Tesco Confirms China Merger Talks

Tesco has confirmed it is in exclusive talks over combining its Chinese operations with a major supermarket operator in the country.

While it is unclear at this stage whether a deal would mean the Tesco brand disappearing in China, Britain's biggest retailer updated investors on the talks after they were made public by Sky's City Editor, Mark Kleinman.

Its statement said: "Noting recent media speculation, Tesco Plc and China Resources Enterprise Limited (CRE) today announce that they have entered into a memorandum of understanding and are in exclusive talks to combine their Chinese retail operations to form the leading multi-format retailer in China."

Tesco said the proposed joint venture would create a business with sales of some £10bn, in which CRE and Tesco's effective interests are expected to be split 80% and 20% respectively.

The proposed deal - which would represent a significant watering down of Tesco's China operation - would involve CRE combining its CR Vanguard business, which operates 2,986 stores across China and Hong Kong, with Tesco China's 131 stores and shopping centre business.

"The intended partnership follows a series of highly successful joint ventures between CRE and other multinational corporations and is consistent with Tesco's stated strategy of focusing on profitable routes to growth in fast-growing but less mature markets," Tesco said in the statement.

"The transaction is subject to further due diligence and agreement of final terms. There is no certainty that a transaction will occur," it added.

According to Chinese media the company has failed to turn a profit in nine years in China.

Tesco recently closed its operations in Japan and in the US and it moved to improve its core UK supermarket business.

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BA Compensation After Saudi Flight Horror

British Airways has promised compensation after hundreds of Heathrow-bound passengers reportedly endured an horrific experience on a faulty plane that led to fights in Saudi Arabia.

The Boeing 747 had to return to Riyadh twice because of a recurring wing flap problem.

Describing the scenes after the second landing, passenger Dean Jones told the online Daily Mail there was "mayhem" as a BA worker tried to deal with more than 300 passengers while other ground crew allegedly "hid' in a back office.

He went on: "Fights broke out and the military turned up."

The letter to passengers from BA. Pic. Hetaf Bin Saedan

Mr Jones said that on the first return to Riyadh on Wednesday "there was screaming and crying and we hit the runway with a massive bang".

He said passengers had to make their own way to accommodation, before being told to return to the airport at 3am for a flight on the same plane that eventually took off at 8.45am.

Around 30 minutes in, the wing flap problem recurred. Mr Jones said: "This time people were even more frightened. Women were crying. People were being sick."

After landing, around 70 passengers refused to leave and called for an official to explain what was happening.

A BA spokesman said today: "We apologise to customers for their experience, and we sent a replacement aircraft to fly them to the UK.

"Our customer service teams are contacting customers directly to offer compensation, expenses and complimentary tickets as a gesture of goodwill.

"The safety of our customers and crew is always our first concern and due to a technical problem, the decision was taken to return the aircraft to Riyadh.

"Our crew and customer service teams did everything they could to care for customers, and we provided overnight hotel accommodation."

Another BA plane suffered an 'air scare' in May when an engine caught fire

The incident first began 48 hours before a BA aircraft bound for Hong Kong returned to the airport because of technical problems understood to involve the left wing's landing gear.

In May, a BA flight caught fire as it flew over central London - leading to a dramatic emergency landing at the west London hub airport.

According to an official accident investigation, doors on both engines had been left unlatched during maintenance.

They then fell off as the aircraft left the runway, puncturing a fuel pipe on the right engine.

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RBS Gets Heated Over £230m Radiator Deal

By Mark Kleinman, City Editor

The taxpayer-backed Royal Bank of Scotland (RBS) is risking a renewed political outcry by opposing the restructuring of a major British-based manufacturer that would preserve hundreds of UK jobs.

Sky News has learnt that RBS intends to vote against a proposed takeover of Ideal Stelrad, which makes boilers and radiators, by Bregal Capital, a private equity firm, in a move which will potentially prevent a transition to new ownership.

Bregal has tabled an offer valuing Ideal Stelrad's equity and debt at roughly £230m, a sum sufficient to enable the company's senior lenders to recover their original exposure to it.

RBS, which holds approximately 15% of Ideal Stelrad's shares, is understood to be holding out for a better offer despite the fact that the group's lenders have run an auction lasting well over six months.

Bank of Ireland, another major financial institution that was bailed out by taxpayers during the banking crisis of 2008, is also said to be opposing the deal, although it speaks for only around 5% of the company's shares.

The takeover bid from Bregal is understood to require the approval of at least 75% of Ideal Stelrad's shareholders, but with time running out ahead of an initial deadline on Friday evening, support for the deal is understood to have stalled at around the 70% mark.

Although it is possible for Ideal Stelrad's board to extend the deadline, many of the manufacturer's lenders are understood to be frustrated at RBS's stance and are concerned that Bregal could withdraw its interest.

A spokeswoman for RBS declined to comment, although a source close to the bank said that several options for the future of Ideal Stelrad remained under consideration. RBS did not have the power on its own to block a deal and the bank was intent upon remaining as an investor even after a transaction, they said.

RBS has frequently encountered a political backlash over its lending activities since it was rescued by taxpayers in 2008, with complaints ranging from its choice of customers to its perceived willingness to lend to British companies seeking funds to expand.

Headquartered in Newcastle, Ideal Stelrad has manufacturing facilities in Hull and Mexborough, south Yorkshire. It employs roughly 1,800 people in the UK and at its international operations in countries including Holland, Romania and Turkey, and Bregal is understood to have indicated that it would maintain the manufacturing capacity in the UK.

Ideal Stelrad is one of hundreds of companies in which RBS ended up holding a significant equity stake after the banking crisis and subsequent recession, with these shareholdings apportioned to dedicated teams within the taxpayer-backed bank.

Insiders said that relations between Ideal Stelrad's chairman, Richard Connell, and RBS had been strained for some time.

The bank is said to have been keen for the radiator and boiler divisions of the company to be sold separately in an effort to maximise value. Insiders said on Friday, however, that profits had been in decline at the radiator unit while trade buyers had not made compelling bids for the boiler business.

Bregal is a private equity firm whose investors include the billionaire Brenninkmeijer family, founders of the high street retailer C&A. Its investments in the UK include the fast-growing education company Cognita, and Zephyr, a wind-power generator.

The prospective buyer is understood to have structured its offer to allow existing shareholders to remain owners of up to 24.9% of the company if they wish to remain exposed to it.

If Bregal does succeed in acquiring Ideal Stelrad, it would become the third private equity firm to own the manufacturer in less than a decade.

Previously called Caradon Plumbing, the company was acquired by Montagu, formerly HSBC's buyout division, for £496m in 2000. The new owners decided to break up the business, selling Twyford Bathrooms for £85m and Mira Showers for £301m, and selling the rump of the group to Warburg Pincus for £227m in 2005.

That investment went awry after Warburg Pincus refinanced Ideal Stelrad at the height of the debt boom in 2007. The company then breached its borrowing agreements and underwent a financial restructuring that culminated in a debt-for-equity swap.

The current auction is being run by BNP Paribas, another of Ideal Stelrad's shareholders. Among the other investors are understood to be HSBC, GSO, a division of the giant US investment firm Blackstone, and National Australia Bank.

BNP and Bregal, which is being advised on its bid by DC Advisory Partners, were both unavailable for comment.

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Yahoo!: Tumblr Founder Nets 'Golden Handcuff'

It has emerged that the recently completed acquisition of Tumblr by Yahoo! includes a $110m (£70.8m) payment to the Internet blogging service's founder.

The retention payment - dependent on David Karp remaining at Tumblr for the next four years - was disclosed in a regulatory filing and part of the windfall that he and Tumblr investors realised by agreeing to sell the service for $1.1bn (£700m) in May.

At the time of the sale, Yahoo! boss Marissa Mayer pledged not to make any dramatic changes at Tumblr in the hope it would not alienate the blogging service's existing users, which include a substantial number of teenagers and young adults.

As part of her promise "to not screw it up," Mayer is allowing Karp to run Tumblr independently in New York.

Karp is believed to own a stake of up to 25% in Tumblr, which means he probably has already received a windfall though no such payment from the sale has been disclosed.

Under the terms of his retention payment he must stay at Tumblr until June 2017.

It will consist of $70m in stock and options and $40m in cash, according to Yahoo's filing.

The documents also disclosed that Yahoo paid a total of $44m to buy six other companies during the three months ending in June.

All told, Yahoo paid about $1.15bn (£740m) to buy 10 companies, including Tumblr, during the first half of the year.

Yahoo has bought several other start-ups since the end of June. The prices for those deals are likely to be disclosed in another regulatory filing.

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Revealed: The UK's Most Wanted Tax Fugitives

By Poppy Trowbridge, Business and Economics Correspondent

A rogues' gallery of the UK's most wanted tax fugitives has been released in an effort to collect hundreds of millions of pounds in unpaid duty.

One year on from releasing the details of the UK's 20 most sought-after tax criminals, HM Revenue & Customs (HMRC) has now added the names and photographs of 10 more fugitives to that original target list.

Those on the list are being pursued for a range of crimes, including VAT fraud, tax evasion and money laundering.

Together, their crimes have cost the taxpayer close to £720m.

Among the new names on the list are Michael "Arthur" Fearon, who is wanted in connection with evasion of excise duty on nearly £8.4m of cigarettes, and is believed to be in the Republic of Ireland.

Chancellor George Osborne says tax evasion 'will not be tolerated'

Anish Anand, who is believed to be in the UK, is wanted in relation to £6m VAT and film tax credit fraud, while Michael George Voudouri is wanted in connection with a £10m VAT fraud. He is believed to be in Northern Cyrpus.

And Sumir Soni (aka John Soni, John Miller, Samir Soni, Bhader Singh), who is believed to be in Kenya, is wanted in connection with evading duty of £3.6m from the illegal sale and distribution of alcohol, and the illegal importation of nine million cigarettes.

Anthony Judge, who was wanted for his role in over £350,000 of tax fraud and had been on the run for 10 years, was detained at Heathrow Airport last month as he attempted to enter the UK on a forged passport.

He is the second of HMRC's most wanted to be captured since the rogues' gallery was first published.

In May, John Nugent was apprehended in the US after the authorities there saw the list.

The gallery has been viewed more than 1.5 million times, with new intelligence received from the public on the current whereabouts of 17 of the 20 named on the original list.

HMRC has also launched an interactive map of the world to illustrate where the tax fugitives are believed to be.

The crimes of those on the list have cost the taxpayer £720m

Chancellor George Osborne said: "Our message is clear, tax fraud and evasion is illegal and will not be tolerated.

"The Government has stepped up HMRC's enforcement activities to enable them to pursue tax cheats relentlessly around the world."

"This new list will help put more tax fraudsters in the spotlight and bring them to justice."

The Chancellor has faced public outrage in recent months over the number of large, multinational corporations operating in Britain that pay little or no corporation tax on earnings which can top billions of pounds each year.

Yet some tax experts say HMRC is missing the real problem in tackling tax avoidance.

Richard Murphy, of Tax Research UK, told Sky News: "The problem is very large companies who aren't paying very large amounts of tax that they might owe because of skilful tax avoidance by accountants and lawyers.

"The second problem is actually ordinary people avoiding and evading income tax by putting cash in their pockets … paying their builders, their plumbers, their cleaners, their tutors and everybody else without tax being paid and that is a massive problem in our economy.

"But the big problem is not this form of crime of which this list is being published about."

Taxpayers Alliance chief executive Matthew Sinclair said part of the difficulty was with the UK's "hugely complex and fundamentally dysfunctional tax system".

He said reforming taxes to make them simpler would reduce the scope for evasion and free up HMRC resources to focus on fraud.

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Tesco Confirms China Merger Talks

Tesco has confirmed it is in exclusive talks over combining its Chinese operations with a major supermarket operator in the country.

While it is unclear at this stage whether a deal would mean the Tesco brand disappearing in China, Britain's biggest retailer updated investors on the talks after they were made public by Sky's City Editor, Mark Kleinman.

Its statement said: "Noting recent media speculation, Tesco Plc and China Resources Enterprise Limited (CRE) today announce that they have entered into a memorandum of understanding and are in exclusive talks to combine their Chinese retail operations to form the leading multi-format retailer in China."

Tesco said the proposed joint venture would create a business with sales of some £10bn, in which CRE and Tesco's effective interests are expected to be split 80% and 20% respectively.

The proposed deal - which would represent a significant watering down of Tesco's China operation - would involve CRE combining its CR Vanguard business, which operates 2,986 stores across China and Hong Kong, with Tesco China's 131 stores and shopping centre business.

"The intended partnership follows a series of highly successful joint ventures between CRE and other multinational corporations and is consistent with Tesco's stated strategy of focusing on profitable routes to growth in fast-growing but less mature markets," Tesco said in the statement.

"The transaction is subject to further due diligence and agreement of final terms. There is no certainty that a transaction will occur," it added.

According to Chinese media the company has failed to turn a profit in 9 years in China.

Tesco recently closed its operations in Japan and in the US and it moved to improve its core UK supermarket business.

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Borrowers Boost: Interest Rates Tied To Jobs

The Bank of England plans to keep the base rate of interest at its record low level until unemployment falls to 7% - unlikely for another three years.

The announcement was made by new governor, Mark Carney, at his first Inflation Report news conference where he outlined sweeping changes to monetary policy in a bid to provide more clarity to the public and financial markets.

The bank said it would keep the base rate at 0.5% unless inflation threatened to spiral out of control or there was a danger to financial stability.

Policymakers said they stood ready to buy more government bonds if additional stimulus was needed and would not reverse existing purchases while unemployment was too high.

It meant there would be no scaling back on the bank's £375bn programme of quantitative easing (QE) for at least three years.

The bank expects economic recovery to accelerate

Mr Carney said unemployment falling to 7% would mean more than 750,000 UK jobs are created, which, combined with rising wages, would represent "real improvements in the lives of people across the nation".

But the Bank suggested that growth was likely to be "weak by historical standards", even though economic recovery was "taking hold."

Inflation, the report said, was forecast to stay above its 2% target until the second half of 2015 based on market rate expectations though it was now not expected to rise above 3% this year.

The forward guidance on the likely movement of bank rate - while welcome news for borrowers - means savers face more years of weak interest on their money.

A growing number of major central banks, including the US Federal Reserve, are providing so-called forward guidance to help nurse their economies back to health.

The BoE also forecast that the economy would grow by 0.6% during the current quarter - the same as between April and June, and that growth would reach an annual rate of 2.6% in two years' time.

The Chancellor welcomed the introduction of forward guidance by the Bank in a letter to Mr Carney.

George Osborne said: "Given the exceptional economic challenges continuing to face the UK economy, I agree with you that forward guidance can play a useful role in enhancing the effectiveness of monetary policy and thereby supporting the recovery."

Vicky Redwood, chief UK economist at consultancy Capital Economics, said the Bank's guidance was a "clear steer that interest rates will stay on hold until the end of 2016 or even 2017.

"Although financial markets already expected rates to stay low for a long time, this probably exceeds their expectations," she added.

But the Bank's interest rate pledge did little to boost market confidence as the FTSE 100 Index fell as much as 1% after the announcement, although the pound gained some strength.

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'One In Four' Mums Feel Work Discrimination

More than one in four mothers feel they have been discriminated against at work while pregnant or after returning to their job, according to new research.

Two thirds also said they would advise women to wait until the last possible moment to tell their bosses they are expecting.

But the survey of almost 2,000 women found that most did not make a formal complaint about the discrimination.

The study, by law firm Slater & Gordon, questioned mothers on how they were treated before and after the birth of their child and showed some employers were still penalising women for getting pregnant.

Almost a third said they were not treated well during their pregnancy and maternity leave, while almost half were overlooked for a promotion, almost a fifth demoted, while more than a third had responsibility taken off them.

Two out of five also said younger colleagues without children were given more support and encouragement.

Kiran Daurka from Slater & Gordon said: "Despite the equality legislation in place, attitudes and working practices continue to block women in achieving their career aspirations in the UK.

"Anecdotally, we hear of mothers complaining about being put on a 'mummy track' when back at work, and this research illustrates that this is a real experience for many women."

It is illegal to sack a women because she is pregnant or on maternity leave, said Employment Minister Jo Swinson.

She said the Government was committed to supporting women's talents and that shared parental leave and pay, being introduced in 2015, "will allow couples to choose how they share care for their child in the first year after birth".

However, TUC general secretary Frances O'Grady said newly-introduced fees for employment tribunals would deter some women from tackling discrimination.

"Sadly some employers are still living in the dark ages when it comes to women in the workplace," said Ms O'Grady.

"[But] by introducing tribunal fees of up to £1,200 to take an employer to court over pregnancy discrimination, the Government has ensured that many more of these women will have to suffer in silence."

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China Trade Figures For July Beat Forecasts

China's trade outpaced expectations in July, in a possible sign that world's second-largest economy is stabilising, following a slowdown this year.

The rebound is a rare optimistic sign following fears over China's economic expansion amid weak global demand, as policymakers have tried t to cool a local credit boom.

Exports rose 5.1% compared with the same period a year earlier while imports leaped 10.9%, customs data showed.

Economists had expected growth, though at a slower rate.

China's politically sensitive global trade surplus narrowed to $17.8bn (£11.5bn).

Exports to the United States edged up 2.3% however exports to Europe contracted 2.8%.

The latest trade figure disparity further fuels signs of US green shoots emerging while Europe stagnates.

The expansion comes after trade fell in June, when exports contracted by 3.1% while imports shrank 0.7%.

China's economy grew 7.5% in the three months ending in June over a year earlier, down from 7.7% in the previous quarter, as growth in factory production and investment slowed.

Some analysts suspect growth in China could slide below 7% in coming quarters.

The latest data could help support Chinese leaders, who are facing pressure to achieve a 7.5% growth target for the year.

The target is far stronger than forecasts for the United States, Europe and Japan, but would be the country's weakest performance since 1991.

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Fair Trade Warning To Quick Home Sale Sector

The trading watchdog is urging almost 120 firms operating across the "quick house sale" sector to make sure their business practices are up to scratch.

The warning comes after an investigation found some hard-pressed customers end up handing over their home for less than half of its market value.

The Office of Fair Trading (OFT) said it has also opened formal investigations into three un-named businesses for alleged unfair practices that may have led to some customers losing tens of thousands of pounds.

People who sell their homes to a quick house sale firm usually receive between 10% and 25% less than the market value of their property in return for getting fast access to cash.

But concerns have been raised about firms reducing the price offered at the last minute when the seller has already committed to the transaction.

The OFT said it has seen firms dropping the prices they will pay by up to 53% on initial offers which were already below market price, leaving people tens of thousands of pounds out of pocket compared with the market value.

The average quick sale is estimated at around £100,000.

The regulator warned that some firms risk giving the industry a bad name by exploiting a customer's difficult financial circumstances and giving them significantly less than they were expecting.

It said seven in 10 complaints received by the OFT about quick house sales came from "vulnerable" consumers who may have been particularly attracted by claims of a hassle-free service, with no viewings or hold-ups.

These include older people who may be suffering ill health, people who are heading for repossession and need a fast route out of their debt problems and those who are under pressure to stop a property chain collapsing.

Gaucho Rasmussen, OFT Director, said: "Responsible quick house sale firms offer a valuable service to consumers who want a fast sale.

"However, we have also seen potentially illegal behaviour and as a result the OFT has opened investigations into three companies.

"When sellers get a bad deal, they could lose a lot of money. We want to ensure that consumers can have confidence in this sector and put an end to these shoddy practices."

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Bank Of England To Unveil Monetary Policy Shift

By Ed Conway, Economics Editor

The Bank of England is set to unveil the most significant changes to the way it conducts monetary policy since it was granted independence in 1997.

Mark Carney, the bank's new governor, is expected to announce that in future it will follow a policy of "forward guidance" - pre-committing to keeping interest rates low long into the future.

The precise details of the new policy will be laid out at the bank's Inflation Report press conference at 10:30am, but economists say the bank may pledge to leave rates unchanged until the unemployment rate drops beneath a certain threshold.

Allan Monks of JP Morgan said he expected that level to be 7%, but added that the main message will be "that rates are unlikely to rise for the next two years or more - despite the better signs on growth".

The BoE is expected to follow "forward guidance"

The economy has been showing increasingly convincing signs of recovery in recent weeks, with both the services and manufacturing sectors expanding at rapid rates.

The data has led some to suggest that any shift by the Bank of England may risk stimulating the economy too much.

However, Sir John Gieve, former deputy governor, said forward guidance would help improve the bank's communication with the general public.

"The main impact will come through how it affects the economy," he said.

"But Mark Carney is also very keen to reach out beyond the narrow audience of central bank watchers, to ordinary people and companies. I think he can do that if he can keep the message simple and plain."

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US Sues Bank Of America Over Investor Losses

The US government is suing the country's second-largest bank over investor losses on $850m (£550m) of mortgage bonds sold ahead of the financial crisis.

Separate filings by the Justice Department and Securities and Exchange Commission (SEC) were launched in North Carolina, where Bank of America is based, accusing the firm of failing to disclose risks about the mortgages and misleading investors in its sale of the mortgage-backed securities in 2008.

The government claimed the bank failed to tell investors that more than 70% of the mortgages backing the investment were written by mortgage brokers outside the banks' network.

Bank of America, which said it would fight the allegations in court, could face financial penalties if found guilty in the civil cases.

The government did not specify how much it was seeking in damages but it estimated that investors lost more than $100m on the deal.

US banks are facing regulatory action over pre-crisis behaviour

In its filing, the SEC said: "Bank of America's CEO at the time described those mortgages as "toxic waste."

Anne Tompkins, the US attorney for the Western District of North Carolina, said in a statement: "Bank of America's reckless and fraudulent ... practices in the lead-up to the financial crisis caused significant losses to investors.

"Now, Bank of America will have to face the consequences of its actions," she concluded.

Bank of America responded: "These were prime mortgages sold to sophisticated investors who had ample access to the underlying data and we will demonstrate that.

"The loans in this pool performed better than loans with similar characteristics (made and packaged into securities) at the same time by other financial institutions.

"We are not responsible for the housing market collapse that caused mortgage loans to default at unprecedented rates and these securities to lose value as a result," the statement added.

The cases follow years of criticism that the government had failed to do enough to hold accountable those companies that contributed to the crisis.

When the real estate bubble burst in 2007, home values plunged and millions of people defaulted on their mortgages and lost their homes.

Investors who bought securities backed by high-risk mortgages lost billions.

Regulators have said that inaccurate statements by banks in packaging and selling mortgage bonds contributed to the investors' losses.

Bank of America, which received $45bn in federal bailout aid during the crisis, has had to pay tens of billions of dollars to settle class-action lawsuits and previous actions brought by the SEC.

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Summer Of Sporting Success Boosts Retailers

Retailers have enjoyed their best July growth since 2006 - the last time the country saw a prolonged heatwave.

The British Retail Consortium (BRC) said warm, sunny weather helped sales rise 2.2% on a like-for-like basis compared with last year as beer and burgers, together with swimwear, sun cream and sandals buoyed consumer spending.

It was the third consecutive month of improvement after a fall in April when shops were hit by freezing conditions, the BRC said, though deep discounting also helped reel shoppers into stores.

Easy rider: Chris Froome won the Tour De France

Online sales growth was 7.9%, a relatively slow improvement for the burgeoning sector as the weather encouraged consumers to get out from behind their computer screens.

BRC director general Helen Dickinson said the "very solid" sales performance was also driven by a 'feel-good factor' arising from the arrival of the Royal baby and sporting success.

She cited the Wimbledon win by Andy Murray, Chris Froome's Tour de France victory and the start of the Ashes.

She said: "While we know that the picture is still variable and the high street in particular continues to face considerable challenges, these positive results will be welcomed in town centres around the country that depend so much on retailers performing well."

David McCorquodale, head of retail at KPMG, which compiled the figures, added: "Food and drink saw the best growth performance since November 2009, with champagne, beer and other drinks as well as burgers, baps, summer fruits and ice cream all seeing significant increases."

In other categories, DIY and gardening was strong after a very slow start to 2013, together with toys including paddling pools.

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Labour: Workers '£6,000 Poorer' By 2015

The average worker will have lost more than £6,000 in real terms under the coalition by 2015, according to Labour.

The Opposition claims they will be £6,660 poorer by the time of the next election, with incomes £1,520 lower in real terms compared to 2010.

Shadow Treasury minister Chris Leslie says the amount of money lost is enough to pay for the average family weekly shop for a year-and-a-half.

Labour is accusing David Cameron of presiding over a record 35 consecutive months of falling real wages, with spending power down in every month during his time in power.

Its analysis suggests James Callaghan is the only other PM on record to have overseen more than a year of constantly falling real wages.

Real wages fell for 17 consecutive months under Mr Callaghan - less than half the total period of consecutive real wage decreases under the current Government.

As the wider economy continues to recover and the Tories reap the benefits, Labour is battling to make the cost-of-living a key election battleground.

Its figures are based on forecasts by the Office for Budget Responsibility and figures from the Office for National Statistics.

At loggerheads: David Cameron and Ed Miliband

Further analysis of figures from the House of Commons library also suggest that by 2015, workers will have seen their spending power fall more than in any other G7 country since 2010.

Labour's study also revealed a regional disparity, with workers in Yorkshire and the Humber, Wales, the North West and the South West of England seeing the biggest real wage drops.

Real wages are now 8.1% lower in Yorkshire and the Humber, compared to a 5.5% decrease in the South East, the figures showed.

Mr Leslie, shadow financial secretary to the Treasury, said: "David Cameron will go down in history as a disastrous Prime Minister for people's living standards.

"He is totally out of touch, his economic policies have failed and the result is working families are massively out of pocket."

"Far from never having it so good, many working people have never had it so bad. Prices have risen faster than wages in 36 out of the 37 months since David Cameron has been in Downing Street. This is the worst performance of any Prime Minister on record."

Mr Leslie claimed Labour would reverse the cut in the top rate of tax, introduce a new 10p tax rate, take steps to tackle high energy bills and protect tax credits for working families.

Coalition figures blamed the Opposition for driving the economy into the ground when they were in power, which had driven up the cost-of-living as a result.

They highlighted low interest rates and Government moves to slash income tax for millions, reform welfare to ensure it pays to work and increase the state pension.

Government whip and Lib Dem Mark Hunter said: "The reason the cost of living is high is because Labour crashed the economy. For them to criticise the coalition for cleaning up their mess is utterly hypocritical.

Conservative Business Minister Matthew Hancock added: "Today's squeeze on living standards is a direct result of Labour's disastrous economic policy that got us into this mess.

"If they were in government now, Labour would make hard-working people worse off. Their plan for more borrowing and more debt ... would mean soaring mortgage rates and higher bills."

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Amazon's Jeff Bezos Buys Washington Post

Bezos Letter To Washington Post Staff

Updated: 8:05am UK, Tuesday 06 August 2013

This is the letter written by Jeff Bezos to the staff of The Washington Post:

You'll have heard the news, and many of you will greet it with a degree of apprehension. When a single family owns a company for many decades, and when that family acts for all those decades in good faith, in a principled manner, in good times and in rough times, as stewards of important values – when that family has done such a good job – it is only natural to worry about change.

So, let me start with something critical. The values of The Post do not need changing. The paper's duty will remain to its readers and not to the private interests of its owners. We will continue to follow the truth wherever it leads, and we'll work hard not to make mistakes. When we do, we will own up to them quickly and completely.

I won't be leading The Washington Post day-to-day. I am happily living in "the other Washington" where I have a day job that I love. Besides that, The Post already has an excellent leadership team that knows much more about the news business than I do, and I'm extremely grateful to them for agreeing to stay on.

There will, of course, be change at The Post over the coming years. That's essential and would have happened with or without new ownership. The Internet is transforming almost every element of the news business: shortening news cycles, eroding long-reliable revenue sources, and enabling new kinds of competition, some of which bear little or no news-gathering costs. There is no map, and charting a path ahead will not be easy. We will need to invent, which means we will need to experiment. Our touchstone will be readers, understanding what they care about – government, local leaders, restaurant openings, scout troops, businesses, charities, governors, sports – and working backwards from there. I'm excited and optimistic about the opportunity for invention.

Journalism plays a critical role in a free society, and The Washington Post -- as the hometown paper of the capital city of the United States -- is especially important. I would highlight two kinds of courage the Grahams have shown as owners that I hope to channel. The first is the courage to say wait, be sure, slow down, get another source. Real people and their reputations, livelihoods and families are at stake. The second is the courage to say follow the story, no matter the cost. While I hope no one ever threatens to put one of my body parts through a wringer, if they do, thanks to Mrs. Graham's example, I'll be ready.

I want to say one last thing that's really not about the paper or this change in ownership. I have had the great pleasure of getting to know Don very well over the last ten plus years. I do not know a finer man.

Sincerely,

Jeff Bezos

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Little Chef Bought By Kuwaiti Group 'For £15m'

The Little Chef chain of roadside restaurants has been sold to a Kuwaiti restaurant group.

The company went up for sale in April, six years after it was rescued from administration.

During that time there were several attempts to revive its position in the market as one of the main providers of snack foods for people on the move around Britain.

Celebrity chef Heston Blumenthal was among those recruited to inject new life into its traditional menu of mainly fried breakfasts and burgers.

But the chain had been struggling for some time to compete with the other fast food chains and supermarkets that were increasingly occupying motorway service stations.

Now Kuwait restaurant owner Kout Food Group Restaurants UK Limited (KFGR-UK) has bought the company for what is believed to be £15m.

It was rumoured to be on the market for 'tens of millions of pounds'.

KFGR-UK takes over a group, famous for its 'Fat Charlie' logo, that has been slimmed down from more than 400 at its peak to 83 sites beside A-roads all over Britain, all of which are believed to be profitable.

Heston Blumenthal was brought in to revive the fortunes of Little Chef

The seller, venture capital group RCapital, said it was confident that KFGR-UK  would continue to rejuvenate Little Chef's fortunes.

RCapital CEO Jamie Constable said: "Since we put Little Chef up for sale people have asked us, why sell the business?

"The answer is very simple. We are specialists in reversing the fortunes of businesses with significant financial and operational problems.

"We turn businesses around, we rebuild and fix them, that's our business.

"When we bought the chain, it needed huge changes to revive the business and bring it back to profitability.

"Having owned Little Chef for a long time it feels like we are selling part of ourselves.

"But we take comfort from the fact that the new owners will take the brand to the next stage."

KFGR-UK said it had ambitious plans for the company.

Chairperson Fadwa al Homaizi, said: "KFGR-UK has exciting plans to revitalise the Little Chef brand.

"Little Chef will benefit from a process of brand renewal in keeping with current trends, supported by traditional British values."

Kout Food Group runs several branches of Burger King, Pizza Hut and Taco Bell in its home country. 

It also operates a portfolio of Middle Eastern brands such as Ayyame, Kabab-ji, Burj Al Hamam and the ice cream parlour Scoop A Cone.

Little Chef employs 1,100 staff and has sites across Britain's A-roads.

After trialling Blumenthal's meals in 2009, his new menus were rolled out to several branches. It is not known if his menus will continue to be served.

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Payday Loan Victims Urged To Fight Back By CAB

Payday loan customers are being urged to "fight back" if they have been mistreated by a lender by making an official complaint to the ombudsman.

Citizens Advice said that in three-quarters of cases (76%) it has examined, borrowers would have grounds to take their complaint to the Financial Ombudsman Service (FOS).

The charity launched a month-long campaign today calling for payday customers "not to let predatory lenders get away with treating them unfairly".

Citizens Advice analysed 665 payday loan cases reported to its consumer service in the first half of this year.

People are reluctant to complain because they won't admit they use lenders

The charity found that one in five were possible cases of fraud, where someone was being chased for a loan they had never taken out.

More than one third of the cases involved lenders using a type of recurring payment called a continuous payment authority to drain people's bank accounts of cash without warning.

And in 12% of cases lenders pestered people with phone calls and texts rather than accept offers of payments that borrowers could afford.

The ombudsman service, which resolves disputes between consumers and financial bodies, can order firms to put the situation right if it finds in the customer's favour.

This means a borrower could get a refund and compensation.

There has been a large growth in internet lenders recently

Citizens Advice chief executive Gillian Guy said: "The level of debt and hardship caused by some payday loans is absolutely scandalous and people often feel completely powerless to do anything about it.

"But consumers can fight back. If you are struggling to pay back the loan Citizens Advice can help you sort out a reasonable repayment plan and if you make a successful complaint to the Financial Ombudsman Service you could find you get a refund for an unauthorised payment or compensation for unfair treatment.

"By making your voice heard you will expose the bad behaviour of lenders and put pressure on them to clean up their act which could help stop similar problems happening to other people."

The chances are also high that the ombudsman will uphold a payday loan complaint in the consumer's favour.

Of 160 complaints made to the ombudsman between April and June this year about payday loans, 72% were upheld.

A spokesman for the ombudsman service said its own research into why payday loan customers do not tend to come forward to it more often suggests that people appear reluctant to admit that they have used a payday lender.

He said: "The big message is: Nobody is here to judge you. We understand that times are hard, the important thing is to ask for help."

The spokesman said that the ombudsman service would expect a firm which has been told that a customer is struggling financially to help the consumer to come up with a solution, regardless of whether or not the firm has made a mistake.

Giving advice to struggling borrowers, Citizens Advice said lenders should accept a repayment plan which is reasonable.

They should not be contacting the borrower's employer for money or ringing during the night.

Consumers should initially make their complaint directly to the lender but if it cannot be resolved they can ask the ombudsman to step in.

Payday lenders have come under heavy scrutiny in recent months following an investigation by the Office of Fair Trading (OFT).

The OFT referred the industry to the Competition Commission after finding "deep-rooted" problems.

Issues it raised included lenders not carrying out proper affordability checks, meaning the borrower cannot afford to pay their loan back on time.

The lender is then forced to roll the loan over, meaning the cost of the debt balloons.

Fifteen out of 50 lenders which were given a deadline by the OFT to prove their business practices were up to scratch have since said they do not plan to continue operating.

Payday lenders have said they have been working to improve standards and make sure loans are only given to those that can afford them.

They have said that rogue lenders which have tarnished the whole industry should ship out.

Complaints can be made to the Financial Ombudsman Service consumer helpline on 0300 123 9 123 or 0800 023 4567 or emailed to complaint.info@financial-ombudsman.org.uk.

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Zero-Hours Contracts 'For One Million Britons'

By Liz Lane, Sky News Reporter

Up to one million people, many more than previously thought, could be employed on zero-hours contracts across the UK, new research suggests.

The agreements mean that employees are expected to be on call, but are not guaranteed any work from one week to the next.

The Office for National Statistics recently suggested only 250,000 were on such contracts at the end of last year.

But the Chartered Institute of Personnel and Development (CIPD) surveyed 1,000 employers and found one in five use zero-hours contracts for at least one member of staff.

Firms in the voluntary and public sectors, as well as the hotel, leisure and catering industries, are more likely to use them.

CIPD chief executive Peter Cheese said: "Zero-hours contracts are a hot topic and our research suggests they are being used more commonly than the ONS figures would imply.

"However, the assumption that all zero-hours contracts are bad and the suggestion from some quarters that they should be banned should be questioned.

Business Secretary Vince Cable has ordered a review into the practice

"Zero-hours contracts, used appropriately, can provide flexibility for employers and employees and can play a positive role in creating more flexible working opportunities. This can, for example, allow parents of young children, carers, students and others to fit work around their home lives.

"However, for some this may be a significant disadvantage where they need more certainty in their working hours and earnings, and we need to ensure that proper support for employees and their rights are not being compromised through such arrangements."

The Unite union said the Government must stop the growth of the zero-hours culture, as these contracts are "the latest attack on workers' rights and dignity".

Separate research among zero-hours contract workers revealed only 14% said their employer failed to give them enough hours to have a basic standard of living.

Sarah Wicks, from Liverpool, used to work as a security guard on a zero-hours contract, but sometimes worked 72 hours a week.

She told Sky News the large number of hours did not equate to job security.

"There wasn't much expectation that your job was ever going to get any better, or that you had any recourse to the employer for anything," Ms Wicks said.

Business Secretary Vince Cable has announced his staff are going to investigate how they are being used.

"Whilst it's important our workforce remains flexible, it is equally important that it is treated fairly," Mr Cable said.

"This is why I have asked my officials to undertake some work over the summer to better understand how this type of contract is working in practice today."

Shadow business secretary Chuka Umunna said: "Whilst some employees welcome the flexibility of such contracts, for many zero-hours contracts leave them insecure, unsure of when work will come and undermining family life.

"The 'review' the Business Secretary has established into zero hours contracts is clearly inadequate given the seriousness of this issue and the mounting evidence of the abuse of zero hours contracts.

"Nothing less than a proper consultation with a formal call for evidence will do."

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Ireland Digs Deep For Economic Recovery

By David Blevins, Ireland Correspondent, in County Mayo

Seismic surveys are to be carried out to ascertain if Ireland has enough oil and gas reserves to export fuel.

Shell is already building the longest gas tunnel in Europe (4.9km) to transport fuel from one field, 85km off the west coast.

If Russia ever turns off the supply, Ireland may soon be able to offer an alternative.

Michael Crothers, managing director of Shell Ireland, explained: "Because Ireland is beside a major market, and the UK is looking at decommissioning nuclear facilities, having to shut down coal-fired power plants because of greenhouse gas emissions, there's an enormous opportunity for Ireland, if gas can be found, to export into that ready market."

At the peak of its 20-year life, gas from the Corrib field will meet two thirds of Ireland's need. 

The ambitious project has created 1,400 construction jobs in County Mayo, a remote region previously blighted by unemployment and emigration.

Bernadette McManamon, a civil engineer, said: "Sixty percent of my class, if not more, have emigrated and most of them are in Malaysia or Australia and some in America so I definitely wouldn't be working in Ireland … if it wasn't for the Corrib gas project."

The exploration has not been without its opponents. In 2005, five local protesters - the so-called 'Rossport Five' - went to prison.

Civil engineers will carry out the seismic surveys

Lessons have been learned about the need for greater engagement with communities along the coastline before any prospecting takes place.

Gerry Coyle, a Fine Gael councillor, said: "You cannot come in and go telling them what to do. You have to explain in great detail.

"Sometimes, it's very difficult on communities. This community were cast into the middle of this. They didn't go looking for gas. Gas came to them."

Mr Crothers agreed: "I really think it depends upon how they are approached. Any project is a balance between the social, the environmental and the economic and getting that balance right is key."

The gas has brought an estimated 6bn euros (£5bn) for Ireland's GDP.

Tommy Talbot, who opened a local hotel during the recession, said: "You drive from here to Dublin and there's a lot of towns on the way out - Roscommon, Leitrim, there's nothing in them. They really are struggling.

"Down here, we really have been cushioned by the development."

To date, they have found one trillion cubic feet of gas in the Corrib field, boosting the country's energy security.

If the seismic surveys turn up enough fuel for export, Ireland could have found the solution to its economic problems.

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Swansea Bay Tidal Lagoon May Open In 2017

By Rhiannon Mills, Sky News Correspondent

Exploratory work is underway off the coast of south Wales where scientists hope to build the world's first tidal lagoon power station.

As Britain continues to search for more sustainable forms of energy, plans are in place for a 9.5km-long, U-shaped sea wall in Swansea Bay that would harness the strength of the tides.

The £650m project's 26 hydro turbines would be permanently under water, generating energy on both the incoming and outgoing tides.

It is hoped the power station could produce enough electricity to power every home in Swansea, saving over 200,000 tonnes of CO2 and offering predictable zero-carbon electricity for 120 years.

The project is yet to receive planning permission but teams are already drilling to assess the make-up of the seabed.

Alex Herbert, head of planning for Tidal Lagoon Swansea Bay, told Sky News: "We hope this will be the first in a network of lagoons around the British coast which could produce up to 10% of our energy requirements.

The power station's 26 turbines would be permanently underwater

"With the first one happening in Wales, we're on the map and we're producing jobs locally, as well as expertise we can take elsewhere."

Promotional videos describe the power station's potential to help regenerate the area and attract tourists.

The sea wall would be used for walking, running and cycling, while the lagoon itself would be used for watersports.

However some groups have concerns about the environmental and visual impact of the project.

"It's concerning a number of people," Swansea councillor Tony Colburn said. "It's basically going to cut the bay in half and we'll be looking at a very large wall as opposed to the magnificent view we've got."

Sarah Kessell, of the Wildlife Trust, added: "There could be a loss of breeding ground or of spawning areas for fish that birds feed on.

The 9.5km-long sea wall would be used by walkers and cyclists

"We don't know what the long-term impact will be ... but there are certainly opportunities for mitigation along the way."

A planning application will be submitted later this year with a decision expected in early 2015.

If the development is approved it could be open by 2017, with similar schemes possible in Colwyn Bay, north Wales, and in locations near Liverpool.

Canada, France and South Korea already have tidal power plants but the one planned for Swansea would be the first to utilise both the incoming and outgoing tides.

The bay is considered an ideal location for the project because of its shallow water and 10-metre tidal range - the second highest in the world.

"It's a fantastic proposal because it diversifies how we produce energy," Barry Stewart, a local wildlife enthusiast, said.

"Obviously a project of this scale is always going to have an adverse effect on some ecological features. The wildlife can be accommodated but time will tell."

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Apple Ban Overturned By Obama Administration

The White House has stepped into a patent war between Apple and Samsung by vetoing a ban on imports of iPads and iPhones in the US.

The US International Trade Commission (ITC) in June banned the import or sale of the iPhone 4, iPhone 3GS, iPad 3G and iPad 2 3G distributed by AT&T Inc, saying the devices infringed a patent owned by the South Korean electronics giant.

But US Trade Representative Michael Froman vetoed the ban, saying his decision was in part based on its "effect on competitive conditions in the US economy and the effect on US consumers".

The decision marks a setback to the South Korean electronics company. However, Mr Froman said Samsung could continue to pursue its case through the courts.

The decision, dealing a blow to Samsung, was welcomed by Apple

It is the first time since 1987 that a US administration has vetoed a product ban ordered by the trade panel.

Samsung said it was "disappointed" at the lifting of the ban.

"The ITC's decision correctly recognised that Samsung has been negotiating in good faith and that Apple remains unwilling to take a licence," it said in a statement.

Apple welcomed the news and applauded the administration "for standing up for innovation".

It added, "Samsung was wrong to abuse the patent system in this way".

US Trade Representative Michael Froman

The Apple products targeted by the ITC ban are more than a year old, though some models such as the iPhone 4 remain solid sellers.

Apple sells more than 100 million iPhones annually, but it does not break down sales by models.

Apple and Samsung have been waging a global patent war since 2010, filing multiple lawsuits against each other over the design and functionality of their devices.

Apple argues Samsung's Android phones copy vital iPhone features. Samsung is fighting back with its own complaints.

Last year, a federal court ruled that Samsung owed Apple $1 billion in damages for infringing on non-essential Apple patents.

But the judge refused to impose an import ban on Samsung phones and later struck $450 million from the verdict, saying the jurors miscalculated.

The case is set for a rematch in appeals court.

Samsung is the world's largest maker of smartphones. Analysts estimate it outsold Apple nearly 2 to 1 in the first three months of the year.

However, Apple's smartphone business is more profitable.

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