Friday newspaper round-up: Mervyn King, BP, Essar Energy

30th Apr 2010 06:33

The Governor of the Bank of England was at the centre of an electoral storm last night after saying that the austerity measures needed to tackle Britain's budget deficit would be so unpopular that whoever wins next week would not get back into government for a generation.Mervyn King's opinion, revealed hours before the prime ministerial debate on the economy, came as respected think-tank NIESR predicted that taxes would have to rise by the equivalent of a 6p-in-the-pound increase in income tax over the next ten years, the Times reports.The massive oil spill pouring from a ruptured well in the Gulf of Mexico is expected to reach the Louisiana coast today, threatening hundreds of species and prompting an environmental catastrophe. As BP faced growing accusations that it had tried to play down the scale of disaster after the Deepwater Horizon rig exploded and sank last week, the US authorities said that five times more oil was surging into the Gulf from the seabed than had been calculated previously, the Times reports.Meanwhile, President Barack Obama said BP was "ultimately responsible" for the cost and clean-up of an growing oil slick in the Gulf of Mexico which threatens to develop into an environmental catastrophe. The US President is to dispatch two senior members of his cabinet to the site of the spill today to ensure that the British oil giant is "doing everything possible not just to respond to this incident but also to determine its cause," the Telegraph adds.Essar Energy has dropped the asking price for its $2.5bn (£1.6bn) flotation, London's biggest stock market offering in more than two years, below its planned price range, under lining the fragility of the UK market for new listings. The oil and gas producer, which is being spun out of one of India's biggest conglomerates, has struggled to cover its order book at the very bottom of its price range in a week where markets have been rocked by the Greek sovereign debt crisis, the FT reports.A Russian company has shelved plans for a $640m (£418m) listing on the London Stock Exchange. It would have been one of the biggest flotations in the City this year by a foreign business. It was unclear last night why Uralchem had abandoned its plans and a spokesman in London did not return calls. Reports in Russia said that the listing of the fertiliser company was pulled because of a lack of interest from investors, the Times reports.The Greek Government has agreed the draft outline of a €24bn (£21bn) rescue package, which is expected to include savage cuts in Civil Service wages and state benefits along with hefty tax increases to cut its deficit. Final details of the measures were still being decided last night with officials from the International Monetary Fund (IMF), the European Commission (EC), and the European Central Bank (ECB), the Times reports.In stark contrast to Banco Santander, Britain's leading banks refused to detail their exposures to the debts of the troubled economies of Greece, Portugal and Spain, although they were falling over one another to play them down.The Bank of International Settlements has estimated the collective exposures of Britain's banks to Greece at $15bn (£10bn) Portugal at $24.2bn and Spain at an alarming $114bn, threatening a fresh banking crisis if contagion from the Greek crisis spills over into other debt-ridden Eurozone economies, the Independent reports.HSBC is facing an investor revolt over plans to pay its chief executive £800,000 a year in cash and benefits for moving to Hong Kong. Institutional investors have told The Times they regard Mike Geoghegan's relocation package as egregious and "in effect a pay rise by the back door". Some are threatening to vote against the bank's remuneration report at the annual meeting on May 28. HSBC is attempting to defuse the revolt in meetings with concerned investors, but appears to be in no mood to back down, the Times reports.Sports fans will be able to watch Premier League football and Ashes cricket for as little as £15 a month from August, after BSkyB agreed to make its flagship content available to its rivals at cheaper prices. BT is planning to make Sky Sports 1 available to its BT Vision TV subscribers for about £15 after BSkyB and Ofcom agreed a deal which will allow rival broadcasters to show Sky's prized sports coverage at lower prices pending a full appeal, the Telegraph reports.Moore Capital, one of the world's most successful hedge funds, and Morgan Stanley were fined on Thursday by US regulators for alleged breaches of rules in the precious metals and oil markets.The fines, totalling $39m, are among the largest ever imposed by the US Commodity Futures Trading Commission. They came amid closer scrutiny of the commodities markets in the US after record volatility two years ago, the FT reports.