Published: 02 October 2023
By Suzanne Evans, Director, Political Insight
The Government’s Help to Buy scheme, which helps first-time buyers buy a home, has been a “disaster” according to mortgage brokers who have spoken to The Telegraph, after the newspaper found the number of Help to Buy homeowners in arrears on their mortgages has more than doubled in just 12 months. A freedom of information request submitted to Homes England found 4,854 Help to Buy homeowners are now in arrears, up from 2,413 in 2022. The situation looks even worse over the longer term; with a seven-fold increase in homeowners in arrears on Help to Buy interest payments since 2019, when only 659 people were behind on payments. The initiative closed to new applications last year, but originally gave first-time buyers equity loans of up to 20% of the purchase price (40% in London) to help them afford a new build home with just a 5% deposit. The loan was interest-free for five years, but buyers who have come to the end of this period are finding it increasingly difficult to keep up with the interest payments, which have risen with inflation, reporters found. In some cases, buyers have faced mortgage and interest charges that are so unaffordable they have had to sell up and rent again, five years into the scheme. Lewis Shaw, of broker Riverside Mortgages, said Help to Buy was a “disaster waiting to happen”. He said many planned to remortgage at the end of the five-period but mortgages have risen so significantly that they cannot afford to do so now. He cited the case of a couple he worked with recently who had seen their mortgage repayments rise from £820 to £2,400, ruling out any prospect of paying off their 20% equity loan. Scott Taylor-Barr, of broker Barnsdale Financial Management, said many people did not have the scheme explained to them well when they took it out, saying they were unaware the Government’s 20% or 40% loan is not a fixed amount, but is charged on the value of the property when buyers sell up or pay off the loan. He said: “You have to say to somebody, ‘I know you borrowed £50,000 but you owe back £65,000.” Kylie-Ann Gatecliffe, of broker KAG Financial, said she has had difficult conversations with “shocked” homeowners who had used mortgage brokers that worked closely with the property developers. She said: “Because they’re working alongside the builder their intention was obviously to try and help them sell as many properties as possible. In a lot of these cases it was very much advice given to try and get the sale rather than giving the client a really balanced view of Help to Buy with all the risks involved.” She too has seen homeowners sell up to clear the Help to Buy loan and their mortgages and “just start again somewhere else”. Since it launched in 2013, more than 380,000 people have bought properties using Help to Buy. In the first nine months of 2022, about 20,000 used the scheme. The Department for Levelling Up, Housing and Communities did not respond to a request for comment.
The Information Commissioner’s Office has ruled that The Financial Conduct Authority (FCA) had “infringed their data protection obligations,” following an investigation launched when a former employee of the financial watchdog reported it had a policy of “intercepting and diverting” emails of its staff to keep track of people “considered a nuisance”. The Times says the policy was allegedly signed off in 2016 by the office of the then CEO Andrew Bailey, now Governor of the Bank of England. Some individuals’ emails were automatically diverted from intended recipients, including confidential channels including whistleblowing and independent reviews, and intercepted by a designated more senior individual at the regulator, according to the report. The scandal is likely to raise major questions of the judgment of FCA management and could trigger a reprimand from officials this week, the newspaper says, adding that its own complaints commissioner will criticise it for “maladministration” of the diversion policy.
The price of a first class stamp has gone up to £1.25 from £1.10, the third increase in the space of 18 months, but one backed by Ofcom, which says pricing "flexibility" is necessary to ensure the postal service remained viable in a time of increasing cost pressures. Royal Mail also justified the rise, saying it had no option given its continuing Universal Service Obligation (USO), which requires the company to deliver letters to all 32m UK addresses six days a week. Royal Mail wants to drop Saturday deliveries. The price of a second class stamp remains unchanged at 75p.
It is day two of the Conservative Party Conference. There will be keynote speeches today from Chancellor Jeremy Hunt, Trade Secretary Kemi Badenoch, Education Secretary Gillian Keegan, Thérèse Coffey, Secretary of State for Environment, Food and Rural Affairs, Claire Coutinho, Secretary of State for Energy Security and Net Zero, Transport Secretary Mark Harper, and Lucy Frazer, the Culture Secretary.
Water companies are seeking permission from regulator Ofwat to increase bills by an average of £156 a year by 2030 to pay for upgrades and reduce sewage discharges. The increase will allow infrastructure spending to almost double to £96bn and fund the construction of 10 new reservoirs, they say, to secure the country's water supply in the long-term. Industry body Water UK said it is planning the "most ambitious modernisation of sewers since the Victorian era" and by the end of the decade could reduce leaks by a quarter compared with 2020, and sewage spills into waterways by more than 140,000 each year by 2030. Environment Secretary Therese Coffey says she broadly welcomes the investment plans, but that Ofwat should ensure customers do not "pay the price for poor performance". Last week, the regulator ordered water companies to pay back £114m to customers through lower bills after missing key targets.
The leaders of 88 retail companies including the CEOs of Tesco, Greggs, Ikea and Aldi have signed an open letter to Home Secretary Suella Braverman demanding the Government make assaulting or verbally abusing retail workers an “aggravated” offence, i.e. one that is considered a more serious crime to a general assault. Abusing supermarket staff who ask for ID or try to stop shoplifters should be so categorised, they say. In recent weeks, retailers have highlighted soaring rates of retail crime which the police seem unwilling to help them tackle; according to figures from the British Retail Consortium (BRC), more than 850 incidents of violence and abuse against retail workers took place every day between April 2021 and March 2022, while shoplifting is estimated to have cost retailers almost £1bn over the last year.
Moto, Britain’s largest motorway service station provider has hired marshals at its Exeter, Rugby and Wetherby branches to police “charge rage” among electric vehicle drivers battling for access to plug-in points, The Telegraph reports. Moto CEO Ken McMeikan warned motorway service stations are facing growing “public disorder” due to a lack of grid connections, meaning he cannot install enough car chargers to meet demand, hence “very angry and stressed” drivers face long waits, and in the meantime confront staff and each other. McMeikan said: “People need to drive their EV cars around without range anxiety, without long queues and without public disorder but at peak seasonal times we are experiencing all this now.” Moto runs 49 motorway services around the UK.
Meanwhile, John Lewis Financial Services has paused offering insurance cover for electric vehicles while its underwriter, Covéa, analyses risks and costs. According to the Association of British Insurers (ABI), vehicle repair costs rose 33% over the first quarter of 2023 compared to 2022, helping to push annual premiums to record highs, with electric cars costing around a quarter more to fix on average, compared to a petrol or diesel vehicle, according to Thatcham Research, the motor industry’s research centre. Particular worries surround the expensive batteries, which can account for as much as 50% of the vehicle’s cost, but which are commonly mounted on the floor of the vehicle, making it more likely that it will be damaged even in a minor accident such as mounting a kerb. EV batteries cost between £14,200 and £29,500. There is also a shortage of technicians with the skills to carry out repairs, which also contributes to making EV repair more expensive.
BAE Systems is set to create more than 5,000 jobs after being awarded a £3.95bn contract by the Ministry of Defence (MoD) to deliver the next phase of the so-called Aukus pact to provide Australia with nuclear-powered attack submarines by the late 2030s, to counter China's ambitions in the Indo-Pacific region. The contract will see through development work on the proposed SSN-AUKUS submarines, which incorporate technology from all three countries in the pact - the UK, the USA, and Australia – to 2028, when the detailed design phase of the programme and procurement of long-lead items is set to begin. Manufacture is expected to begin towards the end of the decade with the first SSN-AUKUS delivered in the late 2030s. The money will contribute to significant infrastructure investment at BAE Systems' site in Barrow-in-Furness and investment in its supply chain, as well as job creation. Beijing has criticised all three countries over the deal.
Axel Springer, the German media giant which publishes Die Welt, one of Europe's leading newspapers, has joined the race to buy The Daily Telegraph and its Sunday sister title, a Sky News exclusive reveals. Insiders said the company, which also owns the Business Insider and Politico digital news platforms, had notified Goldman Sachs of its desire to participate in the forthcoming auction. The Spectator, the weekly current affairs magazine, is also up for sale, having been part of the corporate structures seized by Lloyds Banking Group from its long-standing owners, the Barclay family, earlier this year. It was unclear whether Axel Springer, which also owns the German newspaper Bild, has any interest in owning The Spectator. Sky says.
The Competition and Markets Authority (CMA) is considering whether Qualcomm's proposed acquisition of Israel's Autotalks could lead to a "substantial lessening of competition" and has invited comments from any interested parties ahead of a formal investigation. US chipmaker Qualcomm first announced in May that it would acquire Autotalks, a technology firm specialising in manned and driverless vehicles, for an undisclosed sum. The California-based firm wants to incorporate Autotalks into Snapdragon Digital Chassis, its assisted and autonomous driving portfolio. European Union regulators have already said Qualcomm will need to secure antitrust approval for the deal to go ahead. Neither Qualcomm or Autotalks have yet commented on the CMA's announcement.
Meanwhile, the CMA has cleared UnitedHealth's proposed £1.2bn takeover of UK healthcare software company EMIS, which supplies data management systems to the NHS, including the electronic patient record system used by most GPs in the UK. The CMA referred the deal for an in-depth investigation in March, warning that the merger could increase the cost of digital services for the NHS, however the competition watchdog now says is it satisfied it will not.
Disgraced business lobby group the CBI is said to be hoping to persuade Business and Trade Secretary Kemi Badenoch to address its delayed annual conference in November, Sky News understands. Sources told the broadcaster the CBI believes her attendance would provide an opportunity for it to cement its recovery from the sexual misconduct crisis which threw its future into doubt.
London-listed identity protection and insurance group CPP has published a statement this morning distancing itself from founder and former chairman Hamish Ogston who is at the centre of a sex worker immigration scandal. Ogston, a well-known philanthropist and one of Britain's richest men has allegedly been involved in human trafficking, breaking immigration laws and prostitution, according to a Sunday Times investigation. An article from the weekend, which is based on 1,000 leaked documents, details Ogston's alleged exploitation of vulnerable south-east Asian sex workers over the past 15 years. "The board of CPPGroup Plc is aware of the serious and troubling allegations made by The Sunday Times against Hamish Ogston, a shareholder in the Group, in its article published on 1 October 2023," the company said in a statement. "Hamish Ogston left the Board on 28 June 2013 and since that time, and save for those rights reserved for shareholders, has had no involvement in the management or operations of the group. It is not appropriate for CPP Group Plc to comment further." Ogston resigned from CPP in the aftermath of a mis-selling scandal involving the company, which found that customers were taking on card and identity protection policies that they did not actually need, resulting in a record £10.5m fine from the Financial Conduct Authority.
Barclays Bank is seeking to overturn a ruling by an Indian court that found it had retaliated against a whistleblower, a former senior IT manager who raised concerns about how a data loss had been handled. Barclays' whistleblowing policy "appears to be in existence only on paper", a District Court in the western Indian city of Pune said in a March judgment seen by Reuters, and now reported for the first time. The court ordered Barclays to pay Atul Gupta two years' salary, totalling around 9,600,000 Indian rupees ($115,620), saying the bank's Indian service company had made him redundant "in retaliation to his whistleblowing act". Barclays' appeal to the Bombay High Court is listed for 20th October. "Barclays is unequivocally committed to having a culture where colleagues feel comfortable to speak up when something isn't right and no employee is excluded from being able to raise a concern – by contract or otherwise," a bank spokesperson said. Email messages between the Financial Conduct Authority (FCA) and Gupta, seen by Reuters, showed the whistleblowing team at Britain's markets regulator tracked the Indian case but does not plan "specific action". "We are in regular contact with Barclays and discuss a wide range of issues, including whistleblowing," a spokesperson said, adding that the FCA could not comment on individual cases.
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