The Times - UK (2022-04-08)

the times | Friday April 8 2022 2GM 35

Business

Emily Gosden Energy Editor

One of Britain’s biggest gas and elec-
tricity suppliers has launched an out-
spoken attack on the government’s new
energy strategy, accusing it of con-
demning households to paying unnec-
essarily high bills in cold homes.
E.ON UK led a chorus of criticism
from industry experts, charities and
opposition MPs at the government’s
failure to include substantive new plans
for energy efficiency in the strategy
launched yesterday.
Michael Lewis, its chief executive,
said that measures such as home insu-
lation could be a “silver bullet” for the
energy system by cutting bills and
carbon emissions and reducing reli-
ance on foreign gas. Yet the strategy
included no new funding for energy
efficiency schemes after proposals ap-
parently were vetoed by the Treasury.
Lewis said: “The announcement con-
demns thousands more customers to
living in cold and draughty homes,
wasting energy and paying more than
they need to for their heating.”
Energy bills for most households in
Britain have risen by 54 per cent to
£1,971 a year and are forecast to rise
again in October to anywhere between
£2,500 and £3,000 if gas prices stay
high. Lewis said that the strategy was a
chance to ensure people “pay less
should the worst happen”, but that it
contained little that would “deliver a so-
lution this decade, let alone this year”.
Britain has some of the draughtiest
housing stock in Europe, but installa-
tion rates for loft and cavity wall insula-

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Tens of thousands of the smallest
finance firms in Britain will have their
authorisation fees raised up to seven-
fold under a plan to speed up policing of
the industry.
The Financial Conduct Authority
disclosed yesterday that the minimum
authorisation fee for most firms would
increase next year from £1,151 to £1,750
after a near-freeze lasting ten years, and

FCA reveals huge rise in fees to bolster fight against problem firms

Patrick Hosking Financial Editor then to £2,200 in 2023-24. Consumer
credit brokers would face even steeper
rises, with fees for the smallest firms in-
creasing from £106 to £750 by 2023-24
and at least doubling for most others.
More than half of the 51,000 author-
ised firms pay the minimum fee. They
include many small firms in consumer
credit, financial advice and insurance
broking. The FCA said that the increase
would “better reflect the cost of autho-
rising and supervising firms”. Overall, it

plans to raise fees by an average of

4.9 per cent next year to £591 million to

help to meet its overall budget, which is

rising by 4.3 per cent to £640 million.

The regulator is mostly dependent

on fees charged to all authorised firms,

including the biggest banks, brokers

and asset managers, to meet its costs.

The profit on fines that it issues for mis-

conduct are passed to the Treasury.

The latest fee proposals were pub-

lished alongside a three-year strategy

in which Nikhil Rathi, the chief

executive, pledged to make the regula-

tor more assertive and quicker in tack-

ling wrongdoing and consumer harm.

A further 80 people are to be hired so

that it can be faster in closing down

authorised firms doing harm to the

public. The regulator has been criticised

for being slow to act over firms such as

London & Capital, which offered mini-

bonds that left 11,600 investors facing

losses of more than £200 million when

it collapsed in 2019. Rathi said that the

higher cost of living would expose con-

sumers to more risk and would make

them more reliant on financial services

including credit, which made address-

ing the issues more urgent.

“This augurs a real change in tone

and substance,” Simon Morris, of CMS,

the law firm, said, “but in positioning

itself as a more powerful regulator, the

FCA’s greatest challenge is accountabil-

ity, especially to the firms it regulates.”

‘Missed opportunity’ to help insulate homes

Critics blow

cold on new

energy plan

tion plummeted a decade ago when the

government cut funding schemes.

The Climate Change Committee, the

government’s official adviser, called the

lack of measures on energy efficiency

disappointing; Citizens Advice, the

consumer charity, said it was the “major

missing piece of this strategy”. Gareth

Miller, chief executive of Cornwall

Insight, the consultancy, said: “The

absence of any measures on energy

efficiency such as housing insulation

are a missed opportunity.”

The strategy instead set ambitious

targets for expanding nuclear, offshore

wind and hydrogen that were wel-

comed by developers but met with

scepticism from experts who ques-

tioned whether they could be achieved.

Separately, Rishi Sunak requested

that the Bank of England support the

new energy strategy — including

investment in oil and gas — in a letter

sent to Andrew Bailey, the central

bank’s governor. The chancellor wrote

that his latest recommendations were

“intended to supplement rather than

replace” advice from a year ago, when

he asked City regulators to back the

UK’s drive to reduce climate emissions.

The government said it was aiming to

“kickstart a nuclear reaction to recover

our global leadership in civil nuclear

power” with plans for capacity equiva-

lent to at least six more big new nuclear

plants by 2050. It aims to approve two

projects in the next parliament. Dun-

can Clark, UK head of Orsted, said it

was “a truly momentous day for the

offshore wind industry”.

Wasted energy, leading article, page 31

BEN CURTIS/PA

Strike threats over ‘dismal’ pay offers

Alex Ralph

Britain’s biggest companies have been

put on notice of the threat of industrial

action over below-inflation pay rises

for employees.

The Communication Workers Union

yesterday rejected BT’s biggest pay rise

in more than 20 years, calling an

average 5 per cent pay increase from

the telecoms group for 58,000 employ-

ees a “bruising real-terms pay cut” and

“nothing short of an insult... We have

no choice now but to immediately

prepare for a statutory industrial action

ballot.”

The threat of strike action is the latest

deterioration in relations between BT

and the union over pay, after cost-cut-

ting and restructuring of the former

state monopoly, and comes as the

squeeze on living standards escalates.

Inflation hit 6.2 per cent in February,

official figures show, and it is forecast

by the Office of Budget Responsibility

to reach 8.7 per cent in October.

BT said it had awarded all “frontline”

workers, including engineers, contact

centre and retail workers, across its BT,

Openreach, Plusnet and EE brands a

£1,500 annual pay increase, effective

from last Friday. It said this was a rise of

up to 8 per cent for some and more than

3 per cent for the highest-paid.

The Unite union said last month that

it would ballot members employed by

GlaxoSmithKline after rejecting a “dis-

mal” pay increase offer of 2.75 per cent

for more than 1,000 workers and a

subsequent 4 per cent rise with “con-

siderable strings attached”. Unite’s

ballot closes on April 19 and it said that

if workers voteed in favour then strikes

were likely to begin this spring.

Tesco, which faced pressure from

unions late last year over pay, said that

it had reached an agreement with

Usdaw over a 5.8 per cent pay increase

for store and fulfilment centre workers

to £10.10 an hour from July.

J Sainsbury has come under pressure

over pay, with institutional share-

holders, including Legal & General,

forcing a resolution at its annual meet-

ing in July calling on the chain to pay

the so-called real living wage. The

retailer is expected to announce today

that employees in outer London will

receive the London living wage of

£11.05, an improvement of 55p.

The CWU has rejected BT’s pay offer. It has a history of disputes with the telecoms firm, including a strike in Glasgow in 1999