jonathan.rawle.org

My article on bank charges a few months ago prompted a few angry responses from people who claimed the current system of bank penalty charges is unfair.

Under the current system, people who go overdrawn – borrowing their bank’s money without permission – are charged fees. Some commentators have suggested that if these fees are found illegal by the courts, banks will have to find other ways to maintain their excessive profits, possibly by charging fees that all customers will have to pay, including those who manage their finances carefully and keep their accounts in credit.

My article in favour of the current system of charges drew criticisms from some readers. However, I have always had a sneaking suspicion that there is a silent majority in the UK who wouldn’t dream of going overdrawn, and who never have to pay penalty charges to their banks; and that these people naturally would not want a system of universal account service charges.

Today, the BBC reported the results of a YouGov poll where people were asked whether they would prefer the current system of penalties; a monthly account fee for everyone; or a fee per transaction. The vast majority of people said they would like to keep the current system. Only 9% said they would prefer fees that everyone had to pay.

In addition, the BBC ran its own poll alongside the article. At the time of writing, 60% of respondents have said they would prefer the current system of penalties to remain. Only 11% wanted a monthly fee, and 9% would prefer a charge per transaction. The remaining 20% wanted “alternative charges”, but with no indication of what those might be.

While the exact percentages above could be disputed, it is clear that the majority of people approve of the current penalty charges, and do not want bank fees that everyone has to pay. Given this fact, I think it’s time that supposed consumer champions such as MoneySavingExpert.com, Moneysupermarket.com, and indeed the BBC, jumped off the anti-penalty charges bandwagon, and realised that most consumers will not benefit from the changes their campaigns could very well bring about.

(Here is an article in The Times that agrees with me on charges, and gives an good analogy with borrowing money from a friend.)

It should have come as no surprise to the authorities that awarding Salman Rushdie a knighthood in the Queen’s Birthday Honours would cause protests from the Islamic world. Of course, this would be no reason not to reward a person deserving the honour.

The United Kingdom is a country where free speech is valued. It was quite right for Rushdie to be given police protection when his life was threatened in the 80s and 90s, just as anyone should be protected from threats to their life or any other sort of criminal activity (although, it has to be said, he could sometimes be a little more gracious or grateful towards the British authorities in return).

However, the question has to be asked, why was Salman Rushdie awarded a knighthood? Is he so much better than so many other authors? Few best selling writers are made knights or dames, nor do most of Sir Salman’s fellow Booker Prize winners hold that discinction. Is his work so great that he deserves what is almost the top British honour? Maybe making him an OBE or something similar would have been in order. But a knighthood?

Unfortunately, one can only come to the conclusion that many Muslims have no doubt come to: Sir Salman was given his title to cause controversy. It is not too difficult to imagine the civil servants in their secret rooms thinking it could be a good idea to stir things up a bit. Perhaps the idea was to cause a diplomatic crisis to overshadow the start of the new Prime Minister, Gordon Brown’s term in office next week. An OBE might have provoked some protests, but Pakistan, as a Commonwealth country, understands the significance of making someone a “Sir”, and it will inevitably be seen as an endorsement of Sir Salman’s work by the British establishment.

It is quite amusing to hear the First Deputy Speaker of Iran’s parliament say:

The British monarch lives under this illusion that Britain is still a 19th Century superpower and that bestowing titles is something still deemed important.

From the level of protests that it has caused, it would seem that many people in Muslim countries still deem it to be important.

However offensive Muslims may find The Satanic Verses, in itself it caused no damage to their religion. What is hugely damaging is when people around the world see violent protests, and hear foreign ministers imply that awarding a mere honour justifies indiscriminate murder. Surely a far better approach would be to accept the principle of free speech, explain why the remarks are offensive, and for scholars to criticise Rushdie’s work in general – in other words, tell us why his writing is no good! People would be far more sympathetic, and without the threats, there would not be so much interest in Rushdie’s work. If this approach had been followed in the late 80s, we would probably not be seeing Sir Salman with his knighthood today.

As of earlier this month, the Chinese authorities appear to have blocked access to Flickr. More specifically, Flickr images are blocked, but the rest of the site (all the text content) is still available. The reason for the ban seems to be that some photos of the Tiananmen Square massacre were posted on the site around the anniversary on 4 June.

China isn’t the only country that blocks access to Flickr. Other states such as Iran and the United Arab Emirates don’t allow their citizens access to the website. Fortunately, an Iranian, Hamed Saber, has written a Firefox add-on, Access Flickr, that will allow the site to be accessed from all these countries.

A while ago, I began using the Flickr API to display Flickr photos from within the photo gallery on my website. Unfortunately, that meant that users without the Firefox add-on could no longer view all the images on my website either. Interestingly, the Chinese block appears to work simply by blocking DNS lookups to the Flickr image server. If the server is accessed by its IP address, it works fine. Access Flickr ensures that the IP address is always used. For the sake of users without the add-on, I have now changed my gallery to perform the DNS look-up first, then reference images by the IP address. This should allow at least users in China to view my photos as they could until this month. If anyone has any issues with the gallery following this change, please let me know.

Some articles appear to suggest that it’s ironic that Flickr has been blocked in China in the same week that they added support for seven new languages, including Chinese. In fact, they have added support only for traditional Chinese, with the target markets being Taiwan and Hong Kong (where Flickr is still accessible). China, where simplified Chinese is used, was never the intended market. More significant is that the block occurred at around the same time that shareholders at Yahoo, Flickr’s parent company, rejected plans to oppose internet censorship in China. Some people predicted bad things would happen when Yahoo bought Flickr. If using a Yahoo service makes my photographs less accessible to any potential website visitors, I may have to have a rethink and keep my photos elsewhere.

• Related article: Chinese censorship in action

After all the speculation, it’s finally been announced that Prince Harry will not be serving in Iraq. The military officials who had to make the decision were in a no-win situation – they would have been criticised whichever conclusion they came to. In the end, it seems they have done what was best for all of their troops.

Prince Harry himself had wanted to go to Iraq, so will be very disappointed at the decision. It seems strange, therefore, that many people have said he is receiving special treatment. In fact, like any other member of the armed forces, Harry must obey orders. The top brass come to their decisions for operational reasons, and in this case the decision is that Harry will not go to Iraq. If the Prince had then been able to twist their arms and be granted his wish to serve in Iraq, then he would be receiving special treatment. But as with any other officer who is not deployed abroad for whatever reason, if Harry’s posting is to sit behind a desk somewhere at HQ, that’s what he must do.

One of the most outspoken critics of the decision is Reg Keys, whose son was killed in Iraq in 2003. While one has to feel some sympathy for Mr Keys, his comments can hardly be considered the most objective. He said the decision was “distasteful” and that, “It would appear that Harry’s life is more valuable than my son or the other nearly 150 service personnel who’ve given their lives.” He also questioned whether insurgents in Iraq would be able to identify the Prince.

No-one is saying one person’s life is more valuable than another. The fact is, sending Harry to Iraq would put all British troops in unnecessary extra danger as insurgents attempted to kill or capture the Prince. Mr Keys may have a point in that they would find it hard to identify an officer as Harry, but that would surely only mean an increase in attempts on the life of other officers. All of the other soldiers in the country would face increased attacks on their convoys, resulting in more British casualties. They all have parents, ordinary people like Mr Keys, who would then have to ask why one Prince’s wishes to see service in Iraq had been put before the safety of their own sons and daughters.

For the first time, a bank has had its charges upheld in court. Since the Office of Fair Trading warned credit card providers last year that their penalty charges were excessive, causing all providers to cut fees to £12, people have been encouraged by numerous consumer groups to demand the refund of charges from bank accounts too. These charges might be for an unauthorised overdraft, exceeding an overdraft limit, insufficient funds to pay a cheque or direct debit – in other words, the charges are penalties for people who overdraw their bank accounts, borrowing the bank’s money without permission.

In some countries, going overdrawn is actually illegal. After all, it is only just short of stealing someone else’s money. Yet UK consumers seem to think it is their right to overdraw their accounts without even arranging an overdraft first, and not be charged for it.

It’s clear that the banks are using the charges to make profit, and if the law currently says that penalty charges are only allowed to cover administrative costs, then I suppose the current charging regime is illegal. But I don’t think it should be. In the recent case, the bank had argued that it was actually charging fees for a service, rather than as a penalty. Hopefully, one way or anther, banks will be able to continue making similar charges.

Why am I so keen for banks to be allowed to charge their customers penalty fees? Well, it may come as a surprise to any readers from abroad, but in the UK, almost everyone still enjoys free banking. We don’t have to pay to keep a bank account, and can enjoy a cash card, debit card, cheque book, direct debits, internet banking, etc. without having to pay a monthly fee. Banks make up for this by charging higher penalties for people who go overdrawn. Now, let’s face it, the banks are never going to accept reduced profits, so if they are not permitted to continue charging these penalties, they are going to find other ways to take money from their customers. The net amount consumers pay is going to remain the same, it’s just how the payments are distributed between a bank’s customers that will change. The bottom line is, without penalty charges, banks may well introduce monthly fees for their accounts. There is already an increasing trend for “premium” bank accounts that incur a monthly fee, and one bank has announced a monthly fee for accounts with low balances.

Outlawing bank charges will not be better for the consumer at all. All it will mean is that everyone is paying charges, instead of just those people who are not very good at managing their money. There’s no excuse for regularly going overdrawn. The last thing this country needs – increasingly a country where people are piling up debt and haven’t a clue how to budget or look after their pennies – is a change to the banking system that makes life easier for the financially reckless.

One final note is that, while people may be pleased that they are receiving refunds for unauthorised overdraft charges, it actually only represents a small part of the extra profit the bank is making from them. The interest rate on an unauthorised overdraft is typically around twice that for an authorised one. Hopefully, if penalty charges are ruled illegal in a higher court, the banks will respond by tweaking their interest rates. That might enable those who prefer to save and not spend to retain the free banking they deserve.