Sunday newspapers round-up: Murdoch, UK GDP has 'stalled', BP ...

16th Oct 2011 13:35

America's two largest public pension funds have increased the pressure on Rupert and James Murdoch to step down from the board of News Corporation just days before the billionaire family faces a showdown with shareholders at the company's annual meeting, informs the Sunday Telegraph. The call to action from the $146.6bn California State Teachers' Retirement System and the $226bn California Public Employees' Retirement System comes as Rupert Murdoch, News Corp's founder, chairman and chief executive, prepares to defend the company's handling of this summer's phone-hacking scandal and the independence of its board. The annual general meeting in Los Angeles on Friday is expected to be the most highly charged that Rupert Murdoch senior has ever faced.Forecasting group, Ernst & Young's Item club, says Britain is "stalled at a dangerous junction". Item's Peter Spencer said the government should take targeted steps to protect jobs, such as a cut in national insurance contributions for younger workers and German-style top-up payments for short-time working, The Observer reports. "The unemployment figures really put the kibosh on the idea that the private sector will take up the slack from public-sector job losses," he said. Spencer has downgraded gross domestic products forecasts to just 0.9% this year (compared with the 1.4% it expected three months ago) and 1.5% in 2012. "It's worse than we thought. The bright spots in our forecast three months ago - business investment and exports - have dimmed to a flicker," he said.Meanwhile, Britain's Chancellor of the Exchequer, George Osborne, has admitted for the first time that Britain may have to provide billions of pounds more to bail out the Eurozone as part of €2 trillion international efforts to shore up the single currency bloc and revitalise the flagging global recovery. Group of 20 (G20) finance ministers, including the US Treasury Secretary Tim Geithner, agreed in Paris over the weekend that the International Monetary Fund (IMF) should consider using its resources to backstop a massive Eurozone-led rescue effort. Under the terms of its membership, the UK will be liable for 4.2% of any funds provided by the IMF, the Sunday Telegraph reports. The IMF has $390bn available.China has made a secret commitment to prop up the Eurozone in exchange for sweeping budget reforms and further public sector cuts across the 17-nation currency bloc, claims the Sunday Times. Sources close to the talks said China had indicated its willingness to pump tens of billions into the Eurozone by buying infrastructure assets from debt-crippled states. Chinese banks would also increase their purchases of sovereign debt to prop up ailing nations, but the Chinese delegation is demanding further budget cuts and structural reforms before committing large amounts of cash. The Chinese want to see evidence that Europe can cope with the rising cost of state pension and welfare payments across the continent.Lufthansa, the German airlines, wrote off more than £140m of investment in British Midland International (BMI) in the 18 months after it took control of the airline in June 2009, according to the Independent on Sunday, which has been examining documents registered with Companies House last week by the German flag-carrier. The documents could explain why Lufthansa is so keen to sell BMI, with reports on Friday indicating that British Airways' parent, International Airlines Group (IAG), is in very early talks with Lufthansa over buying out either the whole or part of BMI. The latest annual results filing by LHBD Holding, the Lufthansa subsidiary that owns BMI, shows that it put £45m into the British airline in 2010.The Obama administration has infuriated environmentalists by giving BP the green light to bid for new drilling rights in the Gulf of Mexico, The Observer reports. The move - seen as a major step in the company's political rehabilitation as an offshore driller following the Deepwater Horizon accident - was revealed by the head of the US safety regulator after a congressional hearing in Washington. "They don't have a deeply flawed record offshore," said Michael Bromwich, head of the newly formed Bureau of Safety and Environmental Enforcement. "The question is: 'Do you administer the administrative death penalty based on one incident?', and we have concluded that's not appropriate."British construction consultants Arup and Mace are the two hot favourites out of six groups battling to oversee the build of the $8.2bn 2022 football World Cup in Qatar, according to the Independent on Sunday. Mace, the £850m-turnover company behind London's Shard is the head of a consortium that is thought to include Middle Eastern companies. Arup is part of a team led by the American giant CH2M Hill. The remaining teams are led by huge companies from the US: KBR, Turner International, WorleyParsons, and Aecom. The competition for the contracts, which has been running since April with virtually no publicity, is expected to end in the first week of November when a programme manager will be selected. The full scale of stock-market jitters over this summer's euro crisis is revealed by new analysis from The Sunday Times. Big daily fluctuations in the FTSE 100 index have been five times more frequent than usual. In the three months since mid-July, there have been nine separate occasions when the FTSE 100 rose by more than 2% in a single trading day. Over the same period, there were 12 one-day falls of more than 2%. Between January 1984, when the FTSE 100 came into existence, and the middle of this year, big daily movements were far more rare: on average, the index rose by more than 2% just two days a quarter. Falls of a similar size also averaged about two a quarter.--jh