EQ weekly roundup 8-8-18

This week’s roundup includes news that 18 pubs are closing a week in the UK, house price growth has accelerated since June and millions of vulnerable households could face energy price increases.

This week’s roundup includes news that 18 pubs are closing a week in the UK, house price growth has accelerated since June and millions of vulnerable households could face energy price increases.

Pubs closing at rate of 18 a week

Pubs are continuing to struggle with 18 closing a week in Britain, according to the latest industry figures.

The Campaign for Real Ale (Camra) said there were 476 closures in the first six months of the year, 13 more than in the last six months of 2017.

Camra’s chairman Jackie Parker said the high cost of drinking out meant more people were choosing to drink at home, with tax rises adding to the pressure on pubs.

’Pubs are struggling under a triple whammy of high Beer Duty, rapidly rising business rates and VAT. As a result, a third of the cost of a pint is now made up of various taxes,’ added Parker.

The hardest hit areas include the North West and South East of England, both of which saw more than 60 pub closures in the first half of the year.

According to Camra, pubs contribute £23.1bn to the British economy each year.

Parker added: ‘The result is incredibly detrimental to our local communities and to our own personal connectivity. Having a good local makes people happier, better-connected and more trusting.’

UK house price growth accelerates

UK house prices picked up last month, rising at the fastest annual pace since November, according to Halifax. Prices in July rose a stronger-than-expected 1.4% from June.

The lender says prices in the three months to July rose by 3.3% from a year earlier, with the average cost of a house hitting a record £230,280.

Despite the rises, Halifax said housing activity remained ’soft’. It also said it did not expect last week’s interest rate rise to have much impact.

Last week, the Bank of England raised its key interest rate to 0.75% from 0.5%, which is set to affect the 3.5 million people with variable or tracker mortgages.

However, the Halifax said it did not anticipate that the rise would have a ‘significant’ effect on either mortgage affordability or transaction volumes. The lender added it did not expect much pick-up in activity for the rest of 2018.

Vulnerable households face energy price rise

The energy bills of five million of the UK’s most vulnerable households are set to rise by £47 a year.

Energy regulator Ofgem is raising its safeguard tariff because of higher wholesale energy costs. Energy suppliers must keep their prices below the level of the safeguard and this is adjusted twice a year to ensure any price increase is justified.

The tariff, which protects five million prepayment meter and vulnerable customers from being overcharged on poor value deals, will be £1,136 for dual fuel customers from 1 October.

This year the global rise in oil prices has fed through to wholesale gas prices, which affect both domestic heating and electricity generation.

Ofgem chief executive Dermot Nolan said: ‘Any price rise for customers is unfortunate. But while the level of the tariff will rise in October, these customers can be confident that this increase is justified and that their energy bill reflects the real cost of supplying gas and electricity. There are also better deals on the market for those who want to save even more money by switching.’

House of Fraser store closures to go ahead

House of Fraser has settled a legal row with a group of landlords removing one hurdle to a potential rescue deal, meaning the chain can proceed with plans to close 31 of its 59 stores.

The landlords had argued slashing rents on remaining stores was unfair to them, putting the rescue plan in jeopardy.

However, the deal will not be enough to safeguard House of Fraser’s future, with it now urgently seeking fresh investment in order to survive.

Potential suitors for the chain include Philip Day, owner of Edinburgh Woollen Mills, and whose retail empire includes Peacocks, Jane Norman, Austin Reed and Jaeger.

Sports Direct boss Mike Ashley, who already owns an 11% stake in House of Fraser, also approached the chain in July over a potential investment deal.

The retailer employs 17,500 people – 6,000 direct and 11,500 concession staff.