BA strike action talks under way

Talks between British Airways and the Unite union, which represents cabin crew, are continuing in central London after a talks deadline was extended.The TUC, which is chairing the meetings, had set a deadline of the “close of play” on Tuesday 9 March for significant progress to be made. This was put back to Wednesday midday, but the BBC’s John Moylan said talks would continue into the afternoon. Last month, BA crew voted for strike action over pay and working conditions. Our correspondent said BA has admitted it is losing bookings because of uncertainty over strike action. He added that Unite had offered £60m of cost savings to try and end the dispute. Notice periodThe union must give a week’s notice of any stoppages, but it has already given assurances that members will not walk out over Easter. Should talks end without a resolution on Wednesday and the union decide to name strike dates immediately, industrial action could begin as early as 17 March. However, indications from those close to the talks at TUC headquarter were that if talks did break down it was by no means certain that strike dates would then be announced on Wednesday. On Tuesday, a statement on behalf of both sides had said: “It had been hoped to be able to conclude the talks today but both sides have agreed that more time is needed and the negotiations will be resumed again under TUC auspices tomorrow [Wednesday].” Heavy lossesThe main sticking point in negotiations is BA’s decision, taken in November last year, to reduce the number of crew on long-haul flights, bring in a two-year pay freeze from 2010 and offer less generous contracts to new staff. A High Court judge has ruled that BA was within its rights to make the changes to save money. But the measures have angered BA staff, and led to the vote for strike action. Last month, Unite said that 81% of its members who had voted supported strike action. In response, BA said it had lined up 1,000 staff who had volunteered to work as cabin crew if the strike does go ahead. It also said it would hire up to 23 fully crewed planes from a charter company to help run flights from Heathrow. BA lost £342m in the nine months to the end of December last year.

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TV licence fee rises £3 to £145.50 despite BBC cutbacks

By
Daily Mail Reporter
Last updated at 2:30 PM on 09th March 2010

Rise: A colour TV licence will cost £145.50 from next month
The cost of the BBC licence fee will increase by 2 per cent to £145.50 from April 1, it was confirmed today.The rise from £142.50 for the colour licence is part of a six-year BBC funding settlement agreed in 2007.It was set at 3 per cent for the first two years of the settlement and 2 per cent in years three, four and five - with 2010 being year four.The rise highlights that the BBC is continuing to receive increased
funding despite its recent announcement of cuts to some projects.The Tories are not contesting the change, which also sees a black and white licence go from £48 to £49 and was brought in under an order laid down in the Commons.The added cost will come into force as the BBC Trust mulls over the biggest shake-up in the corporation’s 88-year history.Director general Mark Thompson outlined £600million in ‘cuts’ last week, including axing 6 Music and the Asian Network and slashing the website by half.Critics claimed the measures were a political move aimed at showing the next Government it can handle its own affairs.Union leaders have said the move threatened up to 600 jobs and warned of strikes to fight any compulsory redundancies.The measures will not result in any shrinking of the corporation’s size but the cash saved will be directed elsewhere to drive up ‘quality programming’. The Tories have refused to rule out cutting the licence fee if they win power and they and Labour have signalled they will seek to replace the BBC Trust.Pay cuts for executives and top stars will form part of the re-negotiations of the £3.5billion licence fee settlement, which is due in 2012.

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Iceland’s president demands that Gordon Brown intervenes in payback row

By Richard Tyler


Published: 12:29PM GMT 06 Mar 2010

Last ditch talks between the two countries and Netherlands were suspended last
night ahead of a referendum today, which was triggered by president Olafur
Grimsson in January when he refused to approve the compensation deal.

Polls suggest that as many as three-quarters of Icelanders will vote ‘No’ to
paying £2.3bn to Britain and £1.2bn to the Dutch.

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Prudential plans £15bn Asia deal

Prudential looks set to buy one of Asia’s biggest insurance firms in a £15bn deal, the BBC understands.The UK insurance giant is believed to be in advanced talks to takeover AIA, the Asian arm of US company AIG. Prudential has refused to confirm the huge deal, but the company is expected to issue a statement to the market next week. BBC correspondent Joe Lynam said the move looks like an attempt to tap into the Indian and Chinese markets. “This is a play for the middle classes of India and China as they grow in wealth and numbers in the coming years. The sums involved range up to $25bn, which could make it the biggest overseas purchase by a UK firm,” he added. AIA is regarded as a crucial part of AIG with about 20 million customers, or close to a third of AIG’s total customer base. AIG was bailed out by the US government in 2008 and is now 80% owned by it. In total, the firm has received $182.5bn of government funding.

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Credit claims firm investigated

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An investigation has been launched into one of the biggest claims management companies in the UK.BBC Radio 4′s Money Box has learned that Cartel Client Review is being investigated by the Ministry of Justice, following complaints. For an upfront fee of up to £495, the company offers to help customers bring claims against lenders for mistakes in their credit agreements. The company denies it is being investigated by the regulator. Customers in limboThe BBC has been contacted by customers of Cartel Client Review who say they have paid hundreds - in some cases thousands of pounds - to get credit cards and loans written off, or to get compensation on their mortgages. But despite being told their claims would be resolved in six-to-12 months, two years later it seems that thousands of customers are still waiting in limbo. Tricia Page paid almost £500 to submit a mortgage claim in 2007. She says the promise of several thousand pounds in compensation would have paid for her family to visit her father, who was terminally ill in Australia. “We were told the risk with this £495 was minimal. If there was no money to come back to us we would get all but ten pounds back. “And the paperwork I have says this should go through within a period of about three-to-nine months and, I thought, that’s ideal - if something came through in three months, we’d be able to go and see my dad. “Now we’re two years on, my father has since died, and we don’t have the money or anything.” Cartel’s terms and conditions say the £495 you pay upfront for a mortgage claim is refundable if the claim is not successful. In November 2008, Trisha demanded a refund but Cartel Client Review refused to pay her. In frustration, she contacted the Jonathan Vernon-Smith consumer programme on BBC Three Countries Radio in January. Once the BBC became involved, Cartel Client Review told Trisha that her claim would not be successful and has offered a refund. The company says the reason for the delays customers are reporting is that it has been waiting for judgements in court and it says there has never been an issue with refunding cases. Solicitors investigatedAfter an initial assessment by Cartel Client Review, eligible claims are passed to a firm of solicitors. Legal experts at Consumer Credit Litigation Solicitors (CCLS) review the paper work for each case to decide if customers have a valid claim. But a paralegal who was formerly employed at CCLS, has told the BBC that the vast majority of customers he dealt with had no claim. Colin Power said he reviewed potential mortgage claims, which were colour-coded according to their likely success: “With a green case, there would be no success whatsoever - that’s it, there is no claim that can be made against the lender. I would say that around about 99.9% of the files I dealt with were what were classed as green files.” Cartel Client Review disputes Mr Power’s account and said he is not independent as he now works for a competitor. The firm also said it is the only company across the UK that actively can do this work with a legal firm and that it has got very positive results. Cartel Client Review and CCLS deny they are being investigated by regulators, claiming they have “always maintained a strong relationship with the Solicitors Regulation Authority and the Ministry of Justice.” But sources confirmed they are being investigated.

Have you tried to get your debts declared unenforceable?Has your lender agreed not to enforce a debt?Did you use a claims management firm?Tell us your experiences.

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RBS reports £3.6bn loss for 2009

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Stephen Hester: “The starting point for RBS was unenviable”

Royal Bank of Scotland (RBS) has announced losses for 2009 of £3.6bn ($5.5bn), after struggling with billions of pounds of bad loans.Despite the losses, the bank is set to announce it will pay bonuses totalling £1.3bn to its staff. But the bank‘s head, Stephen Hester, said it had lost money by not paying big bonuses to retain productive staff. The UK taxpayer owns 84% of RBS after the government bailed out the bank at the end of 2008. ‘Experiment’Chief executive Mr Hester told BBC Radio 4’s Today programme: “We’ve had a small experiment in this respect… some of our best-performing people have been leaving in their thousands. “The people who left us last year, I believe, would have increased our profits by up to £1bn beyond the ones that we’ve got.” However there has been some criticism of the bonuses paid. Liberal Democrat treasury spokesman Vince Cable said that making hefty payouts to individual bankers was “like a football team paying their striker for scoring when they’ve just been relegated”. Meanwhile, shadow chancellor George Osborne said “unacceptable” pay levels throughout the sector must be tackled. “The banking community needs to understand that the taxpayers were there for them a couple of years ago, because we had to keep the banking system going, but really it is unacceptable these very high levels of pay they get.” However RBS bonuses were approved by the Treasury, and Mr Osborne conceded he would not have blocked the payouts had he been in power. Torrid timeMr Hester has decided not to take his own bonus, which would have been £1.6m. The company’s £3.6bn loss was lower than the £5bn many experts were expecting and is well below the £24bn it lost in 2008. However, the level of bad debts rose sharply to just short of £13.9bn, up from £7.4bn in 2008, although the bank says it thinks these have now peaked. As well as the RBS chain of banks, the company’s UK businesses include NatWest, Ulster and Coutts banks, and the insurance companies Churchill and Direct Line. Mr Hester said he expected the bank to return to profit next year.








The banks have been through a torrid time since the credit crunch struck in 2007, an event sparked by the banks‘ own unwillingness to lend to each other after the major lending spree they had been on started to turn bad. Added to that was RBS’s unique heavy burden - its takeover of the Dutch bank ABN Amro in October 2007, just as the banking boom was about to turn to bust. A consortium led by RBS paid 71bn euros (£49bn at the time) for ABN Amro in October 2007, but RBS then wrote down the value of the business by £17bn a year later. The Bank of England governor, Mervyn King, said bank investors had been living in a “fool’s paradise”, with people’s money being used for risky activities while they themselves thought they were taking no risks. He told the cross-party Future of Banking Commission that the case for simple, utility banks was “irrefutable”. RBS is the second major UK bank to report 2009 results, after Barclays announced profits of £11.6bn last week. Lloyds Bank, which is also partly state-owned, will report its results on Friday. Under fireAside from bonuses, one other controversial topic for the banks has been their role in lending to business and home buyers.

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Barclays to pay £2bn in bonuses

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Barclays is preparing to pay bonuses to its staff of more than £2bn, the BBC has learned.But the bank, which did not take any direct state help during the financial crisis, is expected to say it is paying out less than it normally would. Barclays will reveal its full-year results on Tuesday and is expected to announce profits of about £10.3bn for 2009 - up 70% on the year before. Royal Bank of Scotland is expected to pay out £1.3bn in bonuses. The rise in profits means there are still likely to be multimillion-pound handouts for Barclays’ top bankers. Barclays is expected to pay out around £4.5bn in total remuneration to the 23,000 investment bankers employed at its investment bank, Barclays Capital.

Average pay for Barclays Capital’s 23,000 employees will be about £196,000 and just under half of this will be in the form of bonuses. The large profits enjoyed by bankers prompted widespread public anger because they were widely perceived to have taken dangerous risks which led to the global recession. BBC business editor Robert Peston said: “Bank chiefs insist they are paying out less of their revenues as bonuses than they normally do to show they are sensitive to the mood of the public.” The semi-nationalised Royal Bank of Scotland has “more or less agreed” with UK Financial Investments, which looks after the taxpayer’s controlling 84% stake in the bank, that it will pay out £1.3bn in bonuses, Robert Peston added.

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MPs to quiz Kraft on Cadbury deal

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MPs are to question senior officials from US food giant Kraft next month over its takeover of Cadbury.Kraft announced plans earlier this week to close Cadbury’s Somerdale factory in Keynsham, having previously said that it hoped to keep the plant open. The move drew criticism from workers and Business Secretary Lord Mandelson. Business select committee chairman Peter Luff said MPs wanted to know why Kraft went back on its pledge, and wanted it to clarify its position. The committee cannot automatically summon foreign companies to give evidence, but Mr Luff said Kraft had already been contacted about the hearing. The committee will also hear from unions representing Cadbury workers. ‘Time for assurances’Kraft completed its takeover of the UK chocolate maker on 2 February. Plans to close the Keynsham plant, with the loss of 400 jobs, were originally announced by Cadbury in 2007 as it looked to move production to Poland.

Before its bid was accepted, Kraft told the BBC: “We believe we would be in a position to keep the Somerdale plant operating and we are sincere about that.” However it now says that it only become aware of how advanced plans for the new Poland factory were after the takeover deal had been agreed. Mr Luff said the committee would look at “everything to do with the takeover bid, including its dealings with the government”. “The government opposed the bid, then embraced it and then Lord Mandelson criticised Kraft for closing the factory,” he said. “I think it’s time for Kraft to give the assurances they’ve been giving in private to politicians in Parliament. “It’s been a very controversial bid. I think we would be failing in our duties if we didn’t get Kraft to clarify their position.”

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BBC pays £230million every year to top presenters and actors

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By
Paul Revoir and Liz Thomas
Last updated at 9:50 PM on 09th February 2010

Jonathan Ross: His £6million-a-year deal is coming to an end
The BBC was last night embroiled in a fresh row over pay secrecy after
admitting it spends £54million a year on its stars - but refusing to
reveal individual salaries.
After months of criticism, the corporation bowed to pressure and revealed it spends £229million a year on ‘talent’.
But it still refuses to publish precisely how much performers such as Jeremy Clarkson and Jeremy Paxman earn individually.
The refusal came just days after MPs accused the broadcaster of
hiding behind the Data Protection Act to keep the salaries of its top
stars secret. However, the BBC did break down the £229million a year into
broad pay bands. This revealed that those who earn more than £150,000 a
year account for nearly a quarter of the talent spend. Some salaries are already in the public domain. Jonathan Ross
earns £6million a year but will leave in the summer, Graham Norton has
just signed a £2million a year deal, while Adrian Chiles has a £
1million salary. Last week it emerged actor Trevor Eve earns about £700,000 per series of Waking The Dead.
Even lesser known stars such as DIY SOS presenter Nick Knowles can pocket more than £300,000 a year.

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BA’s £50m loss beats expectations

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British Airways has announced it made a pre-tax loss of £50m ($79m) in the three months to December 2009.This was down from the £122m it lost in the same period in 2008 and smaller than many analysts had expected. However, BA’s pre-tax loss in the nine months to December rose to £342m from £70m in the same period in 2008. BA is currently locked in a High Court battle with the union Unite over changes to cabin crew contracts and is facing possible strike action. Cost-cuttingAnalysts had predicted BA would announce a loss of £151m in the third quarter, taking its loss for the nine months to £443m.

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