Tuesday newspaper round-up: Virgin, new airport, Unilever

29th Nov 2011 06:18

George Osborne will raise hopes of a new multi-runway airport in the Thames Estuary today when he commits the Government to a global hub in the South East. The proposal, championed by Boris Johnson, the Mayor of London, and the architect Lord Foster of Thames Bank, will receive full consideration next year, the Chancellor will say, as he vows to lay the foundations for Britain's future beyond the eurozone crisis. Mr Osborne will have to accept that the spectre of recession will hang over Britain next year in a bracing Autumn Statement short of good news. The Office for Budget Responsibility (OBR) is expected to paint a gloomy outlook of slower growth, rising unemployment and higher public borrowing, The Times reports.Weak growth has blown a £50bn black hole in the Chancellor's deficit reduction programme, according to the Organisation for Economic Co-operation & Development (OECD). The Paris-based think tank's forecast came as it warned that Britain has already begun to slide back into recession and that the Bank of England will have to pump another £125bn into the economy to salvage the recovery. The collapse in growth will trigger a fresh surge in unemployment next year, now forecast to peak at 9.1% in 2013 - far above the current 8.3% and putting another 400,000 workers out of a job, on top of the 2.62m already unemployed. (...) The OECD's forecasts show that the structural deficit, which the Chancellor has pledged to eliminate within five years, will be 5.2% in 2013, compared with the Office for Budget Responsibility's official forecast of 2%, The Telegraph writes.The City watchdog warned today that traded life policies are high-risk, toxic products that should not be promoted to UK retail investors and is seeking a Europe-wide ban. The policies are popularly known as "death bonds" because investors put their money into a pooled investment or fund that invests in US life insurance policies. In brief, an investor bets on when a particular set of US citizens will die. If these people live longer than expected, the investment may fail. The products are therefore subject to a high level of risk and are affected by developments such as medical advances and lifestyle changes that promote increased longevity. Moreover, they are generally based offshore, so not covered by the Government's Financial Services Compensation Scheme if they fail, The Times says.An overwhelming majority of the public believes that George Osborne should slow down his spending cuts in order to boost Britain's anaemic growth levels, according to a ComRes poll for The Independent. The findings suggest growing public fears - including among the majority of Conservative supporters - that the deep cuts may be choking off a recovery. Asked whether the Government should slow the pace of the cuts so that it can try to boost growth, 69% agree and 24% disagree. Even 54% of Conservative supporters want to delay the cuts, as do 71% of Liberal Democrat supporters and 86% of Labour voters, according to The Independent.Three of UK's largest unions vote for walkout at Unilever, maker of Persil, Pot Noodles and Britain's best-known yeast spread. Production of food institutions including Marmite and the Pot Noodle is under threat after three of Britain's largest trade unions voted for strike action at Unilever. Unilever employees represented by Unite, the GMB and Usdaw are preparing for a series of strikes in a dispute over pension changes, starting with a 24-hour walkout. (...) "There is a real sense of betrayal over this," said Jennie Formby, Unite's national officer, who said the closure had come only three years after the scheme was shut to newcomers. "Significant numbers of workers are going to lose a major amount of what they expect to get when they retire." Although scheme members will retain the benefits accrued so far, they will now move on to less generous pensions, Formby said, The Guardian reports.Taxpayers are being taken 'for a ride' over the discount sale of Northern Rock to Virgin Money, it was claimed last night. Experts fear the bank has been sold virtually for free under a deal which could see Sir Richard Branson's empire claim its cash supplies. In theory, Virgin Money is paying £747m after ministers accepted an offer 'in the best interests of the taxpayer'. In practice, it is feared the price tag will be very little as the company can plunder the Rock's 'cash buffer'. These are the reserves built up since the credit crunch. The worries surround the amount of back-up cash which Northern Rock has, known as its Tier One capital ratio, warns The Daily Mail.AB