UK Economy: GDP Growth Accelerates To 0.8%

The Chancellor claims there is now "real momentum" in the UK's economic recovery after GDP growth of 0.8% was measured in the third quarter.

The Office for National Statistics (ONS) said it marked the strongest period of growth in more than three years - with services, construction and manufacturing all expanding.

It was also the third successive period of improving output, in line with the expectations of economists, though some had forecast growth to have reached 1%.

The ONS said construction - a sector bolstered by Government initiatives such as Help to Buy - surged by 2.5%.

George Osborne said: "This shows that Britain's hard work is paying off & the country is on the path to prosperity."

Prime Minister David Cameron tweeted: "Today's encouraging #GDP growth figures are another sign we are turning a corner."

Labour argued the growth was "long overdue".

Overall GDP was 1.5% ahead of the same period last year - a time when the economy was being boosted by the Olympics and Paralympics.

But the economy remains 2.5% off its pre-recession peak at the start of 2008.

During the third quarter, construction was boosted by new work on private housing and private commercial building as well as domestic home repair and maintenance but remained 12.5% off its 2008 high.

Housebuilders have been buoyed by the Government's Help to Buy scheme, which recently launched a new phase offering mortgage guarantees.

Production grew by 0.5%, though this remains 12.8% off its 2008 level, while within this manufacturing improved 0.9% in the third quarter.

The powerhouse services sector, which represents three-quarters of economic output, grew by 0.7% and is now 0.6% above its pre-crisis peak.

The largest contributions here came from business services and finance, followed by distribution, hotels and restaurants.

But the wider statistics highlighted one piece of bad news - in terms of UK growth.

The contribution from utilities - including gas and electricity - tumbled by 6.8% in the period, possibly a result of the warm summer compared to the same period last year which was largely a washout and cool.

The figure was seen as a potential factor behind the decision among energy suppliers to increase household bills - to make up for lower demand.

Chris Williamson, chief economist at Markit, said: "Britain is booming again with the economy showing the most sustainable and robust-looking upturn since the financial crisis."

But Alan Clarke of Scotiabank said the figure was a "tad disappointing" - given survey data indicating growth nearer 1% - and "wasn't a home run".

Shadow chancellor Ed Balls said: "After three damaging years of flatlining, it's both welcome and long overdue that our economy is growing again.

"But for millions of people across the country still seeing prices rising faster than their wages this is no recovery at all."

Dave Prentis, general secretary of the Unison union, said growth figures will "mean nothing to the vast majority of people in this country faced with mounting household bills and stagnant wages."

12.06 | 0 komentar | Read More

Family Not Seeing 'Green Shoots' Of Recovery

By Emma Birchley, East Of England Correspondent

The green shoots of economic recovery might be growing stronger but the Horton family is not feeling the effects.

"It's been really, really tough. We are struggling to make ends meet," said Spencer, 39, from Felixstowe.

He has his own recording studio and band, Mohawk, but he makes much of his money from teaching guitar, bass and drums as well as vocal coaching.

The past year has been difficult as the luxury of music lessons has been dropped by those struggling to meet the cost. Pub closures mean fewer gigs.

But there are tentative signs that things may be on the up.

He said: "The lessons have started picking up in the last month or so. I've got five new students so that helps but I don't know how much of that is a sign that the economy is improving."

His wife, Morgan, is training to be a counsellor and volunteers her skills, but is also a self-employed massage therapist and has seen her business suffer.

She said: "I used to have a lot of clients who have a massage as a luxury or to treat chronic back pain but it got to the point that they had to make a choice because of money and the massage went.

"We have both chosen to be in professions that give back to the community and that keeps us going yet the Government does not value or recognise that."

The couple have two children, April, five, and Coby, two.

Keeping the house warm and the family well fed has meant putting up with increasing costs.

Mrs Horton said: "We don't buy luxuries very often and our food bill is still big. It's gone up by about a third in the last year or so.

"Energy is really expensive too. They say the national average is £1,400 a year and we pay close to double that in gas and electricity."

Keeping up with the bills meant they recently had to get a £10,000 loan.

She added: "It really frustrates me because I wanted to spend it on doing up the house but the overdraft kept creeping up so we had to pay that off."

12.06 | 0 komentar | Read More

Mark Carney Announces Liquidity Boost

By Ed Conway, Economics Editor

The Bank of England Governor has unveiled a major overhaul of the way the Bank pumps cash into the markets.

In a speech on Thursday evening to celebrate the 125th anniversary of the Financial Times, Mark Carney revealed that the Bank will be making major changes to the terms under which the Bank provides cash to Britain's financial system.

Though the overhaul itself is unlikely to be noticed by bank customers, policymakers hope that it will help encourage lenders to provide more cash for those who want to borrow.

One of the key ways in which the Bank controls the UK economy, borrowing rates and financial stability is by lending private banks cash in exchange for assets.

However, over the course of the financial crisis it came under fire for offering this so-called liquidity at high prices and in exchange for only the best-quality assets.

The Bank of England will make facilities cheaper

Mr Carney said that the Bank intended to cut the charges for one such facility - the Index Long-Term Repo - and to allow banks to leave collateral of less-stringent quality in exchange for cash.

Whereas previously only high quality assets were acceptable, in future, lesser-quality investments such as mortgage-backed securities will be allowed.

The Bank will also make the terms of its discount window, an emergency short-term lending facility – more generous.

Mr Carney said: "Our facilities are not ornamental. They are there to be used by banks to access money and high-quality collateral. We are offering money and collateral for longer terms.

"The range of assets we will accept in exchange will be wider, extending to raw loans and, in fact, any asset of which we are capable of assessing the risks. And using our facilities will be cheaper. In some cases the fees are being more than halved."

The speech comes only hours ahead of the official announcement of Britain's latest gross domestic product figures.

The Governor indicated that while he was cheered by the recovering economy, the improvement in GDP, which is expected to be strong, was not as broad based as some had hoped. 

He said: "The economy has picked up over the last couple of quarters. We expect the second half to be stronger than the first half, as indicated in our minutes that came out earlier this week.

"We will find out, I'm not so foolish as to try to give a prediction of a number that's going to come out in less than 24 hours so why don't we wait for the GDP report."

12.06 | 0 komentar | Read More

UK Economy 'May Have Grown By Up To 1%'

Official statistics released later are expected to show that the UK economy grew by up to 1% in the three months to September.

Investec's Philip Shaw forecasts 0.8% growth for the third quarter but said it was "not impossible" that it could be closer to 1%.

Samuel Tombs, an economist at Capital Economics added: "GDP looks on track to have grown at a healthy rate."

Growth of around 0.8% or higher would be the strongest for three years and be the first time the economy has expanded for three successive quarters since 2011.

The UK economy expanded 0.7% month on month in the second quarter of this year, the fastest rate since 2010.

The National Institute of Economic and Social Research predicted that output has grown by 0.8%.

This is higher than official forecasts by the Bank of England and the Office of Budget Responsibility, which have predicted growth rates of 0.5% and 0.3% respectively.

Official word on the UK's economic performance comes from the Office for National Statistics. The figure will then be revised at a later date.

The housing market recovery is seen as a driving force behind the rising economic output.

The IMF now expects the economy to grow by 1.4% this year – double the rate it was forecasting in April.

:: Watch live coverage of the third quarter GDP results on Sky News at 9.30am.

12.06 | 0 komentar | Read More

Grangemouth Job Fears As Chemical Plant Shut

The owner of the Grangemouth petrochemical plant is to close the operation permanently and keep shut, for now, its major oil refinery amid a continuing pay dispute.

The move threatens up to 800 jobs at the petrochemicals business, which makes products used in everyday items such as packaging and plastic bags, unless it can be sold.

The Grangemouth site's owner Ineos said while it would retain the refinery, which produces 80% of Scotland's petrol and diesel, production would remain shut down until the threat of industrial action was removed.

The Government said there was no current threat of fuel shortages in Scotland because of contingency planning.

Workers were given news of the closure at a meeting with Ineos petrochemicals chairman Calum MacLean following the passing of a deadline on a survival plan which asked all Grangemouth staff to accept changes to pensions and other terms and conditions.

The Prime Minister described the closure as "disappointing"

The Unite union said around 680 of the site's total 1,370-strong workforce rejected the proposals, which included a pay freeze for 2014-16, removal of a bonus up to 2016, a reduced shift allowance and ending of the final salary pension scheme.

Following the meeting with staff, one worker who did not want to be named, said: "I feel sick. It's gone."

The worker, who appeared close to tears at points, told Sky News he could only listen to about 10 minutes of the meeting, before he felt he had to leave.

"There's no livelihoods left and we don't even know if we're going to get redundancy out of it. I hope they're happy with themselves," he said.

More than 1,300 people are currently employed at Grangemouth by Ineos

Unite has accused the company's owner Jim Ratcliffe of playing "Russian roulette" with the future of Grangemouth, the biggest industrial site in Scotland, and said it would back any efforts by the Scottish Government to find a new buyer for the petrochemical complex.

In a statement, Ineos blamed the union's opposition to its survival plan for the decision to close the petrochemical plant - saying shareholders could no longer fund it.

Mr MacLean said: "This is a hugely sad day for everyone at Grangemouth. We have tried our hardest to convince employees of the need for change but unsuccessfully.

"There was only ever going to be one outcome to this story if nothing changed and we continued to lose money.

"We still struggle to comprehend what has happened here. The employees were offered a chance to secure substantial new investment in the company, preserve their jobs and keep their salaries. Sadly this will no longer be the case."

The company added: "As a result of this decision, the directors of the petrochemicals business have had no option but to engage the services of a liquidator. It is anticipated that a liquidation process will commence in a week."

Energy Secretary Ed Davey said: "I am saddened to hear of Ineos' plans to place the petrochemicals business into administration, particularly because of the impact it will have on the workforce and local community.

"While respecting Ineos' right to make this decision, it is regrettable that both parties have not managed to negotiate a fair and equitable settlement that delivers a viable business model for the plant.

"Even at this late stage, I urge Ineos to continue dialogue with the workforce and Government will offer help and support with this.

"Ineos have informed us that the refinery will stay open and the management wish to restart full operations as soon as possible.

"We stand ready to help with discussions between the management and the union to ensure this can happen.

"Fuel supplies continue to be delivered as usual and there is no current risk of disruption to supplies."

More follows...

12.06 | 0 komentar | Read More

Aberdeen Plots Share Raid For Lloyds Division

By Mark Kleinman, City Editor

One of the City's biggest asset managers is plotting a takeover of the fund management arm of Lloyds Banking Group that could result in the taxpayer-backed bank owning a sizeable stake in it.

Sky News has learnt that Aberdeen Asset Management is proposing an all-share deal to buy Scottish Widows Investment Partnership (SWIP), which manages more than £140bn on behalf of investors.

Aberdeen, whose chief executive, Martin Gilbert, appeared to rule out a bid for SWIP earlier this year, is one of two remaining bidders for the unit, which Lloyds has earmarked for sale as it continues to shed non-core businesses.

Its interest in a deal is nevertheless unsurprising given its history of acquiring rival fund managers and successfully integrating them. Aberdeen has more than £200bn of funds under management and a combination with the SWIP unit would significantly increase its scale.

Acquiring SWIP is likely to cost a buyer between £400m and £500m, with Antonio Horta-Osorio, Lloyds' chief executive, said to be holding out for a sum towards the upper end of that range.

Aberdeen's rival to buy SWIP, which is part of the Lloyds-owned insurance group Scottish Widows, is understood to be Macquarie, the Australian bank, although it remains possible that another bidder could yet emerge.

Royal Bank of Canada and Natixis are among the other asset managers to have expressed an interest in buying SWIP during the six-month auction.

Under Aberdeen's plans, which are understood to be at a preliminary stage, it would issue new shares to Lloyds if its offer is successful. The fund manager's market capitalisation of just over £5bn would therefore mean that Lloyds could potentially hold a stake of up to 10% in Aberdeen.

The two companies have held initial talks about a broader strategic alliance of which the SWIP deal would be the beginning, according to one insider.

Aberdeen has undertaken acquisitions using its shares as currency before, notably when it acquired the asset management arm of Credit Suisse, the Swiss banking group, in 2008. That deal resulted in Credit Suisse owning roughly 25% of Aberdeen, a shareholding that it has now offloaded.

The Scottish asset manager, well-known for its prominent advertising and commercial association with sailing regattas such as the annual Cowes Week, would cement a miraculous recovery from the chastening experience of the split capital scandal which rocked the City during the early part of the last decade.

Aberdeen's recent performance has been robust, with Mr Gilbert - who is also a director of BSkyB, the owner of Sky News - saying: "Aberdeen's performance during the past year, and particularly over the last three months, has demonstrated our core resilience. Our assets under management, balance sheet and profitability remain robust despite continuing market volatility. Aberdeen and our funds are well placed to navigate the difficult market environment ahead to deliver strong returns to our clients and investors."

Lloyds is expected to select a winning bidder for SWIP within weeks, although completion is unlikely until next year.

The bank, in which taxpayers now own a 33% stake, has sold numerous assets during the last two years as regulators pressure big lenders to bolster their capital reserves. Among the businesses it has sold are portfolios of shipping and property loans, a shareholding in Sainsbury's Bank, and chunks of St James's Place, the wealth manager.

Aberdeen and Lloyds declined to comment on Wednesday.

12.06 | 0 komentar | Read More

Grangemouth: Owner 'In Dark' As Buyer Sought

The owner of the Grangemouth refinery, currently shut down during a bitter dispute with staff, has told Sky News it did not know the Scottish Government was seeking a new buyer.

Ineos said it would announce on Wednesday morning whether it planned to keep the site open following a shareholder meeting - hours after Finance Secretary John Swinney confirmed talks with several parties.

The developments emerged after two-thirds of workers at the refinery refused to accept new terms and conditions as part of a survival plan for the site's future.

Unite has welcomed the prospect of a sale

The Scottish Government's move was seen as a precaution - given the threat the shutdown poses to fuel supplies.

In an interview with BBC Radio Scotland Mr Swinney warned that the dispute between the current owner and the Unite union was heading for a stalemate and said "alternative options" were being considered.

"I don't think it will come as any surprise to anybody that the Scottish Government is looking at alternative options and there will be other players around the globe who will be interested in this particular plant.

"There are discussions...going on with other parties. The Scottish Government will continue to pursue those discussions because we think that is the right and the responsible thing to do."

Mr Swinney dismissed any idea of Government ownership of the site as "not appropriate".

"We are in a situation where the plant is operating successfully within the marketplace and it can work and operate more successfully in the market place," he said.

He urged Ineos to accept a trade union statement that there would be no strike action during negotiations at "face value".

"I can see no good reason for the plant lying idle today and I think it should be started as a matter of urgency," he said.

Ineos had set a deadline of 6pm on Monday for its employees to sign up to changes to pay, pensions and terms and conditions.

The company said hundreds of workers had accepted the proposals, but Unite maintained that, as the deadline passed, two out of three of its members had said no.

Last Thursday, Ineos sent a letter to all 1,350 workers at the site asking them to indicate their rejection or acceptance of the plan.

It said those who supported the survival plan would receive a transitional payment of up to £15,000.

The two sides have been embroiled in a bitter dispute for weeks, initially over the treatment of Unite convenor Stephen Deans, who was involved in the row over a selection of a Labour candidate in Falkirk, where he is chairman of the constituency party.

He was suspended, then reinstated, and is facing an internal investigation, which is due to report on Friday.

The dispute has since widened to the future of the entire site, with Ineos warning that it will close without fresh investment and changes to pensions and other terms and conditions.

The company said the plant, which has been shut down since last week because of the dispute, is losing £10m a month.

Ineos shareholders are expected to meet today to discuss the dispute and Unite released the text of a letter to the company's chairman Jim Ratcliffe ahead of the meeting, which accused him of standing in the way of an agreement.

Unite general secretary Len McCluskey also welcomed news of the buyer talks with the Scottish Government in a statement.

He said: Jim Ratcliffe's behaviour has exposed a dreadful frailty at the heart of our energy supply, which is that one man's power and wealth can hold our governments and citizens to ransom.

"Our politicians need now to step up. Our public utilities cannot be run by those indifferent to considerations of social responsibility.

"Unite calls upon politicians in Edinburgh and Westminster to support a new beginning for Grangemouth, free of the tyranny of one man's whims.

"If this means securing financial assistance - or even nationalisation - then this must be done. We can have no objections from Westminster when they have handed our nuclear energy future over to the state-owned Chinese and French nuclear industries."

12.06 | 0 komentar | Read More

Energy Bills: Major Calls For 'Windfall Tax'

By Jon Craig, Chief Political Correspondent

Former Prime Minister Sir John Major has dropped an energy price hike bombshell on David Cameron by calling for a windfall tax on power companies this winter.

In a move that stunned the Tory high command, he said the recent price rises were unacceptable and many people would have to choose between heating and eating.

And he said that if there was severe cold weather this winter and the Government had to help vulnerable people it should impose an "excess profits tax" on the energy companies.

But within an hour the former Prime Minister was slapped down by Downing Street, with the Prime Minister's spokesman declaring: "We have no plans for this."

Labour seized on the apparent disarray.

Ed Miliband, whose price freeze pledge has put the Government on the defensive for weeks, tweeted: "Sir John Major makes Labour's argument: David Cameron stands up for the energy companies not hard-pressed families."

Ed Miliband said Sir John was making "Labour's argument"

Sir John's shock intervention in the energy price row came in a comeback speech to political journalists at Westminster in which he made a passionate plea to the Tories to win back the support of blue collar voters.

Asked about energy price hikes of up to 10%, Sir John said: "I do not see how it can be in any way acceptable that with energy prices rising broadly 4% in terms of costs that the price to the consumer should rise by the 9-10% that we are hearing.

"I do not regard that as acceptable at all by the energy companies.

"And it is not acceptable to me, it ought not to be acceptable to anyone, that many people are going to have to choose between keeping warm and eating. That is not acceptable.

"So if we get this cold spell the government, I think, will have to intervene and if they do intervene, and it is costly, I for one would regard it as perfectly acceptable for them then, subsequently, to levy and excess profits tax on the energy companies and claw that money back to the Exchequer, where their primary job is to get the economy working and people back to work."

Asked if he was backing the Labour leader, the former Prime Minister said: "When Ed Miliband made his suggestions just a few weeks ago I think his heart was in the right place but his head had gone walkabout.

"But he did touch on an issue that's very important. The private sector is something the Conservative party support but when the private sector goes wrong or behaves badly I think it is entirely right to make changes and put it right."

David Cameron's spokesman said it was an "interesting contribution"

Sir John told reporters that with interest rates at a record low, energy companies should be looking to borrow money to pay for investment rather than funding it "out of the revenue of families whose wages have not been going up at a time when other costs have been rising".

"I believe there will be difficulties this winter without action and, if there are those difficulties, the Chancellor will have my total support if he acted in the way I suggest and imposed an emergency impost upon the energy companies to claw back the money that we will have to give to people to help them see the winter in any form of warmth," he said.

Shortly after Sir John's speech, Mr Cameron's spokesman told reporters: "The Prime Minister's view on this is that this is an interesting contribution. We have no plans for this.

"What the Government is doing is legislating around forcing energy companies to put customers on their lowest tariffs and more competition in energy markets."

Asked about Sir John's concerns about people having to choose between eating and heating this winter, the spokesman said: "There are a number of initiatives that the Government has to support vulnerable people, such as the cold weather payments.

"We have a range of ways in which support is given and those are the right ones."

12.06 | 0 komentar | Read More

Grangemouth Refinery Workers 'Reject Deal'

Two-thirds of workers at the Grangemouth oil refinery have refused to accept new terms and conditions, their union says.

Ineos had set a deadline of 6pm on Monday for the workforce to agree to its "survival plan", which amounts to a cut in pension entitlement, overtime pay and redundancy terms.

Without agreement and without fresh investment, management has said it could close the plant by 2017.

Ineos said the Scotland's biggest oil refinery, which has been shut down since last week because of the dispute, is losing £10m a month. 

Ineos Grangemouth site manager Gordon Grant talks with Unite's Pat Rafferty

Ineos group director Tom Crotty told Sky News that the risk of the refinery having to shut permanently was very real and that the workers needed to show commitment to persuade shareholders to increase investment.

He said: "The shareholders will consider the over all view of the workforce and we have to consider have we got enough people supporting the company to make it a viable proposition to restart the plant because we have serious safety concerns over this type of operation.

"It's a big site, three time the City of London, and to restart it we cannot take the risk of having to restart it and then stop it again. It's very risky.

"Until we know we have got the support of the people on the site we cannot do that."

Ineos sent out a letter on Thursday to all 1,350 worker at the plant asking them to either reject or accept the plan, and said that hundreds had agreed to the new deal.

However, according to Unite, 65% of workers had rejected the plan.

Ineos says if workers do not agree, the refinery will close

Unite's Scottish Secretary Pat Rafferty said: "The people who have so far rejected Ineos' ultimatum are the backbone of the plant, the people who keep the site running and the oil flowing.

"The people of Grangemouth and Scotland will be expecting Jim Ratcliffe and the Ineos shareholders to now take heed. Do the right thing tomorrow, drop the threats to the workforce, fire up the plant and get around the table at Acas.

"This is an overwhelming rejection of the company's blackmail and threats. This workforce has said that they want to secure a future for Grangemouth, free from fear, based on negotiation not confrontation."

A shareholders meeting is expected to take place on Tuesday to discuss the dispute.

The plant processes around 200,000 barrels of oil a day and supplies most of Scotland's fuel, however, Ed Davey, the energy secretary has said that the shutdown would not hit petrol and diesel supplies.

Ineos and Unite have been embroiled in a bitter dispute for weeks, initially over the treatment of Unite convenor Stephen Deans, who was involved in the row over a selection of a Labour candidate in Falkirk, where he is chairman of the constituency party.

He was suspended, then reinstated, and is facing an internal investigation, which is due to report on Friday.

12.06 | 0 komentar | Read More

Rescue Plan Leaves Co-op With 30% Bank Stake

The Co-operative Group is to lose overall control of its banking arm amid a funding struggle, Sky sources have confirmed.

The Co-op will be left with only a 30% stake in the bank, according to Sky News City Editor Mark Kleinman.

An announcement is expected to confirm the deal next Monday, with City investors and bondholders filling the funding shortfall.

The growing likelihood of the self-styled ethical lender being controlled by predatory US hedge funds and blue-chip investors such as pension funds and insurers has triggered warnings over the bank's future ethos.

Meanwhile, the bank has confirmed a suspension of listing and trading on the London Stock Exchange of its subordinated debt securities.

"The group has stated that constructive engagement with bondholders is continuing and that Group remains confident that a proposal to recapitalise the bank can be agreed and put to bondholders," it said in a statement.

"The bank expects to request the suspension of the relevant securities to be lifted at the time that full details of a recapitalisation plan are announced."

The Co-op banking division operates as a mutual concept and currently has 4.7m customers. It includes an insurance arm for home, motor and pet cover.

On June 17 the bank, which was founded in 1872, announced it needed to raise £1.5bn to plug the capital black hole.

The bank now admits it needs an additional £105m to deal with increased provision for payment protection insurance (PPI) and other product mis-selling claims, and "expects that many elements of any recapitalisation plan will be materially different".

The recapitalisation from outside the mutual comes after the Co-op previously set aside £269m to compensate customers mis-sold PPI.

The recalculated funding shortfall is due to more customers coming forward as well as the Financial Conduct Authority providing fresh guidance on appropriate levels of compensation for customers.

The sum also includes a compensation for mortgage customers affected by a newly-discovered flaw in which they were charged only interest on their first mortgage instalment - meaning further payments were higher than they should have been.

Customers who took out Platform and Optimum mortgage products would have been affected although the bank has not yet notified any of them and further details of the scale of the issue remain unclear.

The bank said the overall new provision of up to £105m also took into account "the identification of a technical breach of the Consumer Credit Act".

This was thought to relate to failing to inform some loan customers that they could reduce their outstanding balance.

The overall provision from the bank also includes money put aside because of overdue payments and unpaid cheques.

Co-op disclosed the figures as it prepares for its recapitalisation plan - which will mean it has to publish financial details to the stock market.

The attempt to plug the £1.5bn black hole in its balance sheet through a painful fundraising will force losses on to owners of its bonds and leave it with a stock market listing - ending its prized mutual status.

Hedge funds represented by investment banks had earlier demanded the bank tear up its rescue plan, instead proposing an alternative plan of converting all its bonds into shares, giving it a bigger stake in the lender.

12.06 | 0 komentar | Read More

London House Prices Leap 10% In Just A Month

London house prices are said to have soared to a new high this month, beating their previous record by nearly £30,000 and fuelling fears that the capital is overheating.

Property website Rightmove said asking prices in the capital saw an "unsustainable" 10% month-on-month increase in October, pushing typical asking prices in the capital to £544,232, leapfrogging a previous high set in July by more than £28,000.

It put much of the increase down to a "frenzy" of activity in parts of prime inner London as overseas investors look for a safe haven to place their cash amid the troubles of the eurozone, which is "leaving the shelves bare".

Westminster was named as London's strongest-performing house price area in October. Prices there have soared by 11.9% month-on-month to reach £1.6m typically.

Kensington and Chelsea and Hammersmith and Fulham also recorded increases of 11.8% in sellers' asking prices over the month.

In comparison, Rightmove said across England and Wales, asking prices rose by 2.8% month-on-month, following two months of falls, to reach £252,418 on average.

Prices across the country are 3.8% higher than they were a year ago, although in London they have shot up by 13.8% over this period, Rightmove said.

There are concerns that London's property market is overheating

Despite the overall upward march in prices, Rightmove said that "a bubble seems a long way off in the majority of regions".

The patchy state of the housing market was still shown, as four areas recorded year-on-year falls in house values - Wales, the North, the North West and the West Midlands.

The North recorded the biggest year-on-year drop, with asking prices falling by 2.2% to reach £145,094 on average.

Sellers in Wales have dropped their asking prices by the second biggest amount over the last year, with prices falling by 1.4% annually to typically reach £165,708.

The findings come after the Council of Mortgage Lenders reported last week that lending activity is at its strongest in five years and the Office for National Statistics said that UK house prices reached an all-time high of £247,000 in August, surpassing a previous 2008 peak.

Housing market activity among people with low deposits who have previously struggled to get on the property ladder is expected to increase further in the coming months, as a new phase of the Government's flagship Help to Buy scheme is fully fired into action.

12.06 | 0 komentar | Read More

Nuclear Power Plant 'Strike Price' Agreed

A deal to build Britain's first nuclear power plant in a generation is expected to be announced today.

The Government has been negotiating with French-owned EDF Energy for more than a year over two new plants which will be built at Hinkley Point in Somerset.

But ministers are now understood to have agreed on the crucial "strike price" which will give EDF a guaranteed rate for producing low-carbon electricity, raising concerns that this will hike up energy bills.

If wholesale prices drop below the strike price, investors who financed the project will be compensated. If prices rise above that level, EDF will pay the difference back to consumers.

The 'strike price' gives EDF a guaranteed rate for producing electricity

The two reactors proposed for Hinkley are a key part of the coalition's drive to shift the UK away from fossil fuels towards low-carbon power.

Energy policy has shot up the agenda since the party conference season, when Labour leader Ed Miliband pledged to freeze retail prices for 20 months.

Chancellor George Osborne removed another obstacle last week when he announced that Chinese firms will be allowed to invest in civil nuclear projects in the UK - even potentially taking a majority stake.

The funding agreement will almost certainly mean that the new reactor at Hinkley will be a mirror image of the Taishan plant in China.

Ed Miliband and George Osborne weighed into the energy debate last week

During a visit to the Taishan plant last week, Mr Osborne said: "It is an important potential part of the Government's plan for developing the next generation of nuclear power in Britain.

"It means the potential of more investment and jobs in Britain, and lower long-term energy costs for consumers".

But anti-nuclear activists living near the site say they have been misled by the decision process to site the plant at Hinkley.

Anti-nuclear campaigner, Theo Simon

Campaigner Theo Simon told Sky News: "We were told it would mean lower energy bills, but actually the announcement of the strike price is really the last nail in the coffin of this project.

"We were told that it would provide cheap energy; we were told it would help us to bridge the energy gap in the early 2000s, and now it seems it won't be built (until) 2025 and we will all be paying for the profits of EDF and Chinese nuclear corporations for the next 40 years."

The issue of prices has become even more controversial with the Big Six power firms unveiling hikes of more than 9% in electricity and gas prices.

Deputy Prime Minister Nick Clegg has raised concerns about the increases, telling Sky News' Murnaghan programme that the energy firms needed to justify prices increases.

"Clearly the companies need to justify the bill increases that they are now announcing," he said.

"It cannot be right that people who are really struggling - many, many people still struggling to pay their weekly, their monthly bills, where electricity and gas bills for this winter are a looming worry.

"It can't be right that those bills are increased for those households in our country and yet it is all rather opaque about what drives these increases."

12.06 | 0 komentar | Read More

HS2 Rail Link: 'Cities Could Lose Up To £220m'

Some cities in the UK could lose as much as £220m if a new high-speed rail link is built, previously unseen figures have shown.

If HS2 goes ahead, it will leave more than 50 areas worse off - details that were omitted from a Government-commissioned report in September, it is claimed.

The full findings of the KPMG study into the north-to-south rail route were released under a Freedom of Information request by the BBC's Newsnight programme.

Last month, the Department for Transport hailed the study, which found the UK economy would be boosted by £15bn a year, with Greater London benefitting by £2.8bn and the West Midlands by £1.5bn.

The project has caused outrage in some areas

But the study shows many areas not on the line - which would connect London to Birmingham and to Manchester and Leeds - will suffer a fall in economic output.

The worst-hit areas will be Aberdeenshire (-£220m), Norfolk East (-£164m), Dundee and Angus (-£96m), Cardiff (-£68m) and Norfolk West (-£56m).

Professor Henry Overman, who was an expert adviser to HS2 Ltd, told the BBC it was obvious that as some areas reap the benefits of being better connected, other places away from the line will pay a price.

The link will cut journey times between the north and south

"When a firm is thinking of where to locate, it thinks about the relative productivity of different places, and the relative wages etc," he said.

"HS2 shifts that around. So if you are on the line, that makes you a better place that hasn't had that productivity improvement."

Alison Munro, chief executive of HS2 Ltd, told Newsnight the figures were unsurprising.

"What this is showing is that the places that are on the high-speed network ... those are the places that will benefit most from high-speed two," she said.

The first phase of HS2 from London to Birmingham

"But high-speed two isn't the only investment that the Government is making. Over the next five years it is planning to spend £73bn on transport infrastructure."

Earlier this month, the Treasury Select Committee said HS2 had "serious shortcomings" and should be put on hold.

It said a "more convincing" economic case was needed for the scheme, which is now estimated to cost £42.6bn - 17% higher than first thought.

A Department for Transport spokeswoman said: "These figures show that the new north south railway is vital to rebalance our economy and it boosts the north overall more than the south. Of course the line does not serve every city and region and these figures reflect that.

"But it is wrong to take them in isolation. HS2 is part of a much bigger boost to our transport system - £73bn in the next parliament, of which HS2 is just £17bn. This will massively benefit places HS2 will not serve long before the line opens."

12.06 | 0 komentar | Read More

Energy Bills: Welby Slams 'Severe' Price Rises

The Archbishop of Canterbury has launched a stinging attack on Britain's energy firms, warning the latest round of price hikes seem to be "inexplicable".

Justin Welby insisted the so-called Big Six energy companies had an obligation to behave morally rather than to simply maximise profit.

His intervention, published in an interview with the Mail on Sunday, came after British Gas followed in the footsteps of SSE by announcing a 9.2% increase in prices.

The head of the Church of England, himself a former oil executive, said he understood the anger the rises had generated.

"The impact on people, particularly on low incomes, is going to be really severe in this, and the companies have to justify fully what they are doing," Mr Welby said.

Last week British Gas announced a 9.2% increase in prices

"I do understand when people feel that this is inexplicable, and I can understand people being angry about it, because having spent years on a low income as a clergyman I know what it is like when your household budget is blown apart by a significant extra fuel bill and your anxiety levels become very high. That is the reality of it."

The Archbishop urged firms to be "conscious of their social obligations", saying they had to "behave with generosity and not merely to maximise opportunity".

"They have control because they sell something everyone has to buy. We have no choice about buying it. With that amount of power comes huge responsibility to serve society," he said.

"It is not like some other sectors of business where people can walk away from you if they don't want to buy your product and you are entitled to seek to maximise your profit.

"The social licence to operate of the energy companies is something they have to take very, very seriously indeed."

Electricity prices are rising faster than those for gas

But the Church Of England owns a significant number of shares in energy companies.

Sky's Chief Political Correspondent Jon Craig said: "Justin Welby has now joined in this increasingly politically charged debate about energy prices - the only embarrassment really for the Church of England really is that it owns more than £7m of shares in Centrica and about £6bn of shares in SSE.

Craig added: "The remarks have been welcomed already by the Labour Party - but they will infuriate government ministers, the Prime Minister and the Energy Secretary."

An ongoing bitter political spat over energy has seen Labour leader Ed Miliband attempt to seize the initiative by pledging a 20-month-long price freeze.

But Prime Minister David Cameron has dismissed the idea as a "con", and encouraged consumers to switch suppliers to keep bills down.

But polls have suggested that Labour's promise is popular with voters, putting pressure on the coalition to respond.

12.06 | 0 komentar | Read More