Supreme Court Ruling
The Supreme Court has
ruled in favour of the UK’s high street banks in an ongoing
row concerning overdraft charges.
Seven major banks and
a building society had challenged previous court rulings which
allowed the Office of Fair Trading
(OFT) to investigate the ‘fairness’ of the overdraft fees
levied on customers.
Today (25 Nov 2009)
the President of the Supreme Court, Lord Phillips, overturned
these earlier rulings after the banks argued that they would
receive a ‘deluge of litigation’ if the OFT was allowed to
investigate the charges. All new claims against banks were put
on hold in July 2007 while a test case was carried out to
determine whether the charges were legal.
The Court’s latest
decision will come as a blow (but probably no great surprise)
to millions of consumers who were hoping to recoup billions of
pounds in refunds.
However, Lord Phillips
added that the landmark verdict would "not close the door on
the OFT's investigations" and may
not resolve the ‘myriad cases’ that are currently suspended.
We would not advise anyone to hold their breath.
Queen's Speech
Business groups have given their reactions to the 2009
Queen's Speech, which included a total of 13 Bills and was the
shortest such Speech since 1997.
The Speech included a Financial Services Bill, which
strengthens the powers of the Financial Services Authority to
take action over pay, following the recent scandal over bankers'
bonuses.
Meanwhile, the Fiscal Responsibility Bill would commit the
Government to halving its budget deficit within four years.
Another key Bill of interest to businesses is the Equality
Bill, which aims to strengthen and streamline existing equality
laws. The Bill includes measures to extend the ban on age
discrimination beyond the workplace, to apply to goods,
facilities and services, together with new powers to force
businesses with more than 250 employees to report on gender pay
differences. The power of employment tribunals will also be
strengthened.
Additional regulations outlined in the Speech include plans
to give agency workers the same rights as directly employed
staff, after 12 weeks of employment. The legislation could come
into effect by October 2011.
Critics described the Speech as an 'election manifesto' and
criticised the absence of any measures to reform MPs' expenses.
The Federation of Small Businesses has called on the
Government to follow through with its plans, while the British
Chambers of Commerce has stressed the need for a credible plan
to cut the UK's financial deficit, reduce borrowing and help
businesses to lead the return to growth.
Growth Capital Review
An independent review into the availability of growth capital
to small and medium-sized businesses has now been published.
The Rowlands' Growth Capital Review has revealed that a
permanent gap exists for businesses looking for between £2m and
£10m in growth capital, and that banks and equity investors are
unlikely to fill the gap in the near future.
The report calls for SMEs to be given access to the finance
they need as the economy recovers, and new opportunities emerge.
Prime Minister Gordon Brown has welcomed the report, and
pledged that the Government intends to develop a proposal for a
new growth fund for businesses looking to invest and grow.
Gordon Brown commented, 'Where there has been market failure
in the past, our new innovation fund will provide support to
high-tech start-up business growing to £1bn as a fund over the
coming years. And where there is a gap also in finance for
companies looking to expand, we propose a Growth Capital Fund, a
credible channel for private capital to invest in established
and growing SMEs'.
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