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How to prevent a family war

First published in Spear's magazine.

We all know the importance of leaving a Will, but often the story doesn’t end there. All too frequently it’s the practical and emotional matters that need addressing to avoid leaving your family at war over your estate.

Andrew R.E.T. Murray, Pitmans Law partner specialising in advising high net worth clients on Wills preparation, spoke to Spear’s Magazine about the all important personal letters that you also need to leave your loved ones.

Most would agree that saying goodbye is, above all, the most important note you want to leave behind. This should be written in closed and sealed letters, read only by the recipients, so there’ll never be the “I wish I had said…”. It’s advised to write these when you are fit and well, in case of accidents or long periods of illness.

The open letters, which are stored with your Will and seen by your executors, are further important documents that can be used to leave instructions for how you want your beneficiaries to spend their money, or for how Guardians should bring up your children, for example.

In his full blog, Andrew discusses a few of the cases he has experienced in his 30 years of advising individuals on their Wills.

Remember: the Wills will cover the money and material, but will that be enough when you’re gone?

Andrew R.E.T. Murray

T +44(0)207 634 4591

M +44(0)788 181 4302

E amurray@pitmans.com

More about Pitmans Wills, tax & trusts

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We’re all told to write a will, and the higher the value of our assets the greater the pressures to get one’s estate arranged in advance of that almost unimaginable time when we won’t be here anymore.

But in my experience, just drawing up a valid, tax-effective and up-to-date will isn’t necessarily enough. All too often it’s the practical and emotional matters you leave behind that really matter.
JLR lifting the veil?

JLR continue to do well responding to customer demands and produce good news stories. A new Range Rover is likely to be assembled at Solihull which will be good for jobs there.

At the same time there is uncertainty for Vauxhall manufacturing because of the acquisition by Peugeot.

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A new Range Rover is being launched between the baby Range Rover, the bestselling Evoque, and the Sport Jaguar Land Rover. It is expected to be assembled at the group’s Solihull plant,

This is good news when a shadow has been cast over the future of the Vauxhall plants at Ellesmere Port and Luton..
Directors and the long arm of the law

http://bit.ly/2kbrntT

Top liabilities of directors include those relating to corruption and bribery, cyber threats, loss of data and criminal which may not only cause costs, fines and penalties but imprisonment.

The liabilities do not finish when a director leaves so directors should ensure that they have D and O Insurance during and after they hold office.

While in office it is imperative they know their liabilities, take immediate action if they discover non-compliance with the law, take advice and make sure the best Insurance is in place.

Former directors of Rolls Royce including Sir John Rose will be carefully reviewing their insurance as will their lawyers and insurers.

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Former Rolls-Royce (RR) boss Sir John Rose has been questioned under caution by the Serious Fraud Office.

Last month RR agreed to pay £671m in fines; in return RR secured a “deferred prosecution agreement” under which it did not face criminal charges.

The judgment on RR's actions referred to the “most serious breaches of criminal law in the areas of bribery and corruption”.

The judgment said part of the reason that Rolls secured a DPA was because management at the time of the bribery had been cleared out and that RR was a different company now.

Lord Justice Leveson’s judgement said that RR knew about corruption claims in 2010.

Sir John is not the only person to have been questioned under caution, and it is understood that “dozens” of those involved at all levels have been quizzed.
Bribery and corruption massive settlement

Companies need to take bribery and corruption very seriously to avoid incurring substantial settlements, costs or prosecutions. The starting point is to have structures and policies in place, to make risk assessments, to focus the attention of Compliance on this issue and for Internal Audit to report on this issue.

A whistleblowing system is invaluable so as to capture and deal with problems and where appropriate bring to the attention of relevant authorities for assistance and to mitigate penalties.

http://www.bbc.co.uk/news/business-38644114

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Rolls-Royce has agreed to pay £671m to settle bribery and corruption cases with UK and US authorities. This comprises £497m plus costs to the SFO, and $170m (£141m) to the US Department of Justice.A further settlement would see it pay $26m (£21.5m) to Brazilian regulators, .


It stressed "These are voluntary agreements which result in the suspension of a prosecution provided that the company fulfils certain requirements, including the payment of a financial penalty,"

The SFO confirmed it had reached a deferred prosecution agreement (DPA) with Rolls-Royce, which would be subject to approval by a court on Tuesday.It is only the third such agreement that the SFO has struck since they were first introduced into UK law in 2014.
DB pension scheme deficits increased £1bn a day in December

Whilst the deficit increased by £29.2bn in December, it fell by £81.2bn in November. There are so many variables that it would be inconceivable for there to be no change during the course of a month. Scheme deficits change for a number of reasons including changes in investment returns and the cost of buying out schemes though an insurance contact. 

The PPF attributes the increased deficits in December to an increase in liabilities, with asset values increasing and gilt yields falling.The PPF always has a clear view of potential liabilities so that even large failures such as the BHS scheme can be factored into its calculations and its plans to ultimately be self sufficient by 2030 through investment of those assets that it acquires when sponsoring companies fail and the PPF levy.

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Pension shortfalls grew at a rate of nearly £1bn a day during December, figures released by the UK's pension lifeboat have revealed.

The Pension Protection Fund (PPF), into which defined benefit pension schemes fall upon corporate insolvency, calculated an aggregate deficit for the 5,794 schemes covered of £224bn at the end of December.
JLR Car sales continue to grow and electric cars

One part of British industry which has continued to do well is the sale of cars which has resulted in new jobs, and more jobs to come, including 10,000 jobs with Jaguar's building of their electric car in the UK.

The electric car is a solution to the likely difficulties of compliance with environmental regulation but also with shorter journeys becoming more prevalent it is a better fit with trends in car usage.

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Jaguar Land Rover sold more than one car every minute last year according to

City A.M. with global sales of 583,313 vehicles; this was up 20 per cent on 2015.

Jaguar also wants to build its electric car in the UK - creating 10,000 jobs

Andy Goss, JLR's group sales operations director, said:

"These results mark significant steps in Jaguar Land Rover's strategy to become a truly global business and meet the growing international demand for its two iconic brands.

Earlier this year, the company unveiled its very first electric car, an electric SUV. A full charge will take just over two hours and deliver more than 220 miles range measured on the US EPA test cycle, or 500km measured on the European NEDC test cycle.
Are fines the answer?

If Philip Green or any of his companies has acted in contravention of the law then the Administrators of BHS or the Pensions Regulator have the powers they need to seek compensation. If a fine were to be imposed the Pensions Regulator would still have to demonstrate a basis for liability so the same obstacles remain.

It would help if legislation confirmed that the Pensions Regulator could seek punitive award as well as compensationOtherwisesponsors of schemes may decide to take a chance on the basis that they will only ever have to pay a sum to cover the detriment caused to the scheme which would be the same price as for clearance in advance.

Enacting new law to apply retrospectively would be challenging to say the least.

- Denise Fawcett, Pitmans Partner

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This deterrent would be a fine from The Pensions Regulator (TPR) worth three times the amount it believes a company or individual should contribute towards filling the deficit in a pension scheme. Given that the regulator is understood to be seeking £350m from Green for the BHS pensions scheme, this means it could threaten the billionaire tycoon with a charge of about £1bn.
Potential spike in company car requirements predicted following Autumn Statement

Employers battle a 4 month window to put schemes in place to maximise tax advantages before April 2017 cut off

The announcement in the Chancellor’s 2016 Autumn Statement that, as of 5 April 2017, most new company car salary sacrifice schemes will be axed, means that the opportunity to benefit from tax and employer National Insurance advantages will be significantly reduced.

Schemes that are in place before the deadline will be able to run until April 2021.

With a four month window to administer a salary sacrifice scheme before the 2017 deadline, a huge escalation in the number of registrations is expected.

The enforcement excludes schemes using ‘ultra-low emission cars’ (sub 75g/km).

If you are considering putting a scheme in place, we advise that you take into account the following points. Please contact us if you would like to discuss your options.

  • Employment contracts and service agreements of affected individuals should be drafted carefully. The employee should not be able to opt out at any time, giving up the non-cash benefit and reverting to the pre-sacrifice salary, as the non-cash benefit may be taxable as earnings. Changes should last for at least 12 months to minimise this risk.
  • Remuneration under the contract must be validly sacrificed before the employee is entitled to receive it under the original contract.
  • The salary sacrifice arrangement must fall within the disguised remuneration rules.
  • A disclosure may be required under the direct tax or NICs disclosure rules.
  • There may be VAT implications of the provision of the benefit.
  • Corporation tax deduction may be due to the employer.
  • Specifying "shadow salaries" for other remuneration purposes may be possible.
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Chancellor Philip Hammond has announced today the tax and employer National Insurance advantages of salary sacrifice schemes will be removed from April 2017.
Reading: PwC’s Good for Growth for Cities

Reading has grown and continues to grow as a great place to live and start and grow a business whether you are coming from abroad or are more local.

My colleague Angela Shields has developed a service called Kickstart which is specifically tailored to the needs of start-ups.

http://www.pitmans.com/kickstart

We provide inward and outward support with foreign lawyers in our expanding association of our firms and international trade organisations.

To meet the challenges of work life balance, which this report says are growing, and to attract and retain the best employees, employers must give careful thought to flexible working. 

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http://bit.ly/2fnAilS

Reading is again 1 of the 2 highest-performing "cities" in the 2016 Good Growth for Cities index when it comes to jobs, health, income, skills and business start-ups.

This is from the fifth annual index which measures the performance of 42 of the UK’s largest cities, England’s Local Enterprise Partnerships (LEPs) and the new Combined Authorities.

This result is largely driven by the large number of business start-ups. Reading is, however, beginning to experience the price of success in terms of pressure on housing affordability and work-life balance.




Reduced benefits vs relying on Philip Green: the future for the BHS pension scheme members

Which option would prove best?

The scheme currently looks set to be bailed out by the PPF, which would see members receive a pension worth much less than they have built up.

As things stand, the obvious way for members affected to not lose out is for Green to take back responsibility for the scheme and fund it to a level which provides for benefits above the PPF level of compensation, or perhaps to set up a new scheme to which members may want to transfer instead of relying on the PPF. But can the members rely on Green - the man who had pledged to sort the pension problems when he appeared before MPs four months ago?

Green has voiced his desire to help the scheme members by investing personally in ‘topping up’ their reduced benefits, but the Pensions Regulator, who has a duty to protect both members of schemes and the PPF, would unlikely agree this proposal that only compensates members. If they were to do so, they would be setting a very dangerous precedent.

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Sir Philip has vowed several times to sort out the pension problem, telling MPs in June that his advisers were working on a "resolvable and sortable" solution.

On Monday, he told ITV that he was in a "very strong dialogue" with the pensions regulator to find a solution, but would not put a number on the level of financial support he would be willing to give.
Are further regulator powers a step too far?

Denise Fawcett argues that suggested powers for the Pensions Regulator to veto corporate transactions is going “too far”.

Fawcett says: “Corporate wheels must be allowed to turn. It is the responsibility of the corporates to ensure transactions and reorganisations comply with pensions legislation rather than the remit of Pensions Regulator to decide whether or not these should go ahead.

"The Regulator already has powers designed to deal with the aftermath of transactions that are deemed to be detrimental to a pension scheme and which will adversely affect the ability of the scheme to pay benefits. These are designed to be a deterrent to poor corporate behaviour. Clearance can also be obtained voluntarily by companies if they wish to avoid these powers being used against them.

"The new powers have been suggested following criticism that the Regulator should have intervened with the sale of BHS, whose pension fund looks likely to enter the PPF. However, Denise argues that in this case it was the job of the Pension Trustees to observe the ongoing activity over a number of years, foresee the detrimental consequences and raise the alarm earlier. 

"If there is to be a legislative change then schemes should be obliged to have at least one professional Trustee.  Further, Trustees should be given greater powers to enquire into corporate arrangements and seek mitigation where they weaken the covenant of an employer.

"Recourse to the Regulator should be a last resort."

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The Pensions Regulator is asking for new powers to stop final-salary pension schemes being dumped when companies are sold.

Lesley Titcomb would like firms with large pension deficits to be required to inform her if a sale is imminent and powers to intervene if necessary.

At the moment, companies do not have to inform the regulator before a sale.
The long awaited decision: Horton v Henry

The decision to protect bankrupts’ pensions from creditors is evidently the right one, so why has there been four years of uncertainty? Denise Fawcett, Pitmans pensions and insolvency partner, discusses.

The Court of Appeal has finally handed down a long awaited judgment that, contradictory to a decision made in 2012, confirms a bankrupt individuals’ pension will be safe from creditors.

The long awaited decision means pensions payments can only be claimed (as income) if it is being drawn while the individual is still bankrupt; an untouched pension is safe.

In the 2012 Raithatha v Williamson case, the court ruled that a bankrupt could be forced to draw down a pension (now available from the age of 55 following the governments’ pensions reforms last year) and the trustee in bankruptcy could take a portion of the bankrupt’s pension income. Clearly this decision was wrong and would add to a bankrupt’s financial despair.

Since the 1999 Welfare Reform and Pensions Act came into force, Trustees had not expected to have access to a bankrupts’ pension.  The aim of that act was to protect it. The Raithatha case was contrary to Parliament’s intention. 

Although it has taken four years, ultimately the decision was the right one, and both individuals and Trustees will benefit from the clarity this decision provides.

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Savers will not be forced to fork out their retirement savings to pay outstanding debts if they have to declare bankruptcy, the Court of Appeal has ruled.
Bernard Matthews controversial rescue plan

Biased in favour of secured creditors or the only viable solution? Pitmans pensions and insolvency partner Denise Fawcett discusses the controversial use of pre-pack arrangements in the case of Bernard Matthews

This week it was revealed that the rescue package for Bernard Matthews has left unsecured creditors with only 1p in the pound. Some have accused the administration strategy of being tactically implemented to ensure maximum cash for the secured creditors and investors whilst the pension scheme, which has a £20m deficit, and other liabilities are left penniless.

However, Denise debates that pre-packs are a legitimate way of maximising returns to creditors and saving jobs: “This process is designed to provide for an orderly and fair distribution of the value of the business and its assets amongst creditors and preserve the business as a going concern.”

Whilst, unfortunately, investors have on occasion manipulated the process to cut costs and generate value for themselves, Denise argues that this is not the norm and that they are not some “underhand or mysterious arrangement designed to prefer these parties.”

However, it is not to say that the system is not open to abuse and if that is the case, it is for the Pensions Regulator to consider using its ‘moral hazard’ powers. As the members have the benefit of the Pension Protection Fund guarantee, whilst some members will be worse off, the PPF is the ultimate victim of any cynical attempt to shed the pension scheme debt and it is the job of the Pensions Regulator to protect the PPF as well as the members.

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The recent takeover of Bernard Matthews will be scrutinised by the Work and Pensions select committee this week after concerns that the deal was “carefully crafted to dump the pension scheme”.

The turkey firm was sold last month in a pre-pack deal to Ranjit Boparan, the food tycoon behind the 2Sisters poultry giant, Goodfella’s frozen pizzas and Harry Ramsdens’s restaurants.

The sale by private equity owners Rutland Partners saved 2,000 jobs but meant that Bernard Matthews pension scheme and the £17.5m deficit is now shouldered by the Pension Protection Fund, which is supported by levies on businesses.
Pitmans Argue Government Plans to Scrap Changes in Pension Law Undermines the Future of the BSPS

Government’s plan to scrap proposed pensions law changes affecting the British Steel Pension Scheme is “short-sighted, unhelpful and not with the best outcome for members in mind".

Pitmans Unions expert advisers Julian Richards and Jonathan Gray attended the 148th annual TUC Congress this week.

Since 1868, union delegates have met at the annual Congress to debate ways of addressing workplace issues.

One key debate at this year’s Congress was the future of the steel industry as members promoted the Save our Steel campaign and called for an industrial strategy to protect the future of steel making in the UK.

Pitmans are advising the trade union Community on the issues facing the British Steel Pension Scheme, and Julian supported discussions surrounding its future. Delegates deliberated the Government’s likely decision to rule out pensions law changes that would’ve reduced the deficit by £2.5bn. Julian called the likely rejection of the proposals “short-sighted, unhelpful and not with the best outcome for members in mind.” Julian continued to say that “some creative thinking is needed by the employer and Government to properly safeguard the rights of the 130,000 Scheme members.”

Both Julian Richards and Jonathan Gray have 15 years’ in-house Unions experience. Julian, Unions Pensions Director at Pitmans, was the previous Head of Pensions at Amicus (now Unite), and Jonathan, Pitmans Employment Partner, has worked with GMB, Unite and Unison, advising on employment related legal issues.

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A government plan to save Tata Steel’s UK business by changing pensions law has been shelved, according to industry figures briefed on the matter, dealing a blow to efforts to support the troubled sector.
Who should take responsibility for the BHS pension deficit?

Former BHS owner Sir Philip Green was questioned by the Business, Innovation and Skills Committee and Work and Pensions Committee on the collapse of the business.

Denise Fawcett, partner and insolvency specialist at Pitmans said: "Whilst many may consider that Green has a moral obligation to the scheme, there is little in any of the information that has transpired to date that would point to any legal obligation to the scheme.

Should he care that BHS was sold to an ex-bankrupt with no retail experience who may not have had the best intentions for BHS?  There is no obligation on the seller of a business to ensure that a buyer has the best intention for a business.

The BHS scheme had a surplus when Green bought it in 2000. The way that schemes are valued and funded was changed by the Pensions Act 2004. Most corporates found themselves owing more to their schemes after that. And deficits have just got worse – actuaries have changed their assumptions as to mortality of members, legislation has been enacted about gender equality, pension scheme assets have generated less profit with low bond yields and poor investment returns; none of this is within the control of the employer.

Before 2008 there was no deficit, the business was profitable. Profitable businesses pay dividends. After 2008, it was the job of the Trustees to get the right support for the scheme.

There may be a lot of things about Green and his way of doing business that might leave a bad taste but it doesn’t make it illegal and it doesn’t mean he has to put his hand in his pocket.  We will see in due course whether any skeletons appear when a few more cupboard doors are opened."

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The billionaire said he should have sold BHS earlier and that “stupid, idiotic mistakes” had been made about the pension scheme. “Nothing is more sad than how this has ended,” he said.

In response to questions from MPs, Green said the financing of BHS was “not an aggressive finance strategy” and not excessive. He said that as much as £800m had been pumped into the business between 2004 and 2015. “We put all that back into the business and more,” he said.
Time for closer involvement for pension scheme trustees in corporate transactions

Whilst clear legislation already exists to compel employers to make good deficit payments, the problem is that, in between valuation cycles, insufficient attention is placed on the fluctuating strength of the employer covenant, particularly on sale and purchase of businesses, which often trustees do not hear about until after the event. Trustees powers tend to be limited in dealing with such fluctuations and so we should consider requiring that all scheme trustees have a greater role in business transactions with the power to demand increased scheme security as a condition of the transaction completing. Of course this would also require a welcome need for a broader, and advance, employer notification requirement.

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Arcadia has faced claims it was irresponsible in agreeing to sell BHS for a nominal sum last year to a consortium led by Dominic Chappell, a twice-bankrupt former racing driver with no retail experience.

Green and his fellow directors have also been criticised for taking as much as £580m out of a business that ended up with a pension scheme deficit in the hundreds of millions of pounds.
Questionable dividends

Denise Fawcett, Restructuring and Insolvency Partner, said "The payment of dividends is not always challengeable. If a company has distributable reserves then dividends can be paid. Of course, the company’s debts need to be taken into account and that includes the pension scheme.

Prior to 2005, companies only had to achieve a “Minimum Funding Requirement” when funding a scheme. The law changed in 2005 and that change in legislation has seen funding requirements rise and deficits appear where they previously did not. 

From the news reports it seems that a large amount of money appears to have been extracted just before this change occurred, which may not be a coincidence. However, a company is only obliged to pay to a scheme what it agrees with the Trustees of the scheme to pay.  Unless anyone has acted to the detriment of the scheme, there may not be legal grounds on which anyone can be forced to compensate the scheme, though political pressure and reputational damage may be enough to encourage a voluntary payment. 

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When Sir Philip Green bought BHS in May 2000, he insisted it would not be rocket science to revive the ailing high street retailer.

But last year, after failing in his mission, Green sold BHS for £1 to a little known group of investors who have steered it into collapse in just over 12 months. His dreams for the chain may have come to nothing, but Green’s family have still been big winners from BHS, taking out more than £580m in dividends, rental payments and interest on loans to help fund a lavish lifestyle.

As the pensions regulator considers whether to pursue Green for between £200m and £300m – to help fill the black hole in BHS’s pension schemes that had developed since 2000 – he is awaiting delivery of his latest toy: a $150m (£100m) superyacht named Lionheart.
Pitmans advises Premier Marinas Ltd on Noss Marina acquisition

Pitmans has advised Premier Marinas Limited on its acquisition of Noss Marina, which is just outside Dartmouth, from the Administrators Duff & Phelps.

Noss comprises nearly 40 acres set in natural woodland with a commanding water frontage to the River Dart.

Pitmans' experience working with marina and waterside development benefited the process which involved six months of protracted and complex four-way negotiations. 

The team was led by head of corporate Sean Kelly and commercial property partner John Newton.

John Newton commented: “We are delighted to have had the opportunity to work with Premier Marinas on this exciting project from the outset.  Access to the site via the bridge that crosses the Paignton-Kingwear railway will also be improved.  The investment in the site will be supported by sensitive residential development."

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Premier Marinas Limited has today completed the purchase of Noss Marina from the Administrators Duff & Phelps. The marina was purchased for an undisclosed sum following a period in Administration. Set in 37 acres on the eastern bank of the River Dart in Kingswear, close to Dartmouth, the Noss Marina site accommodates 180 serviced pontoon berths, 47 river moorings and a limited boatyard operation. Premier plans to work alongside local stakeholders to design and deliver a mixed use, employment-led, regeneration of the site, most of which is currently in a derelict and unusable state. This regeneration is expected to bring over £100m of investment into the area, creating a new identity for Noss as part of the Dartmouth and Kingswear community.
A software upgrade is not a solution

Further details continue to emerge of the extent of the Volkswagen group's use of emission test cheating software, and the group's attempts to demonstrate that they are engaging with consumers' concerns. Curiously, though, these plans currently seem to be focused around a recall of vehicles in order to "refit the software" in the engines, which enabled the test to be cheated.

It is hard to see how this is going to meet any of the concerns of those who have purchased the vehicles on the basis of misleading emissions figures. We still have a far from complete picture of how the software worked, but it seems that simplistically the emissions results were improved by running the engine in a lower performance mode while the vehicles were being tested.

Either the "refit" will involve disabling that functionality, so that at least the cars respond honestly to emissions tests - but without doing anything about the level of emissions produced. Alternatively they will achieve those consistent emissions levels even under normal driving conditions, but seemingly only by sacrificing vehicle performance. Either way, consumers are going to end up with something significantly different to what they paid for.

This is a market place where differentiation between makes and models tends to be on relatively marginal differences in efficiency, power or environmental credentials. That being so, it is hard to see how a manufacturer in these circumstances is credibly going to be able to argue that the original deception wasn't responsible for sales being made that would have gone elsewhere if the truth were known. Nor is it easy to see how tinkering with the software, after the damage is done, is going to change any of that.

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Mr Lies said the company had no idea of the total bill to sort out the engines and cover any legal costs arising: "Huge damage has been done because millions of people have lost their faith in VW. We are surely going to have a lot of people suing for damages. We have to recall lots of cars and it has to happen really fast." ...
VW is working out how to refit the software in the 11 million diesel engines involved in the emissions scandal. Seat is the latest VW brand to reveal it, too, used the emission cheat device.
Disruption from within

As someone interested in the future of the automotive industry, I am used to reading articles suggesting that disruptive strategies in that sector are likely to come from the outsiders - the electric cars of Tesla, the driverless vehicles of Google, for example.

In addition to the many other dramatic aspects to the Volkswagen emissions scandal - as to which more in other posts - one of the most striking is the extent to which serious predictions are being made about this event marking the beginning of the end of the combustion engine. As identified by the UBS analysts interviewed below, this is because what is beginning to emerge is a picture of almost overwhelming challenges facing those attempting to regulate emissions and other risks in the automotive industry.

At the root of this challenge is the technology now being deployed within even the current generation of vehicles. This is technology which, as I have written in previous posts, even the businesses deploying it do not always fully understand. Much of it is confidential and proprietary. The idea that external regulators can with confidence be satisfied that they have excluded the effect of that technology from their testing is simply unrealistic.

The proposed changes to the emissions testing regime, which will be more heavily focused on real-world, rather than lab-based, testing, are a step in the right direction. But they will increase costs, and will also undoubtedly lead to a number of further revelations about the ways in which car manufacturers have until now been designing to pass tests, rather than for genuine performance. This will not be confined to emissions, but is likely also to extend to fuel consumption and other key considerations for those in the market for new vehicles. It cannot help but erode confidence in fossil fuel based cars generally, even those innocent of the present scandal.

By contrast, electric vehicles have to date had nowhere to hide - their designers and engineers have been obliged to face their difficulties in the public eye, and take up of electric vehicles has been slow as a result. If a level testing playing field reveals that the perceived gap in performance is not as great as has been supposed, all of that may change. Predictions of an extinction-level event for the internal combustion engine may not be as far-fetched as they seem.

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Analysts at UBS warned that if the crisis worsened it could signal the eventual end of the combustion engine. Julie Hudson at UBS said: “Should transport emissions become too difficult to regulate because of the difficulty of amassing accurate data, we think this might go way beyond the diesel engine, to accelerate the demise of the combustion engine.”
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