News digest 1 November 2011
The digest opens with the shock Greek
referendum which has sent stock markets back down just as the
government tries to boost growth by handing out funds it could not
find before, will that be enough to stem the impact of job losses
in the public sector. As personal debt rises, protestors will soon
be served notice but there will be bonuses for Barclay’s investment
bankers. npower is fined, Alstom attacks Siemens and Gillard
attacks Qantas. Gove moans at heads, Fox gets the brush off and
while the Tories are divided low paid workers in Germany get a
boost to basic pay…
Greece to hold
referendum on bail-out – Greece’s prime minister George
Papendreou threw a spanner in the works of the second EU bail-out
agreement after unexpectedly announcing a public referendum to
approve the deal. With a strong wave of opposition across the
country is this the first step to Greece’s exit from the eurozone
or a way to ensure the backing of the people for austerity? After
rallying last week stock markets around the world retreated and the
euro lost more than two per cent against the dollar. Looks like it
will be another difficult week for the economy and there’ll be a
lot on the agenda at the G20 especially as the OECD has warned that
the current crisis could be as serious as the one that triggered
the banking crisis in 2008 and think tank the IPPR argued that it
could take at least six years for the economy to recover (Mirror p6, Sun p2, Express p4, Mail p2/65, Times p14, Indie p1/51, Guardian p1/23, Telegraph p1/b1, FT p1, Morning Star p9).
£1 billion boost announced –
As data released this morning shows that the UK economy grew by 0.5
per cent in the last quarter most papers follow up on the funds for
‘growth’ announcement by deputy prime minister Nick Clegg
yesterday. Beneficiaries of the fund include JCB, Pirelli,
Santander, Siemens and surprise surprise Sheffield Forgemasters.
The firm that famously had an £80 million loan withdrawn will
receive £36 million, has Clegg finally cottoned on that he needs to
shore up his seat? (Mirror
p6, Express p2, Mail p8, Times p15, Indie p2, Guardian p2, Telegraph p21, FT p2, Morning Star p3)
Steep rise in job losses
feared – The FT (p1)
reports that the poor growth figures (the Office of Budget
Responsibility originally forecast a rise of 0.9 per cent against
the 0.5 per cent result announced today) mean public sector job
losses could be much larger than expected. The OBR forecast just
20,000 public sector job losses in 2011/12, so far 105,000 have
been axed, while the overall total axed looks likely to be nearer
600,000, and that is with a worsening jobs’ market.
Debt is personal – A few of
the papers report on how the downturn is hitting the poorest
hardest. The rise in VAT has had a disproportionate impact on
worst-off families and changes to council tax benefits are also
expected to hit over one million low income workers. The Indie (p14-15) also shows that,
as the government’s austerity bites, personal debt is soaring with
record numbers now using credit cards to make ends meet (Mirror p6, Times p15, Telegraph p8, Morning Star p3).
Crisis at the cathedral –
Pressure grows on the archbishop after a third resignation - this
time the dean of the cathedral the Right Rev Graeme Knowles - over
the handling of the doorstep campaign. With one headline branding
St Paul’s a ‘national joke’ the church cathedral is expected to
reverse its decision to back legal action to remove the protesters,
but the Corporation of London is still expected to serve notice on
the protesters to quit today, meaning protestors speaking for the
99 per cent could be forcibly removed within 48 hours (Mirror p7, Sun p6, Express p19, Mail p4, Times p1, Indie p7, Guardian p1, Telegraph p1, FT p4, Morning Star p2).
Bonuses at Barclays -
Barclays yesterday announced pre-tax profits of £5 billion despite
the eurozone crisis denting its investment bank division which saw
revenues fall faster than costs. The bank however said it was
putting aside almost half of revenues from its BarCap division
towards bonuses and staff pay, although the surge in the company
came from the bank’s high street operations. Calling for ordinary
bank workers to benefit after thousands of job cuts Unite’s Dave
Fleming said: “Frontline staff have been given between
nothing and very little in recent years. It is time to redress the
balance.” (Mirror p6, Sun p42, Express p44, Mail p19, Times p36, Indie p52, Guardian p27, Telegraph b3, FT p14, Morning Star p2)
npower fined – Ofgem slaps £2
million fine on energy giant over errors when dealing with
complaints, it will hardly hurt as the company made profits of £307
million in the first six months of the year (Mirror p15, Sun p42, Mail p30, Times p42, Indie p54, Guardian p13, Telegraph b3, FT p2, Morning Star p5)
BG appoints new chairman –
UK’s third biggest oil and gas producer has appointed Andrew Gould,
ex of Schlumberger, as its new chairman. He will lead the search
for a replacement for BG’s chief executive, Frank Chapman, who
plans to retire in two years time (Express p44, Mail p67, Indie p56, Telegraph b3, FT p17).
Premier boss wields knife –
The Mail (p68) reports
that the new boss at troubled Hovis-maker Premier Foods, Michael
Clarke, has got rid of his second in command Tim Kelly who had been
the leading internal contender for the top job.
G4S deal off - The Telegraph (b4) and FT (p15) report security group G4S will
abandon its £5.2 billion takeover of Danish cleaning company ISS
after opposition from shareholders, G4S backed down this
morning.
Alstom attacks Siemens – The
FT (p21) reports that the French
engineering group attacked Siemens over leaks of train technology
to Chinese companies through a partnership agreement.
Honda hit by floods – From
trains to cars and the FT (p21)
also reports that the Japanese carmaker has reported a sharp fall
in quarterly profits after floods in Thailand have forced the
company to shut a car factory; Honda has also been hit by the
rising value of the yen and the lingering effects of the
tsunami.
Booking fears for Qantas –
The fall out from the Qantas grounding may have a longer term
impact as consumers book Christmas holiday travel with other
airlines. The airline’s managers were strongly criticised by prime
minister Julia Gillard calling the lock out and shut down
“extreme and irresponsible" action. Nice to have a
prime minister that actively backs workers in dispute (FT p21, Morning Star p6, BBC
online).
R3 written off – A few more
of the papers follow up on Labour abandoning its support for
expansion at Heathrow airport (Times p4, Guardian p28, FT p2).
Call for immigration
clampdown – And as the Telegraph (b1) reports that
Brazil is about to overtake the UK as the world’s sixth biggest
economy later this year, the Mail (p6) reports on calls to cut
immigration with Migration Watch trying to mobilise 100,000 people
to sign an e-petition over UK population growth.
Gove moans at heads –
Education secretary Michael Gove has told head teachers to stop
whingeing about cuts saying lack of funding was not an excuse for
poor economic achievement (Mirror p4, Indie p21).
Twigg backs teachers – The
Times (p8) reports
Labour shadow education secretary Stephen Twigg says teachers have
every right to strike over cuts to their pensions while Unite’s
Gail Cartmail Morning
Star (p5) calls on millions of public sector workers to back
strike action on 30 November.
Fox gets brush off – Shamed
Liam Fox was snubbed by Downing Street after he said he would like
to get back to the front bench, Downing Street made it clear there
were no plans to bring back the former defence secretary and Tory
leadership contender (Mirror
p14, Indie p23,
Guardian p8).
Pickles pickle – Communities
secretary Eric Pickles has been slammed for failing to declare a
slap up meal with lobbyists at the Savoy (Mirror p4).
Tories seen as divided – The
Indie (p6) has the
latest opinion poll and voters say that the current Conservative
party is seen as more divided than the last Labour government as
the impact of the vote over Europe hits home. Labour has doubled
its lead to four points and stands on 38 per cent, the Tories drop
three points to 35 per cent and the Lib Dems rose four to 14 per
cent, Europe definitely not good for the Tories…
Union forces U-turn – And
finally the FT (p7) reports that
Germany’s leading trade unions have welcomed a shift by the German
government and chancellor Angela Merkel to finally consider
introducing a binding minimum wage for low paid workers. After
years of lobbying by trade unions the Merkel government is looking
for measures that can boost its standing among voters and also
disarm critics saying Germany is not doing enough to stimulate
domestic demand.
Edited by Mik Sabiers
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