Home Ownership '£1,440 Cheaper' Than Renting

The cost of buying a home has become £1,440 a year cheaper than renting, according to new research.

Halifax found the average monthly costs associated with buying a three-bedroomed house stood at £621 in December, which is £120 cheaper than the typical monthly rent of £741 on a similar property.

The latest figures are an about-turn from December 2008, when buying a home was £217 a month more expensive than renting.

In recent years the gap has widened amid house price falls and record low interest rates which have made borrowing cheaper for those who can get access to a mortgage.

Meanwhile, increased demand in the rental sector from those struggling to raise a deposit or meet lenders' borrowing criteria has pushed up rental costs.

Home buying costs have declined by one third (34%) over the past four years, while average monthly rents have been pushed up by 14%, the study found.

The gap between buying and renting has widened by £21 a month over the past year. At the end of 2011, the monthly cost of home buying was £99 lower than renting.

Buying was found to be more affordable than renting in every UK region.

Buying is most affordable compared with renting in London, where the monthly difference is £193, while in Yorkshire and the Humber buying is just £1 a month cheaper than renting, Halifax found.

Martin Ellis, housing economist at Halifax, said that while the "financial attractiveness" of buying a home has improved in recent years, the tough economy is still holding would-be home buyers back.

He said: "Concerns over job security and raising a deposit are the main obstacles to people buying their own home. However, it is worth noting that once home buyers are on the first rung of the ladder, their monthly costs are notably lower."

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Horsemeat: Farmers In 'Buy British' Campaign

By Clare Fallon, Sky News Reporter

Farmers are hitting back after the horsemeat scandal with a new campaign urging consumers to 'Buy British'.

The National Farmers Union (NFU) has taken out adverts in 10 national newspapers, saying it is championing British produce as a direct response to the contamination and mislabelling of some beef products.

According to NFU President, Peter Kendall, British farmers feel let down.

"Farmers are very proud of what they produce and are, quite rightly, furious about this current situation. They feel let down by what looks like a criminal element in an isolated part of the food chain," he said.

The advertising campaign comes after the Food Standards Authority (FSA) raided the premises of more British companies.

Two sites in Tottenham, North London and one in Hull in Yorkshire were searched by FSA officials, who removed computer equipment and took away meat samples to be analysed.

One of the businesses being investigated is Dinos & Sons Continental Foods.

The company released a statement saying it is co-operating with officials, adding: "At no time has Dinos & Sons produced or manufactured anything that is under investigation or is the subject of any possible contamination or mislabelling."

The raids came as three men who were arrested on Thursday remain in police custody on suspicion of offences under the Fraud Act.

Dafydd Raw-Rees, 64, the owner of Farmbox Meats near Aberystwyth, and a 42-year-old man were arrested in Wales.

A 63-year-old man was also arrested on suspicion of the same offence at Peter Boddy Slaughterhouse in Todmorden, West Yorkshire.

Both plants were inspected on Tuesday by the FSA.

After test results revealed around 1% of products checked contained a significant amount of horse meat, Environment Secretary Owen Patterson insisted he wants all other tests to be completed by the end of next week.

"It's up to the food businesses to carry out the tests, to organise their businesses and to provide quality products," Mr Patterson told Sky News.

The problem has gone beyond supermarket bought burgers and lasagnes - hotels, restaurants and pubs have also been affected after confirmation from Whitbread, which owns Premier Inn, Beefeater Grill and Brewers Fayre, that horse DNA has been found in its food.

Cottage pie served to children at 47 schools in Lancashire has also tested positive and has now been removed from menus.

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Chancellor Calls For Global Tax Crackdown

George Osborne has renewed his call for international action to tackle so-called "profit shifting" by multinational companies.

The Chancellor revealed the next steps in his fight to reform global tax rules ahead of meeting other finance ministers at the G20 in Moscow.

Calls for an overhaul of tax laws, including the controversial transfer pricing rules that were written almost 100 years ago, will be highlighted at the G20 by the Organisation for Economic Co-operation and Development (OECD), which will present its report published this week.

It comes as companies such as Google, Facebook, Amazon and Starbucks have sparked controversy after it emerged that they all pay minimal tax on large UK revenues.

The Chancellor will announce that Britain will chair a new transfer pricing group which will look at how to reform the system which allows profits to be diverted to a parent companies or to lower tax jurisdictions, via royalty and service payments.

It is one of three groups set up by the OECD to look at the tax issues which will help the group prepare a "plan of action" to be put forward to the G20 in July.

Germany and the US and France also lead the other two groups, which will include looking at how to determine tax jurisdiction, particularly in the context of e-trading.

Mr Osborne said: "Britain has cut its corporation tax rate by more than any other country in the G20 over the past two years, a message to the world that we are open for business that has seen companies return to Britain, and helping to create and secure thousands of jobs and millions in investment.

"But our commitment to the most competitive corporate tax system goes hand in hand with our call for strong international standards to make sure that global companies, like anyone else, pay the taxes they owe.

"That's why the Britain, with Germany and France, asked the OECD to scrutinise the international rules, and we will together welcome their report to the G20 this weekend. The report shows this is an international issue that requires international action.

"It shows the global economy has changed massively over the last decade, but global tax rules have stood still for almost a century, and Britain will lead the international effort to bring them into the 21st century."

In an interview with Sky News, Mr Osborne went on to dismiss newspaper reports that a pre-election RBS share giveaway was under consideration.

Scandal-hit RBS - which is 81% state-owned after a £45bn bailout in 2008 - could be ready for privatisation this year, but at present prices that would mean a huge public loss.

The Liberal Democrats have championed the idea of a share giveaway and it was reported today that Conservative ministers were also now examining the idea of handing it back to taxpayers.

Party sources told the Independent and Daily Mail that Mr Osborne saw continued ownership as politically "untenable" amid Libor-fixing and other scandals and was keen to end the state's role soon.

But the Chancellor said the idea was "premature" and not something the Treasury is currently looking at.

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G20 Meets Amid Fears Over Currency Wars

Finance ministers of the G20 nations are meeting in Moscow amid fears of an increased risk of 'currency wars'.

Friction has occurred over the Japanese yen and government policy which has driven down the value of the yen - making it more competitive - in recent months.

The G20 forum, which put together a huge financial backstop to halt a market meltdown in 2009, is back in the spotlight after a week in which the Group of Seven (G7) rich nations tried, and spectacularly failed, to speak on currencies with one voice.

Japan's Prime Minister is attempting to end two decades of deflation

The G7 has long been the powerhouse of financial diplomacy, but tension between Washington and Tokyo has risen over new Prime Minister Shinzo Abe's bid to end two decades of deflation.

The group issued a joint statement last Tuesday reaffirming "our longstanding commitment to market determined exchange rates".

Yet the show of unity was quickly undermined by off-the-record briefings critical of Japan.

Hosts Russia say the G20 - which includes leading emerging markets and accounts for 90% of the world economy - will back the thrust of the G7 text when they issue their communique on Saturday.

Russia's finance "sherpa",deputy finance minister Sergei Storchak, said the drafting discussion was proving "difficult", but the final text would not single out Japan for criticism.

"There is no competitive devaluation, there are no currency wars," Mr Storchak said.

"What's happening is market reaction to exclusively internal decision making."

When the G20 last met in November, its statement contained a call to "refrain from competitive devaluation of currencies".

That was omitted by the G7 in what Tokyo took to mean its policies had won a free pass.

"As the G20 meeting in Moscow gets underway, the battle lines are drawn - it isn't 'G6 against Japan' as much as it is 'G7 against G13'," French bank Societe Generale said in an analysis note.

The United States, G20 delegation sources said, was blocking attempts to agree on a commitment to cut borrowing to replace a collective pledge to halve budget deficits agreed at the G20 Toronto summit in 2010.

The so-called Toronto goal expires this year.

Meanwhile, the eurozone's largest economy, Germany, and the European Central Bank, want a new borrowing pledge - in line with their own tough medicine for the currency bloc's ailing periphery.

The manoeuvring on currencies is reminiscent of the 1980s, when two accords sought to manage first the excessive strengthening, and then weakening, of the US dollar.

But, with the collapse of communism in eastern Europe and China's adoption of its own brand of capitalism, the world has changed.

Empowered emerging markets now demand a greater say in global financial management - especially after the Western-led global financial crisis.

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Horsemeat: Test Results Expected On UK Meals

Test results for horse meat in British processed meals are due today - as detectives continue questioning three men over the scandal.

The Food Standards Agency (FSA) will report on the UK products after asking retailers and suppliers to provide "meaningful results" from tests to detect the presence of horse meat in processed meals labelled as beef.

The FSA said it wanted the food industry to show the food it sells and serves is what it says it is on the label.

The test results, for significant levels of horse meat, will come from all beef products such as burgers, meatballs and lasagne.

Prime Minister David Cameron reportedly believes supermarkets have been too silent on the scandal.

A senior No10 source told the Daily Telegraph: "It is not acceptable for retailers to remain silent while their customers have been misled.

"The supermarkets need to justify their action and reassure the public."

The eagerly-awaited test results will emerge as police in Wales probe three men arrested on suspicion of offences under the Fraud Act.

Some butchers have used the horsemeat scandal to boost their trade

The trio were taken into custody from two plants inspected and temporarily shut down by the FSA on Tuesday.

Sources said Dafydd Raw-Rees, 64, owner of Farmbox Meats near Aberystwyth, was arrested along with a 42-year-old man.

A 63-year-old man was also arrested on suspicion of the same offence at Peter Boddy Slaughterhouse in Todmorden, West Yorkshire.

On Wednesday, owner Mr Boddy, 63, said he had done nothing wrong and insisted the FSA inspection was merely to look at his records, but was last night unavailable for comment.

His firm is also contracted to remove fatally injured horses from the Grand National.

It removes the carcasses of some horses which have been put down during the world famous meeting, Aintree Racecourse, and said it was "confident" no unfit meat had entered the food chain.

The arrests were made by Dyfed-Powys Police in a joint operation with the FSA.

The two plants became the first UK suppliers suspected of passing off horse meat for beef.

Production at both plants was suspended pending the outcome of investigations into claims they supplied and used horse carcasses in meat products purporting to be beef for burgers and kebabs.

The FSA said on Tuesday it had "detained" all meat found at the premises and seized paperwork and customer lists from the two companies.

Last night's arrests were made as Asda withdrew its 500g beef bolognese sauce from shelves after tests revealed the presence of horse DNA, the supermarket chain said.

The company apologised to customers and said it was taking a "belt-and-braces approach" by removing a further three beef products made by the same supplier, the Greencore plant in Bristol, as a precaution.

Yesterday it emerged a significant amount of horse meat containing the painkiller phenylbutazone - or "bute" - could have been entering the food chain for some time.

Authorities in Britain and France are trying to trace the carcasses of six horses contaminated with bute - which were slaughtered in a UK abattoir and may have entered the human food chain across the Channel.

The drug, which is potentially harmful to human health, was detected in eight horses out of 206 tested by the FSA in the first week of this month.

Two were intercepted and destroyed before leaving the slaughterhouse but the other six were sent to France, where horse meat is commonly eaten.

Announcing the results of the bute tests in the House of Commons yesterday, agriculture minister David Heath said the Government had instigated the "biggest investigation ever" into criminal activity in Europe over horse meat contamination of beef products.

FSA chief executive Catherine Brown said the agency increased testing of horse carcasses over a three-month period last year after intelligence from abattoirs suggested bute was getting into the food chain.

Of 63 tested - amounting to 5% of all carcasses - four (6%) tested positive for the painkiller, prompting the FSA to start testing 100% of horse meat in January, which revealed the eight contaminated carcasses.

Ms Brown said: "That would say there has been a significant amount of carcasses with bute going into the food chain for some time."

However tests on Findus processed beef products withdrawn from sale in the UK after the discovery of traces of horse meat found no evidence of the substance.

Chief Medical Officer Dame Sally Davies downplayed the risk saying: "If you ate 100% horse burgers of 250g, you would have to eat, in one day, more than 500 or 600 to get to a human dose."

The highest level of bute found in tests was 1.9 milligrammes per kilo of meat.

Ms Brown said both vets and horse owners have to sign horse passports if an animal is treated with bute, to ensure it is not subsequently sold on for human consumption.

"If both these people have done the right thing, horses with bute in don't make their way into the food chain," she said.

"Someone has always broken the rules."

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Crippled Carnival Cruise Ship Finally Docks

Thousands of passengers stranded on a crippled cruise ship for nearly a week have finally docked in Alabama.

There were cheers as the Carnival Triumph finally docked in Mobile, Alabama, after its first attempt failed when the towline being used to manoeuvre it into position snapped.

Passengers were slowly disembarking from the ship in a process that Carnival officials said could take as long as five hours.

Many then face long journeys home after days enduring what the company's Chief Executive admitted were "poor conditions".

What began as a four-day voyage in the Gulf of Mexico last Thursday has turned into a holiday nightmare. Passengers have described overflowing toilets and say food has been scarce and some of those on board have become unwell.

Speaking as the 14-storey ship docked, Carnival Chief Executive, Gerry Cahill, said that his priority was to go on board to apologise and to help passengers disembark as quickly as possible.

Relieved passengers begin to disembark from the Carnival Triumph

He said: "I know that the conditions on board were very poor. I know it was very difficult and I want to apologise again for subjecting our passengers to that.

"We pride ourselves on providing our guests with a great vacation experience but clearly we failed in this particular case."

The ship left Galveston, Texas, for a four-day cruise last Thursday. It was about 150 miles (240 km) off Mexico's Yucatan Peninsula when an engine room fire knocked out its primary power source, crippling its water and plumbing systems and leaving it adrift on only backup power.

Frustrations with the cruise line were simmering on and off the ship, as passengers and their relatives questioned why it has taken so long to get back to dry land.

Renee Shanar, of Houston, said from her mobile phone: "There's poop and urine all along the floor. The floor is flooded with sewer water ... and we had to poop in bags."

Ms Shanar, who is on the ship with her husband, said the couple had a cabin with no windows, so they have been sleeping outside for days. She said food has been distributed on the ninth floor, and some of the elderly have needed younger people to bring it to them.

A relative waiting at Mobile talks to a passenger on the ship

They were initially only given cold cuts, like turkey and vegetable sandwiches. Then another cruise line dropped off hamburgers and chicken sandwiches, but the line for that fare was nearly four hours long.

"And then people started getting sick from the food," she said.

The company has disputed the accounts of passengers who describe the ship as filthy, saying employees did everything to ensure people were comfortable.

Carnival said that passengers would receive a full refund, discounts on future cruises and a compensation sum of $500 (£322).

Carnival Corp Chairman and CEO Micky Arison faced criticism in January 2012 for failing to travel to Italy and take personal charge of the Costa Concordia crisis after the luxury cruise shop operated by Carnival's Costa Cruises brand grounded on rocks off the Tuscan island of Giglio.

The tragedy unleashed numerous lawsuits against his company.

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Republic In Administration As Website Shuts

Fashion retailer Republic has gone into administration and closed its website, putting 2,500 jobs at risk.

The normal website was replaced with a headline saying "Site Unavailable", along with a message from the joint administrators. 

Customers vented their frustration on social media outlets.

So-called onesies were popular at Christmas

The firm, which operates 121 stores across the UK with a stronger presence in the north of the country, has appointed administrators Ernst & Young to sell the business while it attempts to trade.

It has already made 150 employees redundant at the head office in Leeds.

Speaking to Sky News about the Republic redundancies, Chancellor George Osborne said: "It is always very, very sad news when a retailer goes bust and people lose jobs.

"We are going to work hard to make sure they have jobs to go to."

Republic is owned by private equity firm TPG.

The investment firm's website still promotes Republic as "one of the United Kingdom's top young adult fashion retailers".

Staff tweeted a message after the move to administration.

It said: "Sadly #Republic is now in the hands of Administrators. We did all we could but it's simply too tough out there. Thanks for your support."

Republic was still promoted on owner TPG's website entering administration

On Tuesday, Sky News City Editor Mark Kleinman revealed the retailer was poised to enter administration.

But hours later it still promoted itself as a viable concern with a tweet about its all-in-one outfits.

The tweet said: "We are indeed your one stop Onesie shop. And if you play our #RepublicRomance game you can get 10% off."

Hunter Kelly, head of corporate restructuring team at Ernst & Young, said: "Republic suffered poor trading results in the autumn, and whilst sales picked up in December there has been a sudden and rapid decline in sales in late January.

"The impact on cash flows has resulted in the business being unable to continue to operate outside of an insolvency process."

Republic began as a men's denim retailer in 1986 under the Best Jeans brand, and sells brands including Diesel, Firetrap and G-Star Raw.

Republic's demise is the latest in a string of British high street casualties in the last six months.

Music and entertainment retailer HMV, DVD rental firm Blockbuster and camera specialist Jessops have all gone into administration this year.

In October, electricals chain Comet also called in administrators.

Mr Osborne is aware of the trend in retail of increasing web-based purchases and its affect on the retail sector.

He told Sky: "I think you are seeing changes on our high street, a lot of clothing is sold online now so we are seeing changes in the way people shop in this country."

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Meat Scandal: Call For EU Tests On Beef

One in five people have changed the way they shop as a result of the widening meat scandal, according to a poll carried out by YouGov for Sky News.

Of those who are buying differently, 58% said they had completely abandoned processed meats.

A third of the nearly 2,000 people surveyed said they had stopped buying cheap ranges and now favour more expensive processed meat.

As for who they blamed most, nearly half - 49% - said meat processors were most at fault, while one in five said food manufacturers carried responsibility.

But supermarkets seem to be largely off the hook, with only 10% of people saying they are to blame and even fewer pointing the finger at the Food Standards Agency (FSA) or the Government.

One shopper told Sky's Tom Parmenter she now refuses to buy processed ready meals for her two children.

Sharon Cummins, from Slough, said: "It is affecting everybody because it is all just lies.

"The thought of eating something like a horse - it is there, that picture is in your head: What am I eating?

"You just don't know, it could be school dinners next."

Police and FSA officials raided the Farmbox Meats site in northwest Wales

EU nations have now been urged to begin widespread DNA testing to check processed beef products for contamination with horsemeat.

There should also be tests for the presence of the veterinary painkiller known as "bute", which causes cancer in humans and is banned from the food chain, European health commissioner Tonio Borg said.

The problem was being treated as a fraud issue rather than one of food safety, he said.

Earlier British Environment Secretary Owen Paterson, who attended a summit in Brussels on the scandal, warned those guilty of passing off horsemeat as more expensive beef would face the "full force of the law".

Two British firms have been shut down following raids by the FSA and police. They swooped on Peter Boddy slaughterhouse in Todmorden, West Yorkshire, and meat processing plant Farmbox Meats in Llandre near Aberystwyth, west Wales as part of an audit.

The companies had records seized and have been temporarily closed. The firms' owners deny any wrongdoing.

At Farmbox, Sky News saw large crates of meat - some covered by tarpaulin and others open - left in outdoor areas during Tuesday night, before they were removed.

Until now, meat linked to the scandal had been thought to have come from suppliers in continental Europe, but for the first time it appears the contamination may also come from British premises.

David Cameron described the situation as "appalling" and "completely unacceptable".

Meanwhile, Waitrose announced it has withdrawn its beef Essential British Frozen Meatballs after pork was found in two batches. The supermarket said they were made at the ABP Foods-owned Freshlink factory in Glasgow last summer.

Tesco has become the latest retailer to drop a major supplier after discovering a range of spaghetti bolognese ready meals contained more than 60% horsemeat.

Morrisons chief executive Dalton Philips has told Sky's Jeff Randall the chain could not be 100% sure about the content of all of its beef products, but he said its checks are rigorous and it has "extremely high" confidence.

While supermarkets rush to reassure shoppers, independent butchers have been reporting a significant surge in business.

The Butchers Q Guild has reported a 30% spike in sales of products such as burgers and sausages.

The meat scandal erupted last month after tests in Ireland showed products labelled as beef contained up to 100% horsemeat.

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Rolls-Royce's Profit Boosted By Strong Orders

Strong growth at Rolls-Royce's civil aerospace unit has helped it report a strong rise in profit for 2012.

The aircraft engine maker also confirmed BP director Ian Davis as its new chairman - as revealed by Sky News' City Editor on Wednesday.

Mr Davis, a former partner at management consultancy McKinsey, replaces Sir Simon Robertson as head of the company's board.

It comes after months of uncertainty about its leadership following corruption allegations relating to payments made by its subsidiaries in China and Indonesia.

Rolls-Royce said underlying pre-tax profit was up 24% at £1.4bn in 2012 - an increase for the tenth year in a row. 

Its order book increased by 4% over the year, boosted by £10.3bn of new civil aerospace orders.

Chief executive John Rishton said: "The strength of our order book demonstrates the confidence our customers have in our products and services.

"In 2013, we expect modest growth in underlying revenue and good growth in underlying profit with cash flow around break even as we continue to invest for the future."

More follows...

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Horsemeat Scandal: UK Slaughterhouse Raided

The Food Standards Agency has raided a slaughterhouse allegedly involved in supplying horsemeat labelled as beef.

The FSA has shut down Peter Boddy Licensed Slaughterhouse in Todmorden, West Yorkshire, while it investigates allegations that it supplied horse carcasses to a meat business in Wales.

Officers from West Yorkshire and Dyfed-Powys police accompanied the FSA as they seized meat and paperwork from the Yorkshire abattoir and Farmbox Meats Ltd in Llandre, Aberystwyth.

The FSA and police are looking into the circumstances through which meat products, purporting to be beef for kebabs and burgers, were sold, which were in fact horse.

The FSA has suspended operations at both sites while it investigates the first suspected instance of a UK abattoir passing off horsemeat as beef.

Meanwhile, Waitrose has announced it is clearing the shelves of its Essential British Frozen Beef Meatballs after pork was detected in tests on two batches.

Environment Secretary Owen Paterson said he expects tough action to be taken against any business that has broken the law.

He said: "This is absolutely shocking. It's totally unacceptable if any business in the UK is defrauding the public by passing off horsemeat as beef.

"I expect the full force of the law to be brought down on anyone involved in this kind of activity."

Slaughterhouse owner Peter Boddy, who denied that the FSA visit amounted to a "raid", told Sky News: "I have not been supplying meat to Farmbox. I don't know who they are."

Farmbox Meats Ltd has also denied any wrongdoing.

In an interview with Sky News, FSA Director of Operations Andrew Rhodes said: "We acted on excellent evidence, which includes the traceability of where products go from one location to another.

"I'm very confident that the information we have used and what we have obtained is evidence that something has happened which should not have been."

The raids came after a respected food scientist warned that lamb ready meals and other products may contain horsemeat and should be tested.

Mr Paterson today met representatives of supermarkets and food suppliers to discuss the growing scandal of horse meat mislabelled as beef.

Joining officials from the Food Standards Agency, he talked to the Institute of Grocery Distribution, which represents food retailers and suppliers, to discuss plans for a new regime of quarterly testing of products.

Results of tests into the extent of contamination of beef products are expected on Friday.

The Environment Secretary will travel to Brussels tomorrow to discuss the scandal with counterparts in EU countries.

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Horsemeat Crisis To Widen, Findus Backer Says

By Mark Kleinman, City Editor

The management of Findus UK has been slow to react to the scandal over contaminated ready-meals and has dealt incompetently with the public relations aspects of the crisis, according to one of the company's main shareholders.

In an exclusive interview with Sky News, Lyndon Lea, a partner at the private equity firm Lion Capital, complained that he had learned of the contamination of Findus beef lasagne with horsemeat three days after the products had been withdrawn from supermarket shelves.

"We were notified by the chairman of the company as a shareholder on Wednesday February 6 and the information passed was that there was a labelling issue on some Findus beef products," he said.

"Later that afternoon it was disclosed that the labelling issue was in fact horsemeat. I found out the following day."

Mr Lea, a prominent investor in British companies and a former owner of Wagamama, the restaurant chain, and Weetabix, the breakfast cereal, questioned Findus's approach to the crisis.

"Within hours [of finding out] I sent an email to the chairman stating that Findus needed to step forward and accept responsibility, apologise to the consumer, restore trust in the brand and be very visible in managing this crisis," he said.

"Findus took advice from its public relations adviser, Burson Marsteller, who gave exactly the opposite advice and felt that this was an industry issue and not a Findus issue."

Lyndon Lea was a co-founder of Lion Capital in 2004

Lion Capital acquired Findus in 2008 in a deal worth £1.1bn but ceded control of the business as part of a financial restructuring last year.

JP Morgan, the Wall Street bank, and Highbridge, a hedge fund manager it controls, now own two-thirds of Findus between them.

Mr Lea, who does not sit on the Findus board, said the company had managed the technical elements of the horsemeat issue capably but said the chairman, Dale Morrison, had compounded the crisis by not handling the reputational aspects in the same way.

Although Lion now owns only one-third of Findus' shares, Mr Lea ruled out a fire-sale of his firm's stake.

"I am enormously frustrated, yes. In any Lion-controlled investment we would not have handled the PR in the manner it has been handled by Findus," he said.

"We believe in the investment, we believe it is a good business, and we wouldn't look to any quick sale of our stake. It does, though, give me pause for thought about ever putting myself in a minority [investment] position again."

The Lion Capital partner said he suspected that "criminal activity" was behind the horsemeat scandal and denied that cost-cutting related to the financial restructuring of Findus was to blame.

"I don't think that's the case at all. If that were the case then what we're seeing more broadly in the food chain we would not be seeing," he said.

"Clearly, Tesco is not a private equity-owned company, and they're also having the same issues. Where there is intent and criminal activity, it is very hard to legislate for that."

And Mr Lea insisted that he would be comfortable with members of his family eating Findus beef-based ready-meals.

"Absolutely, I think it's very important to draw a distinction here. There have been no food safety or health issues reported with the consumption of horsemeat," he said.

"It's not something I or many people in the UK would choose to consume but there are no health issues with it, so on that basis, yes."

Mr Lea, who rarely gives interviews, also said Lion had launched its own probe into the issue but cautioned that this was at an early stage.

"Comigel supplied to Findus product that was contaminated. Logic would say that liability resides with Comigel," he said.

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UK To Avoid Triple-Dip Recession, Says CBI

Despite cutting its growth forecast for this year, the CBI has said it believes the UK is in the clear when it comes to a triple-dip recession.

However, the leading business body expects the UK economy will grow 1% in 2013, less than its previous estimate of 1.4%.

It warned of the potential for a new "flare-up" in eurozone tensions, which would hold back confidence and keep growth in check.

Bu, a rise in job vacancies and an improvement in business sentiment since its last forecast suggested the economy would avoid another recession and grow 0.3% in the first quarter of this year.

CBI director-general John Cridland said: "We are beginning to see the return of organic growth, with clear signs that firms offering the right products into the right markets are growing sales and expanding.

"Recent business surveys also give grounds for cautious optimism about our forward prospects."

The CBI predicts that UK exports will be stronger this year.

Hopes that Britain will avoid another recession have also been boosted by recent surveys which showed the services sector returned to growth and manufacturing output rose at its fastest pace since September 2011 in January.

The CBI is forecasting that inflation will edge higher until mid-2013, but will fall back in the second half of the year, and will be close to the Bank of England's 2% target throughout 2014.

On another positive note, UK exports will be stronger this year, with the global economy likely to grow faster as growth in China picks up and the US economy continues its "relatively solid, if unspectacular recovery".

But conditions will still be difficult for households in 2013, given weak growth in household spending power and unemployment at around 7.8%.

Unemployment levels are unlikely to change significantly over the forecast period, at 2.5 and 2.42 million in 2013 and 2014 respectively.

Next year, the CBI is expecting growth of 2%, unchanged from its November forecast, whilst quarter-on-quarter growth is expected to be modest at around 0.5-0.6%.

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RBS Chairman: Stephen Hester's Pay 'Modest'

Stephen Hester, the chief executive of Royal Bank of Scotland (RBS) is doing one of the toughest jobs in world business and is being paid a "modest" salary compared to his peers, MPs have been told.

Chairman of the bank, Sir Philip Hampton, said the chief executive was doing the most difficult job in the industry, and his pay was relatively small.

Mr Hester also mounted a robust defence of his performance, insisting he had managed to get the taxpayer "off the hook" for huge liabilities over the past four years.

The comments came as the bosses were questioned by the Parliamentary Commission on Banking Standards at the House of Commons.

Sir Philip told the panel: "I don't think it is hyperbole to say that Stephen is doing one of the most difficult and challenging, demanding jobs in world business ... because RBS was the biggest banking failure in the world and Stephen took it on at an exceptionally difficult time.

"He is also in his four years in charge being paid well below the market rate for a job in world banking."

He said Mr Hester's basic salary is around £1.2m a year, plus a pension contribution of around £400,000.

The CEO is also in line for an annual bonus of up to £2.4m and a long-term bonus of more than £4m - although Sir Philip stressed that the company had not performed well enough to trigger the full sum.

RBS was bailed out in 2008, and the Government now owns 82% of the bank

"These are very large amounts of money, none of which I hasten to add is triggered, so these are theoretical amounts which Stephen has not received anywhere remotely close," he said.

"So he has been doing one of the most challenging jobs and he has been one of the least well-paid.

"These are still very large amounts of money clearly by most standards - but relative to other people doing these jobs his pay has been modest, relatively."

The session came less than a week after the bank was fined £390m by regulators in the UK and US for its part in rigging the Libor inter-bank lending rate.

Around £300m of this penalty will be clawed back from the bonus pool at RBS, which is 82% owned by the taxpayer.

Some 21 staff have left or are going through disciplinary proceedings in the wake of the revelations.

John Hourican, the head of the bank's investment banking arm, who was brought in to rescue the business after it was bailed out in 2008, is to forfeit around £4m in share options awarded to him based on past performance.

However, he will leave the bank with 12 months' pay worth £775,000 as he resigns over its involvement in the Libor-rigging scandal.

In a memo to bank staff obtained by Sky News, he said he bore "some responsibility" for misconduct, despite having no involvement in, or knowledge of, efforts to rig Libor submissions by RBS staff.

Commission chairman Andrew Tyrie said Mr Hourican had "paid a high price" - and asked Mr Hester if he thought there was a case he too should pay with his bonus.

Mr Hester said his bonus should be assessed on a broad range of issues, not just Libor.

"I think that my bonus should be assessed on all of the things I do well and badly," he said.

"And judgement should be reached in the round. Obviously it's not me that makes a judgement - it is the chairman and board.

"If you look at the RBS that we took on four years ago or so, we have done huge things to rescue a situation for the company and for society and for its different stakeholders, which includes hundreds of billions of pounds of risk that the country was exposed to, that it isn't exposed to anymore.

"So I think it is entirely proper for me and the board and the management team to be assessed on the things that we have done and the things we have not done.

"I believe that this nation is off the hook of a lot of bad things, but not yet all the way off the hook.

"There was never any prospect we could have discovered everything immediately, or fixed everything immediately, but we must of course be accountable for the balance of what we discovered, what we fixed, and in what period."

Earlier, Mr Hourican told the cross-party commission: "I do accept responsibility for the behaviour of our staff and therefore I accept responsibility for the failings that we have found.

"It is important that we do not talk about accepting responsibility and then not do so in our actions. That is why I have resigned."

Head of RBS Group's markets division, Peter Nielsen, said he also contemplated quitting.

"Of course I contemplated resigning," he said. "Indeed John and I talked about it. We talked about myself going instead of him."

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Heathrow 'Ticket Price Rise' Under £3bn Plans

Officials at Heathrow Airport have announced £3bn of investment in a move that is likely to leave passengers paying higher prices.

The proposals include the opening of the new Terminal 2 next year, improved check-in and baggage facilities, and more customer service training for staff.

The airport wants regulators to approve a five-year plan which will see the fees it charges airlines to use the airport rise over the period 2014 to 2019.

If approved, the charges would increase from the equivalent of £19.33 per passenger for 2012/13 to as much as £27.30 in 2018/19.

Heathrow accounts for 78% of all long-haul flights from the UK.

The charges, which need to be approved by the Civil Aviation Authority (CAA), will help pay for the investment.

Heathrow chief executive Colin Matthews said: "Heathrow is the UK's only hub airport and a strategically important national infrastructure asset. Heathrow faces stiff competition from other European hubs and we must continue to improve the service we offer passengers and airlines.

"We have invested billions of pounds in new facilities such as Terminal 5 in recent years and passengers say they have noticed the difference.

"Our plan for a further £3bn of private-sector investment will further improve the airport for passengers.The plan represents good value for money for airlines and passengers and comes at no cost to taxpayers."

British Airways is concerned about the price rises

He said the airport envisaged passenger numbers increasing from just under 70 million now to around 72.6 million by 2018/19.

Asked about the possibility of a third runway, Mr Matthews said that with all that would be need to be done in terms of political decisions and planning there was unlikely to be "any shovel going into the ground realistically for the period we are talking about (2014 to 2019)".

He said that the proportion of Heathrow passengers rating their journey as very good or excellent had increased from 48% in 2007 to 72% today.

While airlines have supported plans for better customer service they have concerns about the rise in charges.

British Airways said: "Heathrow Airport's charges have already tripled over the past 11 years. The charges must be reduced significantly over the coming years, especially when the airport is cutting investment by around 25% from next year onwards.

"We hope the regulator (the CAA) will give a fair ruling in the months ahead, which doesn't penalise customers and airlines."

Virgin Atlantic chief operating officer Steve Griffiths said: "We are totally committed to improving the passenger experience at Heathrow.

"However, we believe this can be done without a repeat of the incredibly steep price rises we have seen in airport charges in the last few years.

"Prices at Heathrow are triple the level they were 10 years ago. Clearly this is a concern for all passengers travelling through Heathrow, and all airlines operating there."

Heathrow's flight punctuality - the number of planes taking off or landing within 15 minutes of schedule - was only around 67% in 2007.

It has now gone up to 80% and the airport wants this figure to increase to 90% by the end of the decade.

Its chiefs said that while 4% of bags went missing in 2007, this figure is now down to 1.5%.

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Barclays Cuts 3,700 Jobs Despite Profit Hike

Barclays announces 3,700 job cuts amid plans to cut £1.7bn in annual costs and improve standards.

Of these job losses, 1,800 will be in its corporate and investment bank and 1,900 will be in European retail and business banking.

Sky News revealed on Monday that thousands of jobs would go outside its investment bank as part of a streamlining programme overseen by the company's new chief executive Antony Jenkins.

It comes as the bank - Britain's second largest - said adjusted pre-tax profit was £7.048bn over the 12 months to the end of December - up 26% on 2011.

Its staff bonus pool for 2012 was down 16%, with staff at its investment bank getting an average of £54,100 and other employees receiving £13,300.

Mr Jenkins, who become Barclay's chief executive five months ago, is due to announce the outcome of a strategic review this morning,

As part of the overhaul, the group's total cost base will be reduced by £1.7bn to £16.8bn in 2015.

The bank also confirmed that its controversial tax avoidance unit would close, as revealed by Sky's City Editor last week.

"We intend to change what Barclays does and how we do it and have set out clear commitments against which our progress can be measured," Mr Jenkins said in a statement.

"Our goal is to make Barclays the 'Go-To' bank for all our stakeholders.

"The plan that we set out today is critical to delivering that goal."

In total, Barclays' employs around 140,000 people across the world.

More follows...

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Scotland: Independence Case Under Scrutiny

By James Matthews, Scotland Correspondent

The UK Government will today step up its campaign against Scottish independence by questioning the legal status of a separate Scotland.

It insists that while the remainder of the UK would inherit more than 14,000 international treaties, an independent Scotland would not.

In what it calls an "unusual step", Whitehall has published its legal advice on the international law aspects of Scottish independence. 

It claims that international precedent dictates that an independent Scotland would become a "new state" and what's left of the UK would be considered a "continuing state".

According to its legal opinion, only the remainder of the UK would automatically continue to exercise the same rights, obligations and powers under international law as the UK currently does, and would not have to renegotiate existing treaties of re-apply for membership of international organisations.

Currently, the UK is signed up to several thousand treaties and has membership of international organisations such as the United Nations, European Union, Nato, the International Monetary Fund and the World Trade Organisation.

The UK Government's legal opinion was written by Professor Alan Boyle, of Edinburgh University, and Professor James Crawford, of Cambridge University.

Alistair Darling believes Scottish independence will weaken the economy

Alistair Darling MP, former chancellor and leader of the pro-Union 'Better Together' campaign, told Sky News: "This is a formidable legal opinion from two internationally respected lawyers. Their opinions have to be taken very seriously and they just can't just be dismissed by the nationalists.

"Again, it begs the question where is the advantage to Scotland of breaking its links with the rest of the UK, losing influence as well as all the other economic advantages that come from being together?

"It's high time the nationalists told us the basis of their increasingly discredited claims."

Scottish Secretary Michael Moore will launch what Downing Street is describing as a series of 'Scotland Analysis Papers' in a speech in Edinburgh.

The event has drawn criticism from the SNP-controlled Scottish Government.

Scotland's Deputy First Minister Nicola Sturgeon told Sky News: "This is an act of breathtaking arrogance by this Tory-led UK Government, which completely shatters their claim that Scotland is an equal partner within the existing UK - it will only serve to boost support for an independent Scotland.

"The fact of the matter is that this is an opinion - no more, no less. Other constitutional and legal experts take a completely different view. For example, Professor David Scheffer, constitutional law expert and former US ambassador, said only recently that 'the break up would be viewed as two successor states of equal legitimacy - not size, wealth or power, but legitimacy' ... this means a continuation for both states."

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Minister's Fear Of Horsemeat Scandal Scale

How Horsemeat Scandal Unfolded

Updated: 9:29pm UK, Friday 08 February 2013

The horsemeat scandal has been unfolding for weeks and products have been flying off the shelves, although not in a good way. Where did it all begin?

January 16

The Food Safety Authority of Ireland says beefburgers with traces of equine DNA, including one product classed as 29% horse, are being supplied to supermarkets by Silvercrest Foods in Ireland and Dalepak Hambleton in Yorkshire, subsidiaries of the ABP Food Group.

Ten million suspect burgers are taken off the shelves, including by retailers Tesco, Lidl, Aldi, Iceland and Dunnes Stores.

A third company, Liffey meats, based in Co Cavan, Ireland, was also found to be supplying products to supermarkets with traces of horse DNA.

January 17

The ABP Food Group suspends work at its Silvercrest Foods plant in Co Monaghan, Ireland, until further notice.

Sainsbury's, Asda and the Co-op later withdrew some frozen products as a precaution but had not been found to be selling contaminated food.

January 23

Burger King, which is supplied burgers by ABP Food Group, switches to another supplier as a precautionary measure.

January 25

Waitrose removes a range of frozen burgers made by Dalepak but says its burgers have been tested and are 100% beef.

The Food Standards Agency said tests at a Dalepak plant in North Yorkshire had found no traces of meat contaminated with horse or pork DNA.

However, Aldi found traces of pig and horsemeat in samples taken from three lines of Dalepak burgers.

It withdrew Specially Selected Aberdeen Angus Quarter Pounder, Oakhurst Beef Quarter Pounders and Frozen Oakhurst Beefburgers from sale.

February 4

Production at a second meat supplier, Rangeland Foods in Co Monaghan, is suspended after 75% equine DNA is found in raw ingredients, The Department of Agriculture confirm.

February 5

Frozen meat at Freeza Meats company in Newry, Northern Ireland, is found to contain 80% horse meat, The Food Standards Agency Northern Ireland said. It is potentially linked to the Silvercrest factory in the Republic of Ireland.

Asda withdraws products supplied by Freeza Meats.

February 6

Tesco and Aldi take down frozen spaghetti and lasagne meals produced by French food supplier Comigel following concerns about its Findus beef lasagne.

The FSA reveals a second case of "gross contamination" after some Findus UK beef lasagnes were found to contain up to 100% horse meat. The products were made by French food supplier Comigel.

February 8

Aldi withdraws its Today's Special Frozen Beef Lasagne and Today's Special Frozen Spaghetti Bolognese after tests showed the products contained between 30% and 100% horsemeat.

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Business Optimism At All-Time Low - Survey

An index which predicts British business optimism has fallen to its lowest level since the report began 21 years ago, prompting fears of a 'triple-dip' recession occurring.

BDO's Optimism Index, which predicts business performance two quarters ahead, fell to 88.9 in January from a reading of 90.3 in December.

It is the eighth consecutive month that the Index has remained below 95.0, the mark which indicates growth.

This suggests the economy will struggle to grow in the first quarter of 2013, following the recently announced negative growth of Q4 2012.

As a result, there is an increased risk of a triple-dip recession taking hold.

Meanwhile the report's Output Index, which predicts short-run turnover expectations, also supports this, falling from 93.1 to 92.3 last month, further away from the 95.0 mark indicating growth.

BDO LLP partner Peter Hemington said: "In spite of a strengthening labour market, business confidence continues to weaken, and improved hiring intentions are not translating into growth plans.

"It seems the damaging effects on businesses of five years' zigzagging economic growth has left them wary of making concrete plans for expansion and resigned to the 'new normal' of economic stagnation."

However its complementary Employment Index rose to 95.1 in January from 93.0 in December, taking the Index above the 95.0 mark that indicates employment growth.

Last Friday the Recruitment and Employment Confederation, along with KPMG, released a report revealing a salary spike trend based on employers struggling to find enough qualified staff.

The BDO index has also showed hopeful signs amongst the UK's manufacturing sector of possible recovery.

But the report's author warned that coalition policy needs to drive greater economic expansion.

Mr Hemington said: "To end this cycle, it is imperative that the Government implements plans to expedite growth.

"Without growth incentives, we will continue to see UK businesses reluctant to invest and expand, which poses a grave threat to the UK's economic recovery."

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Exclusive: Barclays To Shut Tax Advice Unit

By Mark Kleinman, City Editor

Barclays is to close its controversial tax avoidance unit as part of a drive to distance the bank from the perceptions of a "casino" banking culture which flourished under Bob Diamond, its former chief executive.

Sky News can reveal that Antony Jenkins, Barclays' new boss, will announce on Tuesday that it will wind down and close the division which was responsible for generating hundreds of millions of pounds in profit for the bank.

He will say that while legal, the tax avoidance schemes devised by its structured capital markets business were toxic for Barclays' reputation.

Mr Jenkins will commit to avoiding transactions whose sole purpose is to access tax benefits, according to a senior source inside Barclays' investment bank who has been briefed on his plans.

I have also learnt that the Barclays boss will also unveil a set of binding tax principles that will dictate the mandates in which the bank's executives are permitted to be involved.

During his appearance this week in front of the Parliamentary Commission on Banking Standards, Mr Jenkins said that the structured capital markets operation would be "changed" but he did not say it would be closed altogether.

Lord Lawson, the former Chancellor and a member of the Commission, accused Barclays of engaging in "industrial scale tax avoidance".

Mr Jenkins' announcement will be made amid a robust debate about corporate tax avoidance and at a difficult time for the reputation of Barclays and the wider banking industry, mired as it is in mis-selling scandals and a multi-agency investigation into the manipulation of the benchmark interest rate, Libor.

It is unclear what impact the tax unit's closure will have on Barclays' profitability, but its lucrative nature has not deterred Mr Jenkins' decision.

The news will be disclosed alongside Mr Jenkins' broader vision for Barclays as it emerges from the most significant crisis in its recent history.

It is unclear whether executives who work in the tax advisory unit will be reassigned elsewhere within Barclays, or whether some will leave.

Mr Jenkins is cutting a substantial number of jobs in its investment bank, further details of which will be outlined on Tuesday.

I understand that among the other measures that Mr Jenkins will announce as part of his effort to rebuild Barclays' reputation, he will say that Barclays will reduce the proportion of revenue generated by its investment bank that is paid out to staff.

Historically, Barclays has been among the most generous payers in the City, paying out 45% or more of revenues to employees in salary, bonuses and benefits.

After it bought the US operations of Lehman Brothers in 2008, Mr Diamond oversaw an aggressive push to help the bank compete with the likes of Goldman Sachs and JP Morgan on Wall Street.

For 2012, Mr Jenkins is expected to say that the proportion of revenue paid to staff in Barclays' investment bank stood at approximately 38%, and he will pledge to reduce that in the coming years to a level much closer to 30%.

The new Barclays chief will also signal that he plans to re-balance the ratio between dividend and bonus payments following an outcry from shareholders last year.

The bank paid three times as much to employees as it did to investors in 2011, and although he will not make a specific pledge about how far that will change, he is expected to reassure shareholders that he acknowledges their concerns about the issue.

Mr Jenkins has already waived his own bonus for 2012, conceding that the bank's £290m Libor-rigging fine and multi-billion-pound bill for mis-selling payment protection insurance and interest rate hedging products made the decision inevitable.

"Barclays is fundamentally changing," one insider close to Mr Jenkins said on Saturday.

"Next week is about showing that he is reshaping the bank in a radical way."

Barclays will be the first of the big UK banks to announce annual results for 2012 next week.

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'Scotland Is Better Off In Britain' Says Cameron

David Cameron has launched a defence of the UK as his Government prepares to put the "facts" about Scottish independence to the public.

While people in Scotland will make the decision in autumn next year, the implications will have impacts across England, Wales and Northern Ireland, the Prime Minister said.

"Britain is admired around the world as a source of prosperity, power and security," he said.

"Those glorious Olympics last summer reminded us just what we were capable of when we pull together: Scottish, English, Welsh, Northern Irish, all in the same boat - sometimes literally.

"If you told many people watching those Olympics around the world that we were going to erect barriers between our people, they'd probably be baffled. Put simply: Britain works. Britain works well. Why break it?"

Addressing matters of the "heart and head", Mr Cameron spoke out one day before the British Government publishes the first in a series of analysis papers about Scotland's role in the union.

It comes one week after the Scottish Government published a "road map" from the referendum next year to full statehood in early 2016.

The Scottish Government has drawn up a 'road map' to independence

Mr Cameron said Britain has built up "world-renowned" institutions such as the NHS, and "fought for freedom" in two world wars, leaving "unbreakable bonds".

He said: "But the case for the UK is about head as well as heart - our future as well as our past.

"I have no time for those who say there is no way Scotland could go it alone. I know first-hand the contribution Scotland and Scots make to Britain's success - so for me there's no question about whether Scotland could be an independent nation.

"The real question is whether it should - whether Scotland is stronger, safer, richer and fairer within our United Kingdom or outside it. And here, I believe, the answer is clear."

He added: "This big question is for Scotland to decide. But the answer matters to all of our United Kingdom. Scotland is better off in Britain. We're all better off together and poorer apart."

Scotland has its own government and parliament in Edinburgh as part of the UK, allowing decisions to be taken that affect daily lives.

Devolved powers include health and education, while Scotland has maintained an independent legal system.

In the "road-map" publication last week, it was suggested that negotiations between Scottish ministers and the UK Government, European Union and international organisations could be concluded by March 2016, assuming a Yes vote in autumn 2014.

Nicola Sturgeon has accused PM of launching an 'entirely negative attack'

Mr Cameron criticised the Scottish National Party (SNP) for discussing the final transition to independence before all the facts have been aired.

But Scotland's Deputy First Minister Nicola Sturgeon defended the move, saying: "The Electoral Commission has called on both sides of the independence debate to provide more information to the people of Scotland and to work together to discuss what will happen in the wake of the referendum.

"We have agreed with the Electoral Commission and published information about the transition to independence following a Yes vote.

"The Prime Minister's remarks suggest he is ignoring the Electoral Commission's advice - despite the previous calls of the Westminster government for the Scottish Government to follow their advice.

"And instead of spelling out a positive case, David Cameron is simply continuing with an entirely negative attack."

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RBS Boss Hester Paid Bonus Despite Fine

The boss of the taxpayer-funded Royal Bank of Scotland will be paid a bonus of £780,000 just weeks after his bank was fined £391m for rate-rigging.

Chief executive Stephen Hester will be given the bonus in shares next month as part of a reward scheme for his performance in 2010.

The payout will undoubtedly anger critics of such schemes across the City, especially given its timing so soon after the Libor scandal rocked RBS.

Mr Hester will be handed the shares next month, and will be able to cash them 12 months later. The exact value will depend on the share price when he cashes them in.

Stephen Hester is to get the payout next month

Mr Hester said last week he would stay to "finish the job" at the bank despite damning evidence from US and UK authorities over its role in the Libor scandal, dating back to 2006 and continuing through to late 2010 - when investigations had already begun.

RBS, which is 81% owned by the Government, will recoup around £300m from its staff bonus pool and clawing back previous awards to pay for the fines.

RBS said 21 staff were involved in attempting to manipulate interbank lending rates - specifically Japanese Yen and Swiss Franc Libor submissions - from 2006 to as recently as November 2010.

Mr Hester's payout next month is the second tranche of two-part reward scheme that was announced in 2011.

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