Review of 2013: what happened in the news in December

npower bill

We like to forget about bills in the run-up to Christmas but problems with utility and telephone bills filled the news in December.

Npower made a smoke and mirror promise to freeze bills – but only if wholesale energy prices don't rise. It then, like all electricity firms, promised to pass on government cuts to green taxes. But would not say by how much.%VIRTUAL-SkimlinksPromo%

Power cuts?

It was only ten days later that the energy firms came under fire after it was reported that just two of the "big six" providers, British Gas and Scottish and Southern Energy, had announced that they would pass on the savings - worth around £50 - to all customers.

British Gas, meanwhile, said it would cut dual-fuel bills by an average of £53 from 1 January - but this was less than half the increase imposed on customers the previous month. E.ON announced an average 3.7% rise in energy bills to come into effect on January 18th. The E.ON rise was narrowly behind EDF, which is pushing prices up by 3.9% on 3rd January.

It wasn't a good month for Npower. By the end of December the regulator had forced it to pay £3.5m to vulnerable customers after it was found to have breached energy sales rules.

Water, water everywhere

There was good news for some northerners. Yorkshire Water, which already had some of the lowest bills in the UK, said it would raise prices in line with inflation only – less than agreed with the regulator Ofwat.

Further south, Thames Water, the UK's biggest water company, told Ofwat it wanted to raise bills by more than 10% above inflation over five years.

Ring ring

Meanwhile the telephone companies were called in to government to have their heads banged together about the shock bills some people get when abroad. The firms that kike to issue telephone number-sized bills were forced to swallow a new cap on the maximum value of calls they can charge.

Phone users will also gain a right to be informed if prices rise mid-contract and to break off the contract without penalty if they do not wish to pay the higher rates. The mobile firms EE, Three, Virgin Media and Vodafone - along with communications providers BT, Sky and TalkTalk, also agreed to back Government efforts to eliminate roaming charges in the EU by 2016.

Christmas puddings?

Retailers were ripping off their customer too – especially in the run-up to Christmas. Despite well-publicised price cuts in November, retailers such as Amazon, Tesco, Asda and Toys R Us were found to have been quietly pushing up the price tickets on 'must-have' toys. Amazon had bumped up the price of A Matt Smith Eleventh Doctor sonic screwdriver by 130%.

Road tax

December saw the announcement that the road tax disc was to be killed off. After more than 90 years stuck to the insides of motorists' windscreens and bolted to the sides of motorbikes, the tax disc is to be scrapped and replaced with a modern electronic system, Chancellor George Osborne announced.

For the first time motorists will also be able to pay for their vehicle excise duty (VED) by monthly direct debit, spreading the burden but an extra cost of 5%.

Equitable payouts

There was good news just before Christmas for some of those hit hardest by the Equitable Life scandal. More than 9,000 victims got cheques in the post for a £5,000 compensation payment. The single "ex-gratia" payment was made to those who were shut out of the main compensation scheme because they bought their annuities before a cut-off point in 1992.

A further 450 policyholders who also receive pension credit will receive an extra £5,000.
The government has released its latest life expectancy predictions, and pensions experts have fallen on them in a frenzy. Their calculations show that George Osborne's new rules for the state pension will mean that everyone aged 47 or under is likely to see their state pension age rise to 68.

MP get 11%

It was MPs who came off best in December. The head of the watchdog responsible for MPs' pay and perks insisted MPs deserve a "one-off uplift" in their salaries, setting out an 11% rise.

Independent Parliamentary Standards Authority (Ipsa) chairman Sir Ian Kennedy said the issue should not be kicked into the long grass and despite the rise to help MPs' pay "catch up", the overall package would not cost taxpayers "a penny more". So that's OK, then.


It appeared from two separate reports that those with spare cash don't want to spend it – instead preferring to give it to their children who will probably need to inherit money just to live.

British retirees expect to leave an inheritance to their children worth £182,000 on average, a figure among the highest recorded, HSBC's survey of more than 16,000 people in different countries found. Almost two-thirds (64%) of retirees in the UK said they plan to leave an inheritance and only Australia and Singapore had higher average expected windfalls,

That was lucky because The Institute for Fiscal Studies (IFS) said people born in the two decades from 1960 will have no higher income or savings, will be less likely to own a home and will have smaller private pensions than their predecessors from 10 years earlier. They'd need that inheritance, the IFS said.

It said 70% of those born in the late 1970s expected to receive an inheritance compared to 28% of those born in the early 1940s.

December wasn't a month of Christmas cheer.
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