23
16
22
23
7
23
9
/
.
v
,
3
7
5
5
15
9
20
/
.
v
,
3
23
23
2
3
4
5
6
7
8
9
10
11
9
12
13
L
14
15
O
16
17
18
19
20
21
22
23
24
J82
K76
87
J 10 9 5 3
25
26
W
AKQ5
932
6
K8764
N
W
S
/
.
v
,
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
1
Sally Brock
In December the English
women?s team travelled to
Huai?an, China to play in the
IMSA (International Mind
Sports Association)
tournament. The journey was
a bit of a nightmare but once
there everything ran smoothly.
This was the very first board:
17
W
3
1
/
.
E v
,
10 7 6 4 3
AJ
AKJ543
None
9
Q 10 8 5 4
Q 10 9 2
AQ2
The bidding was the same at
both tables:
West
North
East
Pass
Pass
1/
4.
2v
All Pass
South
1.
Pass
A diamond lead is fairly
obvious, but what should East
KENKEN
KILLER SUDOKU EASY
9
17
19
19
10
14
20
23
13
7
8
11
12
10
5
All the digits 1 to 6 must appear in every row and column. In
each thick-line ?block?, the target number in the top left-hand
corner is calculated from the digits in all the cells in the block,
using the operation indicated by the symbol.
16
15
13
21
17
11
7
17
North
East
16
19
21
22
23
26
...................................................................................
ADDRESS ...................................................................................
...................................................................................
Across
Down
1 Awfully ironic pessimist
like Monet? (15)
9 Well-read earl impolite
about relations (7)
10 Captivate English knight
with tea (hot) (7)
11 Fine suitable for
backsliding little Barney (4)
12 Uncertain and without
energy, you fasten time
locks (2,2,3,3)
13 Heavy rock can be more in
your face, I heard (7)
15 Soup and food the
Queen cut with dash of
Dubonnet (7)
17 Blur return to form with
former member close to
tears (7)
19 Agrees end of America
must come over
broadcast (7)
20 Retractable spanner? (10)
22 Go bananas having been
given the run-around! (4)
25 Superior salt with value to
be cut by a pound (7)
26 Telephone informers
about a potential lead (7)
27 Act in a free way and
dismantle your
beehive? (3,4,4,4)
1 Bungling home help only
occasionally on time (5)
2 Green
knickerbockers? (4,5)
3 Yours truly brought up the
other issue (4)
4 One who has gone off in a
railway carriage (7)
5 Polynesian perhaps
cocaine sent into frenzy (7)
6 Old Peruvian amusing folk
working together (2,7)
7 Headdress that's so long
when one puts it on (5)
8 Colleagues exchange
views about Republican
opponents (9)
13 Bad tailor made a mess of
pricey woollen coat (9)
14 Germany?s foremost wig
manufacturer and speed
king? (4,5)
16 A report supporting
academic over arty
bodyworker? (9)
18 Bachelor put in wrong
diesel fuel for us, maybe (7)
19 Area at the end of
impressive driving
course? (7)
21 A daughter Cambridge
University let in (5)
23 Ceremonial staff continue
to receive deliveries (5)
24 Just adequate (4)
Solution to 4788
The first correct solution opened after
next Saturday wins a 10-carat rolled
gold Cross Century II fountain pen worth
г230. The next three win г120 10-carat
rolled gold Cross Century Classic ball
pens. All have lifetime guarantees. Post
solutions to The Sunday Times
Crossword 4789, PO Box 29, Colchester,
Essex CO2 8GZ, or email
puzzle.entries@sunday-times.co.uk
S T A
U B
NOO
R V
I DE
S G
EAR
I
O
NOU
D N
UND
S
TOS
R O
YOU
ND I NGO
A O N
KY DE T
G D H
A L L Y E
O
E
L SAND
L
L G
SAUTRE
C
I
RESS D
R S E
CAN I N I
T M S
V EGO TM
VA T I ON
T C A
ERGENT
O
I
SPARTO
I
E N
I N I S T A
E P L
S DOSS
B N E
EARS I R
N
I
V
DUBA I
I
L C
E THERE
CLUE WRITING CONTEST 1699: REGENT?S PARK
/
.
v
,
Readers are invited to compose a clue for the word above.
Clues must be original, cryptic, and similar to those in the
Sunday Times crossword. Send your entry by email to
puzzle.entries@sunday-times.co.uk. The best entry selected
after next Saturday wins г20.
QJ4
QJ94
J93
10 5 3
Winner 1696: Ciaran Daly, Cork, Ireland
Percussion cap: Restriction on size of orchestra section? This makes firing a possibility
For a full report, visit thesundaytimes.co.uk/cluewriting
Winners Crossword 4786 K Potts, Sheringham, Norfolk, P Candler, Durham, N
Lawson, Lichfield, Staffordshire, B Spencer, Ashford, Kent Mephisto 2999 J
Gibbons, Margate, Kent, R Holt, Sidmouth, Devon, P Wickens, Faygate, West Sussex,
KH Williams, Bexley, Greater London, L Williams, Barlaston, Staffordshire Teaser
2891 L Collins, Isleworth, Greater London, S Raleigh, Adleymoor, Shropshire Chess
1102 R Lowen, Grimsby, Lincolnshire Sudoku February 18 S Bell, Cuffley, Hertfordshire
1v
All Pass
TODAY?S SOLUTIONS
North leads the five of
diamonds. South cashes the
king and ace and switches to
the nine of clubs. Plan the play.
Your aim is to knock out the
ace of trumps, win the next
club, draw trumps, ruff a
diamond and exit with a club.
North wins and switches
(perforce) to a spade. You
play low from dummy and
your nine wins. You then
cross to dummy with a trump
(you do still have a trump
entry, don?t you?) and take
another spade finesse.
DOUB T F
I
N
U
T U T OR
C W N
H E I R
L
S
J
A R T F U L
D
K
V E NGE F
A
E
B
NOX I OU
C
U
X
E A S Y
D
U L
A B L E
N
T
E
Q
CA R I BOU
L
E
O
E
AR K S P U R
D
K
R
P E B B L Y
M R O
U L
I NC H
E
B
A
A
S
L U N A R
L
O
Z
E
I S C L A I M
NEWS QUIZ
BRAIN TRAINER
POLYGON
220
KENKEN
96
31
Each row, column and 3x3 box must contain the digits 1 to 9.
The digits within each group of cells joined by dotted lines
must add up to the figure in the top-left-hand corner of each
group. Within each dotted-line group, a digit cannot be
repeated.
SPOT THE MOVE 1104
1 Qxd7+! removes the defender of f5,
winning a piece: 1?Rxd7 2 Nxf5+ and
3 Nxd4
TEASER 2893
LEMONS = 370124
21
3
28
20
32
132
6 22 8 12 10 22 6 x 22
84
33
5
230 119
3 x 28 10 23 10 x 23 7 x 17
112
23
38
24
7 x 16 7 16 2 x 19 7 17
SUDOKU
WARM-UP
KILLER SUDOKU
9
7
8
2
4
1
5
3
6
3
1
5
9
6
7
8
4
2
2
4
6
8
5
3
9
1
7
8
5
4
6
7
9
3
2
1
7
3
2
1
8
4
6
9
5
1
6
9
5
3
2
7
8
4
6
2
1
7
9
8
4
5
3
4
9
7
3
2
5
1
6
8
5
8
3
4
1
6
2
7
9
9
2
5
8
4
1
3
7
6
3
8
7
6
2
9
1
5
4
2
4
3
2
2 4
2 3 6 7 7 8 10 10 12 16 17 19 22 22 23 28
13
8
CELL BLOCKS
10 x 22 8 x 12 3 28 2 19
OP KGV YME S X HBU
F CN I WL T Z DQA J R
8
18
NAME
South
Pass
3.
8
27
K653
A
AK82
9874
Pass
2v
1.
15
25
TETONOR
CODEWORD
24
4
3
S
/
.
v
,
West
E
7
LAST WEEK?S SOLUTIONS
9
22
N
6
24
10 8 7
765
Q 10 7 5
QJ2
W
14
20
Last week?s problem
A92
K 10 8 3 2
64
AK6
5
12
17
Taylor-Xian, British
Universities? Championship
2018. How did White
force victory in this
complicated position?
/
.
v
,
4
David McLean
10
13
сWDkDW1WD]
рDp0WDWDW]
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To enter, complete the Hard or Very Hard puzzle and call 0901 292 5275 (ROI 1516
303 500), leaving your answer (the numbers in the three shaded squares) and
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SP: Spoke, 0333 202 3390 (Mon-Fri 9am-5.30pm)
do when in with the first
diamond? Nicola Smith
switched to a spade. Declarer
won in dummy and played a
trump. Nicola won the ace
and played another trump.
West won the king and played
a third round of the suit and
declarer had to go down.
In the other room, East
switched to ace and another
heart at trick two. Again, West
won the king and continued
the suit. Declarer, Fiona
Brown, won the third heart
and tried the ace of clubs.
When East showed out the
distribution was more or less
known, so she simply played
off her club winners and her
two remaining hearts. At the
end, dummy held the spade
suit it started with, and
declarer held the queen of
diamonds. East could not
keep both suits guarded and
declarer had made her game.
I would like to report that
this was the first board of a
decisive victory.
Unfortunately it was all
downhill from here and we
lost the first match heavily.
2
9
7 3 8
4
3
1
3 6
9 6
4
2 9
4 2
2
1
he woke up a little later that
day, not fully alert, he saw
the display reflected in a
mirror and was amazed by
how long he seemed to have
slept. This was in fact 10 times
the length of his nap. Next
day, a similar thing
17
the h-file. 11?b5? Moving this
pawn a second time. Cutting
across White?s plan with
11?h6 was essential: after 12
Bxf6 Bxf6 Black can meet 13
h5 with 13?g5, keeping the
kingside blocked. 12 h5 b4 13
hxg6 hxg6 Now Black must
forever worry about his
exposed king. 14 c4 Ne6 15
Be3 d5 16 c5 Ne4 17 0-0-0
White?s king feels very safe
here, with plenty of pawn
shelter. 17?f5? The decisive
weakening. 17?Qc7, guarding
the e5-square, was best. 18
Nxe4 fxe4 19 Ne5! Attacking
g6. Mamedyarov is ruthless in
such situations and he finishes
efficiently. 19?Rf6 Exchanging
pieces does not help: 19?
Bxe5 20 dxe5 Rf5 21 Qg4 and
Black is doomed. 20 Qg4 Nf8
21 Bh6 Bxh6+ 22 Rxh6 Qc8
23 Qh4 Black resigns
Spot the Move 1105:
White
to play.
________W
VERY HARD ? PRIZE 1217
TEASER 2894
Peter Good
The final stage of the quest to
become Magnus Carlsen?s
next challenger for the World
Championship has begun, as
eight grandmasters battle it
out in Berlin over the coming
fortnight. The Candidates
Tournament, with its roundrobin format, is the ultimate
test of a player?s skill, stamina
and nerves.
Despite facing all eight
players in recent times, I find
it hard to predict the eventual
winner. Shakhriyar
Mamedyarov is the favourite
by rating while Levon
Aronian is the form player.
Sergei Karjakin is another to
watch with his solid style and
previous experience of
Candidates success. Of the
other contenders, none can be
underestimated and the only
certainty is that we will see
some surprises along the way.
White: Shakhriyar
Mamedyarov
Black: Peter Svidler
Tal Memorial 2018
Torre Attack
1 d4 Nf6 2 Nf3 g6 3 Bg5 Bg7
4 Nbd2 c5 5 e3 cxd4 6 exd4
b6 This looks slow. I prefer
6?0-0 followed quickly by
?d6 and ?e5, breaking open
the centre. 7 c3 0-0 8 Bd3
Ba6 9 Bxa6 Nxa6 10 Qe2 Nc7
11 h4! An aggressive move in
the style of Mikhail Tal, for
whom the tournament was
named. White wants to open
Send your solution (first move only), to Sunday Times Spot the Move 1105,
The Sunday Times, PO Box 29, Colchester, Essex CO2 8GZ, or email to
puzzle.entries@sunday-times.co.uk. The first correct answer drawn after next
Saturday wins г20.
WARM-UP
Each row, column and 3x3
box must contain the digits 1
to 9. Winners will receive a
Collins English Dictionary &
Thesaurus.
CROSSWORD 4789
David Howell
alum, amulet, amuse, eluate, elute, emulate, haul, haulm, hula, hush, hustle, lues,
luma, lush, lust, lute, maul, meatus, methuselah, mule, muleta, muse, mush, must,
musth, mute, salut, salute, sautщ, shtum, shul, shut, sleuth, slue, slum, slut, smut,
stum, suet, talus, thus, tule, tush, ulema
2
CHESS
Down
Easy 500; Medium 305; Harder 60
1
Across
Tim Moorey
1 Emma Watson, mocked for ?Times Up? campaign temporary tattoo 2 70
now seen as dawn of old age, says survey 3 7ft 4in 4 Cost of Freddo bars
has risen 200% in 24 years 5 Alexa, the voice assistant, emits mysterious
?witch-like? cackle 6 Public Health England called for end to birthday
cakes at work 7 Ascot racegoers, after ?Bardot neck? dresses were
removed from dress guidelines 8 132 years 9 47, says Office for National
Statistics 10 Kept saying ?Watt? when ref asked his name
MEPHISTO 3002
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2
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9
6
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PRIZE 1214
7
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PRIZE 1215
14
20
The Sunday Times March 11, 2018
MONEY
FAME AND FORTUNE
PETER JAMES
Crime pays
. . . for my
collection of
classic cars
JAMES CLARKE
The novelist tells York Membery about
indulging his passions, keeping alpacas
and his first job cleaning for Orson Welles
P
eter James, 69, is a
bestselling British crime
writer. His series about the
Brighton police officer
DS Roy Grace has sold 20m
copies worldwide. He has
won the Crime Writers?
Association?s highest award,
the Diamond Dagger, and
was voted the best crime
author of all time in a WH Smith poll.
Three of his books ? The Perfect Murder,
Dead Simple and Not Dead Enough ?
have been adapted for the stage.
Peter lives in Jersey with his wife,
Lara, 39, and a menagerie of animals.
He has two books out this year: the 14th
Roy Grace novel, Dead If You Don?t,
on May 17 and a standalone thriller,
Absolute Proof, on October 4.
How much money do you have
in your wallet?
About г100. I only use cash these
days for two things: first, paying my
long-standing hairdresser for my
monthly haircut and, second, for tipping
good staff in restaurants and bars to
make sure they actually get the money
rather than the management snaffling it.
What credit cards do you use?
I mostly use American Express,
primarily for getting air miles. I?m a
constant traveller, spending three
months of the year on research and
promotional duties for my books. My
wife and I have numerous air miles ?
1.5m at the last count ? largely because
I find you can never use them when
you actually want to.
Are you a saver or a spender?
A spender. I do try to save, but I enjoy
spending money on all kinds of things,
especially my passion for classic cars.
My wife and I love to travel ? and wine
is a big interest.
I also buy an insane amount of books:
about 10 a week. I read 200-300 a year,
but I speed-read many of them: I did a
course at Toronto University and can get
I produced and
wrote a film called
Spanish Fly ? ?the
least funny British
funny film ever
made?, according
to Barry Norman
Guilty as charged: Peter James, pictured in his Sussex office, admits to buying ?an insane amount of books?, sometimes reading two a day on holiday
through two books a day on holiday. I
used to feel guilty if I didn?t finish a book
but nowadays if I?m not engaged by
page 40, I?ll move on.
How much did you earn last year?
In the Sixties, Rolls-Royce was too coy
to publish the horsepower of its cars?
engines: it simply used the wonderful
line ?Sufficient?. I?ll go with that!
Do you own a property?
My wife and I have a Victorian rectory
near Brighton, from where we run
our office and where we keep part of
our menagerie, which includes alpacas,
emus and ducks. We have a
three-bedroom penthouse in Notting
Hill, west London, and two rental
properties in Brighton. We live in a
rented 200-year-old farmhouse in
Jersey, with an option to buy.
Are you better off than your parents?
My late parents, Cornelia and Jack, had
a successful business, Cornelia James,
which still holds a royal warrant as
glovemaker to the Queen and is now run
by my sister and her husband. At its peak
it employed about 250 people. But my
parents had financial worries in their
later years. So I would say I?m better off
than they were at the same stage.
When did you first feel wealthy?
Wealth is so relative. But it was probably
the first time I went to a restaurant and
didn?t have to worry about buying the
cheapest bottle on the wine list.
Have you ever worried how you were
going to make ends meet?
I had a meteoric rise in my early twenties
when I built a successful film company in
Canada, turning down an $8m offer for
it. Then I wrote and produced a big dud,
Spanish Fly [1976], with Terry-Thomas
and Leslie Phillips, which Barry Norman
called ?the least funny British funny film
ever made?. And at 27 I was flat broke. I
had to go back to live with my parents.
That was when I wrote my first novel.
What was your first job?
Orson Welles?s house cleaner! I was at
film school and my dad gave me enough
money to pay the rent for lodgings off
Fulham Road. But I wanted to take a
posh girl I?d met out to dinner and
needed money. I saw a job ad in a
newsagent ? ?Cleaner wanted, apply
Mrs Welles?.
I went along, little realising it was the
great man?s London home, and got the
job on a month?s trial. One day I was on
my knees wiping the hall skirting boards
and he came in, looking at me like I was
something the cat had brought in, and
said: ?Good morning, young man.?
There were a million questions I
wanted to ask but I was so tongue-tied I
couldn?t get a word out. The following
day he returned to America. A month
later I was very sweetly fired for not
being terribly good.
investment decisions to them because
whenever I?ve dabbled myself I?ve
ended up out of pocket. I bought some
bitcoins out of interest, as they feature
in my new novel. Typically, I bought at
exactly the wrong moment.
What?s best for retirement ? property
or pension?
Property. With pensions, you are at the
whim of governments that can change
the regulations in an instant.
What has been your best
business decision?
I worked for years full time in film and
television as a producer, writing my
novels at nights. In 2005, when Dead
Simple, the first Roy Grace, became an
instant hit, I had to make a decision. It
was a no-brainer. Producing films is a
constant fight between dozens of
creative egos. With my novels, it is just
me. If I don?t want to, I don?t have to
change a single word. I love that
freedom.
And your best investment?
Backing my producing partner, Josh
Andrews, in turning my books into stage
plays. All three so far have been hits,
grossing more than г10m at UK theatre
box offices.
My other best investment is having
the services of a driver to enable me to
work door-to-door wherever I go, which
has gained me hundreds of hours of
writing time. Over the years I?ve got used
to writing anywhere ? the back of a car,
And your worst?
I?d always dreamed of owning an E-type
Jaguar. In the late 1980s, after my first
big publishing advance, I bought two for
about г10,000 each and spent a fortune
restoring them. Then I got divorced and
had to sell them at a massive loss during
a slump in the vintage car market. Today
they?d be worth at least г100,000 each.
What?s your money weakness?
I?m an incurable petrolhead and have
six classic cars. I spent an eye-watering
amount on an Aston Martin Vanquish
Volante four years ago and it gave me
endless joy, even though I took a big hit
on it when I sold it recently.
What?s your financial priority in the
years ahead?
To avoid going into debt.
What aspect of the tax system
would you change?
A lot. The taxation system is completely
wrong and responsible for why our
country is financially broken and the
NHS is in such a plight. High achievers
are punished and we?ve created a
culture of entitlement where you?ve
got three generations of a family living
on benefits. That can?t be right.
The police, military and emergency
services are not looked after by the
government. If you have a disgruntled
police service, as we do now, you have a
very dangerous situation.
What would you do if you won
the lottery jackpot?
After putting aside a lump sum to
help family members or friends, and
splashing out on a racing Aston Martin
DB5, I?d give the rest to the charities
I support, such as the Sussex Police
Charitable Trust, which helps police
staff deal with trauma and emotional
issues.
What has been your most
lucrative work?
Undoubtedly writing the Roy Grace
crime novels. The first appeared in 2005
and the 14th is just coming out. They?ve
sold about 20m worldwide, topped the
charts in Britain, Germany, France,
Russia and Canada, and been translated
into 37 languages. I never dreamt I?d be
able to make a living out of writing.
Do you invest in shares?
I have a portfolio of shares managed by
Quilter Cheviot. I tend to leave the
a hotel lobby. I love writing on planes
? few distractions. I?ve finished two
novels on long-haul flights.
The flop that cost James his first fortune
What is the most important lesson
you have learnt about money?
A wise friend once said: ?Money is no
good unless it?s changing hands.? Pity
the person who will end up the richest
man in the graveyard.
I salute your work ethic,
Grandpa. The kids might not
PETER CONRADI
ADI
Baby boomers are used to being cast
as the pantomime villains in the great
debate about intergenerational
equality. Educated free at university,
they have benefited from the huge rise
in property prices and are now settling
down for a long and comfortable
retirement, courtesy of their generous
defined benefit pensions.
Like most caricatures, this one
contains a dollop of truth. But it seems
many boomers ? let?s call them ?silver
strivers? ? are choosing a different
approach to their twilight years. As
Nicholas Hellen reveals in our cover
story this week, one in eight people
who reach the state pension age ? at
present 65 for men and 64 for women
? are staying at work.
In some cases, the motivation is
financial: not everyone has a goldplated pension. Divorce has also
played havoc with many people?s
financial planning.
For others, it is a lifestyle choice. If
you have a job you are still good at and
enjoy, then why not keep at it, albeit
perhaps on a part-time basis ? rather
than bidding farewell to your
colleagues and heading into the sunset,
carriage clock in hand?
The phenomenon will present
interesting challenges, though: the first
cohort affected by the scrapping of the
state retirement age in 2011 are now in
their early seventies. What if they still
insist on toiling on, five or perhaps
10 years from now?
What employer will dare suggest
they are no longer up to the job, for fear
of being accused of ageism? Expect a
boom time for employment lawyers.
Some younger workers will inevitably
see such ?job blockers? as a barrier to
their own career advancement.
This social change is also likely to
increase the wealth gap: while many
lawyers, accountants and architects are
able and willing to ply their trades well
into their seventies, the same is not true
of builders or street cleaners.
There is a gender disparity, too:
women, who bear a disproportionate
share of caring for their parents as well
as their children, often struggle to
remain in the workforce into their
sixties, let alone beyond.
Yet it would be churlish not to wish
the silver strivers well, especially at a
time when older people are often
spoken of as a burden to be borne
by the working population. Their
determination to remain on the job is
to be applauded.
A spring fillip for Phil
In the past, this week would be the
busiest one of the year for Money.
But these days the annual piece of
parliamentary theatre once known
as the budget has been reduced
to a spring statement. What is
described in the official jargon as
the ?main fiscal event of the year?
is in November.
That being said, what Philip
Hammond says on Tuesday will be
important: the chancellor is set to
reveal a boost in the public finances
of as much as г11bn, thanks to a jump
in tax receipts. There is also expected
to be good news about productivity
? how much each of us produces per
hour ? which is finally on the rise after
a decade of sluggish growth.
Such announcements do not have
the same headline-grabbing effect as
another 1p on income tax or 10p off a
pint of beer. But ultimately, they will
determine how much money you and
I will have left in our pockets.
@peter_conradi
funds are used
as a building block for discretionary
model portfolios that require a small
exposure to certain equities, and they are
designed to be managed to a maximum
tracking error from its benchmark.?
16
The Sunday Times March 11, 2018
MONEY
We?re still
ba?ed by
this switch
glitch
QUESTION
ON
OF MONEY
EY
LEY
JILL INSLEY
Fighting your ?nancial
and consumer battles
M
y daughter is a young
mother on a low, variable
monthly income. On
moving home in 2015
she chose her energy
supplier carefully,
settling on SSE and
paying through direct
debit. This worked fine
until, out of the blue, she
received a letter from Scottish Power
threatening to register a credit default
against her name unless she paid a
gas bill of well over г1,000.
Scottish Power had unilaterally taken
over my daughter?s gas and electricity
supply in April 2016 and caused the
cancellation of her monthly direct debit
with SSE. No reason has yet been given
as to how this occurred.
She went through the complaint
process with Scottish Power and then
the energy ombudsman. But although
the ombudsman found Scottish Power
?at fault? on four counts and ordered
it to apologise, confirm zero account
balances and provide a г150 goodwill
payment, the end result is that she faces
a bill for two years of energy.
Scottish Power should not be allowed
BUY PRINTS OR SIGNED COPIES OF ROB MURRAY?S CARTOONS FROM OUR PRINT GALLERY AT TIMESCARTOONS.CO.UK
HOT TICKETS MAN WHO
SCAMMED READERS
PLEADS GUILTY TO FRAUD
to walk away without taking full moral
and financial responsibility for this.
Jill replies
Your daughter suffered what is known
in the utility industry as an ?erroneous
transfer? ? she was switched to a new
supplier without her consent. The trade
body Energy UK says: ?It is usually the
result of a genuine mistake and suppliers
will always work to fix the problem with
no discomfort to the customer.?
Sadly, this mistake caused your
daughter considerable discomfort. As
she is self-employed and her earnings
are irregular, she did not notice that the
payments to SSE had stopped leaving
her account. Although the ombudsman
found in her favour, she was left with a
huge bill for the gas and electricity she
had used while being supplied, without
her knowledge, by Scottish Power.
Your daughter was not contacted by
either company at the time of the switch.
SSE says it sent a ?We?re sorry you?re
leaving? letter ? and that it issued final
bills and took a final payment. However,
she says she did not receive the letter or
bills and did not spot the payment.
Scottish Power failed to send a
?welcome? letter or provide any tariff
details or advice on the ?cooling off?
period for the new contract. Nor did it
ask your daughter to take meter readings
so the final bill for SSE and the first bill
for Scottish Power could be calculated
accurately.
Scottish Power then compounded
this error by failing to send her any gas
bills for 17 months.
The electricity bills began to arrive
after 18 months, last October. In that
same month, your daughter finally
received a letter from Scottish Power
explaining her new tariff and giving her
14 days to cancel her switch. Sadly, the
offer was 18 months out of date.
?This is what they call a welcome letter?!?
Under the Ofgem code, Scottish
Power would not have been allowed to
backdate the bill by more than 12 months
because it was at fault. This would have
resulted in your daughter?s bill being
reduced by more than г1,000.
However, her supply ? and the debt
for the energy she had already used ?
was transferred back to SSE last
November. The energy ombudsman
did not consider SSE to be at fault, so it
was entitled to bill her as though the
erroneous transfer had never happened.
By the time you came to me for help,
your daughter had been in dispute with
Scottish Power and the ombudsman for
months ? and had not paid an energy
bill for 20 months. Her debt was built up
because of Scottish Power?s actions.
The г150 the company was ordered to
pay in compensation by the ombudsman
was clearly out of all proportion to the
mess it has created. I appreciate that
legally Scottish Power did not have to
do any more, but morally I thought it
should cover the bill your daughter
faced through no fault of her own.
At the same time, I asked SSE to
confirm exactly how much your
daughter owed, as she was still waiting
for a final tally.
As it turns out, Scottish Power had
already sent her a cheque for г318
towards the cost of the gas supply. This
had been done in error but the company
said it would honour the cheque. It also
offered her a further goodwill payment
of г249 for the electricity and a discount
on the amount she owed based on its
cheapest rates. This offer was rejected.
Instead, it was SSE that stepped up to
the plate. It waived your daughter?s
entire bill, which came to г4,093.
It said: ?This was Scottish Power?s
error and the customer?s supply has now
been returned to SSE. Although not at
fault, as a gesture of goodwill SSE has
waived the 20 months worth of energy
used by the customer. SSE understands
the customer is pleased the issue has
been resolved.?
Why won?t they just give
me my deposit back?
I hired a motor home through
unbeatablehire.com last November. As
part of the hire, I had to pay a deposit
of г1,250 for the insurance excess.
Unlike most hire companies I have
dealt with, this had to be an actual
payment rather than a card
pre-authorisation. I was wary, but a
friend had used the company before
with no problems. I paid the deposit
online by credit card on November 8.
The motor home was a bit of a
disaster because of electrical problems
and I ended up returning it a day early.
The fuel level was correct and there was
no damage; this was confirmed by the
depot staff.
The terms and conditions stated that
the deposit would be refunded after
28 working days. This came and went,
so I emailed UnbeatableHire and
received a link to a final statement,
which stated I was due the full г1,250
back. I requested the refund at the start
of January and then waited. And waited.
No refund arrived.
HAVE
YOUR SAY
EDITED BY
RUTH EMERY
Take my adviser
My former financial adviser
put my money into dud after
dud before I eventually
extricated what was left of
my investment portfolio and
self-invested personal
pension (? ?Phoenix firm?
burnt through my savings?,
last week). He also tied my
money into several film
schemes and then washed
his hands of the lot. I
reported him to the
ombudsman but my
complaint came too late
? it was after the six-year
cut-off. The adviser, who was
charmingly persuasive, is
now at another wealth
management firm.
MF, northwest London
A financial adviser was
recommended to me by a
?friend? 19 years ago when I
was looking for funding to
buy my business. She took
г14,000 in fees and lied about
the options available to get
my funding, resulting in a
significant financial loss. The
ombudsman was hopeless.
Always take the advice with
great caution, read the small
print and double-check the
institutions they advise you
to invest with.
Dizzle, via
thesundaytimes.co.uk
I emailed again to no avail and tried
the site?s online chat tool, but found
the staff incredibly unhelpful. I finally
managed to get an email address for the
credit department and contacted it at
the end of January. It replied saying it
had experienced a few problems with
refunds at the end of last year, but it
would chase up my refund with its
merchant provider. This would take up
to 10 working days, it said. If it confirmed
the refund had not been issued, the
credit department would do it manually.
Ten working days came and went ? no
refund. I have since emailed the credit
department twice, with no reply.
It is now three months since I hired
the motor home and I wonder if I am
ever going to see this г1,250 again.
Jill replies
I looked on the customer-review website
Trustpilot and saw 57% of contributors
had given UnbeatableHire one star ? the
lowest rating. Nearly all complained
about exactly the same problem: the
delayed return of a deposit. One
described the company as unbearable.
I called UnbeatableHire, provided
your name and the date of your hire, and
said I wanted to speak to the manager
about your missing г1,250. Within two
hours, you received an email from the
company?s credit department to say
your deposit had been refunded.
CAN WE HELP YOU?
Please email questions to Jill Insley at
questionofmoney@sunday-times.co.uk
or write to Question of Money,
The Sunday Times, 1 London
Bridge Street, London SE1 9GF.
Please send only copies of original
documents. Letters should be
exclusive to The Sunday Times. Advice
is offered without legal responsibility.
We regret Jill cannot reply to everyone
who contacts her.
I have been self-employed for
most of my life; when I made
money I got paid. I have used
two financial advisers who
lost my money but still got
paid. It would seem that
many problems associated
with advisers would be solved
if they received a percentage
of the profits raised using
their clients? money rather
than an upfront reward taken
from clients? investment.
RW, Frome, Somerset
These stories of lost pensions
and savings are sad, but can
any government stop this
happening without the
co-operation of the victims?
Some of these people appear
to have invested without
carrying out the most basic
common-sense checks.
Surely they should check if
the adviser and investment
are regulated? They can also
see another adviser to get a
second opinion. People who
do nothing but hand over vast
sums of money to strangers
will be in grave danger of big
losses and, however harsh
this may seem, they have no
one to blame but themselves.
RC, Wandsworth,
southwest London
Big numbers
Hunter Davies bemoans the
size of the ?dinky digital pad?
he has to use to access his
online banking (?Password?
I can barely remember my
name?, last week). I also
found the First Direct digital
pad difficult to use and made
this point in a phone call ?
and lo and behold, I was
offered a larger version. It
arrived within a few days
and is the size of a calculator.
When switched on, it
welcomes me in a soft voice
and then talks me through
Readers who report suspected
frauds to the police often tell me
they feel no action is being taken to
track down the perpetrators, writes
Jill Insley. So it is a relief to report that
a man who stole money from Sunday
Times readers through a ticketing
scam has been punished.
Jamie Thomas, former chief
executive of the North Wales
Crusaders rugby league team, was
given a 22-month prison sentence,
suspended for two years, after
admitting a number of charges. He
was also ordered to pay г66,000
compensation to his victims.
His lawyer Adam Kane explained
that Thomas had not been in a
position to take on the cost of
running the Crusaders. He said:
?There was no high living ? it was
a misguided venture to keep the
rugby club afloat. He paid the players
when they were up in arms when
they didn?t get their wages.?
Thomas came to the attention of
Question of Money in 2015 when
readers complained about his
agency, Tours Sportif, taking money
for non-existent tickets. One reader
paid the agency г1,140 for tickets
and hospitality at the Wimbledon
championships. Another spent
г1,200 on rugby World Cup tickets.
I spoke to Thomas, who promised
to return the money, and encouraged
the readers to report the loss of their
cash to their banks and Action Fraud.
Thomas actually paid one reader
г800 of the г1,200 he was owed, but
the other reader received nothing
and so pursued a complaint with
the Financial Ombudsman Service
about the way in which the banks
involved had handled his problem.
The ombudsman recommended that
RBS pay г1,140 back to our reader
Jamie Thomas
? pictured on
MasterChef ?
was ordered to
pay г66,000 to
victims of his
ticketing scam
because the bank knew there was
suspicious activity involving Tours
Sportif?s account before he made his
payment. The ombudsman said RBS
?should have made further inquiries?
before allowing any funds to be
removed from the account.
The evening before Thomas
appeared in court, he faced a
different kind of judge on BBC1?s
MasterChef, in which he described
himself as a ?fly by the seat of the
pants? cook. The BBC said the filming
had taken place ?some time ago?.
The MasterChef judges said
Thomas?s food sounded great
before tasting it, but decided his
Asian-inspired concoctions
?completely missed the mark? ?
rather like his imaginary ticket sales.
Hunter on hold: our columnist is not a fan of online banking
what I have to do. The
buttons are nearly half an
inch across (I?m too old for
metric) and easy to press.
JM, Guildford, Surrey
Like Hunter, I have great
difficulty remembering all
my passwords. I did consider
paying for a password
manager, but read some
banks would not reimburse
fraudulent activities if they
found out you had given your
password to a third-party
app. Fingerprint or facial
recognition technology
should be rolled out as
quickly as possible.
IH, Sheffield
I have three A4 pages of
passwords. Yes, three! Most
are for trivial, non-financial
things such as apps. I admit
that for these I do something
that isn?t advised: I use a
password based on a single
word. But it?s a long Welsh
word, with vowels removed,
and a variation of numbers.
My banking and credit card
logins are more complex.
Wyn Ford, via
thesundaytimes.co.uk
Too late by half
We have renewed our
breakdown cover with the
same insurer for the past
nine years. Our renewal
quote this year was г393.69,
which included a г73 admin
fee. I searched the internet
and found equivalent cover
for less than half the price. I
phoned the insurer to say I
did not wish to renew and
was immediately offered a
reduced premium of г150. I
said, ?No, I should have been
offered the best price first
time round? ? and was then
offered 15 months? cover for
the same price. Do these
companies not have any
moral principles at all?
PD, West Kirby, Wirral
We love to receive your
feedback on stories and
your views on any issues
you would like us to
investigate. Always
include your name and
address when contacting
us. Letters may be edited.
WRITE TO
Money, The Sunday Times
1 London Bridge Street
London SE1 9GF
EMAIL
money@sundaytimes.co.uk
TWITTER
@ST_Money
17
The Sunday Times March 11, 2018
MONEY
Best Buys
CURRENT ACCOUNTS
FOREIGN
CURRENCY
CREDIT INTEREST
Provider
Account name
Account fee
Interest rate 1
Balance
Contact
TSB
Classic Plus
None
3% + г10 a month 2 г1-г1,500
0345 975 8758
Halifax
Reward
None
г3 a month
г1+
0345 720 3040
Nationwide
FlexDirect
None
5% 3
г1-г2,500
0800 302 010
Provider
Account name
Account fee
Interest rate 4
0% overdraft limit Contact
First Direct
1st Account
г10 a month 5 15.9%
M&S Bank
M&S Current Account None
These are the interbank
rates at 5pm on Friday,
which show where the
market is trading.
They are not indicative
of the rate you will be
able to get.
OVERDRAFTS *
Post Office Money Standard Account
None
30-Month Purchase Mastercard
Sainsbury?s Bank Dual Offer Mastercard
Fixed to 31.3.20
40%
г745
LV
0345 111 8010
1.39%
Fixed to 31.5.20
20%
г999
LV
0800 494 999
Nationwide
1.89%
Fixed for 2 years
10%
г999
GLV
0800 302 010
Lender
Rate
Scheme
Deposit
Fee
Notes
Contact
40%
г999
LV
0800 494 999
25%
г995
LV
0845 850 1755
14.9%
г0
0345 266 8977
Tesco
2.18%
Fixed to 31.5.21
10%
г995
LV
0345 051 8446
1.12
1.39
1.32
1.77
APR 1
Reward
Contact
0% for 31 months
18.9%
Yes
0808 540 5060
0% for 30 months
18.9%
No
0345 944 4555
0% for 30 months
18.9%
Yes
0808 540 5060
SWITZERLAND
GBP>CHF
Introductory purchase Transfer fee 2
APR
Contact
0% for 36 months
1.85%
19.9%
0800 731 0200
MBNA
Platinum 36 Month Visa
0% for 36 months
2.49%
19.9%
0345 606 2062
Nuba
Transfer Mastercard
0% for 36 months
2.50%
19.9%
0345 606 2062
AUSTRALIA
GBP>AUD
CASHBACK CARDS
APR 1
Cashback
Contact
28.2%
1%-1.25%. Intro 5% for 3 months
0800 917 8047
American Express Platinum Cashback Everyday 22.9%
0.5%-1%. Intro 5% for 3 months
0800 917 8047
0.5%
0800 389 9905
1 APR = annual percentage rate, dependent on credit rating. 2 Fee charged on the amount of each balance transfer during the introductory period.
Source: Moneyfacts.co.uk
Source: timescurrencyservices.co.uk
020 7294 7970
National Savings &
Investments (NS&I) has
reduced the rates on its
three-year guaranteed
growth bonds and
guaranteed income
bonds following a surge
in popularity since their
launch in December.
3-YEAR FIXED RATES
Fixed to 31.5.21
Introductory purchase
21.7%
1.24%
HSBC
Fixed to 31.5.21
Platinum 36 Month Visa
All in One Mastercard
Sainsbury?s
1.64%
Card type
Santander
Contact
1.54%
Barclaycard
Card type
Notes
Skipton
Provider
American Express Platinum Cashback
Fee
HSBC
BALANCE TRANSFERS
Provider
Deposit
0345 900 0900
INTRODUCTORY RATES
Halifax
Scheme
0800 242 424
CREDIT CARDS
Card type
Rate
г100
AMERICA
GBP>USD
Sainsbury?s Bank Purchase Mastercard
Lender
г250
EURO
GBP>EUR
MONEY
MADE EASY
NS&I CUTS
RATES ON BONDS
2-YEAR FIXED RATES
15.9%
1 Based on funding of г1,000 a month. 2 To receive г10 you must have two direct debits and make 20 card payments a month. 3 Introductory rate for one year, then 1%.
4 Equivalent annual rate. 5 Fee waived if minimum funding of г1,000 is met. * Based on overdraft of г500 for 15 days a month.
Some accounts require minimum funding/direct debits to open or receive rates shown.
Source: Moneyfacts.co.uk
Provider
MORTGAGES
LONG-TERM FIXED RATES
Lender
Rate
Scheme
Deposit
Fee
Notes
Contact
Sainsbury?s
1.8%
Fixed to 31.3.23
40%
г745
LV
0345 111 8010
HSBC
1.94%
Fixed to 31.5.23
20%
г999
LV
0800 494 999
Coventry
2.45%
Fixed to 31.3.23
10%
г999
LV
0800 121 8899
First Direct
2.69%
Fixed for 10 years
25%
г0
LV
0800 482 448
Deposit
Contact
What are the new rates?
The growth bonds paid
2.2%, but new customers
will earn 1.95% a year. The
rate for the income bonds
is falling from 2.15% to
1.9%. Rates for existing
customers will not
change.
TRACKERS */ DISCOUNTS
Lender
Rate
Scheme
Fee
Notes
HSBC
1.24%
Tracker +0.74% for 2 years 40%
г999
ELV
0800 494 999
Hinckley & Rugby
1.99%
SVR -3.9% for 2 years
г0
ER
0800 774 499
Nationwide
1.94%
Tracker +1.44% for 5 years 25%
г999
EGLV
0800 302 010
Hanley Economic
1.75%
SVR -3.44% for term
25%
г950
ELV
01782 255 000
Contact
10%
Why are rates being cut?
The bonds were ?best
buys? initially and demand
was high. As a taxpayerbacked savings provider,
NS&I is obliged not to be
too competitive for too
long. It has a ?net
financing target? set by
the government that
determines how much
it is allowed to draw from
savers each year.
FIRST-TIME BUYER / LOW DEPOSIT
Lender
Rate
Scheme
Deposit
Fee
Notes
Yorkshire BS
3.29%
Fixed to 30.6.20
5%
г995
DP
0345 166 9510
Hanley Economic
3.1%
SVR -2.09% for 2 years
5%
г250
PV
01782 255 000
Barclays
2.69%
Fixed to 30.4.21
0%
г0
FP
0333 202 7580
Lender
Rate
Scheme
Deposit
Fee
Notes
Contact
Virgin Money
1.79%
Tracker +1.29% to 1.6.20
40%
г995
D
0345 605 0500
Post Office
1.91%
Fixed to 30.4.20
25%
г995
DV
0800 077 8033
Barclays
2.18%
Fixed to 30.4.23
40%
г1,950
R
0333 202 7580
BUY TO LET
What if my bonds
are maturing?
Your money will
automatically be rolled
over into a new three-year
deal paying the old rates
of 2.2% or 2.15%. The same
applies for those with 65+
guaranteed growth bonds
(also known as pensioner
bonds), which were
available between January
and May 2015 to people
aged 65 and over.
You can ask for the
bonds not to be rolled
over if you want to move
your money instead.
Early repayment charge applies unless otherwise stated. * Most deals track Bank of England base rate. Notes: SVR = Standard variable rate;
D = г500 cashback; E = No early repayment charge; F = Family Springboard, 10% deposit must be in a Barclays Helpful Start account;
G = г500 cashback for first-time buyers; L = Free legal work for remortgages; P = Purchases only; R = Free valuation and legal work for
remortgages; V = Free valuation.
Source: landc.co.uk ? 0800 373 300
SAVINGS ACCOUNTS
INSTANT ACCESS
Provider
Account name
Min deposit
Interest rate
Contact
RCI Bank
Freedom Savings
г100
1.3%
rcibank.co.uk
Virgin Money
Double Take E-Saver Issue 4
г1
1.3%
uk.virginmoney.com
Ford Money
Flexible Saver
г1
1.22%
fordmoney.co.uk
NOTICE ACCOUNTS
Provider
Account name
Notice period
Min deposit
Interest rate
Contact
Secure Trust Bank 1
180-day notice
180 days
г1,000
1.65%
securetrustbank.com
Paragon Bank
120-day notice (Issue 8)
120 days
г500
1.55%
paragonbank.co.uk
120-day notice
120 days
г1,000
1.55%
securetrustbank.com
Term
Min deposit
Secure Trust Bank
1
1 Maximum three capital withdrawals a year subject to required notice.
CASH ISAS
INSTANT ACCESS
Provider
Account name
Min deposit
Interest Transfers in Contact
Nationwide
Single Access Isa
г1
1.3%
Yes
nationwide.co.uk
Virgin Money
Easy Access Cash E-Isa Issue 22
г1
1.21%
Yes
uk.virginmoney.com
FIXED RATE
Provider
Account name
Term
Min deposit Rate
Transfers in Contact
Virgin Money
Cash E-Isa Issue 317
1 year
г1
1.5%
Yes
Paragon Bank
Cash Isa
2 years
г500
1.67% Yes
uk.virginmoney.com
Are there better rates
available?
Yes. Ikano bank, for
example, offers 2.26%
over three years.
paragonbank.co.uk
Source: Savingschampion.co.uk ? 0808 178 5354
FIXED-RATE BONDS
Provider
Account name
Interest rate
Contact
Investec Bank
Fixed Term Deposit
1 year
г25,000
1.9%
investec.com
Ikano Bank
Fixed Saver
2 years
г1,000
2.1%
ikano.co.uk
Vanquis Bank Savings
Fixed Rate Bond
3 years
г1,000
2.3%
vanquissavings.co.uk
DEALS ARE LISTED ONLY IF THEY ARE COVERED BY THE UK FINANCIAL SERVICES COMPENSATION SCHEME (FSCS) OR A EUROPEAN EQUIVALENT
Source: Savingschampion.co.uk ? 0808 178 5354
CHILDREN?S ACCOUNTS
Provider
Account name
Account type
Min deposit
Interest rate
Contact
Halifax
Kids? Regular Saver
Regular saver
г10-г100
4.5%
halifax.co.uk
Santander 1
123 Mini Current Account
Current account
г300
1%-2.96%
santander.co.uk
Cambridge
3-year Fixed Rate Bond (Issue 1) Fixed rate bond
г1,000
2%
cambridgebs.co.uk
1 Interest rates are tiered: 1% on balances of г100-г199; 1.98% on г200-г299; 2.96% on г300-г2,000.
ENERGY DEALS
JUNIOR ISAS
HOW TO
INVEST
Average annual bill
Rate
Contact
Provider
Account name
Min deposit
Interest rate
Rate
Tonik
г835
F
0333 344 2686
Coventry
Junior Cash Isa
г1
3.5%
V
coventrybuildingsociety.co.uk
People?s Energy
г864
V
0131 285 5510
Nationwide
Smart Junior Isa
г1
3.25%
V
nationwide.co.uk
Together Energy
г875
F
0333 150 1699
Tesco Bank
Junior Cash Isa
г1
3.15%
V
tescobank.com
Source: TheEnergyShop.com ? 01259 220 270
г10,000
Just starting your
portfolio? First,
decide how long
you will invest for
Rebecca
O?Keeffe,
Interactive
Investor
Each week we ask an expert
for tips on how to invest
г10,000. Our latest
contributor is Rebecca
O?Keeffe, head of investment
at the online broker
Interactive Investor.
O?Keeffe said people
starting to invest need to
consider how long they
want to invest for and how
much they are prepared to
pay in fees.
?Time is critical to your
choice of investment,? said
O?Keeffe, 47, who lives in
Hildenborough, Kent, with
her husband and two
teenage children.
?Over the short term,
equities are much riskier
than other assets, but over
the long term, not being
invested in equities is a
much greater risk.?
Charges can also have an
enormous impact on your
total returns, ?particularly
in a low-interest-rate
environment where annual
market returns are expected
to be lower?, she said.
Her choices below are a
mix of passive funds ? which
mimic the performance of a
particular market index ?
and actively managed funds,
which pick individual stocks.
Legal & General Global
100 Index Trust
(up 4.1% over a year)
I would invest г3,000 in this
low-cost passive fund. It
tracks the world?s 100
biggest multinational
companies, including Apple,
Alphabet (the owner of
Google) and ExxonMobil.
As a passive fund, it isn?t
trying to shoot the lights out,
but it does offer consistently
good long-term performance
for a low annual fee.
As you might expect for a
fund that holds the largest
companies in the world, it
has a US bias, with a high
proportion of shares in
technology and finance.
Its average annual charge
is 0.18%. (As with all funds
mentioned, this fee is paid
on top of the charge levied
by the investment platform
or broker that you use to
make the investment.)
Vanguard Global
Small-Cap Index
(up 5.7%)
Most passive funds focus on
the biggest companies as
they are easier to track, but
it is good to have exposure
to smaller stocks too. This
fund, into which I would add
г2,000, attempts to track
the MSCI World Small Cap
Index, which is made up of
small companies in
developed markets.
It has a high proportion
of US stocks but is not as
heavily invested in the big
tech and finance giants.
Its average annual fee
is 0.49%, which is still less
than its actively managed
equivalents.
BlackRock World Mining
Trust (up 11%)
After a decade of low
inflation, we are finally
seeing signs of rising prices.
Owning commodities can
help beat the effects of rising
inflation, so it makes sense to
have some exposure to them
in a diversified portfolio.
This fund invests in
mining companies
worldwide. Top holdings
include Rio Tinto and BHP
Billiton, which are both
listed in London.
I would invest г2,500
here. The average annual
fee is 1.67%.
Man GLG Continental
European Growth
(up 16.9%)
For my final г2,500, I would
go for a fund that invests in a
broad spectrum of countries
and sectors across Europe
and has a track record in
active management.
This fund should offer
solid returns in the event
that the European recovery
continues to strengthen ?
and it also provides good
diversification versus the
technology and commodity
companies held by the other
suggested funds.
Top holdings include the
Italian clothing firm Moncler
and the German software
giant SAP. The average
annual fee is 1.24%.
ST DIGITAL
Read our latest advice
for new investors
thesundaytimes.co.uk/
howtoinvest10k
V = variable rate. Source: Savingschampion.co.uk ? 0808 178 5354
Contact
ICONS BY JAMIE JONES
Table shows the cheapest tariff from the 3 cheapest
suppliers.Excludes
suppliers.
Excludesfixed
fixedtariffs
tariffsof
ofless
lessthan
than12
12
months? duration. Excludes tariffs that do not have
national coverage. Excludes tariffs where payments
are taken in advance of the customer coming on
supply. F=Fixed rate
ratesV=Variable
V=Variablerate
rates
Supplier
Top tip
One advantage of NS&I
products is that deposits
are 100% guaranteed by
the state and you can
shelter up to г1m per
bond. Deposits in ordinary
bank and building society
accounts are protected
by the Financial Services
Compensation Scheme,
which caps refunds at
г85,000 if the firm holding
your money goes bust.
Ali Hussain
18
The Sunday Times March 11, 2018
MONEY
Puzzles
FEEDBACK
Comments about our puzzles
can be sent to puzzle.feedback@
sunday-times.co.uk or Puzzles
Editor, The Sunday Times,
1 London Bridge Street,
London SE1 9GF
GENERAL KNOWLEDGE JUMBO CROSSWORD 100
1
2
3
4
5
6
12
Across
7
8
9
10
11
13
14
15
16
17
18
19
20
21
23
24
26
27
22
25
28
29
30
31
32
33
35
34
36
37
38
40
39
41
42
43
44
Down
1 Travelling at over 100 miles per hour (3-2)
4 Virginia county, part of the Washington metropolitan area,
where the Pentagon and a national cemetery are located (9)
9 Island group reigned over by Queen Salote from 1918 to
1965 (5)
12 In county cricket, Warwickshire?s home ground (9)
13 School founded by Henry VI in 1440 (4,7)
14 Founding member of the Football League which won the
European Cup in 1982 (5,5)
15 State capital of Louisiana (5,5)
17 The weight of a merchant ship?s cargo (7)
19 This craftsman may use an agraffe to hold blocks together (10)
23 Isabella, who wrote the Book of Household Management (3,6)
24 Author of the 1687 work The Mathematical Principles of
Natural Philosophy (5,6) (pictured)
26 The only Celtic language spoken on mainland Europe (6)
28 In pantomime, Baron Hardup?s servant, who is often
dressed in a bellboy?s costume (7)
29 Simultaneously or immediately (2,4)
32 Cut of lamb for the Sunday joint (3,2,6)
33 Type of vitreous pottery noted for its strength and
durability (9)
35 Limb of Dover in the Confederation of Cinque ports, and
HQ of Saga (10)
37 Flaring skirts on suits of armour (7)
41 Folk who lead a routine monotonous life (10)
43 Clay extracted near St Austell; its discovery crucially
developed the manufacture of English porcelain (5,5)
47 One of 24 in an octave (7,4)
48 A former lace-making town in the Erewash district of
Derbyshire (4,5)
49 Ben ____?s first TV success was as a co-writer of The Young
Ones (5)
50 Something used to start an explosion (9)
51 Chemical solution which
softens colours in a
photographic work (5)
50
3
4
5
Across
6
7
9
8
10
11
13
14
12
15
1
8
9
10
11
13
15
17
18
20
21
22
Down
Clumsy person (10)
Quirky (9)
Ladder (3)
Piece of poetry (5)
Scent (7)
Arrogance (6)
Grown-ups (6)
Nuisance (7)
Hooded ophidian (5)
Record (3)
Slogan (9)
Relevant (2,3,5)
2
3
4
5
6
7
8
12
14
16
19
21
Ordinary people (5)
Incredulity (9)
Take up (6)
Mate (3)
Large baleen whale (7)
See (10)
Of use (10)
Italian chicory (9)
Darken (7)
Cheerful (6)
Tanned (5)
Share (3)
16
17
18
20
19
Solution to 1563
Across: 5 Kegs, 7 Applause, 9 Idiom, 10 Set out, 11 Emmanuel, 13 Ruby, 15 Chic,
17 Hesitant, 19 Italic, 21 Error, 22 Flambeau, 23 Snog
Down: 1 Tedium, 2 Badmouth, 3 Opus, 4 Master-at-arms, 6 Spinal column, 8 Squib,
11 Etc, 12 Listen up, 14 Yet, 16 Hotel, 18 Narrow, 20 Crew
21
22
EASY
45
?9
MEDIUM
186 OF+ 2/IT3
HARDER
729 OF/3IT
2
CELL BLOCKS
x 4 ў 12 + 89 x 4 ? 54 ў 7 x 20
x 4 + 759
TREBLE ? 4289 3/4
IT
OF IT
+1/4 ? 3889
x 11 + 722 OF
IT
3/4
OF IT
2/3
OF IT
ў 14
1/2
OF IT
x5
ў 18 + 686 ў 14
ANSWER ANSWER ANSWER
BRAIN TRAINER
Just follow the instructions from left to right, starting with the
number given to reach an answer at the end
16
18
19
20
21
22
23
25
27
30
31
34
36
38
39
40
42
NEWS QUIZ
51
Solution to 99
Across: 1 Red Balloons, 7 Dinaric Alps, 13 Transom, 14 Trapezoid, 15 Mid-on, 16 Blears, 17 Omnium, 18 Pharisees, 20 Greg LeMond, 21 Saturn, 22 Tulsa, 25 It?s a Long Way to
Tipperary, 29 King Richard, 30 Waldorf, 31 Tor, 32 Wiz, 34 Leucine, 35 Stipulation, 37 A Chaste Maid in Cheapside, 40 Diego, 41 Bolero, 42 Accountant, 45 Chatty Man,
46 Anorak, 47 Emboli, 49 Libra, 50 Oppenheim, 52 Trade up, 53 East Lothian, 54 Ayrton Senna
Down: 1 Rutabaga, 2 Diane Keaton, 3 Australian rules football, 4 Lima, 5 Ottoman, 6 Spadix, 7 Dreamcast, 8 NCO, 9 Red Dawn, 10 Committee of Ways and Means, 11 Liddell
Hart, 12 Sinus, 18 Paul Tillich, 19 Embouchure, 23 Amy Grant, 24 Yardie, 26 Gracie Allen, 27 Procurator, 28 Skewbald, 30 Wisent, 33 Zaheer Abbas, 36 Indian Ocean,
38 D?Artagnan, 39 Ethiopia, 41 Bumboat, 43 Cranmer, 44 Topeka, 45 Chloe, 48 Otto, 51 Poi
2
10
11
46
48
1
8
9
44
45
47
CONCISE CROSSWORD 1564
6
7
45
46
49
1
2
3
4
5
4
6
2
2
6
3
2
2
2
9
3
6
Divide the grid into blocks.
Each block must be square or
rectangular and must contain
the number of cells indicated
by the number inside it.
2
E XC L U S I V E
R E WA R D S FO R
SUBSCRIBERS
?Cain [...] dwelt in the land of Nod, on ____ of Eden? (Bible) (3,4)
?Burns? and ?Bonfire? can both precede this word (5)
?____ Superbrain?, Annie Jones?s character in Neighbours (5,4)
Ballerina ____ Sibley often danced with Anthony Dowell (10)
Ivan ____ won every tennis grand slam singles title except
Wimbledon, and later coached Andy Murray (5)
Russian for ?no? (4)
?Oh dear! Oh dear! I shall be ____? (The white rabbit, in the first
words spoken in Alice?s Adventures in Wonderland) (3,4)
Magic, supposedly using communication with the dead (10)
In 1841, John ____ became the first US vice president to
succeed to the presidency without election (5)
A birthmark (6)
Liverpool comedian ____ Sayle was the Comic Strip?s first
emcee in the 1980s (6)
Communist state founded in 1922 (6,5)
Savings for a future rainy day (4,4)
Summer outfit for a baby or young child (7)
Steve ____ was the 1980 Olympic 800m champion (5)
____ Hill, 152m above sea level, is the highest point in Greater
London north of the Thames (8)
An instance of sternutation (6)
Type of sculpture originated by Alexander Calder (6)
(pictured)
Cumbrian village on the estuary of the river Kent, in the
northeast corner of Morecambe Bay (7)
Monteverdi opera, the earliest still regularly performed (5)
Advertised aggressively or questionably (10)
Prospector in the Californian gold rush (5-5)
Characteristic of old age (9)
Dismiss a naughty pupil from class (4,3)
Austrian social reformer Rudolf ____ founded an educational
philosophy, still used in schools named after him (7)
The Spanish provinces of Alava and Vizcaya are such (6)
Body of water such as Bass,
Otranto or Torres (6)
Elgar?s Chanson de ___, was
originally for violin and
piano (5)
A serf in ancient Sparta (5)
Dramatist Joe ____ wrote Loot
and What the Butler Saw (5)
John ___, English logician,
best known for diagrams
used in set theory (4)
spawned a 200% price
increase?
1
Who had an apostrophe
catastrophe with a tattoo?
5
Who can?t stop laughing,
despite Amazon?s efforts?
2
How old is old?
6
3
What height is Brandon
Marshall, 16, the world?s
tallest teenager?
Who told office workers
they shouldn?t have their
cake and eat it?
7
4
Which chocolate frog
Whose necks will no
longer look like that of
Brigitte Bardot, pictured?
A message in a bottle
dropped from a German
ship was discovered on an
Australian beach. After
how long?
9
A man in Knightsbridge
can expect to reach 79 in
good health ? but what
about in Blackpool?
10 Why was Sanchez Watt
given a red card?
MARK MY
WORDS 98
Readers are invited to guess
what was said when a topless
protester accosted Italy?s
former prime minister Silvio
Berlusconi at a polling station
in Milan last week.
See below right for how
to enter.
Send your entries to: puzzle.entries@
sunday-times.co.uk by no later than
Tuesday. Entries should include a postal
address and ?Mark My Words 98? in the
subject line of the email. The best entry as
judged by The Sunday Times will win The
Chambers Dictionary of Great Quotations.
TETONOR
MODERATE
Each number in the main grid
can be formed by adding or
multiplying a pair of numbers
in the strip below the grid.
Each pair of numbers should
be used twice: once as part of
an addition and once as part
of a multiplication. For
example, a 10 and 24 in the
main grid may be solved by
the sums, 4 + 6 and 4 x 6,
respectively. Enter each sum
in the boxes below its answer.
Any blanks in the strip must
be deduced, bearing in mind
the numbers are listed in
ascending order.
Last week?s winning caption,
for this picture of a swimmer
on a wintry Biarritz beach,
was: ?All that and she says she
doesn?t even like Milk Tray.?
It was suggested by
Roland Gardner of Highclere,
Newbury.
Terms and conditions: Competition closes at midnight on Tuesday.
Over 18, residents of the UK and ROI only. One entry per person. The
winner will be the best entry as judged by The Sunday Times. No cash
alternative to prize in whole or in part. Prize is non-transferable. Your
information will only be used for the purposes of this competition.
Promoter is Times Newspapers Ltd. Not open to staff of the Promoter
and promotional partner or their families.
12
200
33
27
32
18
34
252
176
36
13
240
225
30
72
32
14 15
24
4 6
8 9
11
POLYGON
From these letters, make
words of four or more letters,
always including the central
letter. Answers must be in the
Concise Oxford Dictionary,
excluding capitalised words,
plurals, conjugated verbs
(past tense etc), adverbs
ending in LY, comparatives
and superlatives.
How you rate
17 words, average; 23, good;
33, very good; 44, excellent.
Private view at
Tate St Ives
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8
19
The Sunday Times March 11, 2018
MONEY
3
4
5
6
7
9
8
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
NAME
29
...................................................................................
ADDRESS ...................................................................................
...................................................................................
Post your solution to The Sunday Times Mephisto 3002,
PO Box 29, Colchester, Essex CO2 8GZ, or email
puzzle.entries@sunday-times.co.uk
The first correct solution picked at random after next
Saturday wins Whitaker?s Concise, worth г25. Four
runners-up will each receive г20.
1 Splash short gaiter (4)
4 Drinks provided by head
over in the mountains (8)
9 Work in progress after
company dance (8)
11 With no accused about,
book mailed before
official?s entry (10, two
words)
12 Who can?t believe theft
taking place in volunteer
service once? (8)
15 Right away tight credit
mentioned (5)
16 Hint that?s going round
about a foreign capital (6)
17 Heads dropping, father
appears and withdraws (6)
18 Odd points in trumpet
part (6)
20 Supplied number to ring
on return (6, two words)
23 After a duck, go to catch a
seal (5)
25 Slide is behind child (8)
26 Poisonous seed able to be
distributed in Oregon
valley (10. two words)
27 Pop into safe
neighbourhood, primarily
for type of collar (8, two
words)
28 Unsafe building? Sack
party from the east (8)
29 Only part of pump? (4)
1 Historically tax covers
European currency (6)
2 White pots yellow with
characteristic artistry (11)
3 Bishop in row that divides
Rome (5)
4 Gore?s overlooking US
President in clover (6)
5 Study high tone in short
musical composition?
They may do (9)
6 Brexiteer finally to be
sacked, chief early issue (6)
7 Rest does improve
strength of field units (8)
8 Tin merchandise not good
for hair bands (6)
10 German philosopher
tackles writer Dickens
about leadership (11)
13 Experience down under
more robust breathing
aid (9)
14 As laid out in two rules for
Indian commander (8)
18 Rod?s on official
leave (6, two words)
19 Develop entire bonded
compound of three
doubles (6)
21 Inattentive when former
PM turned up (6)
22 No Scottish circles study
Amerind languages (6)
24 Big names with time to
become top authorities (5)
The Chambers Dictionary 13th edition is the primary
reference. Readers are invited to visit Tim Moorey?s
website at timmoorey.info
Solution to 3001
Across: 1 Bubkis, 5 Uckers, 10 Perichaetia, 11 Ruderal, 14 Chewet, 15 Oyster,
17 Naysay, 18 Seat rent, 19 Earp, 21 Buns, 23 Resiance, 26 Arcked, 29 Bruise,
30 Herald, 31 Sesotho, 32 Cappelletti, 33 Spayds, 34 Masais
Down: 1 Barcas, 2 Bedeman, 3 Krewe, 4 Scathe, 6 Caryatides, 7 Keksye, 8 ╔tats,
9 Saury, 12 Rearrested, 13 Searce, 16 Beurre, 20 Annatta, 22 Skippy, 24 Schelm,
25 Eddoes, 26 Abacs, 27 Cuppa, 28 Trots
SUDOKU
HARD ? PRIZE 1216
6
5 9
7 4
Hard
1 7
5
6
4 3
3
8
Time Duality
After a good breakfast, Seb
decided on 40 winks. He
noted the time on his digital
clock as he dozed off. When
CODEWORD
In the grid, each number
represents a letter of the
alphabet ? all 26 letters are
used. Use the initial clues in
the code table to work out the
rest of the code.
STUCK? To get four random
extra letter clues, call 0901
322 5309 (ROI 1514 415128) or
text STCLUE to 84901 (UK
only). Calls cost 75p (ROI 75c)
plus your telephone
company?s network access
charge. Texts cost г1 plus
your standard network
charge. SP: Spoke, 0333 202
3390 (Mon-Fri 9am-5.30pm).
11
10
5
25
13
17
10
8
5
10
5
25
23
happened: he fell asleep at
the same time and slept a
little less, but when he woke,
the mirror led him to believe
he had slept for 20 times as
long as he had. (All times
were whole numbers of
minutes after midnight.)
14
17
9
10
2
At what time did he
fall asleep?
Send your solution to: The Sunday
Times Teaser 2894, PO Box 29,
Colchester, Essex CO2 8GZ or email
puzzle.entries@sunday-times.co.uk.
The first two correct solutions opened
after next Saturday win г20.
BRIDGE
14
13
15
O
10
24
15
16
15
26
25
18
10
7
23
3
10
Neither vul, Dealer South
5
L
7
21
15
7
19
20
19
8
11
15
15
1
7
7
1
23
14
24
3
14
20
7
13
10
4
25
3
19
23
8
21
9
20
9
6
24
24
26
3
11
20
24
20
6
24
10
5
20
5
10
1
7
4
23
19
10
3
17
26
9
12
9
23
16
22
23
7
23
9
/
.
v
,
3
7
5
5
15
9
20
/
.
v
,
3
23
23
2
3
4
5
6
7
8
9
10
11
9
12
13
L
14
15
O
16
17
18
19
20
21
22
23
24
J82
K76
87
J 10 9 5 3
25
26
W
AKQ5
932
6
K8764
N
W
S
/
.
v
,
A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
1
Sally Brock
In December the English
women?s team travelled to
Huai?an, China to play in the
IMSA (International Mind
Sports Association)
tournament. The journey was
a bit of a nightmare but once
there everything ran smoothly.
This was the very first board:
17
W
3
1
/
.
E v
,
10 7 6 4 3
AJ
AKJ543
None
9
Q 10 8 5 4
Q 10 9 2
AQ2
The bidding was the same at
both tables:
West
North
East
Pass
Pass
1/
4.
2v
All Pass
South
1.
Pass
A diamond lead is fairly
obvious, but what should East
KENKEN
KILLER SUDOKU EASY
9
17
19
19
10
14
20
23
13
7
8
11
12
10
5
All the digits 1 to 6 must appear in every row and column. In
each thick-line ?block?, the target number in the top left-hand
corner is calculated from the digits in all the cells in the block,
using the operation indicated by the symbol.
16
15
13
21
17
11
7
17
North
East
16
19
21
22
23
26
...................................................................................
ADDRESS ...................................................................................
...................................................................................
Across
Down
1 Awfully ironic pessimist
like Monet? (15)
9 Well-read earl impolite
about relations (7)
10 Captivate English knight
with tea (hot) (7)
11 Fine suitable for
backsliding little Barney (4)
12 Uncertain and without
energy, you fasten time
locks (2,2,3,3)
13 Heavy rock can be more in
your face, I heard (7)
15 Soup and food the
Queen cut with dash of
Dubonnet (7)
17 Blur return to form with
former member close to
tears (7)
19 Agrees end of America
must come over
broadcast (7)
20 Retractable spanner? (10)
22 Go bananas having been
given the run-around! (4)
25 Superior salt with value to
be cut by a pound (7)
26 Telephone informers
about a potential lead (7)
27 Act in a free way and
dismantle your
beehive? (3,4,4,4)
1 Bungling home help only
occasionally on time (5)
2 Green
knickerbockers? (4,5)
3 Yours truly brought up the
other issue (4)
4 One who has gone off in a
railway carriage (7)
5 Polynesian perhaps
cocaine sent into frenzy (7)
6 Old Peruvian amusing folk
working together (2,7)
7 Headdress that's so long
when one puts it on (5)
8 Colleagues exchange
views about Republican
opponents (9)
13 Bad tailor made a mess of
pricey woollen coat (9)
14 Germany?s foremost wig
manufacturer and speed
king? (4,5)
16 A report supporting
academic over arty
bodyworker? (9)
18 Bachelor put in wrong
diesel fuel for us, maybe (7)
19 Area at the end of
impressive driving
course? (7)
21 A daughter Cambridge
University let in (5)
23 Ceremonial staff continue
to receive deliveries (5)
24 Just adequate (4)
Solution to 4788
The first correct solution opened after
next Saturday wins a 10-carat rolled
gold Cross Century II fountain pen worth
г230. The next three win г120 10-carat
rolled gold Cross Century Classic ball
pens. All have lifetime guarantees. Post
solutions to The Sunday Times
Crossword 4789, PO Box 29, Colchester,
Essex CO2 8GZ, or email
puzzle.entries@sunday-times.co.uk
S T A
U B
NOO
R V
I DE
S G
EAR
I
O
NOU
D N
UND
S
TOS
R O
YOU
ND I NGO
A O N
KY DE T
G D H
A L L Y E
O
E
L SAND
L
L G
SAUTRE
C
I
RESS D
R S E
CAN I N I
T M S
V EGO TM
VA T I ON
T C A
ERGENT
O
I
SPARTO
I
E N
I N I S T A
E P L
S DOSS
B N E
EARS I R
N
I
V
DUBA I
I
L C
E THERE
CLUE WRITING CONTEST 1699: REGENT?S PARK
/
.
v
,
Readers are invited to compose a clue for the word above.
Clues must be original, cryptic, and similar to those in the
Sunday Times crossword. Send your entry by email to
puzzle.entries@sunday-times.co.uk. The best entry selected
after next Saturday wins г20.
QJ4
QJ94
J93
10 5 3
Winner 1696: Ciaran Daly, Cork, Ireland
Percussion cap: Restriction on size of orchestra section? This makes firing a possibility
For a full report, visit thesundaytimes.co.uk/cluewriting
Winners Crossword 4786 K Potts, Sheringham, Norfolk, P Candler, Durham, N
Lawson, Lichfield, Staffordshire, B Spencer, Ashford, Kent Mephisto 2999 J
Gibbons, Margate, Kent, R Holt, Sidmouth, Devon, P Wickens, Faygate, West Sussex,
KH Williams, Bexley, Greater London, L Williams, Barlaston, Staffordshire Teaser
2891 L Collins, Isleworth, Greater London, S Raleigh, Adleymoor, Shropshire Chess
1102 R Lowen, Grimsby, Lincolnshire Sudoku February 18 S Bell, Cuffley, Hertfordshire
1v
All Pass
TODAY?S SOLUTIONS
North leads the five of
diamonds. South cashes the
king and ace and switches to
the nine of clubs. Plan the play.
Your aim is to knock out the
ace of trumps, win the next
club, draw trumps, ruff a
diamond and exit with a club.
North wins and switches
(perforce) to a spade. You
play low from dummy and
your nine wins. You then
cross to dummy with a trump
(you do still have a trump
entry, don?t you?) and take
another spade finesse.
DOUB T F
I
N
U
T U T OR
C W N
H E I R
L
S
J
A R T F U L
D
K
V E NGE F
A
E
B
NOX I OU
C
U
X
E A S Y
D
U L
A B L E
N
T
E
Q
CA R I BOU
L
E
O
E
AR K S P U R
D
K
R
P E B B L Y
M R O
U L
I NC H
E
B
A
A
S
L U N A R
L
O
Z
E
I S C L A I M
NEWS QUIZ
BRAIN TRAINER
POLYGON
220
KENKEN
96
31
Each row, column and 3x3 box must contain the digits 1 to 9.
The digits within each group of cells joined by dotted lines
must add up to the figure in the top-left-hand corner of each
group. Within each dotted-line group, a digit cannot be
repeated.
SPOT THE MOVE 1104
1 Qxd7+! removes the defender of f5,
winning a piece: 1?Rxd7 2 Nxf5+ and
3 Nxd4
TEASER 2893
LEMONS = 370124
21
3
28
20
32
132
6 22 8 12 10 22 6 x 22
84
33
5
230 119
3 x 28 10 23 10 x 23 7 x 17
112
23
38
24
7 x 16 7 16 2 x 19 7 17
SUDOKU
WARM-UP
KILLER SUDOKU
9
7
8
2
4
1
5
3
6
3
1
5
9
6
7
8
4
2
2
4
6
8
5
3
9
1
7
8
5
4
6
7
9
3
2
1
7
3
2
1
8
4
6
9
5
1
6
9
5
3
2
7
8
4
6
2
1
7
9
8
4
5
3
4
9
7
3
2
5
1
6
8
5
8
3
4
1
6
2
7
9
9
2
5
8
4
1
3
7
6
3
8
7
6
2
9
1
5
4
2
4
3
2
2 4
2 3 6 7 7 8 10 10 12 16 17 19 22 22 23 28
13
8
CELL BLOCKS
10 x 22 8 x 12 3 28 2 19
OP KGV YME S X HBU
F CN I WL T Z DQA J R
8
18
NAME
South
Pass
3.
8
27
K653
A
AK82
9874
Pass
2v
1.
15
25
TETONOR
CODEWORD
24
4
3
S
/
.
v
,
West
E
7
LAST WEEK?S SOLUTIONS
9
22
N
6
24
10 8 7
765
Q 10 7 5
QJ2
W
14
20
Last week?s problem
A92
K 10 8 3 2
64
AK6
5
12
17
Taylor-Xian, British
Universities? Championship
2018. How did White
force victory in this
complicated position?
/
.
v
,
4
David McLean
10
13
сWDkDW1WD]
рDp0WDWDW]
▀pDBDWDb0]
▐)W0W0WDn]
▌W)NDPDWD]
▄DW)Q)W0P]
█WDWDWDPD]
┌DWDWDWIW]
┴┬├─┼╞╟╚
/
.
v
,
3
11
To enter, complete the Hard or Very Hard puzzle and call 0901 292 5275 (ROI 1516
303 500), leaving your answer (the numbers in the three shaded squares) and
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SP: Spoke, 0333 202 3390 (Mon-Fri 9am-5.30pm)
do when in with the first
diamond? Nicola Smith
switched to a spade. Declarer
won in dummy and played a
trump. Nicola won the ace
and played another trump.
West won the king and played
a third round of the suit and
declarer had to go down.
In the other room, East
switched to ace and another
heart at trick two. Again, West
won the king and continued
the suit. Declarer, Fiona
Brown, won the third heart
and tried the ace of clubs.
When East showed out the
distribution was more or less
known, so she simply played
off her club winners and her
two remaining hearts. At the
end, dummy held the spade
suit it started with, and
declarer held the queen of
diamonds. East could not
keep both suits guarded and
declarer had made her game.
I would like to report that
this was the first board of a
decisive victory.
Unfortunately it was all
downhill from here and we
lost the first match heavily.
2
9
7 3 8
4
3
1
3 6
9 6
4
2 9
4 2
2
1
he woke up a little later that
day, not fully alert, he saw
the display reflected in a
mirror and was amazed by
how long he seemed to have
slept. This was in fact 10 times
the length of his nap. Next
day, a similar thing
17
the h-file. 11?b5? Moving this
pawn a second time. Cutting
across White?s plan with
11?h6 was essential: after 12
Bxf6 Bxf6 Black can meet 13
h5 with 13?g5, keeping the
kingside blocked. 12 h5 b4 13
hxg6 hxg6 Now Black must
forever worry about his
exposed king. 14 c4 Ne6 15
Be3 d5 16 c5 Ne4 17 0-0-0
White?s king feels very safe
here, with plenty of pawn
shelter. 17?f5? The decisive
weakening. 17?Qc7, guarding
the e5-square, was best. 18
Nxe4 fxe4 19 Ne5! Attacking
g6. Mamedyarov is ruthless in
such situations and he finishes
efficiently. 19?Rf6 Exchanging
pieces does not help: 19?
Bxe5 20 dxe5 Rf5 21 Qg4 and
Black is doomed. 20 Qg4 Nf8
21 Bh6 Bxh6+ 22 Rxh6 Qc8
23 Qh4 Black resigns
Spot the Move 1105:
White
to play.
________W
VERY HARD ? PRIZE 1217
TEASER 2894
Peter Good
The final stage of the quest to
become Magnus Carlsen?s
next challenger for the World
Championship has begun, as
eight grandmasters battle it
out in Berlin over the coming
fortnight. The Candidates
Tournament, with its roundrobin format, is the ultimate
test of a player?s skill, stamina
and nerves.
Despite facing all eight
players in recent times, I find
it hard to predict the eventual
winner. Shakhriyar
Mamedyarov is the favourite
by rating while Levon
Aronian is the form player.
Sergei Karjakin is another to
watch with his solid style and
previous experience of
Candidates success. Of the
other contenders, none can be
underestimated and the only
certainty is that we will see
some surprises along the way.
White: Shakhriyar
Mamedyarov
Black: Peter Svidler
Tal Memorial 2018
Torre Attack
1 d4 Nf6 2 Nf3 g6 3 Bg5 Bg7
4 Nbd2 c5 5 e3 cxd4 6 exd4
b6 This looks slow. I prefer
6?0-0 followed quickly by
?d6 and ?e5, breaking open
the centre. 7 c3 0-0 8 Bd3
Ba6 9 Bxa6 Nxa6 10 Qe2 Nc7
11 h4! An aggressive move in
the style of Mikhail Tal, for
whom the tournament was
named. White wants to open
Send your solution (first move only), to Sunday Times Spot the Move 1105,
The Sunday Times, PO Box 29, Colchester, Essex CO2 8GZ, or email to
puzzle.entries@sunday-times.co.uk. The first correct answer drawn after next
Saturday wins г20.
WARM-UP
Each row, column and 3x3
box must contain the digits 1
to 9. Winners will receive a
Collins English Dictionary &
Thesaurus.
CROSSWORD 4789
David Howell
alum, amulet, amuse, eluate, elute, emulate, haul, haulm, hula, hush, hustle, lues,
luma, lush, lust, lute, maul, meatus, methuselah, mule, muleta, muse, mush, must,
musth, mute, salut, salute, sautщ, shtum, shul, shut, sleuth, slue, slum, slut, smut,
stum, suet, talus, thus, tule, tush, ulema
2
CHESS
Down
Easy 500; Medium 305; Harder 60
1
Across
Tim Moorey
1 Emma Watson, mocked for ?Times Up? campaign temporary tattoo 2 70
now seen as dawn of old age, says survey 3 7ft 4in 4 Cost of Freddo bars
has risen 200% in 24 years 5 Alexa, the voice assistant, emits mysterious
?witch-like? cackle 6 Public Health England called for end to birthday
cakes at work 7 Ascot racegoers, after ?Bardot neck? dresses were
removed from dress guidelines 8 132 years 9 47, says Office for National
Statistics 10 Kept saying ?Watt? when ref asked his name
MEPHISTO 3002
4
1
6
7
5
3
2
8
9
6
5
1
4
8
2
9
3
7
2
3
8
5
9
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6
4
1
PRIZE 1214
7
9
4
1
3
6
5
2
8
8
6
2
3
1
4
7
9
5
5
7
9
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1
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3
9
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3
PRIZE 1215
14
20
The Sunday Times March 11, 2018
MONEY
FAME AND FORTUNE
PETER JAMES
Crime pays
. . . for my
collection of
classic cars
JAMES CLARKE
The novelist tells York Membery about
indulging his passions, keeping alpacas
and his first job cleaning for Orson Welles
P
eter James, 69, is a
bestselling British crime
writer. His series about the
Brighton police officer
DS Roy Grace has sold 20m
copies worldwide. He has
won the Crime Writers?
Association?s highest award,
the Diamond Dagger, and
was voted the best crime
author of all time in a WH Smith poll.
Three of his books ? The Perfect Murder,
Dead Simple and Not Dead Enough ?
have been adapted for the stage.
Peter lives in Jersey with his wife,
Lara, 39, and a menagerie of animals.
He has two books out this year: the 14th
Roy Grace novel, Dead If You Don?t,
on May 17 and a standalone thriller,
Absolute Proof, on October 4.
How much money do you have
in your wallet?
About г100. I only use cash these
days for two things: first, paying my
long-standing hairdresser for my
monthly haircut and, second, for tipping
good staff in restaurants and bars to
make sure they actually get the money
rather than the management snaffling it.
What credit cards do you use?
I mostly use American Express,
primarily for getting air miles. I?m a
constant traveller, spending three
months of the year on research and
promotional duties for my books. My
wife and I have numerous air miles ?
1.5m at the last count ? largely because
I find you can never use them when
you actually want to.
Are you a saver or a spender?
A spender. I do try to save, but I enjoy
spending money on all kinds of things,
especially my passion for classic cars.
My wife and I love to travel ? and wine
is a big interest.
I also buy an insane amount of books:
about 10 a week. I read 200-300 a year,
but I speed-read many of them: I did a
course at Toronto University and can get
I produced and
wrote a film called
Spanish Fly ? ?the
least funny British
funny film ever
made?, according
to Barry Norman
Guilty as charged: Peter James, pictured in his Sussex office, admits to buying ?an insane amount of books?, sometimes reading two a day on holiday
through two books a day on holiday. I
used to feel guilty if I didn?t finish a book
but nowadays if I?m not engaged by
page 40, I?ll move on.
How much did you earn last year?
In the Sixties, Rolls-Royce was too coy
to publish the horsepower of its cars?
engines: it simply used the wonderful
line ?Sufficient?. I?ll go with that!
Do you own a property?
My wife and I have a Victorian rectory
near Brighton, from where we run
our office and where we keep part of
our menagerie, which includes alpacas,
emus and ducks. We have a
three-bedroom penthouse in Notting
Hill, west London, and two rental
properties in Brighton. We live in a
rented 200-year-old farmhouse in
Jersey, with an option to buy.
Are you better off than your parents?
My late parents, Cornelia and Jack, had
a successful business, Cornelia James,
which still holds a royal warrant as
glovemaker to the Queen and is now run
by my sister and her husband. At its peak
it employed about 250 people. But my
parents had financial worries in their
later years. So I would say I?m better off
than they were at the same stage.
When did you first feel wealthy?
Wealth is so relative. But it was probably
the first time I went to a restaurant and
didn?t have to worry about buying the
cheapest bottle on the wine list.
Have you ever worried how you were
going to make ends meet?
I had a meteoric rise in my early twenties
when I built a successful film company in
Canada, turning down an $8m offer for
it. Then I wrote and produced a big dud,
Spanish Fly [1976], with Terry-Thomas
and Leslie Phillips, which Barry Norman
called ?the least funny British funny film
ever made?. And at 27 I was flat broke. I
had to go back to live with my parents.
That was when I wrote my first novel.
What was your first job?
Orson Welles?s house cleaner! I was at
film school and my dad gave me enough
money to pay the rent for lodgings off
Fulham Road. But I wanted to take a
posh girl I?d met out to dinner and
needed money. I saw a job ad in a
newsagent ? ?Cleaner wanted, apply
Mrs Welles?.
I went along, little realising it was the
great man?s London home, and got the
job on a month?s trial. One day I was on
my knees wiping the hall skirting boards
and he came in, looking at me like I was
something the cat had brought in, and
said: ?Good morning, young man.?
There were a million questions I
wanted to ask but I was so tongue-tied I
couldn?t get a word out. The following
day he returned to America. A month
later I was very sweetly fired for not
being terribly good.
investment decisions to them because
whenever I?ve dabbled myself I?ve
ended up out of pocket. I bought some
bitcoins out of interest, as they feature
in my new novel. Typically, I bought at
exactly the wrong moment.
What?s best for retirement ? property
or pension?
Property. With pensions, you are at the
whim of governments that can change
the regulations in an instant.
What has been your best
business decision?
I worked for years full time in film and
television as a producer, writing my
novels at nights. In 2005, when Dead
Simple, the first Roy Grace, became an
instant hit, I had to make a decision. It
was a no-brainer. Producing films is a
constant fight between dozens of
creative egos. With my novels, it is just
me. If I don?t want to, I don?t have to
change a single word. I love that
freedom.
And your best investment?
Backing my producing partner, Josh
Andrews, in turning my books into stage
plays. All three so far have been hits,
grossing more than г10m at UK theatre
box offices.
My other best investment is having
the services of a driver to enable me to
work door-to-door wherever I go, which
has gained me hundreds of hours of
writing time. Over the years I?ve got used
to writing anywhere ? the back of a car,
And your worst?
I?d always dreamed of owning an E-type
Jaguar. In the late 1980s, after my first
big publishing advance, I bought two for
about г10,000 each and spent a fortune
restoring them. Then I got divorced and
had to sell them at a massive loss during
a slump in the vintage car market. Today
they?d be worth at least г100,000 each.
What?s your money weakness?
I?m an incurable petrolhead and have
six classic cars. I spent an eye-watering
amount on an Aston Martin Vanquish
Volante four years ago and it gave me
endless joy, even though I took a big hit
on it when I sold it recently.
What?s your financial priority in the
years ahead?
To avoid going into debt.
What aspect of the tax system
would you change?
A lot. The taxation system is completely
wrong and responsible for why our
country is financially broken and the
NHS is in such a plight. High achievers
are punished and we?ve created a
culture of entitlement where you?ve
got three generations of a family living
on benefits. That can?t be right.
The police, military and emergency
services are not looked after by the
government. If you have a disgruntled
police service, as we do now, you have a
very dangerous situation.
What would you do if you won
the lottery jackpot?
After putting aside a lump sum to
help family members or friends, and
splashing out on a racing Aston Martin
DB5, I?d give the rest to the charities
I support, such as the Sussex Police
Charitable Trust, which helps police
staff deal with trauma and emotional
issues.
What has been your most
lucrative work?
Undoubtedly writing the Roy Grace
crime novels. The first appeared in 2005
and the 14th is just coming out. They?ve
sold about 20m worldwide, topped the
charts in Britain, Germany, France,
Russia and Canada, and been translated
into 37 languages. I never dreamt I?d be
able to make a living out of writing.
Do you invest in shares?
I have a portfolio of shares manage
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