Together, the patient and the doctor can discuss which functions are necessary, and which are ‘nice to have’, as well as what cost to the battery there is for each option
Klaus Witte
Dr Klaus Witte, Senior Lecturer and Consultant Cardiologist…
Victims of the car loans scandal could miss out on more than £4bn in compensation if the City regulator ploughs ahead with plans for an “insulting” interest rate in its redress scheme, consumer groups and claims firms say.
The Financial Conduct Authority (FCA) has been accused of offering a reduced rate of interest which will be added to compensation from banks for borrowers caught up in the car loan commissions scandal.
Claims law firms and consumer groups say borrowers should be offered the same terms as Marcus Johnson: the sole driver whose case was upheld by the supreme court in a landmark case in August.
While the terms of the final payout are sealed, Johnson is widely believed by industry experts to have received about 7% interest on his compensation package, after judges ordered the parties to negotiate a “commercial rate”. But the watchdog has proposed a rate of 2.09% on the compensation.
The FCA has estimated that victims payouts will average £700 resulting from 14m unfair loans, costing lenders – including Lloyds, Barclays, Close Brothers and the financial arms of manufacturers like Ford – a combined £11bn.
Critics say these terms are “unacceptable” and will ultimately rob drivers of another £4bn of compensation, based on calculations outlined in the FCA’s own consultation documents.
Darren Smith, the managing director of the claims law firm Courmacs Legal, said: “The FCA’s proposal to cap interest at 2.09% is frankly insulting to the millions of victims who were overcharged, many well over a decade ago.”
He said lenders would not stand for cut-price rates being offered to consumers. “It exposes a staggering hypocrisy,” Smith said. “If the boot was on the other foot, and a bank was a successful claimant in a commercial dispute, would they meekly accept 2.09% on their losses? [Lloyds Banking Group’s chief executive] Charlie Nunn would rightly be asking the general counsel at Lloyds to demand the full commercial rate of interest from the wrongdoer.”
The scheme is meant to draw a line under the scandal, which centres on unfair loan commission payments paid to car dealers by banks and specialist lenders. The FCA has estimated that 14m historic car loan contracts that may be deemed unfair because of these commission payments.
When discounting administrative costs, about £9.7bn of the £11bn sum will go straight to consumers. However, that sum is based on paying out a 2.09% annual interest rate on base levels of compensation.
Marcus Johnson, whose case was upheld by the supreme court in a landmark case in August. Photograph: Dimitris Legakis/The Guardian
Consumers would be due £14.3bn if the interest rate were closer to 8%, according to FCA documents. That rate of 8% is what has historically been paid out alongside successful county court cases, and by the Financial Ombudsman Service before its own rates were cut earlier this year.
The current proposals mean a consumer will on average receive about £700 in compensation, rather than £1,030 at the 8% rate.
“The interest rate is way too low, in my view,” said Martin Lewis, the founder of MoneySavingExpert, in his BBC podcast this month, adding that he was planning to raise the issue in his response to the FCA consultation.
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Kevin Durkin, of HD Law, who represented Johnson during his supreme court case, agreed, told the Guardian that the FCA’s proposals were “unfair” and did “not adequately compensate consumers enough for the many years they’ve suffered under an unfair relationship with their lender. The FCA redress scheme should reflect what the supreme court awarded to Mr Johnson.”
Consumer advocates have also raised concerns. Alex Neill, a co-founder of the consumer rights organisation Consumer Voice, said: “The proposed rate of interest is unacceptable and would leave drivers losing out on £4bn they’re rightly owed.
“Suggesting that those hit hardest – who have already faced extra costs due to this mis-selling scandal – should negotiate for a fair rate themselves is clearly unworkable.”
However, the Financing and Leasing Association (FLA) said the interest rate should reflect changes to compensation payouts at the FOS, which earlier this year were cut from 8% to the average Bank of England base rate, plus 1%. “The FCA is applying the same rate” in its redress scheme, the FLA said.
An FCA spokesperson said:“Our proposals take account of court decisions on redress. We believe interest that links to the Bank [of England] base rate is fair, proportionate and aligns with the planned approach of the Financial Ombudsman.
“Consumers would have the right to challenge this if they have evidence this was unfair to them. We welcome feedback on our proposals.”
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Travellers are warned to check with their rail provider before setting off on their journeys over the Christmas period
Liverpool Street Station will be closed for eight days between Christmas Day and New Year’s Day for works to be carried out on its roof, Network Rail said.
It has urged people travelling over the Christmas period to check journey plans if travelling via the UK’s busiest station.
Strengthening work will also be carried out inside the Bishopsgate Tunnel approach to London Liverpool Street, alongside signalling renewal work across Cambridgeshire.
Full services will resume from and to the station on 2 January, it added.
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Greater Anglia passengers will be affected by the closure of Liverpool Street station
The engineering work taking place in Cambridgeshire will start on Christmas Day and last up to 11 days, Network Rail said, to deliver the second stage of the Cambridge re-signalling project and modernise the system.
Signalling engineers will introduce a new control system to operate the signals for the section of railway between Cambridge North and Audley End.
“A new digital workstation at the Cambridge signalling centre will replace the 40-year-old signalling panel allowing signallers to oversee the operation of the network more efficiently,” Network Rail said.
“This work is also vital to allow the new station at Cambridge South to open early in the New Year.”
An upgrade to the Meldreth Road level crossing in Cambridgeshire will see a full barrier CCTV system introduced too.
From 27 December to 4 January 2026, there will be no rail services between Royston and Stansted Mountfitchet and Cambridge and Cambridge North.
Rail services between Cambridge and Bury St Edmunds will also be affected during these dates, with rail replacement bus services in place between affected stations from Friday 27 December.
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New ticket barriers on platforms at London Liverpool Street will be introduced
Network Rail, which is responsible for railway infrastructure, said all of its train services will not run on Christmas Day and Boxing Day and will finish early on Christmas Eve on some routes.
From 27 December, Greater Anglia services on the Great Eastern and West Anglia mainlines will run to and from Stratford, including Stansted Express services.
The Stansted Express would operate a revised service to and from Tottenham Hale on Boxing Day.
Services to Norwich, Ipswich, Clacton-on-Sea and Braintree will run to and from Witham due to engineering work.
Buses will run between Witham and Billericay to provide a connection with train services between Billericay and Stratford.
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London’s busiest rail station will shut for eight days over Christmas
London Liverpool Street works include the strengthening of Bishopsgate tunnel, which will see the installation of steel support girders inside the tunnel and work to repair existing steelwork to prevent corrosion.
On the station concourse, roof panels will be renewed to allow more light into the station, improve the drainage system and renew seals “to make the roof resilient to more frequent and intense storms”, said Network Rail.
New ticket gates for platforms one to 10 will also be added.
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