UK Economic Growth Less Than Expected

Britain's growth figure for the third quarter has been revised to 0.9% by the Office for National Statistics.

That is down from their previous estimate of 1%.

Britain's dominant services sector posted meagre growth in October, adding to the challenge for the economy as a whole to expand in the last three months of 2012.

Third quarter GDP growth was the strongest since the third quarter of 2007, but much of that reflected a one-off boost from the London Olympics and a rebound from the second quarter when an extra public holiday dented output. 

Britain suffered its second recession since the financial crisis between late 2011 and mid-2012, and overall has recovered much more slowly since 2009 than most other big economies.

It also emerged that borrowing unexpectedly increased last month, putting more pressure on Chancellor George Osborne's plan to bring down the budget deficit.

Public sector net borrowing, excluding financial interventions such as bank bailouts, was £17.5bn in November, up £1.2bn on the same month last year.

Economists had predicted borrowing would fall slightly to around £16bn.

Public sector borrowing for the year to date is £92.7bn, excluding a one-off £28bn boost from the transfer of the Royal Mail pension fund into Treasury ownership, which is 9.9% higher than the same period last year.

The latest figures will put more pressure on Chancellor George Osborne

James Knightley, analyst at ING Bank, said the borrowing figures highlighted the weak state of the UK economy and the fact that austerity measures were failing to generate the improvement in Government finances that were hoped for.

He said: "All in all, the UK appears to be ending 2012 not in particularly great shape, and as such we suspect the Bank of England has more work to do with further policy stimulus likely in early 2013, especially if the worst fears over the US fiscal cliff materialise."

The ONS said the latest figures do not take into account the transfer of assets from the Bank of England's money printing programme into the Treasury, and the auction of bandwidth for 4G mobile broadband services, which is expected to boost the finances.

In the Chancellor's Autumn Statement earlier this month, the Office for Budget Responsibility (OBR) said it expected borrowing to be £108bn in 2012/13, compared to £119.9bn in the March estimate.

The news will put further pressure on Britain's gold-plated AAA status.

All of the three main ratings agencies have now put the UK on negative watch.

Vicky Redwood, chief UK economist at Capital Economics, said: "Although a number of temporary factors flattered the OBR's new forecast for borrowing this year, the underlying picture is that the weak economy is preventing the deficit from falling."

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BAE Systems Strikes £2.5bn Deal With Oman

By Alistair Bunkall, Defence Correspondent

A deal worth £2.5bn has been completed between British defence manufacturer BAE Systems and Oman.

It will see BAE provide the Gulf state with 12 Eurofighter Typhoon aircraft and eight Hawk training jets.

As well as supplying aircraft, BAE Systems will provide in-service support to the Royal Air Force of Oman's (RAFO) operational tasks.

Work to start building the aircraft will begin in 2014, with the first jets due for delivery in 2017.

But the markets did not seem too enthusiastic about the announcement, as the BAE share price was down 2% during the early hours of trading.

More importantly for the company's future financial health is the Salam deal for 72 Typhoon jets with Saudi Arabia, worth £4.5bn.

Earlier this week, BAE warned that its 2012 earnings would suffer if no agreement was reached on this deal by February 21.

Last month, Prime Minister David Cameron visited Jordan, Saudi Arabia and the United Arab Emirates on a trade mission to promote BAE and persuade the states to buy British-made defence equipment.

PM David Cameron visited Jordan, Saudi Arabia and the UAE last month

It is unusual for a British prime minister to promote defence companies so openly but the Government is seeking to build closer ties with friendly Middle Eastern states in the face of what it sees as a growing threat in the region from countries like Iran.

The move also demonstrates an attempt to forge links outside of the traditional Nato countries.

The deal is not only important for BAE Systems but also for the companies that form the supply chain, many of which are based in the UK.

The deal will support BAE's assertion that it still has a strong business with a positive future after the proposed merger with EADS collapsed in October.

Cuts to defence budgets globally have resulted in a tougher and more competitive market, and BAE had hoped a merger with a company that specialises in civil aviation would lessen any effect of budget cuts.

Guy Griffiths, group managing director for BAE Systems' International business, said: "Receiving this contract is an honour and is excellent news for both BAE Systems and the Eurofighter Typhoon consortium.

"We look forward to working in partnership with Oman's Ministry of Defence, and the Royal Air Force of Oman, to ensure this is a highly successful programme that maximises the potential of both Hawk and Typhoon."

Oman becomes the seventh country in the world, and the second in the Middle East, to operate the Typhoon, joining the air forces of the United Kingdom, Germany, Italy, Spain, Austria and Saudi Arabia.

Business Secretary Vince Cable said: "This is obviously a very good day for BAE Systems, its suppliers and the broader Eurofighter supply chain.

"We, and our partners in the Eurofighter consortium are pursuing a number of opportunities at present and I hope that the decision by Oman to join the Typhoon family is followed by more of its friends and neighbours."

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Retailers Geared Up For 'Busiest Day'

By Tadhg Enright, Business Correspondent

As the last full shopping day before Christmas Eve, today is expected to be the busiest day of the year on high streets and in shopping centres.

The British Retail Consortium expects between £4bn and £5bn to be spent throughout this weekend.

Researchers at the credit card company, Visa, have forecast sales to peak this afternoon between 2pm and 3pm.

At Brent Cross Shopping Centre in north London, management think today could be their busiest on record and extra security and traffic staff have been deployed to help customers.

Centre manager Tom Nathan told Sky News: "Everything shows us that when Christmas is on a Tuesday and the schools only broke up yesterday that today is going to be enormous because people haven't had the chance to go and do their full Christmas shop.

"So combine that with buying the turkey - and today is the start of the big turkey run - and today is going to be a huge one I think."

But the Local Government Association said confidence on the high street remained low.

Its annual Christmas survey found that 84% of town centre managers said confidence among shoppers had either not improved or worsened compared with this time last year.

It also suggested that the particularly cold and wet start to the winter could also be taking its toll on the number of shoppers visiting town centres.

Sales at Brent Cross Shopping Centre could be the busiest yet

Normally the busiest day of the year is December 23 - the last day before Christmas Eve - but this year that falls on a Sunday when trading hours for bigger shops are restricted by law to just six hours.

Big name retailers including John Lewis, Morrisons and Marks & Spencer failed in a bid to convince the Government to relax the restrictions on Sunday trading tomorrow.

M&S has responded by opening more than 100 of its stores at 12.01am on Christmas Eve morning to help shoppers get their Christmas essentials in time.

An M&S spokesman said: "We know that the days leading up to Christmas are some of the most hectic for our customers.

"Due to Sunday trading rules, we can only open for six hours on one of the busiest days of the year.

"We hope that these early bird hours on Monday will ease the pressure and give busy shoppers a bit more time to pick up Christmas food orders or last minute presents."

Waitrose, part of John Lewis, will also extend Christmas Eve trading hours in two thirds of its supermarkets by opening an hour earlier at 7am and closing an hour later at 6pm.

Sky News visited one of its four regional distribution centres at its head office in Bracknell, Berkshire, and saw staff working to deliver twice the normal volume of food to its stores.

They will be working 24 hours a day between now and 6am on Christmas Eve to ensure Waitrose shelves remain stocked.

But management are disappointed for them and their customers that trading will be curtailed on December 23 which is usually their most important shopping day.

Waitrose supply chain director David Jones told Sky News: "If you can imagine what you'd normally take in trading over 14 hours and shrinking that into six hours, it's quite challenging as you walk around the supermarket.

"You're trying to get people through checkouts and we would have loved to have had the opportunity to trade for a longer time."

Mr Jones will be taking time out from his executive duties to man the tills in his local branch over Christmas.

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Banks Face Break-Up Over Risky Trading

By Poppy Trowbridge, Business and Economics Correspondent

UK banks face break-up if they fail to follow new rules protecting high street operations from riskier trading.

The Parliamentary Commission on Banking Standards has published a report assessing Government-backed legislation that will require lenders to protect customers' banking deposits from potential losses.

While the report suggests ring-fencing will help address the damage done to culture and standards in banking, it may not be enough to stop banks taking advantage of the rules.

Commission chairman Andrew Tyrie MP said: "The legislation needs to set out a reserve power for separation; the regulator needs to know he can use it."

"Over time, the ring-fence will be tested and challenged by the banks. Politicians, too, could succumb to lobbying from banks and others, adding to pressure to put holes in the ring-fence."

MPs are looking at ways to exert pressure on lenders that fail to comply.

Shadow chancellor Ed Balls told Sky News: "I think people are really frustrated, families, businesses, that banking reform is taking so long.

"In the meantime, our economy has not been growing, small business lending is falling. We've got to get on with it and we've got to get it right.

"The commission says the proposals on the table so far from George Osborne don't go far enough, they've been watered down, and they also are going to look at the wider issues of standards and culture in the way our banks operate."

Next year, the commission will take further evidence on whether full separation of proprietary trading operations at banks is necessary.

The Government launched an inquiry into banking standards in the wake of revelations that the London Interbank Offered Rate (Libor) had been manipulated by traders.

Barclays and Swiss bank UBS have been fined by authorities for manipulating Libor.

The rate is a reference point for vast ranges of financial contracts around the world worth around £184 trillion.

Mr Tyrie said: "The latest revelations of collusion, corruption and market-rigging beggar belief.

"It is the clearest illustration yet that a great deal more needs to be done to restore standards in banking."

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Nokia And Blackberry-Maker Agree Patent Truce

Nokia has settled all its patent disputes with Blackberry-maker Research In Motion amid the costly legal rows still gripping the fiercely competitive smartphone industry.

While terms of the agreement were confidential, Nokia said, the deal on wi-fi technology licensing includes a one-time payment and continuing fees.

The Finnish firm said the agreement settled all existing patent litigation between the two companies but it added that disputes with HTC Corp and ViewSonic over the same wi-fi technology still stood.

More follows...

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BAE Strikes £2.5bn Deal With Oman

By Alistair Bunkall, Defence Correspondent

A deal worth £2.5bn has been completed between British defence manufacturer BAE Systems and Oman.

It will see BAE provide the Gulf state with 12 Eurofighter Typhoon aircraft and 8 Hawk training jets.

As well as supplying aircraft, BAE Systems will provide in-service support to the Royal Air Force of Oman's (RAFO) operational tasks.

The deal safeguards around 6,000 jobs in the UK at BAE's two sites in Lancashire.

Work to start building the aircraft will begin in 2014, with the first jets due for delivery in 2017.

Last month, Prime Minister David Cameron visited Jordan, Saudi Arabia and the UAE on a trade mission to promote BAE and persuade the states to buy British-made defence equipment.

It is unusual for a British Prime Minister to promote defence companies so openly but the Government is seeking to build closer ties with friendly Middle Eastern states in the face of what it sees as a growing threat in the region from countries like Iran.

The move also demonstrates an attempt to forge links outside of the traditional Nato countries.

PM David Cameron visited Jordan, Saudi Arabia and the UAE last month

The deal is not only important for BAE Systems, but also for the companies that form the supply chain, many of which are based in the UK.

The deal will support BAE's assertion that it still has a strong business with a positive future after the proposed merger with EADS collapsed in October.

Cuts to defence budgets globally have resulted in a tougher and more competitive market, and BAE had hoped a merger with a company that specialises in civil aviation would lessen any effect of budget cuts.

Guy Griffiths, group managing director for BAE Systems' International business, said: "Receiving this contract is an honour and is excellent news for both BAE Systems and the Eurofighter Typhoon consortium.

"We look forward to working in partnership with Oman's Ministry of Defence, and the Royal Air Force of Oman, to ensure this is a highly successful programme that maximises the potential of both Hawk and Typhoon."

Oman becomes the seventh country in the world, and the second in the Middle East, to operate the Typhoon, joining the air forces of the United Kingdom, Germany, Italy, Spain, Austria and Saudi Arabia.

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Tax Row: McDonald's Calls For Review Of Law

The chief executive of McDonald's in the UK has said Britain's corporation tax rules need to be addressed.

Speaking on Jeff Randall's Christmas Dinner, Jill McDonald warned that the continuing row over the amount of corporation tax companies pay could create a negative image of British business.

"Customers, consumers, want businesses to be doing the right thing," she said.

"I think it is politicians who are creating the laws who need to address and look at those."

She added: "I do think that it's in danger of spinning a little bit out of control because you don't want the conversation to be so negative about business …because, as we know, business is ultimately what's important to help Britain grow again."

McDonald's paid £42m in UK corporation tax last year

She made her comments after a number of companies – including Starbucks, Google and Amazon - were heavily criticised by politicians and campaigners over their tax affairs.

McDonald's, which employs over 90,000 people in the UK, paid £42m in UK corporation tax last year, which Ms McDonald defended as "fair".

"One man's efficient tax planning though is another's tax avoidance so the law does need to be looked at," she said.

"But in McDonald's for example we pay what we would consider to be our fair share of corporation tax."

Paul Walsh, the chief executive of Diageo which has Guinness, Smirnoff and Johnnie Walker among its brands, told Jeff Randall that tax is a complex issue for a global company.

Only 7% of Diageo's total sales were in the UK last year but the company - which is the world's biggest spirits company - paid more than a billion pounds in UK corporation tax.

"I think we run the risk of getting into the debate of 'If you pay tax, everything's fine'," he said.

"What about the company that's investing billions and will get appropriate tax losses and capital allowances?

"They're creating a lot of jobs so be very careful that we don't suddenly get so simplified in our approach that it conspires against what this nation is trying to do - create jobs. "

:: Jeff Randall's Christmas Dinner is broadcast tonight at 7pm on Sky News, and is repeated over the festive period. It is also available on Sky On Demand and the Sky News for iPad App.

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London Midland Free Tickets After Delays

Free travel passes and cheap train tickets are being given to London Midland passengers hit by cancellations and delays after the Government stepped in.

The package, worth £7m, was imposed after months of problems on routes which cover London, Birmingham, Northampton, Crewe and Liverpool.

Season ticket holders with the company will receive free travel passes for five days. Another 500,000 extra cheap advance tickets will also be handed out.

The free tickets will be available to all monthly and annual season ticket holders, and weekly ticket holders affected by disruption.

The cheap tickets will be made available over the next two years for passengers travelling on key London Midland routes.

The company has been battling a major driver shortage in recent weeks, forcing it to cancel almost 1,000 trains since October.

Transport Minister Norman Baker said: "London Midland has cancelled or delayed hundreds of services in recent months.

"On repeated occasions, they were not able to provide enough drivers and some services had to be cancelled, with severe delays to services, and they have fallen short both of everyone's expectations and their franchise obligations.

"Securing these benefits for passengers represents a firm yellow card for London Midland and some financial benefit for those who have been hardest hit by their poor performance.

"I am confident London Midland has now rectified their driver shortage but the company need to be clear that we will continue to monitor their performance closely and take firmer action if necessary."

The deal also confirms the franchise will end in September 2015, to ensure the firm has enough time to resolve the driver problems permanently.

London Midland will also have to spend millions improving the resilience of their trains and at least £2.25m on measures to help passengers - mostly in the West Midlands which was affected worst.

Its parent firm, the Go-Ahead Group, released this statement: "Following a period of consultation over the last couple of months, London Midland has agreed a package of benefits with the Department for Transport to compensate passengers for cancelled trains and delays to services.

"We acknowledge the impact that this has had on our passengers and we have now put measures in place to ensure we have sufficient drivers to operate our services.

"We also welcome the confirmation that the London Midland franchise has been extended until September 2015 which gives us the opportunity to provide longer-term investment in our services for the passengers' benefit."

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Ryanair: Airline Bottom Of Which? Survey

Ryanair is the least popular short-haul airline, according to a new survey that gave the carrier its lowest approval rating ever.

The Irish firm received an overall satisfaction score of just 34% in a table put together by consumer magazine Which? from its members' votes.

It was 16th and last in the table, which was compiled from views of passengers on a home-bound flight in the 12 months to October.

On Ryanair, Which? said: "We were inundated with comments about Ryanair - many about its extra charges.

"This partly accounts for the paltry one-star ratings for baggage allowance, boarding arrangements, seat allocation, and food and drinks."

Ryanair boss Michael O'Leary is known for his controversial comments

Which? said it was the first time Ryanair had been at the bottom of its survey, adding that its customer score was the airline's worst to date.

The most popular short-haul airline was Swiss, with an overall score of 82% and a maximum five-star score on a number of the rating categories.

These included check-in process, baggage allowance, seating allocation and airline staff.

Second in the table was Turkish Airlines with a score of 78%, with German carrier Lufthansa third, Aer Lingus fourth and KLM fifth.

Only airlines which received at least 30 responses were considered.

Swiss's results were based on 59 responses, Turkish Airlines on 38, Lufthansa 74 and Aer Lingus 65.

Ryanair's results were based on 563 responses. In 15th place was Thomas Cook Airlines with a score of 36%, with Thomson Airways 14th on 45% and Monarch 13th with 47%.

Swiss's customers spoke of the staff's "politeness and great service", while Turkish Airlines was the only carrier to get more than three stars in the food and drink category.

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Investigation Launched Into Comet Collapse

The Department for Business, Innovation and Skills has launched an investigation into the purchase and administration of troubled electrical chain Comet.

The Insolvency Service has been tasked with scrutinising the process following a number of complaints from MPs.

The business was bought for £2 by Hailey Acquisitions, an investment vehicle put together by Henry Jackson of OpCapita, in November 2011.

They were given a £50m dowry from previous owner Kesa Electricals, now known as Darty, to run the retailer, which collapsed just a year later.

Seven weeks after they were appointed administrators, Deloitte failed to find a buyer for the 235-store chain, and closed its remaining 49 outlets.

The collapse of the company, which was founded in Hull in 1933 and employed around 6,895 people, is one of the biggest high street failures since the demise of Woolworths in 2008.

Deloitte said on Monday that it remained in talks with a small number of parties over the sale of internet operations and the brand.

But the firm also confirmed the taxpayer will have to pick up a £49.4m bill for unpaid redundancy and tax payments.

Comet launched a sale following its collapse at the beginning of November

With insufficient funds raised from the winding down of the chain, the Government's Redundancy Payments Service will be required to meet the £23.2m of outstanding redundancy and accrued holiday pay and pay in lieu of notice.

The scale of the problems at Comet was also highlighted in the report, with the chain racking up losses of £95m in the year to April after also seeing revenues slump by £200m compared to a year earlier.

This was followed by a further £31m loss in the subsequent five months as credit insurers lost confidence and withdrew support for the business.

Hailey Acquisitions is expected to get payments of just under £50m as a secured creditor - a shortfall of £95m on the amount owed.

But it has been reported that unsecured creditors, including HM Revenue and Customs which is owed £26.2m, will receive nothing.

Comet was hit by weak high street trading conditions, competition from online rivals and being unable to secure the trade credit insurance needed to safeguard suppliers.

In particular, it was knocked by the lack of first-time home buyers who were key customers for Comet.

Holders of £4.7m of unclaimed Comet gift cards and vouchers are also on the list of unsecured creditors.

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Nissan To Build Luxury Car Model At UK Plant

Car giant Nissan is to build a new luxury model in the UK, creating 1,000 jobs with a £250m investment.

The new global model will be manufactured at the Japanese firm's plant in Sunderland, which employs 6,000 workers.

The car, built under Nissan's Infiniti premium brand, is set to be produced from 2015.

It will be developed with help from Nissan's design centre in London and technical centre in Cranfield and then exported around the world, the firm said.

Around 280 of the new jobs will be in Sunderland, with the rest in other sites across the country.

Because of capacity limitations at Sunderland, securing the new Infiniti will mean that a C-segment hatchback previously announced for the plant in April will be manufactured elsewhere, said the company.

The North East plant will build more than half a million cars this year, the first UK manufacturer to achieve this milestone.

The new model will be made at the Nissan factory in Sunderland

Colin Dodge, Nissan's executive vice-president and chief performance officer, said: "This milestone, our first premium product to be manufactured at Sunderland, reconfirms our commitment to UK manufacturing and the ongoing success of the plant which is moving up the value chain.

"Just as important, the new Infiniti, which will be exported around the world, is being developed with help from our London design centre and our European Technical Centre."

Business Secretary Vince Cable, who will attend a ceremony in Sunderland to mark the announcement, said: "Sunderland will be the only place in the world to make this new premium compact car.

"Nissan in the UK goes from strength to strength. Not only will the new car be made here and exported all over the world, the UK has already contributed to its design and development.

"Today's news is a strong endorsement of the quality of Britain's car industry which is creating jobs, taking on apprentices and contributing to building a stronger economy.

"The auto sector is living up to being one of the great success stories of our industrial strategy and a testimony to government and private sector working together in close partnership."

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Libor Rate-Rigging: UBS Pays £940m Penalty

The Swiss bank UBS is to pay £940m, including £160m to regulators in Britain, to settle Libor rate-rigging investigations.

The fines, which amount to the second biggest penalty paid by a bank in the wake of the £1.2bn money laundering settlement announced by HSBC in the US last week, relate to manipulation of yen Libor and euroyen contracts.

The Financial Services Authority (FSA) said the case was "all the more serious" as UBS had attempted to manipulate Libor submissions at other banks, making corrupt payments to reward brokers for their efforts.

The FSA's report revealed incriminating conversations between UBS traders and brokers, saying they would "play the rules" and "return the favour".

One trader said: "I need you to keep it (the six-month Japanese Libor rate) as low as possible ... if you do that ... I'll pay you, you know, $50,000, $100,000 ... whatever you want ... I'm a man of my word."

The Libor scandal cost Bob Diamond the top job at Barclays

Bankers, the FSA said, also referred to each other in congratulatory terms, such as "the three muscateers (sic)", "Superman", and "Captain caos (sic)".

The £940m fine goes to regulators in the US, UK and Switzerland and the bank said it could not rule out further penalties in future.

The total comes to more than three times the $290m fine levied on Barclays in June for rigging the Libor benchmark rate used to price financial contracts around the globe from home loan rates to complex derivatives.

UBS said today that around 40 people have left or been asked to leave the bank as a result of the Libor investigation and it now expected to report a loss of up to £1.7bn for the fourth quarter as a result of the case.

Chief executive Sergio Ermotti added: "We deeply regret this inappropriate and unethical behaviour.

"No amount of profit is more important than the reputation of this firm, and we are committed to doing business with integrity."

In its statement, the FSA said UBS made "corrupt payments" of £15,000 per quarter to brokers for at least 18 months to reward them for helping the Swiss bank manipulate global interest rates.

It said that at least 45 individuals including traders, managers and senior managers were involved in, or aware of, the practice.

Kweku Adoboli lost UBS £1.4bn

The regulator recorded at least 2,000 requests for inappropriate submissions and said many more would have been made orally.

Tracey McDermott, FSA director of enforcement and financial crime, said: "They manipulated UBS's submissions in order to benefit their own positions and to protect UBS's reputation, showing a total disregard for the millions of market participants around the world who were also affected by Libor and Euribor."

The FSA had already fined UBS £29.7m for failings which allowed a rogue trader to rack up losses of £1.4bn in an unrelated case.

Kweku Adoboli was jailed for seven years in November after being found guilty of fraud.

The Libor scandal, which is expected to engulf other banks including RBS, has resulted in pledges to reform how the rates are set.

The British Banking Authority, which currently oversees Libor, has agreed to give up that responsibility as part of the changes.

A criminal investigation in the UK, led by the Serious Fraud Office, resulted in its first arrests last week,

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Comet's Remaining Stores Close For Last Time

Comet's 50 remaining stores are trading for the final time after administrators failed to find a buyer for the electrical retailer.

The collapse of the firm, founded in Hull in 1933 and which employed around 6,895 people at the time of its collapse, is one of the biggest high street failures since the demise of Woolworths in 2008.

Administrator Deloitte said in a report that it remained in talks with a small number of parties over the sale of internet operations and the brand.

But the firm also confirmed that the taxpayer will have to pick up a £49.4m bill for unpaid redundancy and tax payments.

With insufficient funds raised from the winding down of the chain, the Government's Redundancy Payments Service will be required to meet the £23.2m of outstanding redundancy and accrued holiday pay and pay in lieu of notice.

The scale of the problems at Comet were also highlighted in the report, with the chain racking up losses of £95m in the year to April after also seeing revenues slump by £200m compared to a year earlier.

This was followed by a further £31m loss in the subsequent five months as credit insurers lost confidence and withdrew support for the business.

Hailey Acquisitions, the investment vehicle put together by Henry Jackson of OpCapita who raised funding from unnamed investors for Comet's takeover from French retail group Darty, is expected to get payments of just under £50m as a secured creditor - a shortfall of £95m on the amount owed.

But it has been reported that unsecured creditors, including HM Revenue and Customs which is owed £26.2m, will receive nothing.

Comet was hit by weak high street trading conditions, competition from online rivals and being unable to secure the trade credit insurance needed to safeguard suppliers.

In particular, it was knocked by the lack of first-time home buyers who were key customers for Comet.

Holders of £4.7m of unclaimed Comet gift cards and vouchers are also on the list of unsecured creditors.

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HMRC Missed Calls Cost Taxpayer £136m A Year

Delays in answering phone calls to HM Revenue and Customs hotlines cost the taxpayer £136m in the last year.

According to a National Audit Office (NAO) report, delays cost customers £33m in call charges while they waited for HMRC to answer the phone and the estimated value of customer time while they waited was £103m.

The NAO said 20 million calls to HMRC hotlines - many of which are 0845 numbers - were not picked up at all last year.

People who did get through were also waiting longer to speak to an adviser - an average of 282 seconds compared with 107 seconds in 2009/10.

In the first quarter of this year, some 6.5 million people were left holding on for longer than 10 minutes.

"Depending on the tariff they pay their phone company, customers are charged once their call is connected even if they are held in a queue," the report said.

"We estimate that if HMRC improved performance to answer 90% of calls and reduced waiting times, it could save customers around £52m a year.

"HMRC currently plans to spend £34m to achieve this level of performance."

The NAO found that there had been some progress since thousands more staff were drafted in, with the 74% pick-up rate significantly higher than the 48% recorded in 2010/11.

However, the report warned that the figures probably underestimated the issue, as calls are counted as answered even if they do not reach an adviser.

Public Accounts Committee chairman Margaret Hodge said: "When people have no choice but to contact the Revenue to discuss their tax affairs, I find it totally unacceptable that HMRC uses costly 0845 numbers and charges people for the privilege of waiting for the department to pick up."

TaxPayers' Alliance chief executive Matthew Sinclair said: "This report exposes a shameful level of service at HMRC.

"Taxpayers will be outraged that HMRC could let 20 million phone calls go unanswered and yet still claim that it is outperforming some arbitrary target."

An HMRC spokesman said: "In 2010/11 we answered 48% of all call attempts, rising to 74% in 2011/12.

"By late 2012 we were answering over 90% of calls to our contact centres. We are well aware that in the past we have not delivered the standard of service to which we are committed.

"We are determined to build on this progress and we have invested £34m so we can deliver on our improvement targets earlier than planned."

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Investigation Launched Into Comet Collapse

The Government has launched an investigation into the purchase and administration of troubled electrical chain Comet.

The Department for Business, Innovation and Skills has tasked the Insolvency Service with scrutinising the process following a number of complaints from MPs.

The business was bought for £2 by Hailey Acquisitions, an investment vehicle put together by Henry Jackson of OpCapita, in November 2011.

They were given a £50m dowry from previous owner Kesa Electricals, now known as Darty, to run the chain.

More follows...

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Fuel Poverty Warning For 300,000 More Homes

A further 300,000 people will be pushed into fuel poverty by Christmas because of the latest round of energy price hikes, an advisory body has warned.

The Fuel Poverty Advisory Group (FPAG) said the latest round of energy price rises has increased the average annual energy bill by 7%, taking it to £1,247 for direct debit customers and £1,336 for cash and cheque customers.

These increases are likely to have pushed a further 300,000 households into fuel poverty and estimates have already shown that over nine million households could be living in fuel poverty by 2016.

The lobby group urged David Cameron to take stronger action to ensure there is a more widespread and ambitious effort to tackle "spiralling" fuel poverty levels.

It said the Government should create a cross-departmental group on fuel poverty to ensure a joined-up approach as well as creating a new duty for local authorities to meet fuel poverty targets.

It also advised the Government to carry out an urgent impact assessment of welfare reforms on fuel poverty.

Derek Lickorish, chairman of the FPAG, said: "With a cold winter, welfare reforms cutting incomes, and all at a time of austerity measures and other rising household costs, the plight of the fuel poor has never been more serious.

"Millions are living in misery due to high energy bills. Yet time is running out for the Government to fuel poverty-proof the homes of those on the lowest incomes.

"A toxic cocktail of rising wholesale prices, the high cost of energy reforms and cuts in incomes for many households means fuel poverty levels are set to sky rocket without radical action."

Families are considered to be in fuel poverty when they have to spend more than 10% of their incomes on keeping their homes warm.

The FPAG said that nearly half of the UK's fuel poor households are pensioners, a third contain people with some sort of disability or illness, a fifth contain a child aged five or under and one in 10 house someone aged 75 or over.

The Government recently announced proposals to require energy firms to provide just four tariffs for each fuel and to place all customers on the cheapest price available for their chosen tariff.

But critics have warned that the plans could see an end to cheap deals, stop consumers switching suppliers, reduce competition and push up bills in the long run.

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Taxpayer Faces £50m Bill For Comet Collapse

The taxpayer is facing a £50m bill for the collapse of electrical retailer Comet, a report from the administrator is set to reveal.

The report from Deloitte is likely to indicate that insufficient funds have been raised from the winding down of the chain to pay up to £24m in redundancy payments to 6,000 staff.

This means the Government will probably have to step in and ensure workers receive their payments.

The statement is expected to be published today and will also disclose that unsecured creditors - including HM Revenue and Customs - will receive nothing.

The Tax Office is due some £26.1m by the firm.

Secured creditors, such as the backers of Comet's parent company Hailey Acquisitions, will get payments of just under £50m.

But according to the Sunday Telegraph, this represented a shortfall of £95m on the amount owed at the time of the collapse of the 236 store chain in early November.

The troubled Comet chain reportedly racking up losses of £95m in the year to April, followed by a further £31m in the subsequent five months as credit insurers lost confidence and withdrew support for the business.

Hailey Acquisitions was the investment vehicle put together by Henry Jackson of OpCapita, who raised the funding from unnamed investors for Comet's takeover from French retail group Darty.

Deloitte has said the last 50 stores will close for the final time tomorrow, amid speculation that the brand will be sold to an online retailer and around 20 shops picked up by rivals.

Unsecured creditors also included ITV and Google, which are owed £1.2m and £602,000 respectively for unpaid advertising bills, the newspaper said.

Meanwhile, holders of £4.7m of unclaimed Comet gift cards and vouchers are also on the list of unsecured creditors.

However, an estimated £40m of payments will be made to suppliers and £2.1m of holiday and back pay owed to staff will be paid in full.

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Fuel Bills To Rise As Networks Get Upgraded

Energy watchdog Ofgem has announced a major upgrade to Britain's gas and electricity networks that will be funded by a rise in consumer bills.

The £24bn investment in the UK's ageing infrastructure will take place between April next year to March 2021.

Fuel bills will increase by an average of £12 a year, rising to £15 a year extra by 2021.

More follows...

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Open University To Go Global With Online Courses

The Open University (OU) has launched a campaign to take distance learning global - as it attempts to catch up with online course offered by US colleges.

The OU has teamed up with 10 British universities in a venture called FutureLearn.

The plan is to give free virtual lectures that are supplemented by digital learning tools to help promote UK institutions.

OU vice-chancellor Martin Bean told Sky News: "You won't be able to get a degree through FutureLearn but you will be able to get free access to some of the best higher education content on the planet.

"In a world of higher fees where people are taking on more of that responsibility for themselves I think they're going to demand better teaching ... and I'm sure it will help these universities really develop new, innovative and experimental teaching practices."

The decision to go global comes after leading US colleges, including Harvard, MIT, Texas and Georgetown, launched various learning partnerships.

One partnership involving Stanford already has two million users around the world.

Professor Bean admitted: "There's no doubt the Americans have got a little out in front of us on this one."

But he insisted the move would benefit Britain's universities.  

"It strengthens brand and competitiveness, it allows them to experiment and develop new teaching strategies for their students on campus and online," he said.

"And it also creates some revenue opportunities in being able to compete for all of those transnational students that are often in developing parts of the world."

The OU has been running courses since 1971, initially using late night television programmes to supplement course notes.

Supporters see FutureLearn as an important way to put students on a path that may lead to traditional tertiary education - a lucrative sector for colleges.

But there are doubts whether any money can be made from massive open online courses (Moocs), even though one in the US has 160,000 users.

Moocs do not carry degree credits and concerns have been raised about plagiarism and the manpower needed to check the work of tens of thousands of students that may be on a single course.

Money-making concepts have included offering free courses but charging for exams, certificates and tutoring.

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EU Summit: Cameron 'Committed To Saving Euro'

The Prime Minister has made it clear he wants favours in return for signing a deal aimed at increasing economic and monetary union in the European Union.

At the seventh and final EU summit of the year, David Cameron insisted the UK was not in an uncomfortable position, despite refusing to have its banks monitored by a centralised supervisor.

"We did not stand in the way of the eurozone having a banking union ...now there are opportunities for us to seek changes in our (EU) relationship, changes that the British people will be more comfortable with," he said.

"They (the eurozone countries) want to make changes, and we can ask for changes too."

His comments come a day after European finance ministers took a major step towards full banking union by agreeing to create a single supervisor for eurozone banks.

But although the UK will not be subject to the scrutiny - continuing to monitor its own institutions - Mr Cameron insisted that Britain "remains at the heart" of decision making in Europe.

The ECB will oversee all banks in the 17 EU countries that use the euro

"I don't think Britain is in an uncomfortable position at all," he said.

"I think we are in a position where we have opportunities to maximise what we want from our relationship with the European Union.

"The fact is we have a multi-faceted Europe, we have a Europe where countries like Britain are absolutely at the heart of decision making."

Earlier this year, Mr Cameron called for a "new settlement" between the UK and Brussels and on Thursday said his focus was now on getting a "better deal" for Britain.

The banking deal gives the European Central Bank (ECB) oversight for lenders in the 17 EU countries that use the euro - and any other country that wants to opt in.

It also paves the way for Europe's bailout fund to give direct aid to ailing banks - a measure seen as vital to helping the eurozone break free of its debt crisis.

The agreement, which follows months of negotiations, was described by the president of the European Commission, Jose Manuel Barroso, as a "deep and genuine economic and monetary union", which requires "steps towards political union".

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Bayer Seeks Approval For Prostate Cancer Drug

Drug company Bayer has requested approval from US regulators for a new drug to treat prostate cancer.

The German pharmaceutical maker said the product could potentially reap annual sales of over 1bn euros (£810m).

Bayer applied for EU approval for the drug on Wednesday.

The drug, Radium-223 - formerly known as Alpharadin - targets bone metastases caused by prostate cancer which is untreatable through standard hormone therapy.

Calcium properties in the drug attach to the cancerous bone cells which are then targeted and destroyed with alpha rays.

The approach is more precise than traditional radiotherapy, and causes fewer side effects than some other types of treatment.

Last year, Bayer predicted the drug boost to its revenues and labelled the product as "blockbuster".

Cancer Research UK said initial results from a trial of Radium-223, which is administered by injection, this year were "very positive".

There are also trials using the drug for breast cancer that has spread to the bone, the charity added.

In 2009, more than 40,000 UK males were diagnosed with prostate cancer, the most common cancer found in men.

The charity movement Movember has raised awareness of prostate cancer and men's health through the growing of moustaches in November, with fundraising that supports charities.

This year's so-called Mo-Bros included Stoke City footballer, Michael Owen and England rugby's Toby Flood.

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