E.ON To Pay Customers £12m Over Mis-Selling

Energy Complaints Soar By Staggering 224%

Updated: 1:11pm UK, Friday 16 May 2014

Complaints about energy companies have trebled in the first quarter of this year, according to the energy sector's ombudsman who is calling for "increased transparency".

The record figures showing a 224% rise in the first three months of this year come after regulator Ofgem said it was referring the energy sector to the Competition and Markets Authority for a full-scale competition inquiry.

Between January and March, complaints trebled to 10,638, compared with 3,277 received during the same period last year.

More than 2,000 consumers complained about not receiving bills, 1,474 people made complaints about billing charges, and over 1,000 consumers criticised the quality of customer service.

The numbers suggest that 2014 will see more complaints overall, as there were 17,960 complaints made over a 12-month period last year.

Chief Energy Ombudsman Lewis Shand Smith said: "Consumer frustration and dissatisfaction is something that we hear about every day, and we welcome any attempts by Ofgem to make the energy market fairer.

"With energy complaints trebling in the first quarter of this year and problems relating to billing the greatest concern, increased transparency is something that should be addressed."

A spokeswoman for Energy UK, the trade body that represents the industry, said most customers had no problems with their energy company, but accepted that sometimes things go wrong.

She added: "If a customer has any concerns relating to their bills, they should contact their provider as soon as they can, and if possible have an up-to-date meter reading to hand which will ensure their bill is as accurate as possible.

"Energy companies work very hard to resolve problems and most complaints are fixed within a few working days with no more than a phone call."

The spokeswoman said there were new rules in force which made matters "more open and clear for customers including: explaining bills so people understand what they are paying; making it easy to switch; ensuring customers are on the right deals; and simplifying tariffs".

But Richard Lloyd, executive director of Which?, the consumer watchdog, said the rise in complaints was "further proof that the energy market is broken".

He added it was "right" that the energy sector had been referred for a full-scale investigation.

A Department of Energy and Climate Change spokeswoman said the figures were "worrying", and added: "We would advise consumers to shop around and switch to find a better deal, whether on cost or customer service."

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Rothschild Gears Up For £150m Autodata Deal

By Mark Kleinman, City Editor

A division of the Rothschild banking dynasty is preparing a swoop on one of the world's biggest suppliers of automotive data in a deal worth close to £150m.

Sky News understands that Five Arrows Principal Investments, which manages a £500m fund which invests in companies in Western Europe, has teamed up with Bowmark Capital to acquire Autodata.

Five Arrows and Bowmark, which owns businesses such as Drake & Morgan, a London-based restaurant chain, are understood to have been granted a period of exclusivity until next week to negotiate a takeover of Autodata.

The investment arm of the Rothschild empire is little-known outside the City but has invested in a number of UK-based businesses, including Kisimul, a provider of residential care, and The Binding Site, a medical diagnostics company.

The two funds are understood to have outbid rivals such as Hearst, the American publishing giant, Inflexion Private Equity and CAP, another automotive data provider which its owner, Montagu Private Equity, had planned to merge with Autodata.

CAP was eliminated from the auction several weeks ago, leading Montagu itself to re-enter as a bidder in its own right.

A deal is likely to cost as much as £150m, much higher than original estimates of the sale price, reflecting buoyant demand from the automotive after-market for vehicle data.

Autodata was put up for sale several months ago, with Livingstone Partners, an advisory firm, appointed to handle the sale.

The deal has attracted interest from at least a dozen potential buyers, according to people close to the situation, with Autodata expected to be valued at somewhere in the region of £50m.

Montagu's interest stems from its ownership of CAP, which it bought from Top Right Group - formerly Emap, the media conglomerate - in 2012 for £170m.

Autodata supplies information about 17,000 models produced by 80 vehicle manufacturers, giving professional workshops access to the relevant manufacturers' information needed for service repair and diagnostic work.

Among the other bidders for Autodata were Francisco Partners, Hg Capital and TA Associates, underlining the intense demand among private equity firms for places to invest the capital they have raised from investors.

Bowmark and Livingstone Partners declined to comment.

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'Yuppies' Go On SW London Property Prowl

Southwest London has become Britain's biggest magnet for the latest generation of 'yuppies', according to a new property survey.

Research by Lloyds said the SW19 Wimbledon postcode is the prime destination for what it calls young urban professionals.

The 'yuppie' tag was first coined in the early 1980s to describe well-paid workers below middle-age, said to be obsessed with frivolous consumerism.

Lloyds said half of the nation's 20 best-selling property purchase locations by young professionals are in London's SW region.

It analysed Land Registry postcode data for the 12 months to January, for 25 to 44-year-old urbanites.

It said the average home price in Wimbledon was £534,999. Other hotspots in the area included Fulham, Wandsworth, Tooting and in leafy Putney, where it said prices were on average £624,676.

Lloyds Bank mortgages director Marc Page said: "Young professionals make up a decent proportion of the capital's workforce and where they choose to live has a bearing on the local housing market."

It said only two out of the top 20 locations were not in the capital - Hove and Brighton.

Others in the top list included Kilburn and Hampstead, Chiswick, Ealing and Hornsey.

The study showed that young professionals pay an average premium of £47,000 extra, some 26%, to live in the southwest part of London compared to other parts of the capital.

Outside of the South, the study said a similar trend of higher prices for urbanites was noted.

It said the premium in Didsbury compared to Greater Manchester was 55%, 37% in Jesmond over Newcastle as a whole, 48% in Nottingham's West Bridgford and 39% in the Ecclesall and Hunters Bar areas of Sheffield.

Mr Page added: "Outside London the areas most popular with this segment of the population also tend to fit the profile. In the majority of cases, young buyers have to pay a significant premium for a property to live in these areas compared with living in other parts of the city."

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Credit Firms Warned Over Misleading Adverts

The Financial Conduct Authority (FCA) has demanded that consumer credit firms, including payday lenders, comply with its rules on advertising.

The FCA has revealed that more than 20% of the adverts it examined failed the set criteria.

The watchdog, which assumed regulatory responsibility of the sector in April, said it reviewed 500 advertisements from companies and found 108 did not meet its expectations.

The FCA said many of the offenders made changes after it complained, however more than 30 of the firms still had not made alterations.

It said it found firms encouraged consumers to hit "apply" buttons for products before having a chance to access important loan information.

The tactic was against its rules, and further scrutiny of the sector would occur, it said.

The FCA acts on complaints from the Advertising Standards Agency, consumer complaints and its own surveillance.

Scrutiny would continue for online, direct mail, print and in-store promotions.

Lenders, and in particular payday firms, have come under increased pressure for their sales techniques.

Payday lending has become a political hot potato because of the potential for customers unable to repay short-term debt being hit with extraordinarily high interest rates.

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Dixons And Carphone Warehouse Merger Agreed

Dixons Carphone Eyes The World Of Future Tech

Updated: 11:53am UK, Thursday 15 May 2014

By Tom Cheshire, Technology Correspondent

It all sounds pretty retro.

The new company to be formed by the merger of Dixons and Carphone Warehouse will be called Dixons Carphone - very 1980s.

And one of its businesses is PC World - which feels slightly more recent, but is still about as dated as an episode of Friends.

But the £3.7bn merger could be the future of how we buy technology in the UK.

And it's all about internet-enabled toasters.

Let me explain.

For some time now, technologists have been prophesying the "internet of things".

This is the quasi-nirvana whereby physical objects in the real world - including toasters, but also cars, thermostats, washing machines, front doors - all become part of the network of networks that is the internet.

These devices all talk to each other, machine-to-machine, and are all controllable digitally - from the web, your smartphone or Google Glass. (The Sonos home music player, built into ceilings but controlled from your smartphone, is an existing example of this.)

According to research firm Gartner, 26 billion "things" will join the internet by 2016.

Tom Coates' house is what the internet of things looks like in the real world. A British designer working in San Francisco, he has installed sensors around his home - and given his house a Twitter account, @houseofcoates.

Weighing scales, light switches and thermostat all chip in, resulting in tweets like: "Tom just weighed himself. I'm going to leave it up to him to tell you if it's good news though."

The house is a playful first step towards an internet of things. It's easy to imagine where to goes next: lawn sprinklers which turn on if the house detects it has been days without rainfall, toasters that start toasting when your morning alarm goes off, lights that turn off when you're not in the room - or the weighing scales to go online and order healthier food if Mr Coates' weight increased too much. Then beyond.

Mr Coates is an early adopter. Recently he wrote: "For me the most important change is the move from Internet of Things concept cars and interaction design experiments, to a new world where the things we're building are simply, cleanly useful."

He cites Nest - the smart thermostat and alarm maker recently bought by Google - as an example of this.

At tech show CES this year, Samsung also showed off smart fridges and washing machines.

And this is where Dixons Carphone comes in. After all, you need somewhere to buy all this gear.

Carphone Warehouse has long excelled at reinventing itself with each wave of mobile technology, from carphones through mobiles, smartphones, tablets and the wearables to come.

The next stage is the integration of these mobile devices with the household - the territory of Currys and PC World.

The new company will be able to offer not just standalone products, but integrated, personalised systems.

It might help with some of the more complex installations in your house.

Rather than catching up with new consumer tech habits, Dixons Carphone is looking to get ahead of them.

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Boots Fights Hands For £600m Co-op Pharmacies

By Mark Kleinman, City Editor

Britain's biggest high street chemist is battling against City investors including Guy Hands, the former owner of EMI Music, to win control of the struggling Co-operative Group's pharmacy chain.

Sky News has learnt that potential buyers of the division tabled preliminary offers on Thursday, two days before a crucial meeting of Co-op members at which urgent reforms of the mutual's governance will be thrashed out.

The bidders included Alliance Boots, which is the UK's largest health and beauty retailer with almost 2,500 shops, Terra Firma Capital Partner, Mr Hands' investment vehicle, CVC Capital Partners, the biggest shareholder in Formula One motor racing, and Carlyle, which owns Holland & Barrett, the health-food chain.

Charterhouse, Cinven and Montagu, three other private equity groups, were also among the bidders, according to people close to the process.

It was unclear on Friday whether Alliance Boots, which is part-owned by the giant US retailer Walgreens, would pursue its interest throughout the auction process and whether it was keen to acquire the entire chain of Co-op pharmacies.

Analysts said that it could seek to offload some of the Co-op outlets to a potential partner.

Legal opinions are mixed about whether a sale to Alliance Boots would trigger an objection from the Competition and Markets Authority, although Co-op executives are understood to be hopeful that the fragmentation of the UK market would make such a deal possible.

Speaking on Thursday as Alliance Boots announced record annual profit of nearly £1.3bn, the company's executive chairman, Stefano Pessina, said it would continue to concentrate its expansion on emerging markets.

The Co-op's pharmacies unit comprises 750 outlets, which employ 6,500 staff and serve 200,000 customers a week.

The business has struggled because of cost-cutting within the NHS' prescription drugs budget although it is still profitable, making operating profit of £28.2m on sales of £764m in the year to January 5, 2013.

A source close to one bidder said its pre-tax profit in the most recent financial year had been roughly £67m, making £600m "an appropriate ballpark" for bids.

It was unclear whether other major pharmacy chains such as Lloyds and Superdrug had tabled offers.

The Co-op has decided to explore a sale of the business, as well as its much smaller farming operations, to raise cash as it aims to puts its finances on a firmer long-term footing.

The annual meeting and special general meeting in Manchester on Saturday will include a crucial vote on reforms to the mutual's management and governance structure proposed by Lord Myners, the former City minister, in the wake of its £2.5bn annual loss.

The Co-op and the bidders for its pharmacies business declined to comment on Friday.

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Hundreds Want Removal From Google Results

By Tom Cheshire, Technology Correspondent

An EU ruling on Tuesday, that search engines should remove links to information that is irrelevant or incorrect, and prejudicial to a person, has led to more than 1,000 requests to Google for information to be taken down.

Sky News sources say they include a business wanting to remove forum posts about it cheating customers, a man who tried to kill his family asking for the news story not to be linked to, and a convicted cyber stalker requesting that a story mentioning his name be dropped.

Not the most pleasant company.

But I've also spoken to others who feel they have legitimate reasons to request links be removed.

One person who committed fraud on a technicality - although he says he rightly takes the blame - says the right to be forgotten would help him and his business move on.

Another person spoke of how a negative, and unfounded, review nearly ruined her business, and caused a huge amount of personal distress.

And criminal convictions that legally become spent hang around a lot longer online.

The reporting in the press on the EU ruling has been polarised.

Either information should flow completely freely, or individual citizens should be able to edit their online profiles.

The two strands of thought have been in opposition for a lot longer than the internet has existed, and will continue their battle.

We've already started to see the ruling's real life effects and unintended consequences. And it looks like they will be just as messy and divided.

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General Motors Fined $35m For Recall Delay

The US government has fined General Motors the maximum $35m (£21m) for delayed recalls of vehicles with faulty ignition switches.

Thirteen people died in crashes linked to the problem, the company says, but lawsuits put the actual death toll at 53. 

GM has admitted it knew about the problem for more than a decade.

But it did not recall the vehicles until this year, even though car-makers are supposed to report safety defects within five days of discovery.

A deadly Chevy Cobalt crash in 2006 could be linked to the faulty switch

The Justice Department is investigating GM's delayed recall of 2.6 million Chevrolet Cobalts, Saturn Ions and other cars.

The Department of Transportation's National Highway Traffic Safety Administration is also looking into the scandal.

But that agency has itself been criticised for failing to act on reports it received in 2007 and 2010 about the faulty switches.

The defective part was prone to turning off, causing the engine to shut down and disabling the air bags.

A grieving mother watches GM's boss testify at Capitol Hill in April

The Detroit-based firm first spotted the problem during pre-production in 2001.

However, it was not until February 2014 that it instigated a recall.

GM engineers held meetings about the issue in 2005, but decided against a fix because it would take too long and cost too much money.

The switch plunger lacked pressure to stop it accidentally turning off

Transportation Secretary Anthony Foxx said in a news conference on Friday: "Literally silence can kill.

"GM did not act and did not alert us in a timely manner. What GM did was break the law." 

The fine amounts to less than a day's revenue for the car-maker, which made $37.4bn (£22.2bn) in the first quarter.

Mr Foxx is urging Congress to pass legislation that would raise the fine against GM to $300m (£178m).

As part of its agreement with the US government, GM has also acceded to government oversight on safety issues.

In a statement confirming the agreement, GM chief executive Mary Barra said: "GM's ultimate goal is to create an exemplary process and produce the safest cars for our customers - they deserve no less."

She appeared before Congress in April and offered her "sincere apologies" for the scandal.

On Thursday, General Motors said it had issued five more recalls, covering about 2.7 million vehicles in the US, mostly for tail lamp malfunctions.

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India's Narendra Modi Celebrates Election Triumph

India's incoming Prime Minister Narendra Modi has been greeted by thousands of jubilant supporters as he arrived in Delhi to take part in a victory parade after his historic win.

Mr Modi's Bharatiya Janata Party (BJP) was swept to power by the most resounding election result in three decades.

Some 551 million people took part in the national ballot - more than the population of the US, the UK, Germany and Canada combined.

Mr Modi, a Hindu Nationalist has pledged to take India forward after ousting the ruling Congress party from power.

Mr Modi received an enthusiastic welcome at his party's Delhi headquarters

Barack Obama has already invited the new Indian PM elect to visit Washington.

Arriving at the airport in Dehli, Mr Modi smiled and gave victory signs. He also received an enthusiastic welcome at his party's headquarters.

He is due to meet senior members of his party to discuss forming a new government.

After securing enough seats to become the first majority government India has elected in 30 years, Mr Modi tweeted on Friday: "India has won. Good days are coming."

Narendra Modi declared his victory on Twitter

He later told crowds: "The heat of the election is over and the people have given their verdict which says that we need to take India forward to fulfil the dreams of India's 1.2 billion people.

"There are no enemies in democracy, there is only opposition. I will take your love and convert it into progress before I return."

The election result is the worst ever for the Gandhi dynasty and follows what the BJP describe as a "people's revolution".

Mr Modi oversaw a modern campaign which utilised everything from holograms to WhatsApp.

The stock market responded to his win by leaping 6%, sending the rupee to an 11-month high.

Narendra Modi is blessed by mother, Hira Ba, on the day of his victory

Mr Modi has been the top official in Gujarat state for a decade.

The 63-year-old is the son of a tea seller and has played on his humble roots during the election campaign, with references to his mother riding a rickshaw to cast her ballot.

His victory comes despite controversy over links to the paramilitary Hindu nationalist group Rashtriya Swayamsevak Sangh (RSS) - which some describe as neo-fascist.

As chief minister of Gujarat, Mr Modi was criticised for failing to apologise for religious riots in 2002 in which at least 1,000 people died - mostly Muslims.

He has denied any role in the violence and the Supreme Court declared he had no case to answer.

However, suspicions prompted the US to deny him a visa in 2005, while Britain maintained a diplomatic boycott on Mr Modi until 2012.

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Co-Operative Members Back Radical Reform

Members of the struggling Co-op have unanimously backed a major overhaul of the group.

It paves the way for radical reforms proposed by former city minister Lord Myners to go-ahead.

A timetable for carrying out the changes will be agreed at a board meeting later this month, says the Co-op as it warned tough times lay ahead.

Lord Myners has said the Co-op is "not fit for purpose"

Some reforms will need rules to be altered, and so require further votes.

Co-op Group chair Ursula Lidbetter, who announced she will step down after a transitional period, said the mood at the annual general meeting was "thoughtful and sober".

She hailed the vote as "a highly significant moment" for the group.

Speaking ahead of the vote, Ms Lidbetter told delegates "catastrophic failure of governance" had taken place at the Co-operative Group but it was in its own hands to "make this business work again".

She also said 2013 had been "a disaster waiting to happen".

Sky's City Editor Mark Kleinman said no-one had been expecting a unanimous vote, and Co-op executives were "breathing a sigh of relief" at the result.

After the vote, Lord Myners said: "My job, when I was asked by the board, was to do a thorough review of governance and I have done that.

"Quite forthright, that upset some people, but I think it was necessary to be frank and straight forward and people have obviously listened with care."

He has proposed a major shake-up of the 150-year-old business which reported losses of £2.5bn for 2013.

The plans include sweeping away the existing 20-strong board of representatives from the Co-operative Group, who currently include an engineer, a plasterer and a retired deputy head teacher.

He wants to replace this with a slimmed-down "plc and beyond" structure staffed by professionally-trained directors.

The former Marks & Spencer chairman was appointed a director of the Co-operative Group in December but has announced he is to leave following this weekend's vote.

He has said it was apparent to him from the first time he attended a board meeting that not one of its members had the ability to address the complex issues faced by a group burdened with £1.4bn of debt.

Lord Myners believes that the Co-op will survive but faces the prospect of having to sell assets such as its £1bn funeral care business, in order to meet the demands of its lending banks, if it does not adopt reform.

Resistance to the changes saw chief executive Euan Sutherland leave the group earlier this year saying it was ungovernable.

The decision on the reforms was taken by representatives of its independent societies and affiliated organisations - who hold 22% of the vote - and others voting on behalf of its regional membership boards making up the remaining 78%.

Ms Lidbetter said: "There is a huge task ahead of us if we are to deliver the reforms necessary to restore the Group's reputation and return it to health but the board will work hand-in-hand with our members to ensure that we seize this opportunity.

"It is vital that the right changes are put in place as soon as possible to build a more effective organisation for our members, customers and colleagues."

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