Pensions Changes At Centre Of Queen's Speech

By Jon Craig, Chief Political Correspondent

Sweeping reforms to boost pensions for millions of people will be the centrepiece of a Queen's Speech outlining new laws for the final year of the Coalition Government.

Changes in George Osborne's Budget will end the requirement for pensioners to buy an annuity to provide a guaranteed income and legislation is also expected on collective workplace pension schemes.

Stung by allegations of a "zombie Parliament" and claims that the coalition has run out of steam, David Cameron and Nick Clegg claim the programme will be "unashamedly pro-work, pro-business and pro-aspiration".

But there are likely to be only around a dozen major Bills, with the bulk of the 2010 Coalition Agreement now enacted and the Conservatives and Liberal Democrats keen to differentiate themselves from each other.

In a coalition bid to rebuild trust with voters after a battering at the polls last month, the Queen's Speech will include a Bill giving voters the power of recall of MPs, with a by-election being triggered if 10% of voters sign a petition.

Another pledge with far-reaching implications for millions will be a 5p charge on plastic bags in supermarkets, pledged by Mr Clegg in his 2013 Liberal Democrat party conference speech.

This will not require primary legislation, because it is already provided for in the 2008 Climate Change Act and therefore will only need the passing of regulations in Parliament to enforce it.

The major Bills expected to feature are:

:: "Tax-free childcare" worth up to £2,000 per child each year, another move championed by the Liberal Democrats

:: Extra legal protection for people carrying out good deeds against liability for health and safety risks

:: A so-called "Cinderella law", outlawing emotional neglect of children by their parents

:: A hugely controversial Bill to authorise fracking, the exploitation of shale gas

:: Regulation of pubs, highlighted by Mr Clegg and Vince Cable in their pub photocall on the eve of the Queen's Speech.

Last year's State Opening of Parliament

In their joint statement, Mr Cameron and Mr Clegg said the speech marks "the next big step in our long-term plan for Britain. Its aim: to secure the recovery for our country".

They added: "Its guiding principle: to back everyone who wants to get on in life.

"We may be two parties, with two different philosophies, but we understand one thing: countries rise when their people rise. So this Queen's Speech is unashamedly pro-work, pro-business and pro-aspiration."

On the pensions legislation, they said: "By no longer forcing people to buy an annuity, we are giving them total control over the money they have put aside over their lifetime and greater financial security in their old age."

And on the coalition's future in the final year before the election, they said: "Four years on, our parties are still governing together and still taking bold steps."

But Labour leader Ed Miliband said: "We would have a Queen's Speech with legislation which would make work pay, reform our banks, freeze energy bills and build homes again in Britain."

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Balls Calls For Sky News Debate With Osborne

By Ian King, Sky News Business Presenter

Shadow chancellor Ed Balls has thrown down the gauntlet to Chancellor George Osborne to meet him head-on in a debate on Sky News.

The challenge came as the combative Mr Balls repeated his call for the Government to pave the way for more homes to be built in Britain.

He pointed out that, although house prices in some parts of the country had only recovered to peak levels seen in 2007, they had risen by 20% in London and parts of the South East during the last year.

Mr Balls said: "It does feel especially in London and the South East, there's a strong housing market that there's price inflation.

"It's fundamentally about supply and demand - if demand is going up but the supply is not keeping pace prices are rising and that can lead to instability of the past.

"If the Government doesn't do its bit to back the supply of housing, the danger is we will see interest rates going up earlier in this cycle more than the country needs and the rest of the country wants."

Mr Osborne visits the construction site for Kent's Ebbsfleet Garden City

The Shadow Chancellor, who accepted that the Chancellor's Help To Buy Scheme had been necessary to help first-time buyers onto the housing ladder, said he was nonetheless still concerned about the upper limit of the scheme - £600,000 - and that it was open to people other than first-time buyers.

He added: "I've asked the Governor of the Bank of England to keep a close eye on this, to make sure the parameters are right, but at the end of the day, it's actually about supply and demand.

"If supply is the problem, which it is, act on it. We need more affordable homes, I'm afraid a few thousand homes (more built) in Ebbsfleet isn't enough."

Mr Balls said the Government should not just leave it to the Bank of England to try and deflate the housing bubble.

Thousands of homes will be built in Ebbsfleet

He went on: "The Government has been really scaling back on supporting new homes…leaving it to Bank of England sort of says to them they'll have to use the main instrument they've got, which is interest rates.

"I think it would be dangerous for the recovery which is still in its early stages at a time when across the country and there's still spare capacity in the economy.

"To start putting interest rates and mortgage rates up now would be risky and it would squeeze the budgets in which people are still struggling - so I think the Chancellor should pull his weight."

Mr Balls also dismissed suggestions that rising consumer confidence weakened his key critique of the Government, that most households are still seeing a fall in living standards, arguing people were seeing the economy getting better but that they were not seeing an improvement in their own finances.

The shadow chancellor added: "Wages are still going up by less than prices. When the Government says the cost of living crisis is over, most people say 'not in the part of the world where we're living'.

"I think at the moment the Government seems to be patting itself on the back even though we haven't caught up to where we were in 2007. I think it's too early to say they've succeeded."

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Tesco Sales Slump Continues In First Quarter

Tesco has reported a 3.8% fall in like-for-like sales in the UK - its worst quarterly performance under chief executive Philip Clarke.

The drop in sales also marked the third successive quarterly decline.

The first quarter UK figure, which excludes fuel and VAT, was announced 24 hours after separate industry statistics charted a continuing decline in market share for the country's biggest supermarket chain.

But Tesco moved to paint a positive picture of trading as it intensifies efforts to stop customers flocking to discounters.

Mr Clarke, who is two years into a multi-billion pound turnaround plan, blamed price cuts and a weak food market for the core UK performance but said its improved offering was making a "real difference for customers".

He said: "We are pleased by the early response to our accelerated efforts to deliver the most compelling offer for customers.

"We expect this acceleration to continue to impact our headline performance throughout the coming quarters and for trading conditions to remain challenging for the UK grocery market as a whole," he added.

Tesco, like its main rivals Asda, Sainsbury's and Morrisons, is facing a squeeze from discounters Aldi and Lidl.

It has responded by investing £200m in price cuts on "the products that matter most" - and Mr Clarke said sales volumes rose 28% in those areas during the quarter.

Tesco also hailed lower delivery and service charges for online delivery and enhanced rewards through its Clubcard Fuel Save initiative as measures that would boost loyalty.

The retailer said it had refreshed a further 100 stores in the period and expected a further 200 to be improved by the end of its first half - admitting the disruption will have a negative impact on sales.

While Tesco's continuing sales woes have held down its share price since Mr Clarke took over in 2011, he has repeatedly brushed off speculation about his future, despite little sign his £1bn turnaround plan is bearing fruit.

Tesco stock rose 1.3% in early trading on the FTSE 100 on Wednesday, with analysts saying the first quarter performance was slightly better than had been expected by many forecasters.

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Ian King Presents Sky News' New Business Show

By Ian King, Business Presenter

Business news should be for everyone. It affects everyone, after all, not just those who read the business pages avidly.

So I hope Ian King Live will demystify business, strip away the jargon and make the worlds of business, economics and markets accessible and understandable to as wide an audience as possible.

In the process, we will aim to bring Sky News viewers interviews with some of the biggest names in business, both from Britain and the rest of the world.

Ian King will present the show from The Gherkin, Monday to Thursday

There will be packages and graphics that will help clearly explain often complex subjects and the breaking news stories of the day, plus regular appearances from the unrivalled team of specialists in the Sky News team, such as Mark Kleinman, Ed Conway and Poppy Trowbridge.

Viewers will also get regular updates from Wall Street and business centres around the world.

And with the general election now less than a year away and the economy, jobs, the cost of living and the deficit all set to be key debating points, viewers can also expect plenty of interviews with the key voices in the campaign - as well as hearing from leading City experts who can help sort fact from fiction.

It all starts this Monday, 6.30pm, only on Sky News.

:: You can follow the programme on Twitter @SkyIanKingLive

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Workplace Pensions Shake-Up 'Could Boost Funds'

Radical changes to workplace pensions are set to be unveiled in the Queen's Speech this week, with supporters claiming the shake-up could boost retirement incomes by thousands of pounds.

Staff will be able to put their money into Dutch-style "collective pensions", which are shared with thousands of other members.

They are regarded by many as a better investment because they are less vulnerable to stock market variations.

The changes, which could be in place as early as 2016, are designed to give better value for pensioners.

Pensions Minister Steve Webb has described the collective schemes, also known as "mega funds", as "some of the best in the world".

Mr Webb told The Sunday Telegraph the key advantage was "pooling risk" of investments performing worse than expected across large numbers of people of different ages, "just like car insurance or the NHS".

The Queen delivers her speech at the State Opening of Parliament in 2013

"It gives people greater certainty and probably better value," he said.

However, critics of the model have warned that pensioners only have a "target" for what they will get in retirement, rather than a guarantee as is the case with a fixed annuity.

Pensioners could in some cases see their incomes fall if the collective fund's investments do not generate the expected profits.

The plan is based on schemes in the Netherlands and Scandanavia.

But some Dutch politicians have recently called for the pensions to be scrapped in favour of British-style individual pensions.

A new bill scrapping tax rules that have stopped pensioners taking more than a quarter of their savings in a cash lump sum will also be included in the Queen's Speech.

Other legislation expected includes:

:: A crackdown on highly paid civil servants and NHS executives getting large redundancy pay-offs before taking similar jobs within a year of leaving their posts.

:: Tax free childcare worth up to £2,000 per child for families where both parents have jobs.

:: A bill to change trespass laws to allow shale gas exploration firms to drill beneath private property without requiring permission from the owner.

:: The Queen's Speech is also expected to contain measures to support further oil and gas developments in the North Sea, and for more major roads to be built.

:: A "Recall Bill" allowing voters to sack their elected MPs, although this has been subject to disagreements inside the coalition.

Legislation for a referendum on Britain's membership of the European Union will not be included, amid opposition from the Liberal Democrats.

David Cameron is instead expected to promise he will use the Parliament Act to overrule the House of Lords and force a bill from a backbench Tory MP into law.

On the eve of setting out its legislative agenda, the coalition has been accused of running out of steam less than a year before the general election.

Labour has released figures claiming the coalition has become a "zombie government", with MPs debating fewer bills last year than at any time since 1950.

Treasury Minister Nicky Morgan rejected this, telling the Murnaghan programme the Queen's Speech will prove the government is "full of ideas".

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Scots Independence: BAE Systems Chief's Fears

The boss of Britain's biggest defence company has become the latest business leader to warn against Scottish independence.

BAE Systems chief executive Ian King said that a "yes" vote would damage the "certainty and stability" necessary for investment.

Mr King's comments were made on a company blog, as the official campaign over independence was launched.

The defence giant currently employs 3,600 people in Scotland.

He said the company was pinning its hopes on an official decision for naval procurement, as it overhauls shipbuilding operations in Glasgow.

Mr King voiced concerns about staff pensions post-independence

Mr King said the company was "investing in facilities for the future" in Scotland "based on an expectation that the Government will make their major production decision for the next generation Type 26 frigate by the end of this year".

He said: "If Scotland became independent, we would no longer have that certainty and stability.

"We would then have to talk to our major UK customer, the Ministry of Defence, and jointly work out a plan for the future."

He also voiced concerns about staff pensions post-independence.

Mr King said: "If Scotland became independent and subsequently joined the European Union, our pension schemes, along with many other UK company schemes, may be caught up in EU regulations relating to cross-border pensions.

"The reality today is we can't say how our pension schemes would be affected.

"There would be a number of possible outcomes and we would use our consultation processes to discuss the options."

His comments come amid a growing business chorus questioning Scottish independence.

On Friday Kingfisher chief executive Sir Ian Cheshire, the boss of B&Q's parent firm, said there were too many uncertainties around tax, currency and Scottish EU membership.

Last month, the British Chambers of Commerce, which itself remains impartial in the debate, surveyed close to 2,500 of its members, and whilst 11% said Scotland should vote yes, some 85% preferred the union to remain.

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Spammer To Pay Damages After Court Victory

John Lewis has been ordered to pay damages for sending "spam" emails in a privacy ruling that could open the floodgates for harassed consumers.

Roddy Mansfield, who is a producer for Sky News, brought the case under EU legislation that prohibits businesses from sending marketing emails without consent.

At a county-court hearing a judge ruled the company acted unlawfully as it could not prove Mr Mansfield had agreed to receive the emails or was one of their customers.

It is the third time Mr Mansfield has secured damages for receiving unsolicited emails but the first time an individual has won damages following a ruling on the legislation.

Spam is named after a Monty Python sketch where it is served with each meal

Previous spam cases won by default include Gordon Dick who secured £1,300 for a single email from Transcom Internet Services and Steve Higgins who was awarded £810 from a home-shopping firm.

Mr Mansfield began receiving the promotional emails after registering his details with John Lewis' website which opted-him-in for marketing using a pre-ticked consent box.

But an EU law drafted in 2003 makes it an offence to send unsolicited emails unless a customer is aware they have been opted-in.

Mr Mansfield issued proceedings under the Privacy and Electronic Communications Regulations arguing it was for John Lewis to prove he consented and after a short hearing the judge ruled in his favour.

Mr Mansfield said: "John Lewis argued that because I had not opted-out of receiving their emails, I had automatically opted-in.

"But an opportunity to opt-out that is not taken is simply that. It does not convert to automatic consent under the law and companies risk enforcement action if they use pre-ticked boxes.

Almost 100 billion spam emails are sent every day

"John Lewis' lawyers then argued that because I browsed their website I had "negotiated" with them for a sale and a business relationship existed between us which would allow them to email me. The judge threw that out too."

Some 100 billion spam emails are sent to consumers every day according to Cyren's Internet Threats Trends report for 2013.

Richard Cox, who is head of anti-spam organisation Spamhaus, said: "As the Information Commissioner cannot take action on individual breaches of the law, the only way to stop this annoying type of spam is for individuals to take action themselves.

"Only the individual in each case will know whether they consented to their details being harvested for this type of activity. Hopefully it will be a warning to other UK companies not to abuse their customers' personal data."

A spokesperson for John Lewis said the case consisted of a "very specific set of circumstances" and while they disagreed with the judge's decision they would abide by the ruling.

The company said in a statement: "Mr Mansfield voluntarily gave us his email address, set up an account online and chose not to opt-out of marketing communications when that option was available to him.

"We listen carefully to what our customers tell us about how and when we communicate with them and endeavour to do so in a manner that is convenient to them.

"We're sorry Mr Mansfield was inconvenienced by our emails."

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Retailers' Credit Union To Defy Payday Lenders

By Mark Kleinman, City Editor

Some of Britain's biggest high street names, including New Look and Next, are forming a credit union that will offer staff an alternative to the sky-high interest rates charged by payday lenders.

Sky News has learnt that RetailCure, which has also received backing from entrepreneurs such as Rymans owner Theo Paphitis, is drawing up plans to launch later this year.

The new venture has received start-up funding of £1m and will eventually be accessible to the 4.8 million people who work directly in retail or in related sectors of the economy, half of whom earn less than £8 an hour.

It will be chaired by John Lovering, a veteran retailer who has led buyouts of companies including Debenhams, Homebase and Somerfield.

Mr Lovering is also chairman of the Retail Trust, an industry charity which has been working on plans for the new credit union for some time.

Speaking to Sky News, he said: "The industry feels that we have to find a way of providing a source of cheap, reliable credit for our people.

"The three million in retail and the nearly five million in the wider industry do have a need for low-cost, value-for-money, short-term borrowing facilities, and that's what we as an industry are trying to provide."

Booker and Matalan have also agreed to support RetailCure, while John Lewis Partnership and Wm Morrison have been approached and are expected to provide financial assistance.

The launch of RetailCure comes amid a still-intense political debate about the business model employed by payday lenders, which charge interest rates that work out at more than 5,000% on an annual basis.

The high street chains' credit union will charge interest on a sliding scale from roughly 7% to nearly 28% depending upon the borrower's credit history.

Mr Lovering expects the average loan request to be lower than £5,000, and believes that RetailCure could ultimately become Britain's biggest credit union.

"We think we can build a loan-book of £50m and attract 50,000 members relatively quickly," he said.

Assuming it receives regulatory approval, savers who deposit funds with RetailCure will be protected by the same Government guarantee as that which covers high street banks.

Labour MP Stella Creasy, who has campaigned against payday loans, told Sky News: "Anything that helps people access affordable credit as opposed to some of the legal loan sharks you see on your high streets - the payday lenders and the logbook loan companies - is a welcome move."

Earlier this week, the Church of England unveiled a pilot scheme through which a new credit union network will be piloted in three of its dioceses.

That project is being led by Sir Hector Sants, the former boss of the City watchdog, which since April has had oversight of consumer credit providers such as payday lenders.

Last year, the Archbishop of Canterbury, Dr Justin Welby, said he had told the then boss of Wonga that he wanted to "compete (the company) out of existence".

The remarks sparked acute embarrassment for the Archbishop, however, when it emerged that the Church of England's pension fund was among the investors in one of Wonga's financial backers.

In its annual report this week, the Church Commissioners said they had yet to dispose of the holding because doing so would crystallise a significant loss for its pension fund.

Some industry stakeholders were sceptical about the prospects for RetailCure.

Russell Hamblin-Boone, chief executive of the Consumer Finance Association, which represents short-term lenders, said greater choice was welcome but warned that it faced significant uncertainties.

"What this body will have to do is make sure it complies with very stringent regulations that are applied to financial services.

"I would ask questions around what is going to be the collection policy, what happens if somebody leaves the retailers business still owing a debt, how are you going to collect that?"

RetailCure hopes to launch formally in November.

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Taxi Law Change 'Puts Women At Higher Risk'

By Anushka Asthana, Sky Political Correspondent

Women are being placed at a higher risk of assault because of Government plans to allow minicab drivers to lend their private hire vehicles to family and friends when they are off duty, it has been warned.

The Local Government Association and charities are calling for plans - which have been introduced into the deregulation bill - to be halted.

They say the reform was slipped into the legislation at the "eleventh hour" with "little consultation". They want the clause deleted - a move being supported by the Labour party. 

The law already exists in London but this change will apply to the rest of England and Wales. 

At present minicabs outside the capital can only be legally driven by someone licensed through the council - who has undergone criminal, medical and background checks.

But under the new law, drivers will be able to loan their cars to anyone they choose. The idea is to help drivers by allowing family members to use their cars - as many can't afford a second vehicle.

But campaigners say it could be used by sexual predators to target victims. "We know that posing as a legitimate minicab driver is the preferred method of some quite dangerous sexual predators and we know that from the statistics in London where sexual assaults by bogus minicab drivers are worryingly high," said Rachel Griffin, director of the Suzy Lamplugh trust - which campaigns for better personal safety.

There are fears unlicensed drivers will target passengers

Councillor David Simmonds, of the LGA, added: "If we are seeing licenced vehicles that may be driven by someone other than the legitimate driver you won't know when you come out of a nightclub late at night perhaps after a few drinks whether the person who is driving that cab... is someone you can trust."

The fear is that unlicensed drivers will target vulnerable individuals who are frail or drunk using the vehicles.

Ministers say the change has been tried and tested in London. But the LGA says unlicensed vehicles are the scourge of the capital.

There were taxi-related sexual assaults across Britain last year including in places such as Cardiff, Birmingham and Nottingham. There were 37 in Manchester. In London there were 71 between April and November. The figures are not collected everywhere, so not available in comparable form.

Campaigners are asking why they can't simply allow drivers to nominate one other driver within their family, rather than having a free for all.

Transport Minister Baroness Kramer said: "The Deregulation Bill will not put taxi passengers at risk and drivers will continue to have their backgrounds routinely checked. Councils will have strong tools to assess drivers' and operators' suitability and to carry out enforcement activity.

"The Disclosure and Barring Service will allow licensing authorities to discover any new convictions during the lifetime of a driver's licence."

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The Week's Big Business Stories

Once you've caught up on last week's business news, you can get ahead on what's coming up next week with Sky's Week Ahead.

:: Monday, June 2

On Monday at 6.30pm, Sky News launches its new flagship business show, Ian King Live.

Also on Monday, Apple is hosting its Annual Worldwide Developers Conference. The event is often used by the company to launch new products. It is reportedly gearing up to announce a smart home software platform, powered by iPhones and iPads which would allow users to control household appliances with the swipe of a finger.

:: Tuesday, June 3

The Nationwide House Price Index for May is out on Tuesday morning. Britain's biggest building society reported an annual pre-tax statutory profit of £677m, up more than 300% on the figure last year. Chief executive Graham Beale said there could be early signs of a natural correction to house price rises in London, but warned that measures to cool capital prices might have a negative impact elsewhere.

:: Wednesday, June 4

Tesco will release its first quarter sales on Wednesday. The UK's biggest retailer has refurbished a significant number of stores and some analysts think this will stand it in good stead for the future, but these figures are still likely to show a like-for-like sales decline. Watch for more about the appointment of a new finance boss.

:: Thursday, June 5

At 12pm on Thursday, the Bank of England will announce whether it is to raise interest rates or not. The rate has been at a record low of 0.5% since 2007. The outgoing deputy governor Charlie Bean has said that rates could increase to 3% in the next three to five years.

:: Friday, June 6

The United States will release its jobless data for the month of April on Friday. Consumer spending unexpectedly fell 0.1% in April, according to a report by the Commerce Department. The drop was the first in a year, but economists expect it to be temporary

:: Missing something? Tweet your business stories to @SkyNKTweets

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