Lecturers' pension action resumes

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6 October 2011 Last updated at 23:01 GMT The dispute could escalate to new strikes, the UCU said Lecturers at 67 UK universities are going to re-start a programme of industrial action from 10 October over changes to their pension scheme.

They will start a "work to contract" if the universities do not resume negotiations over the pension changes.

Substantial cuts to the benefits of the Universities Superannuation Scheme (USS) were introduced on 1 October.

The University and College Union (UCU) said 40,000 members at the affected universities might eventually strike.

The union's general secretary, Sally Hunt, said the aim was to force the university employers to renegotiate some of the changes they have just brought in.

"There are key areas that we believe need to be looked at again," she said.

"Examples being accrual rates and another example being redundancy payments for those who are 50 and 55."

The dispute affects staff at the 67 traditional universities which were in existence before 1992, when the former polytechnics and higher education institutions were upgraded to university status.

'Sustained campaign'

The industrial action may be a precursor to more widespread action which has been threatened by unions with members in other parts of the public sector, such as local government, the civil service, NHS, schools, police and the fire service.

The government is trying to press ahead with substantial increases in staff pension contributions, to be followed by full-scale conversion of most of the schemes from their current final-salary basis to become less generous career average schemes.

The lecturers' industrial action will start with a "work to contract" which the UCU said would be the start of a "sustained campaign of industrial action".

Depending on local employment conditions, this might include union members working no more than their contracted hours, not covering other lecturers' classes, and refusing to carry out any additional duties or attend voluntary staff meetings.

"This will affect the universities in very different ways," said a spokesman for the employers body the UCEA (Universities and Colleges Employers Association).

"The changes would be considered moderate by many as they include the retention of a final salary pension for all existing USS members."

The UCU said if the employers refused to start negotiating again at a scheduled meeting later this month, the action might be escalated to a boycott of internal administration, student assessments and even rolling strikes.

Second campaign

The USS pension scheme has 137,000 contributing members at nearly 300 education institutions.

One-day strikes in March, at universities around the country, failed to deter the employers from pressing ahead with the bulk of their pension changes, which have been in train for three years.

So the UCU held a second industrial action ballot last month, which produced a 77% vote in favour on a 42% turnout - even higher than in the union's first ballot earlier this year.

The union said the some of its members would lose ￡100,000 of their pension income over their prospective retirement as a result of the changes.

It said the employers' private aim was to make huge savings by cutting their contribution rate from about 16% of staff salaries to just 10%.

This might be achieved, the UCU said, if the university employers were able, in a few years' time, to impose the career average scheme for new recruits on existing staff as well.

Big changes

The USS changes were brought in from 1 October in a separate process to the one the government has initiated for the other big public sector pension schemes.

The university pension changes were changes were:

A normal pension age of 65 came in for new entrants and for the future service of many existing members. The exceptions to this are those members who were in the scheme before 1 October - and who were also aged 55 or over at that date. They will be exempt from the normal reductions in their accrued pensions that will be imposed if they take their pensions before the age of 65. The normal USS pension age will rise in line with any increases in the state pension age, which is scheduled to rise to 66 by 2020. It is important to note that this will only affect pension built up after April 2020.The employee contribution rate for members of the final-salary section has gone up from 6.35% to 7.5%. Pension increases (for pensions in payment and deferred pensions) will now be inflation-proofed in line with increases in the consumer prices index (CPI) up to 5% a year. But for pensions earned after 1 October 2011, if inflation is more than 5% but less than 15%, the increase in pension will be 5% plus half of the increase above that level. And if inflation is more than 15%, there will be no extra pension increases - they will be capped at 10% a year.A career-average revalued earnings (CARE) benefits structure has been introduced for new entrants. The benefits are still be based upon a 1/80th accrual rate and cash lump sum of three times the pension.The contribution rate for members of the new CARE section is 6.5%. If the overall cost of the scheme rises above 23.5% of salaries, then "cost sharing" will be introduced. This means any further increases in contributions will be shared in the ratio 65:35 between employers and employees respectively.

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VIDEO: Build up a cash cushion, says Alvin Hall

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30 September 2011 Last updated at 10:22 GMT Help

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Wembley 'to break even by 2015'

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5 October 2011 Last updated at 11:15 GMT By Bill Wilson Business reporter, BBC News Wembley's income is boosted by other, non-sporting events Football Association chairman David Bernstein has said that English football's national stadium, Wembley, will financially break even by 2015, one year later than previously planned.

"Wembley is doing very well, it has been extremely profitable," he said.

Mr Bernstein added that the rebuilt stadium was showing an annual operating profit of between ￡40m and ￡50m.

He said he expected the stadium, built for ￡757m and opened in 2007, to start pumping cash into the game by 2015.

But he said that large interest charges and other continuing costs remained an issue.

The FA, which owns the stadium through its subsidiary Wembley National Stadium Ltd, said earlier this year it envisaged Wembley breaking even in 2014.

But Mr Bernstein told delegates at the Leaders in Football event in London: "By 2015, Wembley should start putting money back into the game, instead of being subsidised by the game."

World-class venue

Preliminary financial figures for 2010 released earlier this month by the FA showed that it paid out ￡22m in net interest during the year, partly to service the loans taken out to build Wembley.

And last year, FA general secretary Alex Horne said the association had budgeted to subsidise Wembley by ￡20m a year in 2010 and 2011 and ￡12m a year in 2012 and 2013.

Wembley's business plan relies on concerts and other events to boost the bottom line, but the FA obviously also sees the stadium as a world-class football venue.

And Mr Bernstein said that this on-field goal had been greatly been helped by the successful staging of the Champions League final at Wembley in May between Barcelona and Manchester United.

"I think that is when the new stadium really came of age," he said.

He also said it was a great vote of confidence in the Wembley when Uefa decided to stage the Champions League final again at the stadium in 2015.

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UK economic growth revised down

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5 October 2011 Last updated at 14:44 GMT Industrial output fell less than previously thought The UK economy grew by 0.1% between April and June, less than the 0.2% estimated previously.

Output from the service sector grew by 0.2% in the quarter, compared with the previous estimate of 0.5%, the Office for National Statistics (ONS) said.

Separate data suggested activity in the UK service sector grew in September.

The Treasury pointed to these figures as evidence the UK economy was still growing and said it would be sticking with its deficit reduction programme.

'Continued expansion'

The ONS also revised down growth in the first three months of the year, from 0.5% to 0.4%.

It added that household consumption fell by 0.8% in the second quarter.

Separately, a survey from Markit/CIPS found the UK's service sector purchasing managers' index (PMI) recorded a figure of 52.9 for September, up from 51.1 in August. A figure above 50 indicates growth.

Figures from the same company published earlier this week showed surprise growth in the manufacturing sector.

A Treasury spokesperson said: "While the UK cannot insulate itself from what is happening to our major trading partners, with financial turbulence in the eurozone and a weaker outlook for global growth, the economy is still growing and this week's survey data for the manufacturing and service sectors are consistent with continued expansion."

The government has been criticised in some quarters for concentrating too much on cutting the budget deficit at the expense of stimulating growth.

Continue reading the main story

So if households do what Mr Cameron wants, and continue to pay back their debts, it is very difficult to see how the economy can grow at much more than 1% or so per year for many years to come”

End Quote Robert Peston Business editor, BBC News On Wednesday, the International Monetary Fund (IMF) said that Europe's stronger economies should avoid imposing drastic budget cuts at the expense of growth.

If economic conditions deteriorate in the UK, Germany or France, governments should "consider delaying" cuts, particularly as they can borrow at low interest rates, the IMF said.

However, the Treasury reiterated that it did not intend to hold back on its spending cuts.

"The government will stick to the deficit reduction plan which has won the UK credibility and stability, but the most important thing for the economy now is restoring confidence, which will depend on the eurozone decisively dealing with its problems."

Further stimulus

The latest GDP revision is likely to raise further questions about the strength of the UK's fragile economic recovery.

In an interview with the Reuters news agency, the head of the British Retail Consortium, Stephen Robertson, said: "The next six months are going to be characterised by very low levels of growth. I think we've probably got another 18 months of real challenge."

Underlying costs for businesses will continue to rise, with the retail sector finding life "extremely difficult", he added.

On Wednesday, supermarket giant Tesco reported a fall in like-for-like sales excluding petrol and VAT of 0.5% for the first half of the year, while retailer Mothercare said like-for-like sales between July and September fell by almost 10%, triggering a 36% slump in its share price.

Also on Wednesday, airline Flybe saw a similar fall in its share price after reporting a "significant slowdown in sales" across its UK domestic network in September.

There has been speculation that the Bank of England will restart its quantitative easing (QE) programme, whereby it pumps money into the economy to boost demand.

At its meeting last the month, most members of the Bank's Monetary Policy Committee (MPC) agreed the case for an "immediate" stimulus had strengthened.

Some analysts said the encouraging PMI data could mean a delay in restarting QE, but most agreed further stimulus would be introduced this month or next.

The MPC's next meeting begins on Wednesday, with an announcement on interest rates and QE due at midday on Thursday.

"The bigger picture, including the risks to the economy from the eurozone debt crisis, far outweigh the services PMI survey and our view remains that the MPC will probably sanction further asset purchases tomorrow," said Philip Shaw at Investec.

Brian Hilliard at Societe Generale said the continuing debt crisis "should trigger a move [for QE] this week. I give about a 60% chance to that; if not, it's an absolute racing certainty for November".

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Experts debate eurozone options

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2 October 2011 Last updated at 00:06 GMT A number of ideas are reportedly being discussed to tackle the eurozone debt crisis.

These include a 50% write-down of Greece's government debts, strengthening big European banks that could be hit by any defaults by highly indebted governments, and boosting the size of the eurozone bailout fund, the European Financial Stability Facility (EFSF).

Here, eight economists discuss what they think will happen and what they think needs to happen in the eurozone.

Senior managing director of economics at FTI Consulting and former UK government adviser

Last week's events, with all the market volatility, were a serious wake-up call to all international institutions and to policymakers. I think they've understood it and institutions will be set up in such a way to ensure future crises should be averted.

I think we will see a haircut on Greek bonds, a recapitalisation programme for banks and an increase in the size of the bailout fund - but you need all these things, they need to be part of a package.

Even with that, in a year's time Europe will still be pretty weak because the long-term problems will still be there - low growth and unsustainable debt.

What we have seen for Greece will have to happen elsewhere. Haircuts are inevitable for other countries too.

They have to rethink how you achieve faster growth in Europe. If you don't get back to growth then the debt problems will remain.

The next thing that needs to be looked at seriously is issuing eurobonds. That may well be what we need in the longer term to lead us back to growth.

Director, Centre for European Policy Studies

We believe a market-based approach is needed to reduce Greece's debt.

The EFSF should offer holders of Greek debt an exchange into EFSF paper at the current market price. Banks would be forced in the context of the ongoing stress tests to write down holdings in their banking book and thus have an incentive to accept the offer.

More widely, we argue that the EFSF needs to be restructured.

You cannot just increase its size because if Italy or Spain were to step out as a guarantor, that would leave France, for instance, with a share of 40%, which it could not sustain and would lose its triple-A credit rating.

It cannot work as intended, but if it were re-registered as a bank, which would give it access to potentially unlimited ECB refinancing in case of emergency, the general breakdown in confidence could be stopped while leaving the management of public debt under the supervision of finance ministers.

Professorial research fellow, the European Institute of the London School of Economics. Currently researching EU economic policy, governance and policy co-ordination under European Monetary Union

The one obvious thing leaders should do would be to decide rapidly on a way of moving towards genuine eurobonds.

The Germans, manifestly, are very hostile to the idea, but it is a development that seems to have so many advantages that it ought to be pursued.

The trick will be to find a formula that deals with the "moral hazard" objections by introducing well-judged conditionality.

Economist at Open Europe, an independent think tank campaigning for reform of the EU

Greece obviously needs to restructure. It's looking at write-downs of 50% - that's a necessary step. It finally looks like the eurozone leaders are coming round to that.

But if it's not combined with recapitalising banks and other economic reforms it won't work.

In terms of the write-downs, banks will be able to absorb the hit because they should have been preparing for it for the last year. I think it would be necessary to use the EFSF to help recapitalise these banks and provide a backstop.

At the moment there's no clear pan-European mechanism for dealing with winding down a cross-border bank. I think we need a policy for what happens in this situation, a huge policy that needs to be detailed.

They also have to look at the different needs of the eurozone - for instance, interest rates in Germany would be very different to those in Greece. Those imbalances aren't going to go away.

Senior Economic Adviser, UBS Investment Bank

What I think the Europeans will choose to do is leverage the capital of the EFSF (currently 440bn euros) up by borrowing 5-10 times that from the market. They would then have the capacity to go and buy all of the sickly sovereign bonds that the banks are sitting on and swap them for bonds they themselves will issue.

I don't think it would be successful. In the short run it would probably be a bit of a tonic for bank stock prices and equity markets, but it doesn't do anything to solve the problem of the euro crisis at all.

I think you need a combination of three things.

These are: a restructuring template for Greece's debt with long gross periods - three years for the interest payment and 5-10 years for the principal repayment. That template might then have to be used for other countries.

Then, to stop Greek banks collapsing, you have to support the Greek banking system. And to stop banking contagion spreading to the likes of Italy and Spain, you need a banking recapitalisation programme.

And if the ECB said they were prepared to stand by and buy any amount of Spanish and Italian bonds, then we'd raise three cheers.

Anything that stops short of cleansing the European banking system will not be enough.

Chairman and chief economist, Lombard Street Research

The problem is that the Club Med countries - Greece, Italy, Spain and Portugal - are not competitive. Even if they agree to writing down Greek debts and increasing the EFSF, that will only be successful in postponing the issue for a few more months. It won't stop debt going up.

For the euro to survive the only solution is for the Club Med countries to leave the single currency. I think Ireland could stay in the euro as, although it's banking system is a mess, it is cost competitive - exports make up most of its GDP - so it is possible to turn the economy round quite fast.

Former economist at Merrill Lynch/Bank of America, now chief economist at Berenberg Bank

The probability that we will get a significant write-down of Greek debt as part of an orderly programme, with an immediate recapitalisation of Greek banks, and with further European support for Greece, has risen substantially.

The key question in all this is nothing to do with Greece - but whether upon granting Greece debt relief we can protect Italy from the market panic and prevent contagion.

The risk Greece will default is now above 50%. But Greece is highly likely to stay in the euro come what may.

I would like to see the ECB commit to being the ultimate backstop - if things get really ugly the ECB should buy more government bonds.

Professor of economics at the Graduate Institute in Geneva, specialises in monetary integration, monetary policy and financial crisis

Discussions about the EFSF are irrelevant. It shows policymakers haven't zeroed in on the crisis and what to do about it. The EFSF currently has 440bn euros. The amount we're talking about for Italy and Spain, as well as Greece, Portugal and Ireland could be 3.5 trillion euros.

I think that Greece will inevitably default, and I believe that Italy too will have to default, but I don't see a willingness in policymakers to accept that.

The ECB is the only institution that can stop the crisis. My solution is for the ECB to issue a partial guarantee on the existing public debts of eurozone governments, of say, up to 60% of GDP. It would allow governments to default but would create a backstop.

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HP completes buy-out of Autonomy

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3 October 2011 Last updated at 21:51 GMT Continue reading the main story Hewlett-Packard has completed the $12bn (￡7.8bn) buy-out of UK software firm Autonomy, despite the departure of the man who initiated it.

Leo Apotheker was replaced as HP chief executive last month amid falling sales and a share price collapse.

The Autonomy deal was part of a massive overhaul of the troubled US computer giant unveiled by Mr Apotheker.

But plans to spin off its core PC business received a thumbs down from the market.

HP's shares have fallen 47% this year, making it one of the worst performers in the Dow Jones index of leading US companies.

The purchase price for Autonomy was also widely criticised by market analysts as too high, but British takeover rules made it almost impossible to cancel the bid.

Meg Whitman, the former head of eBay who replaced Mr Apotheker, said shortly after her appointment that the deal would still go ahead.

The UK firm's head, Mike Lynch, later got into a colourful spat with HP rival Oracle, who claimed that Mr Lynch had sought a rival bid from them and been declined.

Oracle's chief executive Larry Ellison described the asking price as "absurdly high".

HP's shares closed 1.1% lower on Monday, outperforming the wider market.

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Oil prices fall on economy fears

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5 September 2011 Last updated at 16:20 GMT Continue reading the main story Oil prices have fallen on concerns that the US could fall back into recession, and continuing anxiety about eurozone debt levels.

With fears about a slowdown in China also hitting sentiment, US light crude had fallen $2.40 a barrel to $84.05.

Brent crude was also lower, dropping $1.66 to $110.67 per barrel.

The falls come after data on Friday showed that the US economy added no new jobs in August, a much worse reading than had been expected.

Analysts had predicted that the non-farm payrolls figures from the Department of Labor would show about 70,000 new jobs had been created.

The unemployment rate remained unchanged in August at 9.1%.

In Europe, the main share indexes were down sharply as concerns continue about the high debt levels of eurozone countries, and how these could impact on the wider economy.

Germany's Dax index and France's Cac were both 2.6% lower in morning trading.

Meanwhile, a report in China said that the country's service sector grew in August at its slowest pace since records began.

"Oil is falling on worries over weak demand, unemployment and talk of a double dip recession," said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt.

He added that oil prices would be falling further were it not for growing optimism that the US central bank, the Federal Reserve, will announce new measures later this month to try to stimulate the US economy.

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Help 6 October 2011, last updated-20: 00 GMT

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VIDEO: Youth unemployment rise in Eurozone

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4 October 2011 Last updated at 21:07 GMT Help

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European financial tax 'bad idea'

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30 September 2011 Last updated at 12:40 GMT Mr Borg said Sweden's experience of a financial transaction tax was "very bad" A European financial transaction tax is unlikely to raise the sums of money projected as it would encourage firms to move overseas, Sweden's finance minister has told the BBC.

Anders Borg said Sweden abandoned its own transaction tax after most trading companies left the country.

The tax "had a very detrimental impact on our financial markets", he said.

If the European Union introduces the tax, firms could simply move to New York or Asia, Mr Borg said.

'Very bad tax'

Sweden introduced a transaction tax on financial firms in the 1980s.

"Between 90%-99% of traders in bonds, equities and derivatives moved out of Stockholm to London," Mr Borg said.

Continue reading the main story

We are basically taxing growth away from Europe, and that is not a very good idea”

End Quote Anders Borg Swedish Finance Minister "The impact was basically that we did not get any tax revenue. It brought in very little tax money while moving most of the businesses outside of Sweden.

"We abandoned [the tax] because it was a very, very bad functioning tax."

The fact that the US has said it has no intention of introducing a similar tax, meant that firms would be free to move to other financial centres, Mr Borg said.

"So we are basically taxing growth away from Europe, and that is not a very good idea.

"I hope [policymakers] realise they might be losing out themselves. This is not a stable tax base."

Mr Borg said he was in favour of making the banking system pay, and making it more robust, but that any measures designed to bring this about should not push firms out of Europe.

Hard hit

The UK has also been vocal in its opposition to the tax proposed by the European Commission earlier this week.

A spokesperson for the UK Treasury said it would "absolutely resist" any tax that was not introduced globally.

London would be hardest hit by the tax as the majority of banking transactions in Europe come through the city.

However, a number of other European countries are in favour of the tax, including France, Austria, Belgium, Norway and Spain.

The commission has said it will look at implementing the tax just in the 17 member states of the eurozone if other EU members oppose it.

Under the proposals, the financial tax would be levied at a rate of 0.1% on all transactions between institutions when at least one party is based in the EU. Derivative contracts would be taxed at a rate of 0.01%.

The tax would raise about 57bn euros ($78bn; ￡50bn) a year and would come into effect at the start of 2014, the commission said.

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VIDEO: Human cost of Greek crisis

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The people of Greece are now having to pay the price of past official financial mismanagement, as the government takes drastic steps to try to avert a euro debt default. Paul Mason went to Athens to report on the human cost of political hubris.

Broadcast on Wednesday 28 September 2011.

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Banking on technology to stop the rogues

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26 September 2011 Last updated at 23:05 GMT By Michael Millar Business reporter, BBC News WATCH: Risk averse: Used correctly, technology could help to avoid losses like UBS trader Kweku Adoboli's $2.3bn

When news broke that Swiss investment bank UBS had lost $2.3bn (￡1.5bn) through alleged rogue trading, the shock was matched by an equally exasperated response of "not again!" as another financial risk management disaster hit the headlines.

After all, not only did the suspected trader, Kweku Adoboli, work in a 'Delta 1' team - the same desk that the biggest ever rogue trader, Jerome Kerviel of Societe Generale, once plied his trade - but the world continues to reel from a global financial crisis which itself stemmed from a monumental failure of risk management amongst financiers.

It leaves a sceptical public scratching its collective head and wondering just what needs to happen for risk to be kept under control in the financial sector.

It might sound surprising but there is no question whether managing risk is a central obligation for financial firms.

"Under UK company law all companies are required to have a duty of care towards shareholders assets and that includes risk management," explains Prof Brian Scott-Quinn from Henley Business School.

"Under FSA rules they have additional responsibilities, they have to take reasonable care to ensure that any activities in control functions [essentially roles with 'significant influence'] are properly controlled," he adds.

But it is no mean feat to do this; across August an average of 880,000 trades were completed each day on the London Stock Exchange alone, with an average daily value of ￡6.17bn.

Financial firms have back-office functions that are there to confirm transactions are above board, but such is the volume that the only way they can keep up is with increasingly advanced technology.

Technology kicks in

Mat Newman is vice-president at SunGard; its software processes millions of transactions for its financial sector clients every day.

Adaptiv is one of Sunguard's risk management software options

"The interconnectedness of what banks are trying to do across different geographies, different time zones and different trading desks, and asset classes is just immense these days," he says.

"One of the key things banks are faced with as a challenge is how to bring this together, this vast amount of data and make sense of it at the same time - so they can see the wood for the trees."

Without such technology companies don't have a hope of gathering the information they need, analysing it and presenting it to the right people at the right time.

"These days you have systems that will monitor your current positions against those risks and you have a whole series of bells and whistles that will flag not just if you breach those limits but if you come close to those limits," says Mark Hanney, CEO of Valbury Capital stockbrokers.

This is crucial for Valbury Capital, which takes trades from clients and then passes them on to the markets, theoretically running a no-risk business model.

Mark Hanney: "You have a whole series of bells and whistles"

"If a client is trading with us they put up a certain amount of margin, and if that margin is insufficient for their positions then our systems can automatically stop them out," Mr Hanney explains.

"Those systems can apply internally as well, so if a trader goes beyond a certain position then those systems are able, once they've breached those limits, to automatically close the position out."

The "bells and whistles" that flag up problems come in all shapes and sizes, dependent on the technology a firm opts for.

"Exceptions can be flagged graphically on summary dashboards with a number of graphical metaphors employed in the form of traffic lights, dials and graphs," says Daren Cox, CEO of Project Brokers, which supplies data analysis tools to investment banks.

He says that graphics rather than tables of data are often favoured simply because they mean that potential problems are easier to spot.

There are certain key areas of risk on which the technology is often brought to bear.

These include liquidity risk (how much cash you have and whether you can meet your obligations), market risk (what's going on out there in the markets) and one of the biggest of all, credit risk - basically how much people owe you and whether they are going to be able to pay it back.

Abusing the system

With the key flash points picked out and technology that can make a decision on whether a deal is a good idea in less than 10 milliseconds, the obvious question is why things seem to go wrong so regularly?

"One of the main problems these days - as it was in 2008 - is not the system but its operators," says Michel van Leeuwen, CEO of financial compliance consultancy, IMS.

"Their intelligence, experience, vigilance, their clout in the hierarchy and the simple analogy of 'having a clock' is irrelevant if you never look at it or don't look at it frequently."

Technology is also open to manipulation if you know how.

"Part of the problem is the rogue traders we have seen in the past have come from a back office function and they know these processes very well," says Mat Newman of SunGard.

"What's quite common in the City is to grow your own talent from the back office and bring it through to the front office."

Mr van Leeuwen calls this "akin to inviting the cat into the pigeon coop".

"It would be wise not to hire a trader that used to be a... back office employee," he says.

"The imperative, regulator imposed, 'Chinese wall' imposed in process and procedures, doesn't seem to have made it to the frontal lobe of HR or the heads of trading."

Positive thinking

There is a temptation with financial crisis in the air and an angry public after blood to overemphasise the down side of the risks financial institutions take.

This Algorithmics software shows where the trade has failed on a graph

But John Macdonald, executive vice-president at financial software firm Algorithmics, says risk management technology should not just be a way to stamp down on transgressors.

"Any one transaction can be analysed by one individual but it may take some time - if you have a customer you provide banking services to they don't want to wait two or three days for a decision," he says.

"Businesses need to be able to have access to funding and making the right decisions helps the economy grow.

"That's all part of risk management - being able to measure and then decide what level of risk you decide to take because you make a return on the capital you use by taking risk."

Of course there will be those that argue that on occasion slowing everything down a bit and taking a day or two rather than a thousandth of a second to mull a deal over might be a good thing.

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Senate currency bill 'dangerous'

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5 October 2011 Last updated at 05:12 GMT House Speaker Boehner has said taking action against China's currency peg is beyond the scope of Congress A top US Republican has criticised a Senate bill that could penalise China for alleged currency undervaluation.

The Senate voted on Monday by 79-19 to debate legislation that could make it easier to impose penalties against US trade partners.

House of Representatives Speaker John Boehner said it was "pretty dangerous" for Congress to tell other countries how to run their monetary policy.

Beijing said it "firmly opposed" the measure.

The bill would give the US government the power to add tariffs to goods imported from countries deemed to be undervaluing their currencies to boost exports.

The proposed law does not mention China by name, but many US politicians accused China of subsidising exports by holding down the value of the yuan, costing US jobs.

'Unfair trade practices'

Analysts expressed concern that the bill could damage relations with China, which is the biggest holder of US debt, at a time when the American economy is still fragile.

Continue reading the main story Use the dropdown for easy-to-understand explanations of key financial terms:AAA-rating GO The best credit rating that can be given to a borrower's debts, indicating that the risk of borrowing defaulting is miniscule.And Mr Boehner said: "This is well beyond what Congress ought to be doing, and while I've got concerns about how the Chinese have dealt with their currency, I'm not sure this is the way to fix it."

But he came under attack from Democrats over his opposition to the Senate bill, which has bipartisan support in Congress.

"For some inexplicable reason, the Republican leadership in the House is siding with the Chinese government. This is not the time to go soft on Beijing," said Democratic Senator Charles Schumer.

Democratic Senate Majority Leader Harry Reid meanwhile said: "We can't ignore blatant, unfair trade practices that put American workers at a disadvantage."

At the same time, Federal Reserve Chairman Ben Bernanke said that China's yuan policy hindered a more balanced growth path.

Unhappy China

Beijing has expressed "regret" over the measure. Chinese foreign ministry spokesman Ma Zhaoxu said it "seriously interferes with Sino-US trade ties".

"The yuan exchange rate is not the main reason for the Sino-US trade imbalance," said the Chinese central bank, the People's Bank of China.

Analysts have argued that the Chinese currency could be undervalued by as much as 20-40% in relation to the US dollar.

The effect of such a policy would make Chinese goods cheaper in the US, and US goods more expensive in China.

White House spokesman Jay Carney said the Obama administration was still reviewing the currency bill.

The Senate could vote on the bill later in the week.

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Can the iPhone still scare rivals?

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4 October 2011 Last updated at 23:33 GMT By Tim Weber Business editor, BBC News website Sony Ericsson hopes that Android will help it regain market share The days when Apple had a free run for our smartphone hearts and minds are over.

It's the first time that Apple's latest offering, the iPhone 4S, encounters a truly competitive field of rivals.

The competition is powered by Apple's former partner Google, whose Android operating system for smartphones is rapidly gaining marketshare.

Mobile phonemakers, long suffering under Apple's smartphone dominance, have embraced Android with gusto and are jostling to add software and hardware touches that trump Apple's offering.

The iPhone rivals

Samsung's Galaxy S II, for example, is already slimmer and lighter than both the old iPhone 4 and the new 4S and arguably has a better screen.

Taiwanese competitor HTC, meanwhile, hopes that a clever user interface dubbed HTC Sense will help it to best Apple.

Instead of the iPhone's static icons, HTC has improved Android to offer a raft of rich, dynamic widgets that bring information and functionality directly to the smartphone screen. HTC's Sensation, for example, is currently hard to best in terms of ease of use, not just when compared to the new iPhone but Android rivals as well.

For its top-end phones HTC also throws in a free service that allows owners to track and remotely manage their phones, probably one of the reasons why Apple recently stopped charging for a similar service.

Android has even allowed Sony Ericsson to get back into the game. For several years the company and its lacklustre range of phones have been losing market share; now the company is back with the Android-based Xperia Arc S - a well-built and user-friendly phone that can compete with most rivals.

Apple also lags in terms of hardware innovation, with several competitors pushing phones that sport 3D cameras and glasses-free 3D screens - like the Sharp 3D Aquos, the HTC Evo 3D and the LG Optimus 3D.

Google is also constantly updating Android, and provides the software free to manufacturers. This is not charitable behaviour, of course. Google search is deeply integrated into Android phones, providing healthy profits from clicks on sponsored search results (although a few network operators have begun to point customers to different search engines).

The rise of Android

The rise and rise of Android is reflected in the market share.

According to research firm Gartner, during the second quarter of 2011 Android captured a massive 43.4% of the global smartphone market - up from 17.2% just a year ago.

In contrast, Apple's iPhone software iOS gained just four percentage points to 18.2% - mainly by entering 15 new countries and signing up 42 new network operators to sell the iPhone.

The big losers are Nokia's Symbian smartphones, Blackberry maker RIM - and Microsoft who is struggling to gain traction for its new mobile operating system Windows Phone 7.

Operating System 2nd quarter 2011 2nd quarter 2010

Research in Motion (Blackberry)

Advantage Apple

Despite Android's advances, Apple still dominates the "mindshare" of the smartphone market.

This is less a function of the many Apple fans amongst tech journalists. It's more a question of first-mover advantage and, most importantly, branding.

Dozens of manufacturers are now selling numerous Android phones, ranging from the cheap and cheerful to the high end of the market. Apple and its network partners can focus all marketing around a single brand and - now - two devices.

No wonder that the iPhone is still seen by many as the benchmark against which other smartphones have to be measured - even though the new iPhone 4S has arguably failed to raise this benchmark in a significant manner. Some of the new features on the 4S have been standard on Android phones for many months.

The lack of a big "and one more thing" unveiling by Apple's new chief executive will have been greeted with loud sighs of relief by rivals.

Still, any move by Apple creates headaches for competitors. Internal documents of a mobile phone maker seen by the BBC last week showed how worried this company was that an iPhone 5 could steal all attention from the forthcoming launch of its top-end Android smartphone.

Microsoft, meanwhile...

Amidst all the Android and iPhone frenzy, spare a thought for Microsoft. A year ago and to considerable acclaim the software giant launched an all-new mobile phone software, Windows Phone 7.

Microsoft is betting on a distinct user interface

The operating system broke new ground in terms of usability, with a fresh look and many clever little features that neither Google's nor Apple's developers had thought of. Considering this was version one of the software, it was surprisingly polished.

So far, Microsoft has had little commercial success in return for its efforts. But Microsoft hopes that it can still challenge both Android and iPhone. After ironing out a few software wrinkles it has just launched Windows Phone 7.5, also known as Mango.

It's a compelling offering. The software delivers a deep integration with social networks like no other phone. Short messages exchanged with a friend - whether on SMS, Facebook or Twitter - will show up in one thread chronicling the conversation, regardless of which service was used.

A contact stored on the phone shows not just address and phone number but the most recent Facebook, Twitter and LinkedIn status updates too. And the diary is easier to use than any other.

However, Microsoft's fresh assault on the smartphone market is slow out of the starting blocks.

Mango was presented to the public many months ago. A few handset makers have announced a handful of new Windows phones. The first HTC phones running Mango are only now - slowly - arriving in the shops. Microsoft's new best friend, struggling Finnish phone company Nokia, won't launch its first Windows phone before 26 October, at Nokia World in London.

Apple, in contrast, is set to bring the iPhone 4S to market in less than two weeks.

The ecosystem

As operating systems and mobile phone makers jostle for position (don't forget RIM's Blackberry, about to roll out a range of handsets with a new operating system) it may be neither clever software nor stunning hardware that decides who will win the smartphone war.

The clincher will be the services connected to smartphones. Just as Google uses Android to lure people into their ecosystem, from email to media storage to YouTube videos to documents, Apple tries to lock in its customers into the world of iTunes and iCloud services.

Surprisingly, it is Microsoft that is offering the most open mobile phone ecosystem right now.

Consumers should be able to cherish this fierce competition. They may not get the chance. As iPhones, Androids and other devices rush to market, the patent lawyers of all sides are gearing up for epic court battles over patents and protected designs.

Not all that we'll see presented on stage will reach consumers' hands.

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UK 'will resist' EU financial tax

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28 September 2011 Last updated at 22:30 GMT Jose Manuel Barroso: "We have to understand we are in a situation where we have to do things together"

Bank shares have fallen in London after the UK said it would "resist" a financial transaction tax on EU members proposed by the European Commission.

The tax would raise about 57bn euros ($78bn; ￡50bn) a year and would come into effect at the start of 2014.

At close, Royal Bank of Scotland was behind by 3.64%, Lloyds Banking Group by 2.4%, and Barclays by 1.22%.

London would be hardest hit by the tax as the majority of banking transactions in Europe come through the city.

'Tax on London?'

City of London officials have said that about 80% of the revenues of any Europe-wide financial tax would come from London.

Stuart Fraser of the City of London said the question that had to be asked was whether the proposal was "a tax on London".

The banking sector played a role in causing the economic crisis, the commission said

Mr Fraser also warned that such a tax could mean a lot of banking transaction being lost to outside of the EU, and that the cost of setting up the scheme could outstrip whatever monies it raised.

Under the proposals, the financial tax would be levied at a rate of 0.1% on all transactions between institutions when at least one party is based in the EU. Derivative contracts would be taxed at a rate of 0.01%.

The BBC's business editor Robert Peston said that while dealers and investors in financial products such as derivatives and bonds were not happy about the proposal, share dealers were more relaxed as the tax would cost less than the existing stamp duty, which the tax would replace.

Meanwhile, in Germany and France bank shares also fell at close, and the European Banking Federation called the tax a "nonsense".

Among the market losers were Deutsche Bank and Commerzbank in Germany, and Societe Generale and BNP Paribas in France.

'Contribution' Chancellor Merkel faces a crunch vote on the eurozone bailout fund

Despite the opposition Algirdas Semeta, EC commissioner for taxation, customs, anti-fraud and audit, said: "Our project is sound and workable. I have no doubt this tax can deliver what EU citizens expect - a fair contribution from the financial sector."

The EU executive also points out that financial services are "in the majority of cases exempt from paying VAT (due to difficulties in measuring the taxable base)".

Germany and France have been among countries pressing the European Commission to propose the tax on all financial investment systems, as they seek to show their citizens they are serious about recouping some of the costs of the banking crisis.

Austria, Belgium, Norway and Spain also support such a tax.

Earlier, Commission president Jose Manuel Barroso had said banks must "make a contribution" as Europe faced its "greatest challenge".

A transaction tax would need the approval of the UK in order to be implemented across the EU.

The commission said that if the UK vetoed the tax, it would look to implement it in the eurozone.

Referring to "the constraints of unanimity", Mr Barroso said "further changes to the Treaty of Lisbon" may be required in order to push through measures to stabilise Europe's economy.

'Additional revenue'

The commission said the tax was "to ensure that the financial sector makes a fair contribution at a time of fiscal consolidation in the member states".

It said financial firms had played a role in the current "economic crisis" and was "under-taxed" compared with other sectors.

The "significant additional revenue" raised would contribute to public finances, it added.

A spokesperson for the UK Treasury said it would "absolutely resist" any tax that was not introduced globally.

Continue reading the main story Use the dropdown for easy-to-understand explanations of key financial terms:AAA-rating GO The best credit rating that can be given to a borrower's debts, indicating that the risk of borrowing defaulting is miniscule."We would not do anything that is not in the UK's interests," he told the BBC.

The Treasury has said there are also a number of practical issues that need to be worked through.

And the financial secretary to the Treasury, Mark Hoban, said the transaction tax would be ineffectual unless it was a global agreement.

"If it's not done at a global level, it's not done as part of a comprehensive package, then people will find ways around it," he said.

"They'll move business out of Europe, somewhere else, they'll find different products that are outside the scope of this transaction tax, so I think there's a lot of detail to be looked at to get this right."

Earlier, in his annual State of the Union address in Strasbourg, Mr Barroso had called not only for the transaction tax but for eurozone members to issue debt collectively, through so-called eurobonds.

"Once the euro area is fully equipped with the instruments necessary to ensure both integration and discipline, the issuance of joint debt will be seen as a natural and advantageous step for all," he said.

Further austerity

Officials from the commission, along with those from the European Central Bank and International Monetary Fund, are due to begin reviewing Greece's attempts to reduce its debt levels on Thursday.

Greece's new property tax has proved particularly unpopular

They will then decide whether to release about 8bn euros from a 110bn bailout package agreed last summer, money the Greek government badly needs in order to pay its bills.

A key obstacle to the payment was removed on Tuesday when the Greek parliament passed a controversial new property tax bill that aims to boost revenues.

Eurozone members are in the process of ratifying proposals put forward in July, one of which would see private lenders writing off about 20% of their loans to Greece.

The proposals also included expanding the powers of the eurozone bailout fund. Finland approved the plan on Wednesday, while Germany will vote on it on Thursday.

With 330 seats in the 620-seat Bundestag, Chancellor Angela Merkel can afford no more than 19 rebels if she is to deliver the 311 seats required for a majority.

Greek write-off

There has been renewed optimism this week that eurozone leaders may finally be ready to take decisive action to tackle the debt crisis.

G20 leaders met over the weekend to discuss the best way forward, but EU officials stressed that no grand plan of action had been agreed.

A number of ideas were reportedly discussed, including a 50% write-down of Greece's government debts.

Other proposals included strengthening big European banks that could be hit by any defaults by highly indebted governments, and boosting the size of the eurozone bailout fund.

These helped to boost investor sentiment with stock markets rising sharply on Tuesday, although Asian and European markets were largely flat on Wednesday.

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VIDEO: Cargill chief executive on its success

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29 September 2011 Last updated at 08:43 GMT Help

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Qantas buys 110 Airbus aircraft

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6 October 2011 Last updated at 07:18 GMT Qantas is launching two new airlines in Asia European aircraft maker Airbus has struck a deal worth US$9.5bn (￡6.2bn) with Australia's Qantas for 110 jets.

The order, said by Qantas to be the country's single largest aircraft purchase by units, will underpin the airline's expansion into Asia.

Qantas, which is launching a low-cost and a premium airline in Asia, is buying 78 Airbus 320neos and 32 A320s.

Meanwhile, Airbus said it may help customers with aircraft financing if the euro debt crisis affects orders.

Qantas' expansion plans in Asia include a low-cost tie-up with Japan Airlines and Mitsubishi Corp, as well as a separate joint-venture premium airline.

The next-generation A320neo burns about 15% less fuel than the original A320 and is a key part of EADS-owned Airbus's growth plans.

Separately, Airbus said that it could get involved in debt financing to help customers if market conditions worsen.

There have been reports that banks and institutions that bankroll the airline market are starting to scale back lending.

"We will, if necessary, enter into some financing, although we're not a bank," Tom Williams, Airbus executive vice president, told a news conference in Sydney.

Airbus and rival Boeing have been ramping up production in the last couple of years.

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Spain halts lottery privatisation

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29 September 2011 Last updated at 12:18 GMT The national lottery is famous for its El Gordo, or fat one, draw Spain has stopped the part-privatisation of the national lottery which had been expected to raise billions of euros.

The sale of up to 30% of the national lottery was postponed because the market valuation had been too low, the finance ministry said.

It intends to start the sale process again when conditions improve.

Spain had hoped to sell off a number of its assets, including 49% of the airports operator, to cut its deficit.

The lottery sale had been expected to raise several billion euros and would have been the country's biggest privatisation. It would also have created one of the biggest firms on the Spanish stock exchange's Ibex index.

It had been approved by the Spanish government just last week and presentations for potential investors had been expected to start at the beginning of October.

"Rather than have it valued for less than we had expected and for less than we believe to be the fair value, we decided to delay this listing," Finance Minister Elena Salgado told Spanish radio.

"Among individual investors there was and still is an extraordinary interest and among institutional investors too, but at prices that we did not want to accept."

But analysts suggested that opposition to the sale from the Popular Party, who are considered likely winners of the general election in November, may have played a part in the decision to pull it.

Elena Salgado added that the sale of almost half of Aena, the airports operator, would still go ahead.

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VIDEO: China currency vote: US view

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3 October 2011 Last updated at 00:27 GMT Help

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Markets see big quarterly falls

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30 September 2011 Last updated at 20:14 GMT By Damian Kahya Business reporter, BBC News Continue reading the main story European and US stocks were down again on Friday, contributing towards one of the worst quarterly falls for the markets in the past decade.

Stocks in France and Germany have fallen in value by more than 25% since the end of June.

Shares in London's FTSE are down 13.7%, the worst quarterly performance since 2002.

Friday's falls follow an unexpectedly sharp rise in the eurozone inflation rate for September to 3%.

Investors had hoped the European Central Bank would move to lower interest rates in the eurozone, after raising them in July to 1.5% to limit inflation.

However, the latest inflation figures may make such a move less likely.

Wall Street's main Dow Jones index ended Friday trading down 2.2% to record its worst quarterly performance since 2008.

Eurozone worries

But Friday's falls were just the latest bout of volatility in European markets, which have failed to regain ground since crashing towards the end of July.

Continue reading the main story Jamie Robertson Presenter, BBC World News

Following all the violent swings in equity markets since the sharp falls at the beginning of August, the main markets have not really moved outside fairly narrow ranges: the FTSE between 5,000 and 5,400 and the Dow between 10,800 and 11,600.

The Nikkei, the Dax and the Cac 40 have been gradually trending downwards by about 6-10% over the past two months. This is almost entirely due to uncertainty over the debt crisis and the fate of the eurozone.

However, even if there is no further bad news on that front, things are likely to get very active for individual companies.

Many of them, particularly ones that move in tandem with the economic cycle such as those in mining, retail, the auto sector and manufacturing, are trading on values that imply double digit growth.

October's results season could upset a lot of earnings forecasts, as markets come to terms with the prospect of near-zero growth in Europe and the US, and companies undergoing what are politely called price adjustments.

Economists say worries over the ability of eurozone countries to pay their debts are sparking concerns of a new banking and credit crisis.

"The euro area debt crisis has potential ramifications to euro area banking sectors in particular," said Grant Lewis, head of research at Daiwa capital markets.

"You've got concerns that a Greek default going wider into something more serious in terms of an Italian default, for example, that would leave banking sectors under-capitalised as well as having a calamitous effect on the economic outlook."

Shares in Germany's Deutsche Bank and Commerzbank both lost more than 30% in value since the end of June.

Stocks in French banks fared even worse. Societe Generale saw its stock fall more than 50%, while BNP Paribas saw its share price fall more than 40%.

The share falls have therefore been most pronounced in eurozone countries, with the FTSE falling less than benchmark German and French exchanges.

Brent crude was also set for the biggest quarterly fall since the financial crisis of 2008.

Oil for delivery in one month's time fell just over 8% to $103 a barrel in London as investors worried about a slowdown in the global economy.

Worries ahead Global markets have been hit by a 'toxic cocktail' of factors, says one economist

Despite the record quarterly falls, markets remain up on the levels they reached after the 2008 financial crisis.

"There are certainly widespread indications of pretty serious financial stress, but they are not by and large as dramatic as they were in 2007 and 2008," George Magnus, European economist at UBS, told the BBC.

"Then, the whole edifice of the Western banking system was about to implode. At that point, I think it was far more dramatic than it is now."

But investors and economists fear the situation may deteriorate further.

Markets are likely to look to forthcoming company results and quarterly economic data for their next move.

In the longer term, economists say they are seeking reassurance from politicians.

"I think markets are expecting something of substance to be revealed by the G20 [group of leading nations] in November and if it isn't, we could be in a lot of trouble," Mr Magnus added.

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Energy bills break £1,000 barrier

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5 October 2011 Last updated at 12:11 GMT Price rises have recently been announced by all the major energy suppliers The cheapest domestic energy deal available to UK householders has risen above ￡1,000 a year for the first time.

Scottish Power has withdrawn its ￡990 internet tariff, following moves by other energy providers in recent weeks.

Some online packages are cheaper than the average gas and electricity bill because of the lower overheads involved.

But these prices have risen in the same way as other payment options, with companies blaming wholesale costs.

Tariffs

Last month, EDF Energy became the last of the "big six" energy companies to announce increases in prices for domestic customers.

The tariffs across the industry have included price rises of up to 18%.

Price comparison website Uswitch said that in the last couple of months, energy companies had withdrawn some of their most competitive online rates.

Meanwhile, Mark Todd, of price comparison website Energyhelpline, said that the cull meant households with average energy use could no longer get any deals for under ￡1,000.

"This is the first time that has been the case and emphasises in stark terms how bills are reaching historic levels," he said.

Regulator Ofgem is studying whether higher prices are justified, while Energy Secretary Chris Huhne recently pledged to "get tough" with the six biggest energy companies on their tariffs.

Scottish Power Scottish & Southern British Gas Npower E.On EDF

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Games journey times 'may double'

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2 October 2011 Last updated at 17:00 GMT TfL has said Games Lanes will contribute to increased traffic in some areas of London Journey times on some of London's roads could more than double during the Olympics next year, Transport for London (TfL) has admitted.

The information was in a brief sent to businesses about the Games.

Commuters have been warned of huge delays as an extra 5.3 million visitors are expected in London for the event.

Transport Minister Theresa Villiers said she was confident about the preparations being carried out by TfL to cope with the extra demands.

In an interview with the BBC's Politics Show on Sunday she said: "TfL are focused on keeping London moving during what is going to be the largest event ever hosted in this country.

"It will mean some transport disruption and there will be pressure on the transport system but we will adapt to minimise disruption."

She said businesses were actively engaging with TfL but admitted there was more to do.

A TfL spokesman said: "We have been clear that at certain times and places the transport network will be much busier than usual, which is why we are already working with businesses to ensure they can keep on running and make the most of the great financial opportunities offered by the Games.

"While the transport network will be very busy, we are confident that we will keep London moving while delivering a hugely successful Games."

Commuters have already been warned there could be huge delays to get into large stations such as London Bridge because of the extra pressure on the transport network.

In April a London Assembly report claimed transport problems remained "one of the biggest risks" to the 2012 Olympics.

And in July TfL admitted the "Games Lanes" - dedicated lanes for Olympic athletes and VIPs - would put greater traffic demands on certain parts of the network during the Olympics.

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Dexia shares slump on Greece woes

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3 October 2011 Last updated at 19:56 GMT Dexia received a 6bn-euro bailout at the height of the financial crisis Dexia has called an emergency board meeting amid fears over its exposure to Greek debt.

Meanwhile, shares in the Franco-Belgian bank fell 10% on Monday after rating agency Moody's said it was reviewing Dexia for a possible downgrade.

The finance ministers of Belgium and France are meeting eurozone colleagues in Luxembourg, and are expected to discuss ways to support the bank.

Financial markets fell on news Greece would miss deficit reduction targets.

Greece announced on Sunday that the 2011 deficit was projected to be 8.5% of gross domestic product, down from 10.5% in 2010, but short of the 7.6% target set by the EU and IMF.

Write-off

The news affected financial markets across Asia and Europe, with bank shares among the hardest hit.

Eurozone banks have been hit by cash outflows since the summer amid fears that Greece, and possibly other governments, may ultimately default on their debts, and even leave the eurozone, leaving their lenders sitting on big losses.

Dexia shares initially fell 14% on news of the possible rating downgrde, and despite a rally back in later trading, they were still the worst hit in the financial sector.

Moody's cited Dexia's potential losses on a Greek debt default, as well as the bank's recent difficulties in borrowing short-term cash from markets, as reasons for the rating review.

Continue reading the main story

It was only on July 15 that the European Banking Authority [stress tests]... portrayed Dexia as one of the strongest banks in Europe”

End Quote Robert Peston Business editor, BBC News Dexia's exposure to Greek government debt totals 3.4bn euros ($4.5bn; ￡2.9bn). Its total exposure to Greece - including to private-sector Greek borrowers - is 4.8bn euros.

It has already written off 21% of its Greek debts, but market prices now suggest the eventually loss to lenders could be in excess of 50% of the amount owed by Greece.

Paris-based business newspaper Les Echos reported on Friday that the French and Belgian governments would discuss measures to shore up Dexia's balance sheet.

The bank is already partly-owned by the two governments, after it received a 6bn euros joint bailout at the height of the financial crisis in 2008.

There were reports last week that the bank could be split up, and speculation of a possible nationalisation of the bank.

Another option under consideration is the sale of Credit Local, a unit of the bank responsible for lending to French local governments.

Belgian Finance Minister Didier Reynders told Belgian radio on Friday that Dexia's shareholders should be behind the bank and be ready intervene if there was a problem.

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BBC Wales workers' one-day strike

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30 September 2011 Last updated at 06:10 GMT Bectu is protesting against the loss of four BBC Wales editing jobs BBC Wales workers from the broadcasting union Bectu are staging a one-day strike on Friday.

The union is protesting against the loss of four editing jobs in the BBC's post-production news area.

"Every request made that our members be redeployed in new roles being created in the area of their expertise was refused," said a Bectu statement.

BBC Wales said it was disappointed about the strike and apologised for any disruption to services it might cause.

In a statement the broadcaster said it had a record of successfully redeploying as many staff as possible.

In July, members of the National Union of Journalists (NUJ) at BBC Wales took part in UK-wide industrial action protesting at compulsory redundancies due to cutbacks in funding.

?

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Banks rally on rescue deal hopes

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26 September 2011 Last updated at 20:21 GMT Continue reading the main story Last Updated at 17:44 GMT

Market indexCurrent valueTrendVariation% variationEuropean bank shares have risen as investors react to the latest attempts to stabilise the eurozone debt crisis.

A number of measures are being discussed according to reports from the weekend's international meeting in Washington.

They are expected to involve a 50% write-down of Greece's massive government debt, the BBC's business editor Robert Peston says.

French and German bank shares were up 10% at one stage in Monday trading.

European governments hope to have measures agreed in five to six weeks, in time for a meeting of the leaders of the G20 group in Cannes at the beginning of November.

But EU officials in Brussels stress that they should not be seen as "a single grand plan", the BBC's correspondent Chris Morris says.

The measures being discussed are:

Institutions that have lent money to Athens writing off about 50% of the money they are owedThe size of the eurozone bailout fund, the European Financial Stability Facility (EFSF), increasing dramatically to 2 trillion euros (￡1.7tn; $2.7tn)Strengthening big European banks that could be hit by any defaults on national debt obligations.

However, on Monday evening AFP reported that German Finance Minister Wolfgang Schaeuble had told television news channel NTV that there was no plan to boost the size of the EFSF.

"We are giving it the tools so it can work if necessary," Mr Schaeuble was reported as saying.

"Then we will use it effectively but we do not have the intention of boosting its volume."

Pan-Europe gains

Uncertainty over how to tackle Greece's problems has led to some European bank shares losing half their value in recent months due to concerns about their holdings of Greek debt.

But on Monday, French banks, which are particularly exposed to Greece, rallied, with BNP Paribas and Societe Generale up 4% and 5.4% respectively, and Credit Agricole up 3.7%.

Continue reading the main story

Unless the banks are fixed, there will remain too big a risk that a financial crisis could turn the current global economic slowdown into something more akin to depression than recession”

End Quote Robert Peston Business editor, BBC News Germany's big banks were also up sharply. Allianz was up 10%, Deutsche Bank 8% and Commerzbank 7.7%. In the UK, Barclays rose 6.8% and RBS 3.3%.

The Frankfurt was up about 3% at close, and in Paris by about 2%. The UK's main index, the FTSE 100, was virtually unchanged.

US shares closed higher, with the Dow ahead by 2.5%, the S&P 500 by 2.3%, and the Nasdaq by 1.4%.

However, commodity prices were lower on remaining concerns that the eurozone crisis could affect the global economy.

Philip Tyson of brokerage MF Global told the BBC that the proposed bailout fund had to be at least 2tn euros.

He said: "Markets need confidence that the fund has the firepower to deal with the likes of Italy and Spain should contagion risks spread.

"It does need to happen, but there are big question marks about the detail, and exactly how it will happen. Time is running out."

Ben Critchley, a sales trader at spread betting group IG Index, said: "For now at least, it looks as if markets are giving some credence to a firm plan on how to tackle the debt crisis beginning to emerge.

"But if recent experience is anything to go by, this patience is unlikely to last too long if details are not forthcoming."

Key elements

The reports about the rescue proposals emerged from the annual meeting of the IMF in the US capital last week, attended by finance ministers from the G20 group of countries.

The package is expected to involve a quadrupling - from the current projected level of 440bn euros - in the firepower of the eurozone's main bailout fund, the EFSF.

Continue reading the main story

The problem, they said privately, was that ministers couldn't talk openly about a new solution to the crisis when the old one had not even been passed by national parliaments. This was a particular issue, naturally, for Germany.”

End Quote Stephanie Flanders Economics editor, BBC News It is not entirely clear how any expansion of the facility would be managed, but one suggestion is for the EFSF to guarantee the first part of any losses creditors sustain from a government defaulting on its debts, with the European Central Bank (ECB) providing an additional 1.5tn euros of loans.

The EFSF would take on the main risk of lending to governments struggling to borrow from normal commercial sources - governments like Italy.

It is also thought that private investors in Greek debt are likely to have to accept a 50% reduction in what they are owed, our editor says.

Eurozone leaders agreed a plan in July, which has yet to be ratified, that provided for a reduction in Greece's repayments to banks of about 20%.

European officials in Brussels stressed that their current focus was on getting measures, including changes to the EFSF, agreed back in July ratified by 17 national parliaments within the eurozone.

It was proving a difficult task, the BBC's Chris Morris says, to get these less far-reaching changes passed, with Germany one of three assemblies to vote this week.

The third element of the rescue plan envisages a strengthening of big eurozone banks, which are perceived to have too little capital to absorb losses.

'Critical days'

Commodity prices remained under pressure, pulled between relief that a eurozone deal could be nearer and worries that the global economy faces a downturn.

Continue reading the main story Oil prices fell sharply in early trading, but recovered with Brent crude up 60 cents at $104.57 a barrel and US light, sweet crude up 55 cents to $80.40 a barrel.

The stronger dollar, which rose around 0.2% against a basket of currencies, also weighed on oil prices as it makes dollar-denominated assets more expensive.

Gold fell 3.2% to $1,603.95 an ounce, continuing recent declines from record highs. Copper, which has already fallen, was down another 4%.

Senior commodities analysts Edward Meir, at brokers MF Global, said: "These are very critical days and weeks ahead, reminiscent very much of the touch-and-go situation we were in back in 2008.

"The key difference this time around is that it is countries and not companies that are in danger of going bust."

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Wall Street protesters released

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2 October 2011 Last updated at 15:57 GMT Protester Michael Pellagatti holds up the plastic handcuffs used to restrain him and the court summons he was issued Police in New York City have freed most of the more than 700 people arrested on Brooklyn Bridge on Saturday during a protest against corporate greed.

Fewer than 20 protesters are still held as they are yet to be identified.

Most of those freed were given citations for disorderly conduct and a criminal court summons.

The Occupy Wall Street group, camped in Manhattan's financial district for two weeks, says it will continue its demonstrations.

A spokesman for the New York Police Department told the BBC the small group still detained were expected to appear at the Manhattan criminal court on Sunday.

'Multiple warnings'

The arrests took place on Saturday after protesters carried out an impromptu walk over the East River to Brooklyn.

Some demonstrators carried slogans reading "End the Fed" and "Pepper spray Goldman Sachs".

Police said the protesters were given "multiple warnings" to keep to the pedestrian walkway but spread to the road, halting bridge traffic for several hours.

Some protesters accused the police of not issuing warnings or of tricking them on to the roadway, accusations the police denied.

Demonstrator Henry-James Ferry: "'The police moved in with orange mesh barricade". Saturday footage courtesy Robert Cammiso

Occupy Wall Street says it will continue its campaign, with meetings on Sunday in Zuccotti Park, the privately owned area of land not far from Wall Street that it has occupied since 17 September.

There will be another march on Wall Street on Wednesday afternoon.

"We are the majority. We are the 99%. And we will no longer be silent," the group said in a statement.

"We are using the revolutionary Arab Spring tactic to achieve our ends and encourage the use of non-violence to maximise the safety of all participants."

The protesters have had previous run-ins with New York's police.

On Friday, about 2,000 people marched under the Occupy Wall Street banner to New York's police headquarters to protest against arrests and police behaviour.

Some 80 people were arrested during a march on 25 September, mostly for disorderly conduct and blocking traffic, but one person was charged with assaulting a police officer.

A series of other small-scale protests have also sprung up in other US cities in sympathy with the aims of Occupy Wall Street.

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Oil firm resumes Libya operations

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26 September 2011 Last updated at 13:50 GMT Libya's refineries were mostly closed in March, when fighting intensified Italian oil firm Eni has restarted production at an oil field in Libya, as opponents of Col Muammar Gaddafi tighten their control on the economy.

Eni, which was the biggest foreign oil producer in Libya before Col Gaddafi was overthrown, said it planned to reopen other fields in the coming days.

Other firms, including French company Total, have also restarted operations.

Meanwhile, anti-Gaddafi forces are closing in on his hometown of Sirte, one of his few remaining strongholds.

The soldiers, loyal to the National Transitional Council (NTC), launched a surprise attack on the city on the weekend.

The BBC's Alastair Leithead, near Sirte, says the troops have the city surrounded and are preparing to enter it with significant force.

Gaddafi loyalists have been fiercely protecting the city from NTC advances in recent weeks.

Eni said in a statement it has restarted production at 15 wells in the Abu Attifel oil field, about 300km (190 miles) south of Benghazi.

Slow recovery

The company said it was pumping 31,900 barrels of oil a day, compared with a rate of 70,000 barrels a day before the unrest broke out.

The wells were closed in March amid increasing violence between Gaddafi loyalists and rebels, who later formed the NTC.

France's Total announced last week that it had resumed production at its al-Jurf offshore facility, which is capable of producing 40,000 barrels a day.

And Libya's state controlled Arabian Gulf Oil (Agoco) announced earlier this month that it had started pumping 160,000 barrels of oil from fields in the east.

The country was producing 1.6 million barrels a day before the unrest began, making up the bulk of its wealth.

Experts say it is likely to take at least a year before anything close to those levels are reached again.

The NTC still has not found Col Gaddafi, who ruled the country for more than 40 years.

But several of his children and members of his inner circle have fled abroad.

His daughter Aisha fled to Algeria, and told journalists last week that her father was in good spirits and fighting alongside his supporters.

The Algerian newspaper El-Khabar reported on Monday that a group of Gaddafi supporters, possibly including Aisha, had now left the country for Egypt.

The report has not yet been confirmed.

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Drug bust at Boeing defence plant

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30 September 2011 Last updated at 03:25 GMT Chinook helicopters are key cogs in US and international armed forces US federal agents have arrested 37 people in a drugs raid on a plant run by the aircraft manufacturer Boeing.

All but one of those detained are current and former employees at the facility near Philadelphia, which produces aircraft for the US military.

It is alleged they were dealing and buying prescription drugs. Boeing was alerted to the alleged drugs ring by members of staff.

Managers then called in the FBI, whose agents worked undercover at the plant.

The Boeing plant makes Chinook helicopters and Osprey planes used in Afghanistan.

'Critical role'

In all, 37 people were arrested for distributing and/or trying to buy prescription medication - mostly painkillers and anti-anxiety drugs.

US Attorney Zane David Memeger said 23 people were charged with selling the prescription painkiller Oxycontin among other drugs, while 14 people were charged with attempted possession of various drugs.

The suspects are men and women, most of them aged in their 40s and 50s.

"This investigation and prosecution focused not only on the sellers, but also on the users because of the critical role that these employees play in manufacturing military aircraft," Mr Memeger said.

The alleged dealing took place at the plant, although Boeing insists the quality of its production line was never compromised.

In a statement, the firm praised the authorities for a "rigorous and thorough investigation".

The plant, at Ridley Park, Pennsylvania, employs some 5,500 people, reports say.

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Firms vie for UK rescue service

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5 October 2011 Last updated at 12:06 GMT The successful company would run rescue services out of four bases, including Stornaway At least four companies are competing for a contract to run part of the UK's search and rescue helicopter service.

Firms had until Wednesday to submit bids for a new five-year contract to run four coastguard rescue services in Scotland and southern England.

Bids have been submitted by Bond, Bristow, a consortium including British International Helicopters and CHC, the current coastguard contractors.

The government is to announce which has been successful by the end of the year.

The preferred bidder will take over the operation of helicopter rescue services out of bases in Portland in Dorset, Lee-on-the-Solent in Hampshire, Sumburgh in the Shetland Islands, and Stornoway in the Outer Hebrides from June 2013.

The UK's search and rescue service is currently operated out of four Maritime and Coastguard Agency (MCA) bases, six RAF ones and two Navy ones.

All four coastguard bases are run by CHC, but its contract expires next year.

The Department for Transport needed to find a contractor to run the service after plans for a private consortium to take over all 12 UK helicopter rescue bases were shelved earlier this year.

The Soteria consortium did not get the contract after admitting it had access to commercially sensitive information.

Ministry of Defence police are investigating how the information came to be in the group's possession.

This new contract is expected to plug a gap until a private finance deal is reached for the takeover of the entire search and rescue service.

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Fears over debt Chinese surface

October 6, 2011, last updated 04: 28 GMT China market with deep pockets could see slow growth and buoyant, China touted as a White Knight in the world.

But fears are growing that the country can meet its debt crisis as its economy and signs of a slowdown.

Prime weekend urged stronger financial support for small businesses that are missing.

Its a conversation between reports many factories of the private sector are facing bankruptcy due to tightening credit, informal lending operations.

In the eastern city of Wenzhou, a fifth of small businesses to midsize, 360,000 city stops due to lack of cash, reported by China's official Xinhua News Agency on Thursday.

"Efficient means must be taken to contain the trend of usury, crack on illegal fund-raising and handle correctly the problem of collateral, lack of capital to prevent risks from spread and develop regional scale," said Mr. van when visiting the city.

According to media reports, more than 80 businessmen fled town bakpa loans taken from underground banks, owner of a shoe one jumped off a building and killed himself.

' Time bomb '

Continue reading the main story

we take informal lending market most likely short-term time bomb of China's economy, "

end quote Dong Tao, Credit Suisse economists believe it could be the start of a wave of Corporate bankruptcies.

A central concern of China loan informal or shadow banking market-rich individuals and businesses that offer loans at interest rates spanning from 14% to 70%.

Companies and entrepreneurs have turned in this underground, with Chinese banks tightening lending as part of the Government's fight against inflation.

Credit Suisse says it sector statistics was rare, but as total 4 trillion yuan ($ ￡ 627bn; 406bn) is equal to 8% of the formal banking sector-and loans may increase by 50% per year.

He estimates that 60% of informal loans to property developers have with the rest going to other small businesses that need loans bridge.

"We consider formal lending market most likely short-term time bomb of China's economy," Tao Dong, Asia Economist at Credit Suisse, said the report.

"Beijing take decisive measures to deal with active, problem, or the credit crisis is species emerge in our opinion," he says.

Default swaps

Fears of economic slowing down in China has also fuelled a rise in trade of credit default swaps are financial instruments which insure against-risk of debt defaults.

The net value of credit default swaps outstanding bahov Chinese Government rose to US $ 3bn, compared to $ 6bn. two years ago, the Financial Times reported on Thursday.

Investors are worried that China's economy could have a "hard landing" slowed suddenly after years of blistering growth.

The property market is considered to be particularly vulnerable, with home prices soaring over the past two years.

The State raised interest rates three times so far this year and ordered banks to increase their reserves and six times during the same period.

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AUDIO: Would you go off sick with stress?

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5 October 2011 Last updated at 15:40 GMT Help

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Trend in EU economic bucking of Estonia

October 6, 2011, last updated: 57 GMT by Charlotte Ashton, World Tallin Tallinn, Estonia-Skype, as well as other companies in emerging technologies now has the fastest economic growth in the European Union, so what does Estonia just when other countries are so many economic problems?

Ave Maria Ounapuu enjoys boom of Estonia.

Organic cosmetics company established JOIK four years ago to take its business to making candles.

She has received grants from the European Union for machinery and marketing help, but says the business agenda of the Government of Estonia helped too: "it was pretty easy.

"There was no problem with the regulations, even finding products to sell went smoothly enough.

"You can report your taxes online so you don't need to spend valuable time to forms and things. We don't have our growth to the Government, but they will not put any obstacles in our way. "

Currently, JOIK employs four people, was moved to a larger space. It has an annual turnover of 250,000 euros, on export to countries bordering the Baltic.

Ave Maria Ounapuu says the Government of Estonia has set up an independent business with ease

This is a similar story of Estonia as a whole, as the country has a long way since she joined the EU in 2004.

The initial flow of credit to the construction boom that led to high House, but the bubble burst in 2008, when the country found itself the economic doldrums, it had to smarten up their act.

Labour laws were liberalised, increased retirement age and public spending cut. But the tax remained low to encourage business; Entrepreneurs were fashionable.

Estonia GDP grew at 8.5% in the first quarter of this year, the fastest growth of all the EU economy. One of the biggest growth areas in it technology.

Estonia exports mainly to the EU, but exports of its main markets, Finland, Sweden are distorted

Skype Online software used by people 200 m each month to make free or cheap video phone calls over the Internet, has its development, on the outskirts of Tallinn.

The software was invented in Tallinn of Dane, Swede and Estonians.

Stan Tankivi, head of Skype Estonia, says: "you can show the country of Estonia itself as a witness. It regained independence 20 years ago, the company generally or culture here has very little hierarchy.

"It is very small and nimble, that sort of environment is very positive for entrepreneurship".

In January, Estonia joined the euro. Stability of the currency result, along with those low corporate taxes (zero profits reinvested), this tiny nation of 1.3 m investment very attractive. Exports are soaring, up 53% last year. This summer came the euro 1bn for the first time.

But 70 percent of exports go to EU countries, growth is deteriorating steadily and its two main export markets, Finland and Sweden.

How is the economy of Estonia so fragile?

It is still a net recipient of EU money but its contribution to financial stability facility means that European companies is decreasingly profitable. Contribution of Euro 2bn represents one third of the annual budget.

"We were invited to a wedding but turned out to be a funeral," says Anders Arrak, Estonian who has entrepreneurial University apply.

Read on the Central story

of course we understand what the meaning of the credit crisis, but in Estonia is not a hot topic for us "

end quote Andrus Ansip Estonian Prime ??????"??? us a lot of money from the EU.

"We have already renovated churches and roads. But now we are being asked to pay money to improve the errors made in the past, Greece and the countries of the eurozone.

"It makes sense. We have to invest in the future of Estonia. "

But the Prime Minister of Estonia Andrus Ansip stay safer will continue its growth: "of course we all need to be concerned but our banking sector is doing well, our commercial banks are well capitalised and correspond to the reserves.

"The State the money are the best of all the European Union because we have still 12% GDP reserves.

"Yes, of course, we understand what the meaning of the credit crisis, but in Estonia is not a hot topic for us."

Mr Ansip thank him an erection activities explaining why Estonia, a poor cousin Mizrahi, fresh out of troubled times himself, bail out its richer southern cousins.

Drinkers in the lounge of their obligation to contribute to the Museum say bailouts EU

But support for the European Union young Estonians soothes the unwavering with a glass of wine in one of the new trendy bars, lounge Tallinn Museum.

Memories of Soviet occupation, which ended just 20 years ago, are still fresh among the younger generation.

Ali is a teacher at the school who says it fully supports Estonia's contribution to the bailout.

"I don't even understand what the discussion. We already received money from the EU now is a good thing because ultimately we are in a position to help someone else. I think it's only fair. "

The Museum lounge Manager, ARGO, agrees. "An overview of Estonia in the West now, only the West," he says.

And Estonia are ready to pay the price.

The world tonight is broadcast weekdays on BBC Radio 4: 00 p.m. BST.

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