Food banks are a social gateway to discussing wider problems in someone’s life. Photo: Getty
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Food banks: why can't people afford to eat in the world's sixth richest country?

The All-Party Parliamentary Group on Hunger and Food Poverty have published a new report into food banks, and how best to feed impoverished Britain.

Fourteen years ago, in the city of Salisbury, Paddy Henderson was fundraising for a little known local charity called the Trussell Trust, which focused on helping orphaned children in Bulgaria. One evening, he received a phone call from a desperate local mother, who said, "my children are going to bed hungry tonight – what are YOU going to do about it?"

This was the incident that sparked the birth of a movement and the creation of the Trussell Trust’s first "food bank". It was a natural compassionate response to discovering that somebody in 21st century Britain could not afford food.

The Trussell Trust now includes 400 food banks, and there are hundreds more locally based initiatives across the UK. This rapid growth sparked a wider debate about hunger in the UK that evolved as commentators tried to apportion blame.

We established the All-Party Parliamentary Group on Hunger and Food Poverty to comprehensively investigate this phenomenon, looking beyond the headlines and the immediate statistics to the deeper issues. We wanted to answer two questions.

Firstly, why are people skipping meals because they can’t afford food for their children in the sixth richest country in the world? Secondly, what can politicians do to help the charity movement that had responded so magnificently to this need?

We heard often harrowing testimonies from over 150 witnesses in evidence sessions around the country, and received written submissions from 250 more. The more we heard, the clearer it became that few food bank referrals are the same. Although they can be broadly categorised on a tickbox form, the human stories behind the statistics were often complex tales of successive hardships, culminating in a crisis.

We also heard stories of people who had been let down by the state. Unlike some commentators, however, we do not subscribe to the view that the need for food banks would be eradicated overnight by simply throwing money at the welfare state. As Jack Monroe told us, "if my benefits had been paid quickly, in full and on time, I would have been able to meet my living costs".

Benefit delays have long been an issue. In 2006/7, benefit delays accounted for 34 per cent of referrals to Trussell Trust food banks. In 2013/14, 30 per cent of referrals were due to benefit delay. We have a welfare state that is positively creaking under the strain of adjusting entitlements in response to everyday relationship changes in modern life, and in need of holistic reform. Without a more thoughtful and flexible safety net in place, constant gaps in payments will remain whilst the system "processes" life changes – and so too will the problems they cause.

But it also became apparent that there was a perfect storm brewing over the last decade that reached far beyond those living on benefits.

Britain experienced the highest rate of inflation amongst advanced western economies between 2003 and 2013, which had a disproportionate impact on those on the lowest incomes. In the last decade, the price of food rose by nearly 50 per cent, the price of fuel by a staggering 150 per cent and rents by a third. Wages in the same period increased by just 28 per cent.

The reality is that too many of the poorest in society did not benefit from economic growth and were still living from one pay cheque to the next: where the slightest change, such as needing to find extra money for lunch in the school holidays, could be disastrous, and often marked the start of a vicious cycle of debt.

But the most shocking fact that our inquiry uncovered was that just 2 per cent of edible surplus food in this country is given to charities like FareShare. One food bank manager told us he was offered 9,864 Cornish pasties because a lorry was 17 minutes late delivering them. Our frustration at the scale of needless waste in this country is compounded by the unacceptable taxpayer subsidies that are given to convert perfectly good surplus food into green energy, which must end.

When a family turns to the food bank in a time of need, they are met with warmth and compassion that is qualitatively different to what the state can provide. So when they are provided with food, it acts as a social gateway to a discussion about the wider problems in someone’s life.

We believe this offers a valuable opportunity for us to redesign a fragmented approach to support. We want to help more food banks evolve into hubs where services like debt and welfare advice are in one place, and end the system where people are sent from pillar to post in a constant cycle of referral.

We therefore propose a practical solution. We will bring together the voluntary sector, stakeholders and retailers in a new national voice: Feeding Britain. This will have three key goals that have been difficult to address by individual food banks in isolation. First, we will seek to double the redistribution of surplus food. Second, we will pilot twelve regional hubs that bring local agencies together. Third, we will pilot schemes to tackle school holiday hunger.

This is not about bureaucratic intervention from central government to wade in and impose a solution, or a talking shop so politicians can be seen to be doing something. We strongly believe that the best solutions are locally conceived and driven by the voluntary sector. We want to help connect the resources and the expertise that exist. The greatest asset of our food banks is not a stock of tins and packets, but the people staffing them: we hope that they will help us tackle the scandal of 21st century hunger.

Frank Field is the Labour MP for Birkenhead and co-founder and chair of All-Party Parliamentary Group on Hunger and Food Poverty; John Glen is the Conservative MP for Salisbury, PPS to Eric Pickles and co-author of the evidence paper for the group's inquiry with the Trussell Trust

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Artemis Monthly Distribution Fund: opportunities in volatile markets...

The Artemis Monthly Distribution Fund is a straightforward portfolio that combines bonds and global equities with the aim to deliver a regular income. It is run by James Foster and Jacob de Tusch-Lec. James also manages the Artemis Strategic Bond Fund whilst Jacob also manages the Artemis Global Income Fund. Whilst past performance is not a guide to the future, the Monthly Distribution Fund has returned 76.7%* since launch in 2012. Its current yield is 3.9%. It is also the top performing fund in its sector.*

Political uncertainty and the actions of central banks continue to create market volatility. In this article, James Foster talks about the opportunities this has provided and which areas of the market he considers most attractive.


The approach of the European Central Bank (ECB) has been both broad and radical. The increase to its quantitative easing (QE) programme has helped to push the yields on an even wider range of government bonds into negative territory. The cheap financing it offered to banks was less expected. To date, however, it has done little to ease fears that European banks are in trouble. The performance of bank shares across Europe (including the UK) has been abominable. Returns from their bonds, however, have been more mixed.

Bonds issued by banks and insurers are an important part of the portfolio. We increased our positions here in February but reduced them subsequently, particularly after the UK’s referendum on the EU in June. Our insurance positions have increased in importance. New Europe-wide solvency rules were introduced at the beginning of the year. They make comparisons easier and give us more comfort about the creditworthiness of these companies.

As part of its QE programme, the ECB announced that it would start buying corporate bonds with the aim of reducing borrowing costs for investment-grade companies. After months of preparation, the purchases began in June. The mere prospect of the ECB buying corporate bonds proved as significant as the reality. The implications, however, could be even more profound than they initially appear. Bonds of any investment-grade issuer with a European subsidiary are eligible.

Moreover, the ECB has changed the entire investment background for bonds. Companies are more likely to do their utmost to retain their investment-grade ratings. The financial benefits are so great that they will cut their dividends, issue equity and sell assets to reduce their borrowings. We have already seen RWE in Germany and Centrica in the UK undertaking precisely these policies.

High-yield companies, meanwhile, will do their utmost to obtain investment-grade ratings and could also lower their dividends or raise equity to do so. This creates a very supportive backdrop to the fund’s bonds in the BBB to BB range, which comprise around 28% of the portfolio.

The backdrop for higher-yielding bonds – those with a credit rating of BB and below – has also been volatile. Sentiment in the first quarter of 2016 was weak and deteriorated as the risk of recession in Europe increased. These types of bonds react very poorly to any threat of rising default rates. With sentiment weak in February and March, they struggled. However, the generosity of the ECB and stronger economic growth readings helped to improve sentiment. Default rates are higher than they were, but only in the energy sector and areas related to it.

We felt the doom was overdone and used the opportunity to increase our energy related bonds. Admittedly, our focus was on better quality companies such as Total, the French oil company. But we also increased positions in electricity producers such as EDF, RWE and Centrica. In a related move, we further increased the fund’s exposure to commodity companies. All of these moves proved beneficial.

One important area for the fund is the hybrid market. These bonds are perpetual but come with call options, dates at which the issuer has the option to repay at par. They have technical quirks so they do not become a default instrument. In other words, if they don’t pay a coupon it rolls over to the following year without triggering a default. In practice, if the situation is that dire, we have made a serious mistake in buying them. These hybrids have been good investments for us. Their technical idiosyncrasies mean some investors remain wary of these bonds. We believe this concern is misplaced. For as long as the underlying company is generating solid cashflows then its bonds will perform and, most importantly, provide a healthy income, which is our priority.


In equities, our response to the volatility – and to the political and economic uncertainties facing the markets– has been measured. We have been appraising our holdings and the wider market as rationally as possible. And in some cases, the sell off prompted by the Brexit vote appeared to be more about sentiment than fundamentals. We will not run away from assets that are too cheap and whose prospects remain good. We retain, for example, our Italian TV and telecoms ‘tower’ companies – EI Towers and Rai Way. Their revenues are predictable and their dividends attractive. And we have been adding to some of our European holdings, albeit selectively. We have, for example, been adding to infrastructure group Ferrovial. Its shares have been treated harshly; investors seem to be ignoring the significant proportion of its revenues derived from toll roads in Canada. It also owns a stake in Heathrow Airport, which will remain a premium asset whose revenues will be derived from fees set by the regulator whether the UK is part of the EU or not.

In equities, some European financials may now be almost un-investable and we have lowered our risk profile in this area. Yet there are a handful of exceptions. Moneta Money Bank, for example, which we bought at the initial public offering (IPO). This used to be GE’s Czech consumer lending business. The Czech Republic is a beneficiary of the ongoing economic success of Germany, its neighbour, and unemployment is low. The yield is likely to be around 8%. And beyond financials, prospects for many other European stocks look fine. Interest rates that are ‘lower for longer’ should be seen as an opportunity for many of our holdings – notably real estate companies such as TLG Immobilien  and infrastructure stocks such as Ferrovial – rather than a threat.


For high-yield bonds the outlook is positive. For as long as the ECB continues to print money under the guise of QE it will compel investors to buy high-yield bonds in search for income. The US economy is also performing reasonably well, keeping defaults low. Despite the uncertainty created by Brexit, that oil prices have risen means we can expect default rates to fall.

At the same time, there are a number of legitimate concerns. The greatest, perhaps, is in the Italian banking system. A solution to the problem of non-performing loans needs to be found without wiping out the savings of Italian households (many of whom are direct holders of Italian bank bonds). Finding a solution to this problem that is acceptable both to the EU and to Italian voters will be hard. Other risks are familiar: levels of debt across Europe are too high and growth is still too slow.

* Data from 21 May 2012. Source: Lipper Limited, class I distribution units, bid to bid in sterling to 30 September 2016. All figures show total returns with dividends reinvested. Sector is IA Mixed Investment 20-60% Shares NR, universe of funds is those reporting net of UK taxes.

† Source: Artemis. Yield quoted is the historic class I distribution yield as at 30 September 2016.



Source: Lipper Limited, class I distribution units, bid to bid in sterling. All figures show total returns with net interest reinvested. As the fund was launched on 21 May 2012, complete five year performance data is not yet available.


To ensure you understand whether this fund is suitable for you, please read the Key Investor Information Document, which is available, along with the fund’s Prospectus, from

The value of any investment, and any income from it, can rise and fall with movements in stockmarkets, currencies and interest rates. These can move irrationally and can be affected unpredictably by diverse factors, including political and economic events. This could mean that you won’t get back the amount you originally invested.

The fund’s past performance should not be considered a guide to future returns.

The payment of income is not guaranteed.

Because one of the key objectives of the fund is to provide income, the annual management charge is taken from capital rather than income. This can reduce the potential for capital growth.

The fund may use derivatives (financial instruments whose value is linked to the expected price movements of an underlying asset) for investment purposes, including taking long and short positions, and may use borrowing from time to time. It may also invest in derivatives to protect the value of the fund, reduce costs and/or generate additional income. Investing in derivatives also carries risks, however. In the case of a ‘short’ position, for example, if the price of the underlying asset rises in value, the fund will lose money.

The fund may invest in emerging markets, which can involve greater risk than investing in developed markets. In particular, more volatility (sharper rises and falls in unit prices) can be expected.

The fund may invest in fixed-interest securities. These are issued by governments, companies and other entities and pay a fixed level of income or interest. These payments (including repayment of capital) are subject to credit risks. Meanwhile, the market value of these assets will be particularly influenced by movements in interest rates and by changes in interest-rate expectations.

The fund may invest in higher yielding bonds, which may increase the risk to your capital. Investing in these types of assets (which are also known as sub-investment grade bonds) can produce a higher yield but also brings an increased risk of default, which would affect the capital value of your investment.

The fund holds bonds which could prove difficult to sell. As a result, the fund may have to lower the selling price, sell other investments or forego more appealing investment opportunities.

The historic yield reflects distribution payments declared by the fund over the previous year as a percentage of its mid-market unit price. It does not include any preliminary charge. Investors may be subject to tax on the distribution payments that they receive.

The additional expenses of the fund are currently capped at 0.14%. This has the effect of capping the ongoing charge for the class I units issued by the fund at 0.89% and for class R units at 1.64%. Artemis reserves the right to remove the cap without notice.

Any research and analysis in this communication has been obtained by Artemis for its own use. Although this communication is based on sources of information that Artemis believes to be reliable, no guarantee is given as to its accuracy or completeness.

Any forward-looking statements are based on Artemis’ current expectations and projections and are subject to change without notice.

Issued by Artemis Fund Managers Ltd which is authorised and regulated by the Financial Conduct Authority.