Ikea 'Regrets' Using Forced Prison Labour

Ikea says it "deeply regrets" the use of forced prison labour by suppliers in communist East Germany more than two decades ago.

The Swedish furniture giant apologised after commissioning a report into claims political prisoners worked in factories making its products in the 1960s and 70s.

The company says it never condoned the use of forced labour but the report showed it failed to properly vet how its suppliers were operating.

The report concludes that Ikea managers "were aware of the possibility that political prisoners would be used in the production of Ikea products in the former GDR".

"We deeply regret that this could happen," said Jeanette Skjelmose, an Ikea manager.

"The use of political prisoners for manufacturing was at no point accepted by Ikea."

But she added: "At the time we didn't have the well-developed control system that we have today and we clearly did too little to prevent such production methods."

Ikea commissioned accountants Ernst & Young to look into claims aired by a Swedish TV documentary in June but first raised by a human rights group in 1982.

Rainer Wagner, chairman of the victims' group UOKG, said Ikea was just one of many companies that used forced prison labour in East Germany.

"Ikea is only the tip of the iceberg," he told The Associated Press in an interview earlier this week.

Wagner said he hoped that Ikea and others would consider compensating former prisoners, many of whom carry psychological and physical scars.

"Ikea has taken the lead on this, for which we are very grateful," he told a news conference in Berlin, where the report was presented.

Peter Betzel, the head of Ikea Germany, said the company would continue to support efforts to investigate the use of prisoners in East Germany in future.

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Comet To Close 'Up To 40 Stores'

Comet is preparing to close between 30 and 40 stores by the end of the month, according to reports.

Administrators have so far announced 330 redundancies at the electronics retailer but there have been no job losses among shop staff and all the chain's 236 stores remain open.

The bulk of the staff cuts have been made in Comet's head office in Rickmansworth, Herts, as well as its site in Hull and call centre in Clevedon, Somerset.

But the reported closures could threaten the livelihoods of up to 1,000 front line staff.

It has also been suggested that Deloitte, who was appointed administrator when the chain collapsed earlier this month, is preparing to close down the retailer's home delivery operation, putting a further 500 employees at risk.

The stores which do not close are expected to continue trading over Christmas.

Deloitte said it is holding talks with a number of potential buyers.

Neville Kahn, joint administrator of Comet, said: "We are in discussions with a number of parties who have expressed interest in parts of the business and we continue to work hard to preserve jobs."

Deloitte added it was seeing record levels of trade after launching a sale across Comet stores last week.

The collapse of Comet marks one of the biggest high street casualties since the demise of Woolworths in 2008 and came a month after the failure of JJB Sports.

The group was hit by weak high street trading conditions, competition from online rivals and being unable to secure the trade credit insurance needed to safeguard suppliers.

In particular, it was knocked by the lack of first-time home buyers, which had been key customers for Comet, according to Deloitte.

The high street electricals market in the UK has come under huge pressure as cash-strapped shoppers put off purchases of big-ticket items such as TVs and large appliances and online rivals take a bigger slice of the sector.

Comet's administration comes just months after it was taken over by investment firm OpCapita, which bought the chain for a nominal £2 in February.

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Exclusive: Santander UK Plots Jersey Sale

The British arm of the giant banking group Santander is reviewing the future of its Jersey-based private banking arm days after rival HSBC was accused of using its business there to provide accounts to convicted criminals.

I have learned that Santander UK has begun sounding out prospective buyers of Santander Private Banking Jersey, a business it inherited from its takeover of Abbey in 2004.

The unit manages approximately £4bn of deposits and tens of thousands of customers, according to insiders. The Spanish-owned lender has hired Gleacher Shacklock, an advisory firm, to gauge the appetite of potential bidders for its Jersey division.

People close to the situation said that Santander UK had not committed to a sale, but was exploring a series of options that included changing the structure of the business or retaining it in its current form.

It had previously conducted a similar exercise for its Isle of Man private banking division and elected to retain the unit, people close to the bank said.

Potential buyers of the division could include the owners of other large private banking businesses such as Investec or Kleinwort Benson.

Earlier this month, HSBC found itself at the centre of a new controversy over compliance standards when it emerged that a number of individuals with criminal links were customers of its Jersey-based operation.

A list containing thousands of names had been provided to HM Revenue & Customs by a whistle-blower, dealing a further blow to HSBC just days after it was forced to hike the potential bill for breaching US anti-money laundering rules by £500m.

Santander UK declined to comment.

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Fuel Price Misery: AA Demands Action

The AA has accused ministers of failing drivers and businesses by failing to clamp down on what is sees as unfair fuel prices.

The motoring group says while average unleaded prices have gone down from 138.95p a litre in mid October to 135.08p - with diesel dropping from 143.74p to 141.89p - motorists are still being short-changed.

It believes the fall in wholesale petrol prices across Europe should have knocked UK pump prices down by between 10p and 11p a litre instead of by an average 4p.

Despite the signs that the Chancellor is poised to postpone the planned fuel duty rise of 3p a litre due in January, the AA said drivers were facing a series of pressures including a "postcode lottery" in fuel prices.

It found that motorists in one area can be charged as much as 5p a litre more than drivers a few miles away.

AA president Edmund King said: "The Government momentarily had a grip of this monster when the previous Transport Secretary (Justine Greening) called in the industry to agree wholesale price transparency.

"This initiative stalled when the Office of Fair Trading (OFT) called for information on road fuel pricing - to which the industry has responded by pumping up wholesale prices and then not passing on cost savings in a timely fashion.

"The average UK domestic energy bill is £1,252 but the cost of fuel for the average car consuming 1,200 litres a year is over £1,500.

"This week the Government said it was going to tackle high gas and electricity bills, yet lets drivers and businesses down by not reacting swiftly to runaway wholesale and pump prices."

Earlier this week, Treasury Economic Secretary Sajid Javid said the Government understood the pressures facing households and was determined to help with the cost of living.

He said: "The Government is doing all it can to help hard-working families with the cost of living and putting money back into their pockets.

"Action on fuel duty is part of this. Fuel duty is currently 20% lower in real terms compared to its peak in March 2000 and 7% lower compared to May 2010."

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RBS And Lloyds TSB 'May Cost Taxpayer £66bn'

More than £66bn of taxpayers' money invested in RBS and Lloyds TSB may never be recovered, MPs have warned.

The Commons Public Accounts Committee (PAC), said that lessons needed to be learned from the sale of Northern Rock - and applied to decisions concerning any future sale of the banks "with value to the taxpayer taking precedence over speed of exit".

The MPs, who are charged with monitoring Government financial affairs, said that the Treasury made a series of costly mistakes in its handling of Northern Rock, which had to be taken into public ownership in 2008.

Just two bidders were interested in taking it over, sparking fears that the two remaining state-backed banks, RBS and Lloyds, will fail to be sold for a profit.

Auditors earlier this year estimated that losses on the Northern Rock rescue would amount to £2bn. That figure includes the loss of about £480m on the sale of Northern Rock Plc to Virgin Money, owned by Sir Richard Branson, last year.

The estimated losses were highlighted in a report in May by the National Audit Office (NAO) into the nationalisation of the bank in 2009 and its subsequent part sale.

Northern Rock Plc was sold to Virgin Money, owned by Sir Richard Branson

The report criticised the then Chancellor Alistair Darling for failing to look at the full consequences to the taxpayer.

Labour MP Margaret Hodge, who chairs the PAC committee, said: "The lack of competition does not fill us with confidence that the taxpayer will make a profit on the sale of the two banks which remain in public ownership, RBS and Lloyds.

"There is a risk that the £66bn invested in RBS and Lloyds may never be recovered.

"It is vital that the final decisions on the wholly owned banks are made with value to the taxpayer taking precedence over speed of exit.

"This will not be the last banking crisis, and the next one is likely to be different. The Treasury must ensure it retains the right staff with the right skills to understand the risks and respond effectively.

"It needs to learn the lessons from the creation and sale of Northern Rock and make sure that these are applied in future, including to any sale of RBS and Lloyds."

The run on deposits at Northern Rock in September 2007 was an early and pivotal moment in the financial crash and subsequent meltdown.

After nationalisation, the bank was split into a mortgage lending and savings arm, Northern Rock plc, and Northern Rock (Asset Management), which held its bad debt.

The move was supposed to generate lending but it fell well short of its £15bn target, reaching just £9.1bn.

MP Margaret Hodge says the £66bn invested in RBS and Lloyds may be lost

The Treasury has accepted its part in a "monumental collective failure", according to the report.

It has now set up a dedicated team, UK Financial Investments (UKFI), to manage taxpayer shares in banks.

Earlier this year the Treasury's most senior official, Sir Nicholas Macpherson, admitted the taxpayer lost out because of five months of "drift" as the crisis unfolded.

A spokesman for the Treasury said the decision to nationalise Northern Rock in 2008 was taken in the interest of financial stability, and that the sale of Northern Rock plc to Virgin Money last year represented "good value for money for the taxpayer, and has helped increase high-street competition".

A Treasury aide added: "RBS and Lloyds have made good progress over the last two years and our goal remains the same: To get the best possible value for taxpayers."

Matthew Sinclair, chief executive of the TaxPayers' Alliance, said: "This report on the expected cost of the Northern Rock fiasco will come as a devastating blow for taxpayers who are already carrying a huge loss from the Government's stake in RBS."

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British Gas Customers Latest Hit By Hike

Around 8.5 million households are to be hit with a 6% rise in their energy bills today as British Gas becomes the latest utility giant to hike its tariffs.

The move is estimated to add another £80 to the typical annual dual-fuel bill for a British Gas customer, or £1.50 a week.

The price hike is more than double the rate of inflation.

There was mounting anger over the bill boost - first announced last month - after British Gas parent Centrica said it was set to make profits of £1.4bn this year.

Experts also predict around £575m of pre-tax profit from its British Gas residential arm after gas consumption for the first 10 months of 2012 rose 9% because of colder than normal weather.

Mike Jeram, head of business and environment at trade union Unison, said: "The billion pound profits of energy companies, announced at the same time as massive price hikes for their customers, are an insult to the many families who are struggling to get by as winter takes hold."

Audrey Gallacher, director of energy at Consumer Focus, called for rules forcing energy firms to tell customers about the link between bill rises and profits.

She said: "Consumers will be sceptical over supplier profits, given questions over how justified recent price rises have been."

British Gas's bill increase comes amid a spate of tariff rises among the UK's "big six" power firms.

SSE was the first to increase prices, lifting bills by an average of 9% in mid-October, affecting about five million electricity customers and 3.4 million gas customers.

Npower follows with its increase on November 26, while EDF and Scottish Power will raise bills in December.

German-owned E.ON - the last of the utility firms to lift prices - is reportedly planning to announce a 11% January tariff rise next month.

They have all blamed rising wholesale prices, which they say is out of their control, but the sector has been embroiled in controversy this week after accusations of alleged wholesale gas price-rigging.

Regulators are now investigating claims made by a whistleblower to the Financial Services Authority (FSA) and energy watchdog Ofgem of alleged gas price manipulation on September 28.

All six of the big energy companies have released statements denying any involvement in attempts to fix the £300bn market.

Centrica said on Wednesday night that an internal investigation "found nothing unusual" in its wholesale gas trading activities on the day when price manipulation was alleged to have taken place.

The group, which makes most of its profit from upstream gas and oil exploration, is expected to see a 6% profits improvement in its residential energy supply, driven by stronger trading over the first half of the year, with the figure forecast to be lower for the second half of the period.

Its trading update comes after rival SSE reported a 38% jump in half-year profits to nearly £400m.

In yesterday's trading update, Centrica said competition in its division which supplies small and medium-sized businesses had cost it 43,000 customers since June.

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UK Unemployment Total Drops By 49,000

Unemployment has fallen to its lowest total for over a year, although there has been an increase in the number of people claiming jobseeker's allowance, according to official figures.

The jobless total dropped by 49,000 in the quarter to September to 2.51 million, the lowest figure since last summer.

But the so-called claimant count jumped by 10,100 last month to 1.58 million, the highest since July, and the biggest monthly rise since last September.

The Office for National Statistics (ONS) said the number of people in work increased by 100,000 in the latest quarter to just under 30 million, a rise of more than half a million over the past year.

Other figures from the ONS showed that long-term unemployment - those out of work for over a year - increased by 12,000 in the quarter to September to 894,000, while 443,000 people have been jobless for over two years, up by 21,000.

A drop in London jobs was seen as a result of the Olympics winding down

Part-time employment increased by 49,000 to 8.1 million, close to a record high, while there were 51,000 more people in full-time jobs, at 21.4 million.

Employment minister Mark Hoban told Sky News he believed a portion of the higher number seeking jobseeker's allowance were those no longer claiming disability allowance.

"These figures suggest that our welfare reforms are working, with fewer people on long-term sickness benefits and more people either in or looking for work."

He added: "It's good news to see yet another increase in the number of people in work and to see unemployment fall again.

"The fall in youth unemployment is particularly welcome, although we're not complacent about the scale of the challenge still facing us."

Unemployment among women fell by 10,000 to 1.09 million, and by 39,000 among men to 1.43 million.

Meanwhile, unemployment among 16 to 24-year-olds fell by 49,000, which accounts for the total fall in today's jobless figures.

More young people are classed as economically inactive, most of whom were in full-time education.

Neil Carberry, the CBI's director for employment and skills, said: "It's encouraging that people are continuing to find jobs and that the unemployment rate is falling.

New incapacity benefit rules means more people are on jobseeker's allowance

"But progress on getting people into work is much slower than we saw earlier in the year, and last month there was a troubling rise in the number of people claiming jobseeker's allowance."

Average earnings have failed to match inflation. They increased by 1.8% in the year to August, up by 0.1% on the previous month, giving average weekly pay of £471, including bonuses.

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John Lewis Boss Urges Action On Foreign Firm Tax

The managing director of retail chain John Lewis has become the first leader of a British business to call on the Government to examine the way foreign multinationals pay tax in the UK.

Andy Street told Jeff Randall Live exclusively that the Treasury needs to do more to prevent the likes of online retailer Amazon "destroying the UK tax base" and potentially putting British companies out of business.

The comments by Mr Street come amid mounting concern about the tax policies of big international firms in the UK.

This week, Amazon, alongside Google and Starbucks, came under fire from MPs when it appeared before the Public Accounts Committee.

Mr Street said: "If you actually improve your business by investing ... you have got less money to invest if you are giving 27% of your profits to the Exchequer than, clearly, if you are domiciled in a tax haven and you've got much more.

"They (Amazon) will out-invest and ultimately out-trade us and that means there will not be a tax base in the UK.

"I do think it's an issue that needs to be examined."

Mr Street said the question centres on determining whether earnings made in a particular country are to be taxed in that country.

"Exactly how that happens I don't know, but that's the principle that needs to be examined," he said.

Asked whether the Treasury should address the Amazon question, Mr Street replied: "I think it should look at exactly what's happening, yes."

Amazon said it used Luxembourg as a base for its European operations because of the favourable tax rate there.

Andrew Cecil, the online retailer's public policy director, said the Luxembourg business' turnover in 2011 was £7.3bn yet it paid taxes of just £6.4m.

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Credit Card Insurer Close To FSA Deal

CPP, one of Britain's biggest credit card protection providers, is poised to reach a settlement with regulators that could safeguard its future.

I understand that CPP is on the verge of announcing that the Financial Services Authority (FSA) has agreed to drop its probe into the company in return for a binding agreement on a multi-million pound compensation pot for customers.

The FSA has been investigating CPP for months over allegations that it mis-sold products such as identity theft cover, potentially to thousands of consumers.

People close to the situation said that a statement confirming the provisional end of the regulator's probe could come as soon as this week.

A binding deal would require commitments from the banks through which CPP policies were sold to stump up hefty compensation bills.

I have learned that some of Britain's major banks are continuing to oppose a settlement on terms recommended by the FSA on the grounds that they would be financially disproportionate to their involvement with CPP.

The credit card insurer disclosed earlier this month that it had received a takeover approach from the American company behind the rival Sentinel brand.

CPP's impending agreement with the regulator follows a string of other mis-selling scandals affecting British banks, including those relating to payment protection insurance and interest rate swaps.

Santander UK, which recently made a substantial provision for misconduct-related payments understood to include CPP, was a major sales channel for its policies.

CPP has put aside tens of millions of pounds for customer compensation, although the final liability of the entire banking industry will be significantly higher.

CPP and the FSA refused to comment.

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Toyota Issues Another Massive Recall

Toyota has announced its second huge recall of vehicles in as many months in a move affecting almost 2.8 million cars world-wide.

The company blames problems with steering mechanisms and its hybrid system water pump.

The Japanese firm said it was recalling 1.5 million vehicles in Japan, 670,000 in the United States and 496,000 in Europe to correct  steering intermediate extension shafts which can be damaged at slow speed.

But it insisted that the problem, seen in cars such as the second-generation Prius and certain Corolla models, could be fixed in about 50 minutes.

Separately, the car-maker is recalling 630,000 vehicles worldwide, including 350,000 in the US and 175,000 in Japan, to fix water pumps in hybrid vehicles.

Toyota UK told Sky News there were 75 thousand British cars affected by the two recall issues in total and there had been no reported accidents in the UK as a result of the steering problem.

Customers whose cars are subject to the recall will receive a letter to that effect within 6 weeks, the company said, though anyone concerned could enter their car's registration into a special search database on the Toyota UK website to check whether their vehicle is affected.

The move is the latest in a series of embarrassing recalls for the firm.

In October, Toyota said it was pulling back more than 7.4 million vehicles worldwide to fix faulty power window switches, the industry's biggest single recall since Ford took 8 million vehicles off the road in 1996.

A previous series of Toyota recalls involving more than 10 million vehicles between 2009 and 2011 damaged the firm's image but it recovered and earlier this month raised its full-year net profit forecast to $9.7 billion (£6.1bn), citing solid sales.

This year's profit forecast comes despite a big drop in car sales in China since September, when anti-Japanese protests erupted over a diplomatic row.

More follows...

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Sainsburys Sees Pre-Tax Profit Up 2.5%

Supermarket chain Sainsburys has reported like-for-like sales for the half year rise by 1.7%, with pre-tax profit up 2.5% at £405m.

Revenue, excluding VAT and fuel, for the six months to September 29 was up 4% at £12.16bn.

Total sales in the period were up 4% at £13.365bn.

The profit boost for Britain's third largest supermarket chain was helped by the development of its online and convenience stores business, the two fastest growing grocery sub-sectors.

The group, which has enjoyed 31 consecutive quarters of underlying sales growth, has continued to outshine industry leader Tesco.

Last month Tesco posted a 12.4% fall in first half UK trading profit. Asda, the second largest in the market, is due to update on its third quarter on Thursday.

Chief executive Justin King said: "Our share of the grocery market is the highest for almost a decade at 16.7%.

"Whilst the wider economic situation remains challenging, we are well positioned to help our customers live well for less."

More follows...

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SSE Defends 38% Profits Rise As Bills Go Up

The energy firm SSE has defended a 38% rise in half year profits at a time when its gas and electricity bills are rising by 9% on average.

The company, formerly known as Scottish & Southern Energy, made an adjusted profit before tax of £397.5m in the six months to September 30.

Lord Smith of Kelvin, the firm's chairman, said: "While some observers may choose to criticise SSE for making a profit and paying a dividend (of 25.2p per share - a rise of 5%) I believe that profit and dividend allow SSE to employ people, pay tax, provide services that customers need, make investments that keep the lights on and create jobs while providing an income return that shareholders like pension funds need."

In August, SSE blamed "sustained increases" in the cost of using the electricity and gas networks, costs associated with mandatory Government schemes and the price it had paid for energy in the wholesale markets for a 9% increase in its household energy bills.

The move came into effect last month.

Wholesale gas charges had risen 14% year-on-year, the group said and its bill increase would add another £8.53 a month on to the typical monthly direct debit, dual fuel customer - taking the average annual bill to £1,274.

More follows...

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Fuel Duty: Govt Hints It May Axe Increase

The Government has hinted that a planned fuel duty rise could be axed, despite ministers having seen off Labour calls for the 3p increase in January to be scrapped.

Treasury Economic Secretary Sajid Javid said the Government understood the pressures facing households and was determined to help with the cost of living.

Robert Halfon, a Conservative backbencher and a prominent campaigner on fuel duty, did not back Labour's demands because he believed ministers were in "listening mode" ahead of Chancellor George Osborne's autumn statement next month.

"I believe it is perfectly sensible and right to wait for the autumn statement, given the Government's record, given that they cut fuel duty last year and given that they have stopped two fuel duty rises," he told the House of Commons.

Labour's call to delay the tax hike until at least April next year was defeated by 282 votes to 234 - a majority of 48.

Mr Javid said: "The Government is doing all it can to help hard-working families with the cost of living and putting money back into their pockets.

"Action on fuel duty is part of this. Fuel duty is currently 20% lower in real terms compared to its peak in March 2000 and 7% lower compared to May 2010.

"If we had continued with the policies of the previous government, quite simply prices would be higher. Fuel would be 10p more expensive per litre.

"I know some will call for a further freeze in fuel duty today. I can assure them this Government understands the financial pressures hard-working families are facing.

"Subject to the constraints of the public finances, this Government is determined to help families with the cost of living."

Labour's Cathy Jamieson, the shadow economic secretary, said the fragile state of the economy meant it was "exactly the wrong time to hike fuel costs".

She said: "In the here and now petrol is 15p a litre higher than at the general election, it's 5p a litre higher than in the summer when the Government last deferred a rise, and let's remember that the Chancellor took that decision following pressure from this side of the House."

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Gas Prices: Watchdogs Probe Fixing Claims

The Financial Services Authority (FSA) and Ofgem are investigating claims by a whistleblower that Britain's wholesale gas market has been frequently manipulated by energy companies.

The allegations, revealed by The Guardian newspaper, suggest the £300bn market has been fixed in a way similar to the banks' fiddling of the Libor interest rate.

The FSA, the City watchdog, said: "We can confirm that we have received information in relation to the physical gas market and will be analysing that material."

Ofgem, the energy regulator, said it had also received information relating to trading in the gas market and is looking into the issue.

The allegations come as the energy sector is already under fire after major energy suppliers announced inflation-busting price rises.

It is understood the Treasury and the Department for Environment were alerted to the market manipulation claims by Ofgem and the FSA on Monday.

Energy Secretary Ed Davey said: "I am extremely concerned about these allegations and will be keeping in close touch with the regulators while they get to the bottom of this."

Ed Davey said he was "extremely concerned"

Mr Davey is expected to make a statement to MPs on Tuesday afternoon.

An Ofgem spokesman said: "In preparing for full implementation of new EU legislation (Remit) to tackle market abuse, we will consider carefully any evidence of market abuse that is brought to our attention as well as scope for action under all our other powers.

"Ofgem has already activated its established procedures to review the information we have received."

UK energy companies EDF Energy, NPower, SSE, ScottishPower, E.On and British Gas have all denied any involvement.

The whistleblower, Seth Freedman, works as a price reporter for ICIS Heren, a company responsible for setting so-called benchmark prices.

Mr Freedman raised the alarm after identifying what he believed to be attempts to distort the prices reported by the company.

ICIS said in a statement that it had "detected some unusual trading activity" on the British wholesale gas market on September 28, which it reported to Ofgem in October.

"The cause of the trading pattern, which involved a series of deals done below the prevailing market trend, has not yet been established," an ICIS spokesman said.

"ICIS welcomes the seriousness with which the regulator has so far responded to this information and we have provided all the evidence at our disposal to help the regulator determine what happened."

It is believed that on September 28 prices went down by about 0.4%.

Shadow energy secretary Caroline Flint said: "These are very concerning reports which, if true, suggest shocking behaviour in the energy market that should be dealt with strongly."

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Workers To Be Able To Ask For Flexible Hours

By Gerard Tubb, Sky Correspondent

New mothers will be able to share maternity leave with their partners and all workers will have the right to flexible hours under radical reforms.

Mothers will be able to share up to a year's leave with their partners once they have a baby, under changes to be announced by Deputy Prime Minister Nick Clegg.

Every employee in the country will also be given the right to ask for flexible hours to encourage different work patterns for parents and help more women back into work.

Mr Clegg believes that enabling relatives and friends of working parents to alter their working patterns will boost the economy.

The Government estimates around a million women are effectively locked out of employment because of problems balancing work and childcare.

The plans to allow anyone to ask for flexible hours are an extension of the rights introduced in 2009 for parents of children aged 16 and under.

They also mean that grandparents will be able to apply so that they can look after their grandchildren.

Under the changes, a mother could decide to stop her maternity leave at any point and hand over the rest of the year to her partner instead.

Parents will be able to "chop up" time between them or take time off together, as long as no more than 12 months is taken in total and no more than nine at guaranteed pay.

Fathers-to-be will also be given a legal right to take unpaid leave to attend two antenatal appointments.

Mr Clegg will claim that the plans could transform opportunities for young people who want to start a family.

"You won't get to 30 and suddenly have to choose - motherhood or work - because we're making the changes that give you a route back," he will say.

Mr Clegg rethought the reforms after being warned that extending paternity leave from the current two weeks would be too difficult for businesses.

Flexible leave will be reviewed by 2018 and extending paternity leave will be reexamined then, Mr Clegg is expected to say.

"These are major reforms and, at a time of continuing economic difficulty, it's sensible to do them in a number of steps, rather than one giant leap," he will say.

"More and more men are taking on childcare duties, or want to, and flexible leave builds on that."

A study last year of eligible parents showed 28% of women and 17% of men had asked to change their work patterns in the previous two years, with 80 to 90% of requests accepted.

At Odyssey Systems on Teesside, a telecommunications company with 30 employees, management says it has helped parents to change working hours, but extending the scheme to everyone will be a burden.

Sales director Christine Gilbert said: "We're still here because we think about customers first. To say that everybody in the whole company has to have flexible working is just going to be a massive managerial nightmare."

Adam Marshall, director of policy at the British Chambers of Commerce believes the new proposals could cause "unnecessary friction" in the workplace and "unrealistic expectations about the level of flexibility most businesses will be able to accommodate".

But the TUC welcomed the proposals, with General Secretary Brendan Barber describing them as common sense.

He said: "These reforms will make life easier for millions of working parents. Businesses will also benefit from a more engaged workforce and a larger pool of people to recruit from."

The entitlement to ask for flexible hours will be introduced in 2014 at the earliest and employers will have to provide good reason for refusing a request.

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Exclusive: Royal Mail To Deliver Float

By Mark Kleinman, City Editor

The Government is to begin sounding out City investors about their appetite to buy shares in Royal Mail ahead of a potential flotation of the postal service.

I have learned that ministers and the Shareholder Executive, the body which manages state-owned assets, have sanctioned a preliminary roadshow of major City institutions to begin in the new year.

The Government will wait until Royal Mail's Christmas trading performance is clear before commencing discussions with prospective investors.

On Tuesday, Royal Mail will unveil half-year results which are expected to show continued progress in restructuring the core UK letters division, which has seen tens of thousands of jobs axed in an attempt to secure the company's survival.

A decline in letter volumes accelerated by the explosion of the internet has only been partially offset by the growth in Royal Mail's parcels business.

Moya Greene, the Canadian chief executive of Royal Mail, is likely to confirm the plans for initial talks with City investors alongside the results.

A privatisation of Royal Mail would be arguably the most significant privatisation of a UK asset since John Major sold the railways during the 1990s.

Analysts say that a restructured Royal Mail could be worth as much as £4bn, although that figure is likely to be at the upper end of the range that a flotation could attract.

Ms Greene is also likely to reaffirm a ministerial commitment to make shares available to Royal Mail employees as well as the public.

A flotation is viewed in Whitehall as a more attractive option than an outright sale of the company because of the shortage of trade buyers and the political difficulties of negotiating a takeover by a financial investor such as a private equity firm.

Michael Fallon, the business minister, is taking a hands-on role in discussions about the potential sell-off.

Barclays is advising the board of Royal Mail, which is chaired by Donald Brydon, a leading City figure, with UBS advising the Government.

Royal Mail's finances have been knocked into shape by hiving off the company's historic pension deficit onto the taxpayer. The regulatory regime dictating stamp prices and other areas of its operations have also been loosened by Ofcom.

Royal Mail declined to comment.

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Greece Approves 2013 Austerity Budget

Greek MPs have approved the country's 2013 austerity budget - which involves fresh spending cuts.

The budget was passed by a 167-128 vote in the 300-member parliament.

It came days after a separate bill of deep spending cuts and tax hikes for the next two years squeezed through with a narrow majority following severe disagreements among the three parties in the governing coalition.

Prime Minister Antonis Samaras pledged that the spending cuts would be the last Greeks have to endure.

"Just four days ago, we voted the most sweeping reforms ever in Greece," he said.

"The sacrifices (in the earlier bill and the budget) will be the last. Provided, of course, we implement all we have legislated.

"Greece has done what it was asked to do and now is the time for the creditors to make good on their commitments."

Athens says that with the passage of the two bills, the next loan instalment, worth 31.5bn euros, should be disbursed. Without it, the government has said it will run out of cash on Friday, when 5bn euros worth of treasury bills mature.

Finance ministers from the 17-nation eurozone are meeting in Brussels later today, with Greece high on the agenda.

However, German finance minister Wolfgang Schaeuble has indicated it is unlikely that the ministers will decide on the disbursement at that meeting.

"We all ... want to help Greece, but we won't be put under pressure," Mr Schaeuble told the newspaper Welt Am Sonntag.

Mr Schaeuble said the so-called troika of debt inspectors would probably not deliver their report on Greece's reform programme by Monday. The creditors also want to see what the debt inspectors have to say about Greece's debt sustainability.

But speaking minutes before the vote, the prime minister pledged the bailout funds would be disbursed "on time".

Finance minister Yannis Stournaras also stressed the precariousness of Greece's cash reserves, with the treasury bills due on Friday.

"Without the help of the European Central Bank, the refunding of these treasury bills from the banking system will lead the private sector to complete suffocation," Mr Stournaras said.

Disbursement of the next instalment is essential "because the state's available funds are marginal, although better than expected because the 2012 budget is being executed better than expected," he said.

He added that the funds are needed to pay salaries and pensions, as well as for the import of medicines, fuel and food.

Greece is mired in a deep recession heading into its sixth year, with more than a quarter of Greeks unemployed.

Battered by a mountain of debt and a gaping budget deficit, Greece has been relying on international bailout loans from other eurozone countries and the International Monetary Fund since May 2010.

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Fuel Duty: Chancellor Osborne Under Pressure

Chancellor George Osborne may bow to demands and delay a planned fuel duty hike amid fears it will hit struggling families.

Tory rebels had been planning to break ranks and vote with Labour in an Opposition debate on Monday calling for the 3p increase planned for January to be delayed.

They believe the rise, first delayed in August, will ramp up anger because it is due to coincide with rail and bus far increases and the changes to child benefit.

But now rebel leader, Robert Halfon, has said he will vote with the Government after all and wait to see what Mr Osborne does in his Autumn Statement next month.

He said: "The cost of fuel is the number one issue, that's why I am campaigning on it. I have had discussions with various people and it is my view that the Government is in strong listening mode.

"If I didn't believe that I would make a point and go in to the lobby with Labour."

Under pressure: George Osborne

Campaign group FairFuelUK previously said it believes the tax hike could would raise only £800m, compared with Treasury projections that it would bring in £1.5bn. It could also cost as many as 35,000 jobs, it said.

The group will be campaigning at Parliament today ahead of the debate and vote in the Commons.

Its spokesman, broadcaster Quentin Willson, said: "The momentum building up behind FairFuelUK's call to see this damaging 3p rise scrapped is becoming unstoppable.

"The Treasury appears to be listening. We welcome Labour pushing on this issue. Consumers are currently paying an eye-watering 80p-per-litre in combined fuel duty and VAT.

"This is socially unjust and adding another 3p in tax doesn't make sense for economic recovery and deficit reduction."

Shadow chief secretary to the treasury Rachel Reeves added: "With our economy so fragile and prices still rising faster than wages, it would be wrong to go ahead with another tax rise on families and businesses.

"To boost our flatlining economy, Labour has already called for a temporary VAT cut which would take 3p off a litre of fuel. But if ministers won't do this, the very least they could do is axe January's fuel duty rise at least until April.

"And they could pay for this by clamping down on known tax avoidance loopholes, like the one used by some employment agencies to falsely inflate expenses."

A Treasury spokesman said: "The Government recognises that the rising price of petrol is a significant part of households' day-to-day spending.

"Since coming to office, the Government has listened to the concerns of motorists about high pump prices and acted. Fuel is now 10p a litre lower than under the previous Government's plans."

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Treasury Gets £35bn Windfall From QE Interest

The Treasury is to receive a £35bn boost as part of a deal with the Bank of England that will effectively reduce public debt.

Chancellor George Osborne and Bank Governor Sir Mervyn King have agreed that the BoE will give the Treasury interest earned through its £375bn economy-boosting programme known as quantitative easing (QE).

The cash - currently on the BoE's books - will flatter the public accounts by reducing the budget deficit, while also acting as a "small loosening of monetary conditions" equivalent to taking more QE action, according to the Bank.

The announcement comes a day after it decided not to extend QE at its monthly policy-setting meeting.

The Treasury said the agreement was in line with similar practices surrounding QE in the United States and Japan.

In a letter to Mr Osborne, Sir Mervyn stressed the cash transferred to the Government would likely need to be paid back to the Bank in the future.

The move comes at an apt time for Mr Osborne as he faces pressure on his plans to cut borrowing.

But JP Morgan Chase economist Malcolm Barr said it was "still likely" that the Chancellor will need to push back debt reduction targets in his upcoming autumn statement.

Shadow chief secretary to the Treasury Rachel Reeves said it was a "smoke and mirrors" deal.

"Instead of changing course and taking action to create the jobs and growth we need to get the deficit down. The Chancellor seems to think he can just be bailed out in the short term by money from the Bank of England," she added.

Under the arrangement, £11bn is expected to be handed to the Treasury this year, with the remaining £24bn paid in four instalments over the next financial year.

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Exclusive: Royal Mail To Deliver Float

By Mark Kleinman, City Editor

The Government is to begin sounding out City investors about their appetite to buy shares in Royal Mail ahead of a potential flotation of the postal service.

I have learned that ministers and the Shareholder Executive, the body which manages state-owned assets, have sanctioned a preliminary roadshow of major City institutions to begin in the new year.

The Government will wait until Royal Mail's Christmas trading performance is clear before commencing discussions with prospective investors.

On Tuesday, Royal Mail will unveil half-year results which are expected to show continued progress in restructuring the core UK letters division, which has seen tens of thousands of jobs axed in an attempt to secure the company's survival.

A decline in letter volumes accelerated by the explosion of the internet has only been partially offset by the growth in Royal Mail's parcels business.

Moya Greene, the Canadian chief executive of Royal Mail, is likely to confirm the plans for initial talks with City investors alongside the results.

A privatisation of Royal Mail would be arguably the most significant privatisation of a UK asset since John Major sold the railways during the 1990s.

Analysts say that a restructured Royal Mail could be worth as much as £4bn, although that figure is likely to be at the upper end of the range that a flotation could attract.

Ms Greene is also likely to reaffirm a ministerial commitment to make shares available to Royal Mail employees as well as the public.

A flotation is viewed in Whitehall as a more attractive option than an outright sale of the company because of the shortage of trade buyers and the political difficulties of negotiating a takeover by a financial investor such as a private equity firm.

Michael Fallon, the business minister, is taking a hands-on role in discussions about the potential sell-off.

Barclays is advising the board of Royal Mail, which is chaired by Donald Brydon, a leading City figure, with UBS advising the Government.

Royal Mail's finances have been knocked into shape by hiving off the company's historic pension deficit onto the taxpayer. The regulatory regime dictating stamp prices and other areas of its operations have also been loosened by Ofcom.

Royal Mail declined to comment.

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Chancellor Told To Halt Petrol Price Hike

George Osborne is under renewed pressure to abandon a planned increase in fuel duty, amid warnings that the rising price of petrol was putting household budgets under unprecedented pressure.

As MPs prepare to vote on Monday on the planned 3p a litre increase due in January, the consumer organisation Which? said more people than ever before were being forced to cut back on motoring costs.

It said its latest polling found a record 85% of people expressed fears about rising fuel prices - a nine point increase since July.

Those saying they would cut back on motoring costs rose seven points to 39% - another record high - while one in 10 said they had had to dig into their savings to cover their motoring costs.

Overall, one in three people said they were finding it difficult to live on their current income, with 33% also cutting back spending on the essentials last month. Getting on for half  - 44% - said they were planning to cut back on food and groceries in the coming months.

Which? said the figures showed 8.7 million households curbed their spending on essentials last month, while 6.4 million households dipped into their savings to cover their outgoings.

Which? executive director Richard Lloyd said: "Rising fuel prices are the number one consumer worry and people are already telling us they're having to cut back and dip into savings just to get by.

"On the back of inflation-busting energy bill rises and increasing food prices, consumers can little afford another hit on their household budget. We're calling on the Government to think again about their plans to increase fuel duty in January.

"The forthcoming Autumn Statement must focus on measures that will help put money back in the pockets of consumers, because the economic recovery is at risk if we don't increase consumer confidence."

For Labour, shadow treasury minister Cathy Jamieson said: "Families, pensioners and businesses are still feeling the squeeze. Labour will vote on Monday for a delay in this fuel duty increase at least until next April."

A Treasury spokesman said: "The Government recognises that the rising price of petrol is a significant part of households' day-to-day spending.

"Since coming to office the Government has listened to the concerns of motorists about high pump prices and acted. Fuel is now 10p a litre lower than under the previous government's plans."

:: Pollsters Populus interviewed 2,100 UK adults on behalf of Which? online between October 26 and 28.

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