Co-operative Bank's future ethical focus leads customers to look around

Co-operative Group says it is committed to preserving bank's policy, while former leader says ethical label no longer applies

Fears that the Co-operative Bank, now controlled by hedge funds, may drop its much-trumpeted ethical policy has prompted some of its 4.7m customers to consider seeking out alternative green and socially responsible financial institutions.

The wider Co-operative Group has said it remains committed to preserving the bank's ethical focus, but the former boss of the wider Co-op Group, Peter Marks, this week told MPs that in his opinion, the ethical label could not apply to the bank any more.

A glance at Twitter and the letters pages of newspapers indicates many customers feel the same way. Last night, an online campaign was launched to "save our bank" and make sure it "sticks to its principles". Using the website saveourbank.coop, the campaign is backed by Ethical Consumer magazine and is appealing to customers to hold fire on switching away. "Sign up to our campaign instead. Then, once we are in our thousands, let's see if they are prepared to listen. We have two big aims: to protect the values and ethics of the bank, and – in time – to help it return to mutual ownership," it states.

Those determined to leave the Co-op Bank, but who do not want to give their money to one of the big four banks, may be pleased to discover there are other ethical options available. However, ethical finance experts pointed out that a lot depends on an individual's personal priorities and areas of concern. One person's absolute no-no issue is another's shrug of the shoulders, which is one of the reasons why it is impossible to provide one-size-fits-all recommendations.

The website of banking campaign group Move Your Money UK gives all the main banks and building societies a "switch score" out of 100 based on assessments of their honesty, customer service, culture, impact on the economy and ethics.

These five categories take in everything from customer satisfaction levels and the number of PPI mis-selling cases to the proportion of women on the board and the use of tax havens. The information used to determine the scores was compiled three months ago by Ethical Consumer.

For current accounts, the top-scoring institution is Carlisle-based Cumberland building society. However, its current accounts are only available to those living within its branch operating area, which rules most people out.

In joint second place is a bank that most people have probably never heard of: Reliance Bank, originally known as the Salvation Army Bank. Reliance offers a range of products including a fee-free current account that comes with a Visa debit card, cheque book and paying-in book, and offers all the usual facilities – online and phone banking, the ability to set up direct debits and standing orders, monthly statements and so on. But the "Sally Army" connection will not be to everyone's taste. The bank says: "Our investments are made within strict ethical boundaries, and our profits are used to further the Salvation Army's evangelical and charitable work."

Building societies such as Nationwide and the Coventry feature heavily in the Move Your Money list, as does Metro Bank – a relatively new arrival with branches in the London and M25 area; Handelsbanken, the UK arm of the Swedish bank of the same name, and the Islamic Bank of Britain, which calls itself the UK's only wholly sharia compliant retail bank but is keen to strees it is "an inclusive, ethical organisation, and welcomes customers of all faiths".

For those looking for a new home for their savings, the choice is wider, as there are several ethical institutions that don't offer current accounts but do have a choice of savings accounts. In the savings category, Ecology building society took Move Your Money's top spot with a score of 100 out of 100. Based in Keighley, West Yorkshire, the society uses the money put into its savings accounts to offer sustainable mortgages for properties and projects that respect the environment – but because the society has in recent months been inundated with people looking to move their money to a more ethical institution, there is now only one account open to non-member individual savers: Foundations Share, paying 1%.

Meanwhile, Charity Bank lends only to charities, social enterprises and community organisations. It closed its ethical cash Isa to new customers in April 2013 "due to unprecedented levels of new savings," but has other accounts, including one aimed at under-16s which pays 2%.

As things currently stand, the Co-op Bank is still the only high street bank with a clearly articulated ethical policy covering a range of issues, from human rights and the arms trade to genetic modification and animal welfare. Euan Sutherland, the boss of the Co-operative Group, which spans supermarkets, grocers and funeral homes, insisted that the ethical stance will be more ingrained in the bank than in the past.

"This bank will remain the Co-operative Bank. We are embedding the Co-operative principals in the constitution of the bank to guarantee this," he said.

The formal ethical policy was first launched in 1992 and it is signed by the bank's values and principles committee, chaired by a Co-operative Group board member, Herbert Daybell, a retired publisher.

As a result of the policy, the bank turns away £100m of business a year – a test of its ethical stance in the future perhaps.

Article Source : http://www.guardian.co.uk

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Grangemouth plant shutdown leaves government fighting to save 800 jobs

Petrochemicals workers will lose their jobs after abrupt closure, with 2,600 refinery employees and contract staff at risk

The government is scrambling to save 800 jobs at the Grangemouth petrochemicals site in Scotland after its owner, Ineos, abruptly closed the plant in a rancorous industrial dispute.

As the energy and climate change secretary, Ed Davey, said that "all efforts" would be made to rescue the plant, Ineos also refused to rule out closing the oil refinery on the same site.

Workers were given the grim news at a meeting with Ineos's chairman, Calum MacLean. Ineos had given the workforce until Monday evening to accept its demands for radical changes to terms and conditions but the company concluded there was not enough support.

Its decision means that up to 800 petrochemicals workers will lose their jobs, and it threatens the positions of some 600 or more employees at the refinery plus 2,000 contract staff.

Staff reacted with shock to the news, as Ineos followed through on its warning that the threat of closure was not a bluff.

The fate of the giant plant on the Firth of Forth has far-reaching implications for Scotland and the UK. Grangemouth is Scotland's biggest manufacturing business, its refinery supplies most of its fuel and the petrochemicals plant produces plastics used in industries ranging from cars to packaging.

In an urgent question on Grangemouth in parliament, Davey told MPs repeatedly that the government wanted the plant to stay open if at all possible. It would still consider a business case to provide investment to help keep the plant running.

"We will be using all our efforts through the [Business] department and UKTI [UK Trade and Industry body] to assist should we need to have a buyer for the petrochemical plant," he said.

However, Ineos has already warned that the refinery – currently shut down because of the dispute – could be closed permanently if the Unite trade union did not agree to a no-strike deal.

Davey also confirmed that detailed contingency plans had been drawn up to protect firms and customers from running out of fuel and chemical supplies. He met MPs later to discuss the issue in more detail.

Downing Street has insisted the closure of the Grangemouth refinery would not pose a threat to fuel supplies, after the AA warned it could hit petrol prices. The prime minister said in an answer to a parliamentary question from the Labour MP Tom Watson that ministers had discussed the closure during Cobra meetings.

Downing Street dismissed speculation that the plant could be nationalised, saying it was a matter for unions and owner to resolve. The prime minister's spokesman said it was disappointing that the petrochemicals side of the plant had closed and called on "both parties" to "continue their dialogue" over the future of the refinery.

The closure of the petrochemicals plant follows a standoff between Ineos and Unite, which represents about 1,100 of Grangemouth's permanent employees as well as many contract workers. Many businesses – from the Rumbling Tum burger van near the site to cab firms, pubs and hotels – rely on trade from Grangemouth.

Gordon Alexander, who owns Grange Radio Cabs, said closure would devastate local businesses. "Local shops and local snack bars would definitely go out of business. We do a lot of executive work for them and if they were to close I would probably lose about half of my 50 cabs."

Edmund King, the president of the AA, warned that petrol prices could rise if Grangemouth and other European refineries closed down.

"The AA is concerned with the impact of this refinery closure," he said. The European commodity trading houses have been predicting the loss of five to six refinery plants over the next two years.

"In March to April of last year, with the closure of refineries and the impending start of the US motoring season, wholesale prices went up by 20%, adding 8p to 10p to a litre of petrol. The spike was short-lived because US drivers cut back and some of the refineries were bought. However, the damage was done and a new UK petrol record [142.48p a litre] was set."

Bitter dispute

The announcement follows the passing of a deadline on a survival plan put to employees, which asked them to accept changes to pensions and other terms and conditions.

The Unite union said about 680 of the site's 1,370-strong workforce had rejected the company's proposals, which include a pay freeze for 2014-16, removal of a bonus up to 2016, a reduced shift allowance and ending of the final-salary pension scheme.

Ineos said its owner, Jim Ratcliffe, and other shareholders met on Tuesday to study the response from the workforce to their survival plan, and wanted the employees to be the first to know of any decision the company made.

A dispute over pay and conditions at the oil refinery remains unresolved.

Unite has accused the company of "playing Russian roulette" with the future of Grangemouth, the biggest industrial site in Scotland, and is backing any efforts by the Scottish government to find a new buyer for the oil refinery and petrochemical complex.

Ineos sent a letter to workers last Thursday asking them to indicate their rejection or acceptance of the plan.

It said those who supported the survival plan would receive a transitional payment of up to £15,000.

The two sides have been embroiled in a bitter dispute for weeks, initially over the treatment of the Unite convener, Stephen Deans, who was involved in the row over the selection of a Labour candidate in Falkirk, where he is chairman of the constituency party.

He was suspended, then reinstated, then was subject to an internal investigation, which is due to report on Friday.

The dispute has since widened to the future of the entire site, with Ineos warning that it would close without investment and changes to pensions and other terms and conditions.

The company said the plant, which has been shut down since last week because of the dispute, was losing £10m a month.

Ineos had said it was ready to invest £300m in Grangemouth, but only if workers agreed to the new terms.

Article Source : http://www.guardian.co.uk

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Take supermarket price match schemes with 'pinch of salt', says Which?

Investigation into Asda, Sainsbury's and Tesco finds differences in schemes means claims to be the cheapest are worth little to customers

Popularvoucher-style price match schemes run by the majorsupermarkets vary enormously, making it hard for shoppers to tell which supermarket is the cheapest, according to new research.

The consumer group Which? analysed shopping trips to Asda, Sainsbury's and Tesco – which all operate rival price match schemes – but warned that their claims about likely savings "should be taken with a pinch of salt".

The warning came as the advertising watchdog banned what it said was a misleading advert for the Sainsbury's campaign – known as Brand Match – for suggesting that consumers do not need to shop around to benefit fully from deals at rivals Tesco and Asda.

Price comparison tools have become a key battleground in the fiercely competitive UK grocery retail sector. But the supermarkets have been waging further war against each other by challenging their rivals' claims and even referring them to the Advertising Standards Authority (ASA).

The investigation by Which? found that the schemes run by Asda, Sainsbury's and Tesco differ greatly, making them of little real worth to shoppers. Secret shoppers visited the supermarkets to find that, in the majority of cases, each claimed to be cheaper than its rivals.

Which? analysed the till receipts from 59 shopping trips – 19 at Asda, 20 at Tesco and 20 at Sainsbury's – each time checking the price of the basket with the supermarket's own online price match. Asda was the cheapest, according to its own "Price Guarantee" on the most occasions (17 out of the 19), Sainsbury's judged itself cheaper than Asda and Tesco for 10 of the visits and joint cheapest for another two, according to its "Brand Match", and Tesco was cheaper than Asda and Sainsbury's for 10 of the 20 visits – according to its "Price Promise".

But supermarkets set their own rules for what is and isn't compared under price-matching schemes, and sometimes stock products in different sizes, so it can be hard to tell which is the cheapest.

Overall, the 59 shopping trips analysed by Which? resulted in an average discount voucher for shoppers of just £1.45.

Richard Lloyd, Which? executive director, said: "Supermarket price-matching schemes can save you money but we believe they should be taken with a pinch of salt because they are difficult to compare. At a time when consumers are facing a squeeze on their household incomes, we want all the supermarkets to do whatever they can to help consumers find the best deal."

The Sainsbury's television advert showed various people shopping, with the screen split three ways to indicate the supermarkets Sainsbury's, Tesco and Asda, before a voiceover said: "Deals. Everywhere aren't they? But wouldn't it be nice if we didn't have to go everywhere to get them?" The advert said Sainsbury's would compare baskets of £20 or more with prices at Asda and Tesco and offer a coupon for the difference, taking deals into account. But two viewers pointed out that Brand Match compared the total cost of the branded shop, and any savings on cheaper Sainsbury's products were offset against any items that were cheaper at Tesco or Asda. The deal meant the value of the coupon was reduced, and customers could have saved more by buying the items at their cheapest price from across the three supermarkets.

Sainsbury's said it believed the advert made it clear that the comparison was of the total price of the branded shop, and believed it contained all the necessary information "for viewers to understand the offer and assess it objectively".

But the ASA said: "We understood that the amount of any voucher for the price difference would be reduced if any of the purchased branded items on offer at Sainsbury's were more expensive at Tesco or Asda, and that in order to achieve the cheapest overall price in these circumstances it would be necessary to shop in different supermarkets. We considered that the ad … misleadingly implied consumers did not need to shop around to obtain the full savings from deals, when in fact that was not the case. We therefore concluded the ad was misleading."

Article Source : http://www.guardian.co.uk

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