First-Time Buyers 'Getting A Shot At Long Last'

By Poppy Trowbridge, Consumer Affairs Correspondent

The number of first-time buyer sales has hit a seven-year high, according to new figures from LSL Property Services.

There were 30,000 first-time buyer sales in July, up by 25% on a year before and the highest number of monthly first-time buyers since August 2007.

At the same time, the data reveal average first-time buyer deposits are 10% lower than this time last year.

Down payments averaged £26,642 in June, a decrease from £29,609 12 months ago.

David Newnes, from LSL Property Services, said: "A whole generation of young buyers were trapped on the sidelines of the property market as the economy recovered from the recession, struggling to save for a deposit whilst inflation remained stubbornly high, savings rates were stuck at a historic low, and real wages fell.

"But the recent increase in high LTV (loan to value) lending options - enabled by Help to Buy - has allowed them a shot at getting on the ladder at long last."

Yet purchase prices are on the rise, and mortgage rates are climbing, meaning buyers could still struggle with debt and repayments.

First-time buyers paid 8% more over the last year, with the average price paid for a new home now £155,844, according to LSL Property Services.

Simultaneously, average mortgage rates climbed for the fourth consecutive month in July to 4.19%.

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Ghosts And Gods 'Cannot Be Copyright Holders'

The debate over who has copyright over a selfie taken by a monkey has finally been settled.

In a rare update to the US Copyright Office's (USCO) guidance – the last rulebook was published 30 years ago – the office said an animal, ghost or god cannot hold a photograph's copyright.

"The office will not register works produced by nature, animals or plants," it said in a statement.

"Likewise, the office cannot register a work purportedly created by divine or supernatural beings, although the office may register a work where the application or the deposit copy states that the work was inspired by a divine spirit."

The selfie controversy flared last month when photographer David Slater came across a crested black macaque during a trip through an Indonesian national park.

The monkey ended up taking a photo using Mr Slater's camera, which later appeared on Wikimedia's database of free photos for public use.

Mr Slater demanded the photo be taken down, saying it was his photo.

The claim was disputed by Wikimedia, and the new rules from the USCO appear to support their stance.

The rules even use the example of "a photograph taken by a monkey" as an example of work that would not be covered by copyright.

The example is cited alongside a mural painted by an elephant and driftwood shaped and smoothed by the ocean.

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Scottish Independence 'Risks Capital Flight'

A Yes vote in next month's Scottish referendum risks "capital flight" from the country leaving its financial system in a "parlous state", the boss of HSBC has warned.

The bank's chairman Douglas Flint, who describes himself as an exiled Scot, said the sterling currency union was an "anchor of financial stability" for Scotland.

And the move to any of the alternatives would be "complex and fraught with danger".

The three main parties at Westminster have all ruled out the Scottish Government's preferred option of a formal currency union between an independent Scotland and the rest of the UK.

Mr Flint said this was "wholly consistent" with the approach taken in the wake of the financial crash and eurozone crisis.

The SNP wants a currency union between an independent Scotland and the UK

Writing in a personal capacity in the Daily Telegraph, he said: "The alternatives to a currency union include a completely independent currency, passive acceptance of a monetary policy designed in London for the rest of the UK, or, assuming Scotland rejoins the European Union, eventual membership of the euro.

"In all these circumstances, the transition from the existing currency union would be complex and fraught with danger.

"At the extreme, uncertainty over the Scotland's currency arrangements could prompt capital flight from the country, leaving its financial system in a parlous state.

"This could, in turn, place enormous pressure on Scotland's future fiscal policies.

"Scotland would give up the benefits of being part of a larger fiscal union with the stability that offers in terms of scale, diversification and fiscal transfers."

The Proclaimers are backing the independence cause

Mr Flint said Scotland would face "an enormous challenge" to introduce its own currency, while an informal use of the pound, so-called "sterlingisation", would put "enormous pressure" on fiscal policy.

He said: "Monetary policy itself would be imported from the rest of the UK; Scotland would be faced with monetary policy implementation without representation - a very odd form of independence."

Referring to the Westminster parties ruling out a formal currency union, Mr Flint said: "That decision is wholly consistent with the actions that have been taken in the aftermath of the financial crisis to minimise the risks to UK taxpayers from financial sector shocks arising in overseas and wholesale banking operations.

"It is also consistent with the knowledge gained from recent events in the eurozone, which have highlighted the challenges inherent in managing a currency union without political and fiscal union."

Former prime minister Gordon Brown has also poured scorn on Mr Salmond's plans for a currency union after independence arguing it would put Scotland in a "neo-colonial" position, with key decisions over matters such as interest rates made elsewhere.

Meanwhile, those campaigning for a Yes vote marked a milestone having collected one million signatures in support of independence.

Among those to sign were singing duo Craig and Charlie Reid, whose hits as The Proclaimers include I'm Gonna Be (500 Miles), I'm On My Way and Letter from America.

Charlie said: "A Yes vote is vital to secure the kind of society that we want."

Craig said: "This vote is very serious and I think if you have an opinion you should say it."

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Ecclestone Return Heralds New F1 Board Revamp

By Mark Kleinman, City Editor

Formula One (F1) motor racing is preparing for further governance changes as the sport's boss, Bernie Ecclestone, retakes his boardroom seat following a £60m bribery trial settlement.

Sky News understands that Lehman Brothers Holdings Inc, which administers the estate of the bankrupt Wall Street investment bank and is F1's third-largest shareholder, is poised to name Sean Mahoney as its board representative.

Mr Mahoney, a former Goldman Sachs and Deutsche Bank executive, is expected to join the board of Delta Topco ahead of the next scheduled meeting of directors in September.

His arrival will follow a change of the director nominated by Waddell & Reed, a US-based fund manager, which recently named Michael Avery to represent its substantial minority stake in F1.

A director of Delphi Automotive, Mr Mahoney will replace Peter Sherratt, a former Lehman executive, at an important time for F1's ownership.

The Lehman estate is keen to sell its roughly 15% stake in F1, and has been approached by the US media groups Discovery Communications and Liberty Global about a possible deal.

Mr Ecclestone, who stood down from the Delta Topco board earlier this year pending the outcome of his bribery trial in Germany, will resume his place on the board after settling with prosecutors.

Speaking at Belgium's Spa-Francorchamps circuit on Friday ahead of this weekend's Grand Prix, Mr Ecclestone said he hoped to continue running F1 for as long as possible, adding that being reinstated to the board would make "no difference".

CVC Capital Partners, the private equity firm which took control of F1 in 2005, still owns approximately 35% of the sport but is likely to sell that stake or mount a renewed attempt to float the company in the next 12 months.

Last month, Delta Topco's board approved a £585m dividend payout financed through a renegotiation of the company's borrowing arrangements.

Another of F1's minority shareholders, Norway's vast sovereign wealth fund, has faced domestic criticism over its investment in the sport because of its mandate to own shares only in public companies or those which have concrete intentions to list on a stock exchange.

CVC declined to comment on Friday while Mr Mahoney could not be reached.

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Argentine Debt Plan 'Illegal' Says US Judge

Argentina's plan to take control of its own debt repayments to US bond-holders after a default has been ruled illegal by a court in New York.

The federal judge in Manhattan stopped short of finding the South American nation in contempt of court, but described Argentina's actions as "lawless".

District Judge Thomas Griesa rejected requests by lawyers for US hedge funds to make a contempt finding, saying he wanted everyone to concentrate on an eventual settlement.

Griesa said: "In my judgement, it does not add anything to the scales of settlement to make a finding of contempt."

But he said that proposed legislation, announced on Tuesday by Argentine president Cristina Fernandez, would violate orders he imposed favouring creditors who refused to accept restructured bonds following the country's 2002 default on $100bn of debt.

Argentina missed a June interest payment after Griesa blocked payments owed to holders of debt issued under US law that was restructured in 2005 and 2010.

The country has argued that any deal it reaches with US bondholders, owed about $1.5bn, would obligate it to pay over $20bn to other bondholders.

Ms Fernandez, who has refused to pay the US hedge funds face value on their bonds, wants legislation passed that would allow her government to resume payment to holders of exchanged bonds, in defiance of the US court.

She has described the funds, including New York billionaire Paul Singer's NML Capital Ltd, as "vultures" because they refused to participate in swaps in 2005 and 2010 in which over 90% of Argentina's bondholders agreed to accept lesser-valued bonds.

"Far from delivering justice and bringing equal conditions among the parties, the judge only looks to favour the vulture funds", Argentina's statement said after the ruling.

It accused the judge of being contemptuous of Argentina's sovereignty.

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EDF Energy To Pay £3m Complaints Penalty

EDF Energy is the latest of the so-called "Big Six" suppliers to be slapped with a penalty for market failures.

The regulator Ofgem said it had agreed to pay £3m to benefit vulnerable customers after its investigation found that the company breached complaint handling rules.

The inquiry was prompted by an increase of more than 30% in the levels of complaints recorded by EDF as it introduced a new IT system in 2011.

Ofgem found that between May 2011 and January 2012, EDF did not have appropriate procedures in place to properly receive, record and process all customers' complaints in accordance with handling rules.

Its technical problems included unacceptably high call waiting times, with many customers deciding to hang up before getting through to a customer services operator.

The company acknowledged its customers were caused significant disruption - and has apologised.

Sarah Harrison, Ofgem's senior partner with responsibility for enforcement, said of EDF: "Their commitment to putting things right and paying £3m to the Citizens Advice 'Energy Best Deal Extra' scheme and the Plymouth Citizen Advice Bureau's Debt Helpline to benefit vulnerable customers is a step in the right direction to rebuilding consumer trust.

"It's now vital for EDF Energy and the industry as a whole to truly put customers first and put adequate resources in place to deal with complaints.

"Following our reforms, it has never been easier for consumers to switch supplier and therefore those unhappy with the service they receive are able to vote with their feet."

Beatrice Bigois, EDF's managing director of customers, said: "Despite our best efforts and extensive planning to manage this transition in 2011 without impacting our customers, we recognise that for a period of time the service to our customers was not up to the standards they deserve.

"We apologise to those customers who were impacted during this period.

"We have co-operated fully with Ofgem and have taken this matter very seriously.

"The £3m package that we are offering will ensure that thousands of vulnerable customers are provided with free, independent advice on debt, as well as information to help them manage their energy consumption and bills."

The penalty against EDF followed similar actions by the regulator which saw SSE and E.ON pay the biggest sums for past failures as a debate rages on whether consumers get a good deal from the wider market.

The Big Six firms, which also include British Gas, Scottish Power and nPower, denied accusations of profiteering after collective profits quadrupled to more than £1bn over three years.

In a bid to rebuild trust the Competition and Markets Authority (CMA) is carrying out a full investigation, which will include an examination of the relationship between the supply businesses and generation arms of the Big Six.

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Fed Official Wants ECB Action To Lift Economy

A top official at the US Federal Reserve has called on the European Central Bank (ECB) to act to bolster the flagging eurozone economy to help the world's recovery.

James Bullard, who is the president of the St. Louis Federal Reserve Bank, spoke out as ECB president Mario Draghi prepared to speak at the annual gathering of central bankers and policymakers in Jackson Hole, Wyoming.

Mr Bullard's remarks followed confirmation a week ago that GDP growth in the bloc of nations which use the single currency stalled in the second quarter of the year, with German's economy actually contracting.

News of the dire performance prompted renewed calls from economists for the ECB to introduce quantitative easing (QE) to boost money supply and take further action to prevent a possible spiral towards deflation.

During a round of interviews in Jackson Hole, Mr Bullard argued that central banks were operating in a global environment.

He told Reuters: "If Europe as a whole goes into recession, that would be a serious issue from the perspective of US monetary policy."

While he stuck to his forecast of a late first quarter interest rate rise in 2015, he said much depended on everything going according to plan as 2014 was supposed to be the year of recovery for Europe, which would have been bullish for the US economy.

He cited low inflation in the eurozone as a core concern.

Mr Bullard said: "To me, that's a flashing signal to the ECB that they need to take actions that are sufficient to reassure markets that they're going to hit their targets over the near term." 

Euro area inflation was measured earlier this month at an annual rate of 0.4% - a near five-year low.

A failure to combat weak or negative price growth was blamed for 20 years of stagnation in Japan.

The ECB, which in June introduced a negative interest rate on deposits to encourage bank lending, has so far resisted following the Fed and the Bank of England (BoE) in deploying QE.

The Fed is in the process of slowing its stimulus package as the US economy recovers while the BoE has not added to its £375bn of asset purchases since July 2012.

Both central banks are mulling data on wage growth as they consider the timing of interest rate rises.

It emerged this week that two members of the BoE's rate-setting committee voted for a rate increase though official statistics released since the meeting took place showed a deterioration on the wages issue, with pay levels actually shrinking. 

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Current Account Exodus At Troubled Co-op Bank

The troubled Co-op Bank has revealed it lost almost 30,000 current account customers in the first half of its financial year.

The bank, which was forced to raise almost £2bn to plug a capital black hole last year, reported significantly lower losses of £75.8m for the period compared to the same time during 2013 and said its wider financial position was improving despite "deep-rooted" problems remaining.

It shed 13% of its permanent staff, closed 46 branches over the six month period and said it lost 28,199 current account holders, although its net customer number losses has since slowed, it said.

It blamed "negative publicity and significant competitor activity" for the near-2% fall.

Sky News reported on Thursday night that the bank was facing demands from some of its biggest shareholders to accelerate an overhaul of its operations and commercial strategy - as losses were expected to continue for two years.

But in its results statement, chief executive Niall Booker said Co-op Bank had made progress since its rescue from near-collapse - a deal that saw the supposedly ethical bank give up control to US hedge funds.

The bank said its capital position had been strengthened following a £400m capital-raising.

Mr Booker said: "Considering the scale of the challenge we faced a year ago, we are encouraged by the progress made to ensure the stability of the bank.

"The core bank continues to remain stable. In the first half of the year more people switched into the bank than in the second half of 2013.

"Although we have also seen an increase in the number of people switching out of the bank, the net numbers remain small relative to our total number of current account customers whose continuing loyalty is deeply appreciated.

"Recent trends suggest this net outflow of retail customers has slowed."

The bank's problems have been at the centre of a wider crisis for the Co-operative Group, which reported a £2.5bn loss for 2013 as its exposure to the bank hit earnings.

A report on the bank's near collapse and subsequent rescue, which saw the group's stake reduced to just 20%, pinned the blame on toxic loans inherited from its disastrous merger with the Britannia building society in 2009 amid a series of management and cultural failures.

In May, the Co-op Group's members backed radical plans by the former City minister Lord Myners to sweep away its existing 20-strong board and replace it with a more plc-style structure, staffed by professionally-trained directors.

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Draghi: ECB Ready To Spur On Euro Economy

The boss of the European Central Bank (ECB) has revealed it is ready to do more to boost a shaky recovery in Europe.

But Mario Draghi warned EU member governments they must still join in efforts to reduce unemployment, which remains stubbornly high.

Mr Draghi said: "I am confident that the package of measures we announced in June will indeed provide the intended boost to demand, and we stand ready to adjust our policy stance further."

So far the ECB has cut interest rates, offered cheap loans to banks and is weighing up asset purchases to help stimulate the 18-member eurozone.

The ECB has already pumped unprecedented amounts of liquidity into the banking system back in 2011 and 2012, but instead of lending the money on to businesses banks tended to park the cash with the ECB instead.

In June, the ECB created a negative interest rate to encourage banks to lend more.

Mr Draghi also said certain longstanding practices in some countries are helping to keep unemployment high.

He said freer wage adjustments and workforce levels would encourage companies to hire.

Mr Draghi made the comments as part of his speech at the US Federal Reserve conference in Jackson Hole, Wyoming.

Meanwhile, US shares eased on Friday after the Jackson Hole speech by Fed boss Janet Yellen left investors unsure on the possibility of a rate rise in coming months.

She said the financial crash complicated the Fed's ability to assess the US job market and made it harder to determine when to adjust interest rates.

Ms Yellen's remarks failed to offer strong signs that indicate she is moving away from the view of support through ultra-low interest rates.

The timing of a Fed rate increase remains unclear, though many economists foresee an increase by mid-2015.

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Cable Blitz On Loopholes In Zero-Hours Contracts

Business Secretary Vince Cable has called on businesses and trade unions to expose any loopholes in plans to ban the use of exclusivity clauses in zero-hours contracts, under which employers prevent people from working for someone else.

Mr Cable said he wants to crack down on any potential abuse of the contract law which might see "rogue" employers trying to find a way of offering just one hour of work.

Around 620,000 workers are employed on zero-hours contracts, which do not guarantee work from one week to the next.

Around 620,000 workers are employed on zero-hours contracts

Mr Cable said: "We are looking closely at any potential loopholes that could arise from a ban, to ensure that these are closed off and no one can get round the new law. We are also ensuring there is access to justice for workers treated unfairly.

"The evidence shows that the vast majority of zero-hours contracts have been used responsibly by many businesses for many years, but unfortunately we know that some abuse does take place.

"This is why we are bringing in new laws to ban the use of exclusivity clauses in zero-hours contracts, which  currently stop employees getting other jobs if they need to top up their income.

"We want to give individuals the chance to find work that suits their individual circumstances whilst also giving employers the confidence to hire and create new jobs".

Business representatives and trade unions have been asked to draw up codes of practice to help guide the fair use of zero-hours contracts.

TUC general secretary Frances O'Grady said there was "much more the Government should be doing" to tackle the lack of uncertainty in such contracts.

Shadow business secretary Chuka Umunna said the measures "do not go far enough".

"We have seen a rising tide of insecurity in the workplace since David Cameron came to office, with his Government watering down the rights at work of every working person in this country," he said.

"So it is unsurprising the Government has put forward the minimum it thought it could get away with to deal with exploitative zero-hours contracts. Their measures simply do not go far enough."

The exclusivity ban becomes law this autumn.

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