News: the 58 funds that failed to perform

Credit card industry seeks to educate public; wait continues over failed final-salary plans; thousands face higher energy bills

More than £6bn of investors' cash is idling in poorly performing stock market funds, according to research from independent financial adviser (IFA) Bestinvest.

Its biannual Spot the Dog report lists 58 funds that have consistently let down investors with duff performances over the past three years.

Among funds investing in the UK, the worst performers included Henderson UK All Companies, Jupiter Growth and Income, and Threadneedle UK Select Growth funds, Bestinvest found. Worst overall was the Manek Growth fund: anybody investing £100 in June 2002 would only have £94 today.

To qualify for dog status, a fund must first have failed to match the benchmark return in its sector in each of the past three years. It must also have underperformed the same benchmark by at least 10 per cent over the whole three-year period to 30 June 2005.

Bestinvest trains the spotlight on the merits, or otherwise, of paying higher fees to firms that "actively" manage your cash. When performance is consistently poor, investors could be better off with a tracker fund, which uses computers simply to match an index.

"Dog funds are not an automatic sell, however," said Bestinvest director Dominic Cummings. "For example, a poor manager may have been recently replaced or a skilful one had a poor short-term run."

See-through plastic

The credit card industry has launched an advice website to give consumers a better understanding of the borrowing risks.

Set up by the Association for Payment Clearing Services (Apacs), www.choosingandusing.com explains card terminology such as annual percentage rates; the different types of card available and how to compare them; whether a personal loan might be a better choice, and where to find help if your debts spiral out of control.

Britons collectively owe nearly £60bn on credit cards; there are now more pieces of plastic in the UK than there are people.

"The UK has one of the most competitive credit card markets in the world, with around 1,500 to choose from," said Sandra Quinn of Apacs. "We want consumers to make the best choice."

Figures released by the British Bankers' Association (BBA) show that consumer credit borrowing went up by £295m in June - more than double May's £117m rise. Despite this, last month's increase is far below the levels recorded throughout most of 2004.

Pension report on ice

A Parliamentary Ombudsman report into the way government literature portrayed final-salary occupational pension schemes as "guaranteed" has been delayed until October.

It is believed that a draft version of the report has been ready for some weeks but that a government request to make a late submission of evidence has put back its publication. It should finally appear when MPs return in October after the summer recess.

The report focuses on government information dating from the late 1990s, telling workers that final salary pensions were guaranteed to pay out. Since then, a number of such schemes have collapsed without the reserves to meet their obligations, leaving workers facing a bleak prospect in retirement.

The crisis has led to the creation of two support funds, the Pension Protection Fund and the Financial Assistance Scheme, although cash reserves have been condemned as inadequate.

If the Government is found to have acted wrongly, the ombudsman can recommend that compensation be paid.

Powergen price hike

More than five million Powergen customers face higher bills after the energy company announced it was to raise gas prices by 11.9 per cent and electricity prices by 7.2 per cent from the end of August.

Customers' gas bills are set to increase by £44 a year, with electricity bills rising by £26, according to the price-comparison service uSwitch.com.

Powergen blamed higher wholesale gas and electricity costs for the price rises - the latest in a long line for consumers. Since January last year, Powergen has upped its charges for gas four times, and for electricity three times.

The consumer group Energywatch said energy firms continued to generate huge profits despite the rise in wholesale prices.