British Airways Plans Hundreds Of Job Cuts

British Airways is entering talks with a union on plans to cut 400 jobs among cabin crew.

The airline, which is owned by International Airlines Group (IAG) and operates alongside Spanish carrier Iberia, said it was beginning a 90-day consultation with Unite on the possibility of making voluntary redundancy available.

BA stressed there would be no compulsory job losses.

Those being offered the redundancy package would be senior cabin crew employees, BA said, such as pursers and cabin service directors who work exclusively on long-haul and exclusively on short-haul services.

BA, which suffered a damaging cabin crew dispute over jobs, pay and working conditions that ended last year, now has around 14,000 cabin crew in total.

That strike was resolved after the creation of IAG, which is led by BA's former chief executive Willie Walsh.

His departure to IAG was seen as crucial to the resolution of the dispute amid a bitter war of words with union bosses.

IAG is currently locked in a row with Iberia staff over plans to shed workers at the Spanish loss-maker.

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Tax: Starbucks, Google And Amazon 'Immoral'

By Darren McCaffrey, Sky News Reporter

Starbucks, Google and Amazon have been accused of "immorally" avoiding paying their fair share of tax in the UK, as the Chancellor prepares a blitz on tax dodgers.

MPs on the Public Accounts Committee criticised the companies for the "unconvincing and, in some cases, evasive" evidence they gave on why their corporation tax payments are so low.

Starbucks told the committee it had made a loss for 14 of the 15 years it has operated in the UK, a claim the committee said it found "difficult to believe".

In a report, the MPs added that Amazon's representative left them frustrated because he was "evasive and unprepared to answer legitimate questions".

They also said Google "undermined its own argument" that profits should be taxed in the countries where they are made because it transfers its non-US profits, including from the UK, to Bermuda, which has a more advantageous tax system.

Starbucks says it is reviewing its tax arrangements

Margaret Hodge, who chairs the Public Accounts Committee, said: "Global companies with huge operations in the UK generating significant amounts of income are getting away with paying little or no corporation tax here.

"This is outrageous and an insult to British businesses and individuals who pay their fair share.

"Corporation tax revenues have fallen at a time when securing proper income from taxes is more vital than ever.

"There is little credible information about what is going on. The evidence we took from large corporations was unconvincing and, in some cases, evasive."

Starbucks has now declared that it is preparing to change its tax affairs so that it pays more into Britain's coffers and there is growing pressure on others to follow suit.

The report was published as George Osborne prepares to unveil a £154m crackdown on wealthy companies and rich individuals who dodge tax.

Officials will be ordered to use the cash to draft in an army of investigators to target high earners who aggressively avoid or evade paying tax.

The money will also fund extra staff to speed up work challenging multinationals' transfer pricing arrangements to stop global companies using legal loopholes to shift profits out of the UK.

However, Mr Osborne has warned against pricing Britain out of the world economy.

"If we make our taxes less competitive, that will just mean more companies stay out of Britain," he said.

But Katja Hall, from the Confederation of British Industry, told Sky News that tax avoidance is not a widespread problem.

"Companies pay £163bn in tax in the UK every year and the large majority of companies pay the right amount of tax," she said.

The Institute of Directors condemned the "hectoring from Westminster" and called for the tax system to be simplified.

Director General Simon Walker said: "If these firms are immoral to take advantage of tax loopholes, then politicians are surely immoral for creating the loopholes in the first place.

"Taxes should be simpler to cut down on avoidance and relieve the burden our complex tax code puts on companies who do try to do the right thing."

An HMRC spokesman said: "HMRC ensures that multinationals pay the tax due in accordance with UK tax law. We have been very successful in reducing tax avoidance by large businesses in recent years.

"We relentlessly challenge those that persist in avoiding tax and have recovered £29bn additional revenues from large businesses in the last six years, including £4.1bn in the last four years from transfer pricing enquiries alone. These figures speak for themselves."

The latest tax crackdown will be outlined in this week's Autumn Statement, which is also expected to contain bleak news for benefits claimants.

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Exclusive: Germans Set To Feast On KP Snacks

By Mark Kleinman, City Editor

One of Germany's biggest food companies is poised to snatch control of household name British food brands including Hula Hoops and KP Nuts after a £400m-plus raid on their owner.

I understand that Intersnack, which has been in talks with United Biscuits' owners for several months, is close to seeing off rivals in the auction of the British food producer's snacks division.

If successfully completed, a deal would make Intersnack one of the most prominent food companies in Britain.

UB's snacks arm owns the McCoy's, Mini Cheddars, Skips and Phileas Fogg brands, some of which have been staples in British consumers' kitchens for decades.

People close to the talks cautioned tonight that Intersnack and UB had yet to reach a formal deal and that the negotiations could still fall through.

The German group has been vying with a number of private equity firms to win control of KP Snacks.

Capvest, a specialist investor in the consumer goods sector, also tabled an offer for the UB division but is thought to have been outbid. Pamplona Capital, another private equity firm, and Calbee, a Japanese food company, are not thought to have submitted formal bids.

UB is owned by Blackstone and PAI Partners, two private equity firms. They will continue to own the group's biscuits division, which is home to brands including Penguin, McVitie's Jaffa Cakes and Go Ahead, with a sale of that unit possible next year.

Credit Suisse is advising Blackstone and PAI, while Goldman Sachs is advising Intersnack. The current owners tried to sell UB in its entirety two years ago but failed to secure a deal following talks with Bright Food, a Chinese company.

Bright Food subsequently acquired Weetabix, the breakfast cereal producer, a takeover that ranked among the most significant so far of a western brand by a Chinese counterpart.

Blackstone and PAI declined to comment.

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Christmas Shopping Leaves Retailers Nervous

There are signs that Christmas shoppers are adopting a "wait and see" approach in the hope of a price war among retailers in the run-up to December 25.

The latest sales figures from the British Retail Consortium (BRC) show a rise of 0.4% during November, a figure it said was flattered by weak comparisons with last year.

The organisation stated that shops were in a "state of nervousness" about the festive season as a result.

Its survey quoted several toy retailers as saying that Christmas shopping was starting later this year, while online sales also delivered their third worst performance of the year.

Retailers had been hoping for stronger November trading after a battering the previous month when retail sales volumes dropped 0.8% month-on-month, amid declining consumer confidence and rising inflation.

David McCorquodale, head of retail at BRC's survey partner KPMG, said November had been a cautious month: "It appears that consumers know they have to spend before Christmas but are holding off for as long as they can to see if there might be bargains available in the next few weeks.

"Pricing throughout the month and strategic promotions will be fundamental in a key month," he said.

But the BRC said tablet computers were a strong driver of growth in the electrical goods market in November, which also benefited as people bought cooking items ahead of Christmas.

Clothing sales were boosted by the fashion for all-in-one pyjamas, known as onesies.

Singers Rihanna and Robbie Williams are among the celebrities who have stepped out in their own versions of the adult romper suits.

The colder weather helped boost winter clothing ranges and boots.

Food sales faded throughout the month but the launch of festive Christmas adverts helped boost sales of Christmas crackers and confectionery.

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Thomson Owner Paid 'Little' UK Corporation Tax

Tui Travel paid just £1.1m corporation tax in the UK over the last year, despite a hike of almost 40% in statutory profit.

The boss of the British company, which owns Thomson and First Choice among others, told Sky News the low figure was a result of restructuring at the company. 

"Within the UK, because we have accumulated tax losses as a result of restructuring the business, there's little or no tax being paid in the UK," he said.

"But that's as a consequence of these carried forward losses that we have.

"Once those losses have been utilised, then we will pay tax in the normal way as we comply with all the laws of the lands that we operate in."

The losses were incurred as a result of 2010's ash cloud - which caused huge problems to the travel industry - and have been brought forward, offsetting the company's taxable profits in the UK.

"This is fully compliant with UK tax law, perfectly legitimate and normal practice," a Tui Travel spokesperson said. 

Tui owns around 3,500 travel agents and a fleet of 145 aircraft

The comments came as the company reported a rise in statutory profit before tax for the year to the end of September 30 to £201m, compared with £144m the previous year.

The underlying performance of the business - when one-off items are not included - also performed well, with pre-tax profit up 8% to £390m.

Bookings were up across Britain, Germany and Nordic countries, but fell 28% in France as the company reduced capacity in the country.

Mr Long described the year as "one of many successes".

"We have delivered record Group profits while the UK achieved outstanding results both in terms of profit and margin all against a backdrop of continued economic uncertainty," he said.

"Our proven strategy continues to evolve and drive strong trading momentum throughout the group."

He added that, with the exception of France, trading for both winter 2012/13 and summer 2013 was encouraging.

Last week, Tui Travel's rival Thomas Cook said its turnaround plan had taken its toll, causing deeper losses.

The 171-year-old company reported a statutory loss of £590m for the 12 months to the end of September - worse than the £518m loss recorded the previous year. 

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Household Spending Up But Families Get Less

The average UK household spent £483.60 a week in 2011 - the highest amount ever recorded by the Office for National Statistics (ONS).

Last year's level was £10 higher than in 2010, due in part to increases in transport and housing costs.

However, although the average family's weekly spend hit a record high in cash terms last year, it actually fell when adjusted for inflation.

British households spent £498.20 in 2010 when adjusted for inflation, which means spending fell in real terms by 2.9% the following year.

In cash terms, the highest spend in 2011 was on transport, which rose by 80p to £65.70 per week, driven by hikes in petrol and diesel prices.

Rents rose by 70p to cost families' £40.60 a week in 2011

A rise in spending on cinema tickets, leisure classes and sporting events meant that recreation took up the next highest chunk of families' spending, at almost £64 a week.

Housing, fuel and power represented the third largest amount of households' spending at £63.30 a week in 2011 - a weekly increase of £2.90.

Rents were up by 70p to reach £40.60 and average spending on electricity, gas and other fuels was £22.10 per week - another increase of 70p.

But some types of household expenditure fell in 2011.

Spending on household goods and services was down by £4.10 to £27.30 a week, mainly due to a significant drop in the number of people buying furniture and clothing.

There was a small fall in expenditure on audio-visual equipment - including computers - which edged down by 90p to £6.30 a week.

London had the highest average spend - at £574.90 - driven by high housing and fuel costs.

Spending on audio-visual equipment - including computers - fell last year

Weekly spending was lowest in the North East, where the total came to £384.20, Wales with £398.20 and Yorkshire and the Humber with £410.10.

The ONS said there were "notable differences" in the way people of different incomes chose to spend their money.

The 10% of households with the lowest incomes spent a significantly larger proportion of their weekly total on housing, fuel and power, and food and non-alcoholic drinks than the 10% with the highest incomes. 

Better-off households spent a greater proportion on transport and recreation and culture. 

Differences in income also had an impact on internet access - with just four out of 10 low income families having the internet at home, compared with 99% of the highest income households.

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Royal Mail Posties' In Boycott Threat

Postal workers are being urged to refuse to deliver letters from anyone other than Royal Mail in the New Year, in a move which threatens to cause disruption.

Around half of the letters delivered by Royal Mail are collected and sorted by private companies like UK Mail and TNT, who then pay Royal Mail a fee for delivery.

But the Communication Workers Union (CWU) has claimed this arrangement costs Royal Mail money and has led to job losses, price rises and fewer services.

The CWU argues that competition on deliveries is "undermining" the same-price-goes-anywhere universal service, with companies other than Royal Mail not having to meet service and pay standards.

A ballot on a boycott will be held after Christmas.

If passed, this would mean that any mail sent via one of Royal Mail's competitors would not be delivered, the union warned.

Billy Hayes, general secretary of the CWU, said: "Today we're launching a major initiative to protect postal services in the face of mounting threats to jobs and services."

His deputy, Dave Ward, added: "We are not prepared to stand by and watch the jobs of our members be ruined by unfair competition which could be avoided."

Mr Ward also told Sky News the union was opposed to privatisation of Royal Mail. He said: "No private owner is going to sustain the universal service that doesn't make money."

In response to the boycott threat a Royal Mail spokesman said: "All of the mail that we handle is important to us and needs to be delivered, as we always do, six days a week.

"It is vital to all of us at Royal Mail, to Royal Mail as a business and most importantly to our customers, that the post is delivered."

He added: "As we have previously said, we are concerned about the impact of unfettered direct delivery competition on Royal Mail.

"We will be responding to Ofcom's consultation on direct delivery in due course. Royal Mail supports competition on a level playing field and believes Ofcom should consider competition in the light of its primary duty of securing the six-day-a-week, one-price-goes-anywhere universal service."

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Autumn Statement: £5bn Investment Boost

Deeper cuts in some Whitehall budgets are to be used to fund an extra £5bn investment in schools and other capital projects.

Government departments will be expected to cut day-to-day spending by 1% (£950m) in 2013/14 and 2% (£2.5bn) in 2014/15.

But under plans to be confirmed in the Autumn Statement, health, schools, international aid, HM Revenue and Customs and nuclear decommissioning will all be protected.

The new investment will target transport, skills, science and education, with an extra £1bn for new academies and free schools.

The cuts only directly apply to England but there will be knock-on effects for Scotland, Wales and Northern Ireland under the complicated formula which determines UK funding.

Labour claimed the move was an effective admission that the coalition's spending cuts had been a "catastrophic mistake" that has weakened the economy.

But Tory sources insisted the coalition was spending billions more on capital projects than the Labour plans the Government inherited.

David Cameron said the money would "make our country work better" and Nick Clegg added that it would ensure useful cash is not tied up in Whitehall.

George Osborne has very little wriggle room

Local authorities will be exempt from cuts in the first year because they are already having to cut back to deliver a council tax freeze but they will have to meet the second target.

Meanwhile, the Ministry of Defence will have more flexibility to roll over its underspend to help ease pressure on their budget.

An overhaul of the heavily criticised Private Finance Initiative (PFI) and plans to approve new gas-powered electricity power stations are also expected in Wednesday's mini-budget.

Chancellor George Osborne will outline plans for a "faster and more transparent" system of private funding for public infrastructure projects.

It is understood that safeguards will be built into the new system, to be dubbed PF2, to make sure the costs and risks to the taxpayer are minimised.

These will include limits on the type of services, such as maintenance, that can be incorporated into contracts and more flexible terms allowing the state to opt out.

The taxpayer will also take a minority shareholding in the delivery companies to ensure a share in any profits and allow closer oversight.

Some previous projects have taken up to five years but a new, strict 18-month limit will be imposed on the procurement process and cash reallocated if the deadline is missed.

Efforts will also be made to make the scheme more attractive to long-term investors like pension funds in a bid to reduce the amount of debt involved in the financing.

The reforms will promise more transparency over future liabilities facing the taxpayer, placing a cap on the total charges controversially going "off balance sheet".

Mr Osborne will claim up to £2.5bn in savings has been identified from existing PFI contracts following his review of the "discredited" system.

Safeguards will be built into the new private finance scheme

Set up under John Major's government in 1992, PFI was expanded dramatically under Labour and has been continued under the present coalition administration.

It allows private firms to build, operate and maintain public facilities like hospitals, schools and courthouses under contracts lasting as long as 35 years.

But it has faced harsh criticism over escalating costs, inefficiency and "perverse incentives" to use it over more cost-effective funding methods.

The anticipated approval of up to 30 gas-fired power stations sparked accusations of a "reckless dash for gas" from environmental campaigners.

It is thought Mr Osborne will also try to encourage investment in gas with tax breaks and a new regulatory regime for "fracking" - the extraction of gas from shale.

This week's statement will contain further bleak news for welfare claimants as well as the wealthy in the form of a possible benefit freeze and big cuts to pension tax relief.

And economists expect the Chancellor to make an embarrassing climbdown over one of his key goals - to have debt falling as a share of national income by 2015/16.

He conceded at the weekend that it was "clearly taking longer to deal with Britain's debts, it's clearly taking longer to recover from the financial crisis than one would have hoped".

On the eve of the statement, the British Chambers of Commerce (BCC) became the latest respected body to slash growth forecasts.

It now expects the economy to grow 1.2% in 2013 and 1.8% in 2014, compared with previous estimates of 1.2% and 2.2% respectively.

The organisation demanded a "laser-like focus" from the Chancellor on growth-boosting measures such as delivering key infrastructure projects and creating a business bank.

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Ex-FSA Chief Sants In Talks With Deloitte

By Mark Kleinman, City Editor

The former chief executive of the Financial Services Authority (FSA) risks igniting a conflict of interest row by entering negotiations about a job with Deloitte, the accounting firm, just months after he left the City regulator.

I have learned that Hector Sants, who stepped down from the FSA in June, is in talks to become an equity partner at Deloitte. If he accepts the post, he would advise clients across a range of industries including in banking and financial services, insiders said today.

Deloitte, one of the 'big four' accounting firms, has made Mr Sants an offer but he has not yet accepted it and his appointment could fall through, according to people close to the discussions.

People close to Mr Sants said that he was considering a number of options and would not make up his mind about his next move until a period of gardening leave expired at the end of the month.

If he does opt to join Deloitte, it could be controversial given the amount of FSA work channelled through the big accountancy practices in recent years.

Deloitte's rivals were paid millions of pounds for assisting with widely-derided inquiries into the banking crisis, although it is unclear how much Deloitte itself made in fees from the regulator during Mr Sants' five years in charge.

Mr Sants is widely-regarded as an ethical individual whose personal conduct during his career has been beyond reproach.

It is unclear how much Mr Sants would be paid by Deloitte but he would be expected to rejoin the ranks of well-rewarded executives as a member of the partnership at one of the City's most profitable professional services firms.

If he does take the Deloitte role, Mr Sants would be the latest in a string of former executives from the City regulator to accept lucrative posts in the City.

Jon Pain, who headed the FSA's supervisory division, joined KPMG, another member of the 'big four', as a partner in its regulatory practice. Margaret Cole, the head of enforcement at the FSA, now works for PricewaterhouseCoopers, a third member of the powerful quartet.

Mr Sants would also be joining Deloitte at a time when the accounting profession is under intense scrutiny regarding the dominance of its audit work for FTSE-100 companies and across other areas such as tax planning and remuneration consulting.

Prior to joining the FSA in 2004, Mr Sants was an investment banker with Credit Suisse First Boston. He arrived at the regulator during the era of light-touch banking regulation that preceded the crisis of 2008, with banks allowed to operate with minimal oversight and wafer-thin capital levels.

Mr Sants was promoted to be chief executive of the FSA in July 2007, with one of his first decisions being not to raise objections to the takeover of the Dutch bank ABN Amro by a consortium led by Royal Bank of Scotland (RBS).

It was that deal that exacerbated the funding crisis at RBS and led to the bank requiring a £45bn rescue by British taxpayers, along with massive amounts of other Government support.

In 2010, Mr Sants resigned from the FSA following the new Coalition Government's decision to abolish the FSA and fold its responsibilities into two new bodies, one of which will be overseen by the Bank of England.

George Osborne, the Chancellor, persuaded him to stay on as a deputy governor of the central bank while overseeing the FSA's transition to the new regulatory framework.

Mr Sants, who resigned for the second time in March, could not be reached for comment today. Deloitte declined to comment.

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Dandy Comic Publishes Its Final Print Edition

By James Matthews, Scotland Correspondent

The Dandy's final printed edition has gone on sale as it marks its 75th anniversary by relaunching as an online-only publication.

Britain's longest-running comic will now be available to download online, and as a smartphone and tablet app.

Dundee-based publisher DC Thompson announced in August that the weekly children's comic would make the transition into cyberspace following dwindling sales in recent years.

The issue features a cameo from Sir Paul McCartney, who said in 1963 it was his ambition to appear in the comic, and a pull-out of the first issue from December 4, 1937.

The website will feature old favourites Desperate Dan, Bananaman and Korky the Cat in new animated strips, featuring voice overs and sound effects.

Users will also be able to play interactive games, watch videos and create their very own virtual pet.

David Bain, the comic's head of digital development, said: "The Dandy is alive and well, and it's going to continue as usual.

"It's just as of next week it's going to be available online on a regular basis, with all the famous characters and scripts and storylines and humour, as well as games, goodies and interactivity.

"It's all about fun, humour and a bit of mischief, a bit of pranking."

Ellis Watson, chief executive of DC Thompson, said: "I appreciate it's almost a deliberately naive venture into the unknown for a publisher that's been cutting down trees for 75 years, squishing them flat and smearing ink all over them.

"We're not super slick, we're not Silicon Valley, but what we are is some pretty talented animators and storytellers that are really excited about seeing if we can introduce these wonderful characters to another couple of generations."

The first online issue will be free of charge, with following issues being priced at £1.49. A yearly subscription for the digital comic will be £29.99.

During its peak circulation in the 1950s, the Dandy sold two million copies each week. This figure has dropped in recent years to around 8,000.

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