Tuesday newspaper round-up: Budget, Sainsbury's, Jupiter

22nd Jun 2010 06:28

George Osborne will claim today that the harshest Budget for 30 years will squeeze the rich more than it hits the poor. The Chancellor will seek to sell his package of record spending cuts and tax rises as being stamped by fairness as he tries to win public support for a four-year austerity drive. Nick Clegg moved to pre-empt any revolt by Liberal Democrats last night by insisting that his party's values were at the heart of Mr Osborne's assault on the deficit, the Times reports.George Osborne will attempt to soften the impact of what is expected to be the most brutal Budget in a generation by promising to take up to 900,000 low earners out of the income tax system. The chancellor will announce that all basic rate taxpayers will benefit from a £1,000 rise in the income tax allowance - worth £200 a year - at a cost to the public purse of £3.7bn. But in an act of political symmetry, Mr Osborne is expected to raise a similar amount from a new levy on Britain's banks - based on their balance sheets. Banks will also be required to lend more to companies, the FT reports.J Sainsbury is considering entering the Chinese market after announcing the biggest management shake-up of Justin King's six-year reign. The supermarket appointed a new chief financial officer yesterday as part of a boardroom reshuffle, with Darren Shapland, the incumbent finance boss, taking on a new executive role in charge of business development. Mr Shapland's remit will include studying Sainsbury's international options. Consultants have already been asked to explore the Chinese market, The Times has learnt.Alliance Medical needs an immediate cash injection of up to £150 million to stave off possible bankruptcy. The Times has learnt that Dubai International Capital, which bought Britain's biggest independent provider of MRI scans to the NHS in 2006 for £600 million, is in negotiations with its lending syndicate to pay the money before a deadline arrives next month.One of the best-known figures in the City has sidestepped a potential £8m tax bill by contracting to sell shares in his two companies ahead of today's Budget. Terry Smith has kept control of his shares in Tullett Prebon and Collins Stewart, selling them to a trust of which he is the sole beneficiary, but the transaction is aimed at ensuring his gains are taxed under the existing capital gains tax rate, the Times reports.Shares in Jupiter Fund Management surged 15% on their first day of trading. Jupiter, a private equity backed fund manager led by Edward Bonham Carter, on Monday formally returned to the public markets for the first time since 1995 after selling £220m of shares last week, the FT reports.The global crisis has revealed weaknesses in the eurozone's economic framework which left it particularly vulnerable to the downturn, Fitch has warned The ratings agency said that although the risk of a eurozone break-up was low over the short to medium term, further episodes of "extreme market volatility" were likely to persist until the recovery and deficit reduction were secured in the region, the Telegraph reports.A consortium of Eurotunnel, Goldman Sachs Infrastructure Partners and M&G is being formed to bid for High Speed 1, the fast rail link being sold by the Government for about £1.5bn.Eurotunnel, the operator of the Channel Tunnel, has long been touted as a bidder for the line - but it has strengthened its financial hand by joining forces with two of its biggest shareholders, the Telegraph reports.David Abraham is making his mark as the new chief executive of Channel 4 by slashing a quarter of senior managers and calling for a "fundamental evolution" at the group. The former advertising executive had pledged to restructure the broadcaster shortly after taking over at the beginning of May, and yesterday he announced an overhaul of the business, focused on greater integration of its digital operations, the Independent reports.Rio Tinto and BHP Billiton yesterday agreed to pay Western Australia increased royalties if the companies' huge iron ore joint venture in the state is given the green light. The controversial $116bn (£78bn) plan, which would see the mining giants combine their operations in the Pilbara region, still has a several competition hurdles to overcome, not least in Europe, where Eurofer, the steel manufacturers' association, has vehemently opposed the tie-up, the Independent reports.Bob Diamond, head of Barclays' investment banking business, was criticised by a Manhattan judge for an "evasive" performance on the witness stand yesterday as he defended the company's acquisition of Lehman Brothers. In a bankruptcy court hearing last night, at which it was alleged Barclays misled the judge when it sought permission for the deal back in 2008, Mr Diamond was reprimanded for refusing to give straight answers and apparently contradicting testimony he had given under oath earlier in the case, the Independent reports.