Tuesday newspaper round-up: UK construction, Peacock, RBS

17th Jan 2012 06:42

Confidence within the UK's construction industry has "collapsed" with just 5% of small businesses operating in the sector expecting their workloads to increase this year, according to a new report. The Federation of Master Builders' "state of trade survey" found workloads have fallen in each of the past 16 quarters and confidence in the repair, maintenance and improvement (RM&I) market is plunging. Brian Berry, the federation's director of external affairs, said: "The disastrous results for the RM&I market are very alarming." Commenting on the Scottish construction sector, John Hall - Scottish council member with insolvency trade body R3 - said: "Given the continued squeeze on facilities by lenders, it is highly likely that many more businesses in the construction sector will fail in the coming year," The Scotsman says. An independent Scotland could start life with a debt pile of as much as £270bn, equivalent to more than double its annual economic output, according to a report by advocacy group Taxpayer Scotland. Taxpayer Scotland, which is linked to the London-based Taxpayers' Alliance organisation, estimates Scotland's debt could be as high as £189bn, even before taking into account its share of the national debt. Adding in Scotland's £80bn share of the UK's £940bn national debt suggests it might face a £269bn burden, costing more than £10bn in annual interest payments. The report by Taxpayer Scotland warns that even with annual oil and gas revenues of £6bn, the country spends £9bn more every year than it generates in revenues, The Telegraph reports. Directors at Peacock Group secured a stay of execution yesterday after the collapse of emergency debt talks. The company, which trades as Peacocks and Bonmarché, filed a notice of intention to appoint administrators at both discount store chains, which gives it up to ten working days of protection from creditors in which to seek a buyer. The privately owned retailer, which is cash-generative but is in the red because of interest payments, is said to be speaking to trade and financial investors. The company employs 11,000 staff and would be one of the biggest retail failures of the downturn if it does go into administration, according to The Times. Oil prices climbed 70 cents to $111.14 a barrel on Monday, after Iran issued fresh threats to cut off up to 17m barrels per day of oil supply from world markets by shutting down the Strait of Hormuz. Iran warned its neighbours in the Gulf states that they should not attempt to make up for the shortfall if an embargo is imposed on its crude oil exports, and reiterated its threat that it could block oil transport on the Strait in response to sanctions. State-run Iranian news agency Mehr reported that "no country" could cope with the shock of the Strait being closed. But Saudi Arabia, the world's biggest oil producer, hit back, playing down the risk of disruption, The Telegraph writes.Sumitomo fought off competition from China Development Bank Corp to buy Dublin-based RBS Aviation Corp for about $7.3bn in what will be seen as a major success for the state-backed lender RBS as it attempts to become a more UK-focused business. RBS Aviation is the world's fifth-largest aircraft leasing business by the value of its fleet and manages or has on order 466 aircraft. Buying the RBS business will see Sumitomo, which operates its own much smaller aircraft leasing business, become the world's fourth-biggest aviation leasing company. "The deal is expected to complete before the end of the third quarter, and will be seen as a major part of RBS's attempt to restructure its business," said Bruce Van Saun, RBS finance director, on Monday evening, The Telegraph reports. The Government has moved to defuse a row over a possible concession to private employers running final-salary pension schemes, insisting that any change would not affect current pensioners. A proposed reform which would excuse employers from having to raise pensions in line with inflation would only apply to benefits accrued in future, if at all, the Department for Work and Pensions said. Steve Webb, the Pensions Minister, raised eyebrows at the weekend when he suggested that compulsory inflation-proofing could be scrapped as a way of reducing employers' costs. But yesterday the DWP, while confirming that inflation-proofing was being looked at as a way of encouraging employers to retain final salary-linked schemes, said that there would be no retrospective element, The Times says. The temperature of industrial unrest in the country will rise a notch this week as 2,500 Unilever workers go on strike over pensions and 1,600 Balfour Beatty electricians move towards action in a bad-tempered pay dispute. Thousands of staff at HM Revenue & Customs, meanwhile, started the week with lightning walkouts in a row over bringing in private companies to operate its call centres. Workers producing Hellmann's mayonnaise, Colman's English mustard and Flora spreads are to walk out of Unilever facilities at first light tomorrow on the first of 11 days of rolling strikes. They will be joined on the day by boffins at Unilever's molecular science facility deep in the Bedfordshire countryside and by IT workers on Deeside, as five of the group's twelve British facilities face significant disruption, The Times writes. AB