Non-taxpayers can get the same tax benefits by investing directly into a unit trust

Non-taxpayers can get the same tax benefits by investing directly into a unit trust. If customers didn't do it until the last minute there's got to be a reason why they didn't - only time will tell whether their decision was right or wrong."The advisers point to anecdotal evidence that non-taxpaying customers bought Tessas and PEPs ahead of the deadline. In the run-up to Monday, investors were pouring money into PEPs at four times the normal rate.Financial experts fear the public may have rushed to buy Tessas and PEPs simply because they were disappearing, rather than because it was in their best interests.Philippa Gee, of advisers Gee & Company, said: "No one should be doing something like this - particularly if they are basic-rate taxpayers - just because of the tax benefits. Ash Rawal, 38, a corporate consultant from Derby, became the first owner of an ISA, the Government's replacement vehicle for PEPs and Tessas, the tax-efficient vehicles that stopped being sold on Monday. Mr Rawal bought his ISA from Charles Schwab Europe, the Birmingham-based retail stockbroker, at 12.01 am, just one minute after ISAs officially went on sale. THE GOVERNMENT'S long-awaited scheme to encourage retail investors into the equity market finally got off the ground yesterday when the first Individual Savings Account (ISA) was sold in the early hours of the morning. After yesterday's fall they are on 15 times 1999 earnings, a large discount to market and to rival support services groups Despite their run, they are still worth buying.. "If earnings growth is to continue, Jarvis will have to reduce its reliance on Railtrack," said one analyst.Supporters of the stock claim Jarvis is well placed to win a large chunk of the new contracts and to claim a slice of Railtrack's pounds 10bn investment in the railways over the next 10 years.Moreover, the shares look cheap.

They say that to prevent an earnings slowdown, Jarvis must extend its forays into road and airport maintenance and expand abroad. The company now controls 60 per cent of Railtrack renewals contracts and 20 per cent of the maintenance work, and has about pounds 200m of PFI projects under way.Some observers worry that this reliance on Railtrack will constrain earnings in the new millennium when new, lower-margin contracts will be auctioned. One said that yesterday's announcement would do little to dim the Square Mile's admiration for the company.Jarvis shares have enjoyed an astronomical rise from just 8p five years ago as the company transformed itself from a traditional building contractor into a fast-growing support services group.Through a series of acquisitions and sales, Jarvis replaced low-margin, cyclical building work with the high-margin, secure stream of earnings generated by rail maintenance contracts and Private Finance Initiative (PFI) construction projects. Jarvis would also save around pounds 16m next year as it would not have to employ agency staff to replace striking workers.City analysts said the resolution of the dispute, which started in June and continued intermittently until February, would benefit Jarvis's long- term prospects. Under the deal, Jarvis employees would receive a higher basic salary in exchange for scrapping overtime pay.Henry Lafferty, Jarvis finance director, said the agreement could lead to significant cost savings as Jarvis would not have to pay overtime on weekend and night shifts, the periods during which it carried out most of its track maintenance work. The company moved to reassure the market, saying it had reached an agreement with the RMT, which was to be approved in the next few weeks. The two factors will cause a fall in profits for the year to March 1999 to below market expectations of around pounds 62.7m, Jarvis said.City analysts immediately slashed forecasts by around 10 per cent to pounds 56m, still well above the pounds 36.7m posted in 1998.

The shares shed nearly 12 per cent to 478p after Jarvis said the cost of a nine-month action over pay and conditions by 4,000 staff in its rail maintenance business would mar its results. The effects of the strike, masterminded by the Rail Maritime & Transport union, were compounded by the decision by Railtrack to delay a number of track renewal contracts. JARVIS, the facilities management group, yesterday dented its reputation as a City favourite with a warning that this year's profits would fall short of market expectations owing to a lengthy industrial dispute. Caution is urged on Orange, where the rating is seen as a little too high.. The industry still faces a strategic problem in generating "lifetime customers", it said.Although this sector has had a terrific run in the past year, analysts rate Vodafone a long-term buy, mainly on the back of its merger with AirTouch of the US.

Orange closed up 34p at 928p and Cable & Wireless, joint owner of One2One, was up 23.5p to 775.5p.Analysts at Investec Henderson Crosthwaite said the continued growth in subscriber numbers would continue to be good for share prices, but the longer-term issue would be the churn rates. Vodafone added 700,000 customers, raising its total by 14 per cent to 5.57 million. Cellnet added a net 479,000 customers, a rise of 17 per cent, while Orange and One2One added 370,000 and 329,000 new customers respectively.Orange reported growth in its contract business, although it admitted that churn in this service - that is, the proportion of people leaving - had risen from 20.5 per cent to 21.7 per cent.The acceleration in new subscribers boosted mobile share prices yesterday. Analysts said pay-as-you-go services could now account for nearly half the mobile phone market, up from 22 per cent at the end of last year.Consumers are opting for the greater flexibility of not having to sign a fixed-term contract, even though it means paying higher phone tariffs.Yesterday's figures showed the three months to March to be the second- best quarter ever for the mobile phone sector. Vodafone, Orange, Cellnet and One2One all reported bumper new subscriber figures for the first three months of this year showing a total of 1.87 million new subscribers. The figures mean that almost 15 million people in the UK now own mobile phones, with pay-as-you-talk services accounting for a rapidly growing share.

THE GROWING popularity of "pay-as-you-talk" services has provided a further boost for Britain's mobile phone companies, according to new quarterly figures out yesterday. However, the votes were not unanimous; Claude Bebear, chairman of the insurance group AXA who sits on both boards, dissented in each vote, while Jean Gandois, representing BNP on the Paribas board, also voted against the decision to reject BNP's share-swap offer.. THE BOARDS of French banks Societe Generale and Paribas last night each rejected the hostile $37bn (pounds 23.4bn) double bid from BNP, which gatecrashed their agreed merger on 9 March. The announcement prompted a 2 per cent rise in Monument's share price to 47.75p, valuing the business at pounds 418m. Monument, which is headed by the former Conservative energy minister Tim Eggar, said it had received a number of approaches which may or may not lead to an offer, although no firm proposals had yet been put forward.The company also repeated the comments it made at the time of its results announcement last month, that it was also looking at ways of pooling its asset base and other technical and financial link-ups with other exploration companies.This means that the discussions that are being held could result in some form of joint venture rather than a full-blown takeover.However, analysts said Lasmo was an obvious merger partner for Monument as both companies held stakes in the giant Liverpool Bay gas field. SHARES IN Monument Oil & Gas, the independent exploration group, rose sharply yesterday after the company confirmed that it had received several potential takeover approaches, one of which is understood to have come from Lasmo. Mr Prescott last week named Tom Winsor, a City lawyer, as the rail regulator to oversee Railtrack..