Watchdog Urges Faster Energy Tariff Reform

The energy watchdog's proposals for a "simpler and fairer" energy market have drawn a mixed response from consumer groups, as the regulator called on suppliers to adopt them "as quickly as possible".

Regulator Ofgem has told suppliers to limit themselves to four "core" tariffs each for electricity and gas and for each type of payment, while all information suppliers send to consumers must be "simplified, more engaging and personalised".

Suppliers will use a new Tariff Comparison Rate (TCR), which the regulator claims will help to simplify the selection process for consumers.

And new enforceable standards of conduct will enable Ofgem to take action against suppliers where they have failed to treat customers fairly.

Today Ofgem launched the last statutory consultation before it decides whether to implement "the most radical reforms to the retail market since competition began".

The reforms are expected to come into effect from the summer, but Ofgem said there was nothing to stop suppliers moving to deliver them now.

Ofgem senior partner for markets, Andrew Wright, said: "Our reforms today are the blueprint for the simpler, clearer and fairer energy market that consumers deserve.

"This will provide them with the choices they want alongside the simplicity they need.

Both electricity and gas companies have used complex tariff systems

"They have been delivered following two years of engagement with consumers and industry in the most comprehensive ever review of the retail market.

However consumer watchdog Which? said it was "hugely disappointing" that Ofgem had pressed ahead with the TCR format.

Which? executive director Richard Lloyd said: "While these new rules will help make the market simpler and fairer it's hugely disappointing to see the regulator sticking to its fundamentally flawed idea of how energy prices should be presented.

"This will fail to help people find the best deal easily and could even mislead millions into paying over the odds for their energy."

Trade association Energy UK defended the firms and said: "Energy suppliers have already pressed ahead with providing customers with simpler, clearer tariffs.

"Our members have dramatically reduced the number of tariffs, simplified structures and pledged to help all customers move to the deal that suits them best."

But Energy Secretary Ed Davey has continued to push for faster reform and said: "I welcome the continued progress of Ofgem's reform of the retail energy market.

"It's simply scandalous that over eight in 10 of households, including the most vulnerable, are put off switching or engaging in the energy market.

"That's why I'm backing Ofgem's reforms to make it easier to compare tariffs and switch suppliers. These reforms are the fastest way to speed up delivery of simpler bills and a fairer system."

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Diesel Drivers 'Get Worse Deal' In Fuel War

The cost of filling up at the pumps has edged up over the last month, with diesel drivers getting a worse deal than those using petrol, according to new figures from the AA.

The average price of petrol in the UK has risen from 133.35p a litre in mid-May to 134.61p in mid-June, while diesel has gone up from 138.17p a litre to 139.16p.

Northern Ireland has the most expensive petrol, at an average of 135.8p a litre, with London having the cheapest, at 134.61p.

Northern Ireland also has the dearest diesel (139.8p a litre) with London and south west England having the least expensive (139.1p).

The AA said the slight rise in average petrol prices nationally represented "something of a lull" after the 8-10p swings in prices over the last 12 months.

But it warned that this year retailers have on average been "creaming up to £1 a tank extra off diesel car drivers and up to £1.40 a tank extra off diesel van owners".

The AA went on: "At present, the 1p-a-litre premium that fuel stations are generally adding to the cost of diesel adds 5,500 miles to the break-even point for a new car buyer who chooses diesel instead of petrol.

"Diesel cars typically cost £1,500 more but the saving from better fuel efficiency should eventually recoup that."

AA president Edmund King said: "To be fair, there is often much greater variation in the price of diesel among retailers in a town than with petrol.

"However, on average, the profit margin on diesel is consistently at least a penny higher than with petrol.

"The clear message to diesel drivers is to take advantage of the greater range of prices locally. Some forecourts are more diesel-friendly than others."

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Viagra 'Price Drop' As Drug Patent Expires

The cost of Viagra could drop dramatically from today as the UK patent for the drug expires.

The male erectile dysfunction drug, manufactured by American firm Pfizer in Ireland, must now compete against dozens of generic competitors.

There are some 120 alternative versions made worldwide, with some costing as little as 85p per pill.

Sky News understands that Pfizer will release its cheaper, generic 'white diamond' version on June 22. It will also continue to sell the original version.

The drug prompted many jokes - including these 'Viagra-infused' oyster cans

In the UK it has been available as prescription-only medicine since 1999, and nicknamed by company employees as the 'Pfizer Riser'.

Unwittingly, it has also spurred billions of unsolicited spam emails, as online entrepreneurs tried to cash in on perceived embarrassment surrounding asking the doctor for the little blue pill.

The new price drop has the potential to save the NHS millions in prescription costs.

A generic competitor to Viagra, marketed as 'Happigra'

The Health & Social Care Information Centre told Sky News that in 2011-12 there were 1.28 million Viagra prescriptions dispensed across the country.

The 'net ingredient cost' was £39.8m, which includes the cost of the drug before any discounts. It also excludes any dispensing costs or fees.

Pfizer promoted the drug and targeted men interested in sports

According to Pfizer sources, Viagra has been a bigger name in the public's consciousness than in the company's rota of top drugs.

Sildenafil citrate, the pharmaceutical name for Viagra, has been produced by the firm in twice-annual production runs at facilities at Ringaskiddy in Cork.

It is then sent to warehousing facilities in Belgium, prior to regional despatch.

Pfizer is expected to continue producing the drug while simultaneously developing a second generation medicine that can be packaged in a smaller pill.

The company previously took bold advertising steps to market the drug, including sponsorship of race cars and using veteran Brazilian football player Pele as a spokesman.

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Shares Fall As Fed Plans To Slow Bond-Buying

World stock markets have lost more ground after the US Federal Reserve signalled it was moving closer to slowing its bond-buying programme.

The Fed offered a more optimistic outlook for the US economy and job market but said it would maintain the pace of its bond purchases for now to support recovery.

Equity markets, which have tumbled from post-financial crisis highs in recent weeks on fears of the stimulus being withdrawn, fell further in the wake of the announcement.

The Dow Jones lost 1.3% while in London the FTSE 100 joined Asian markets in falling nearly 3% - the London market returning to levels not seen since September 2011.

The cost of government borrowing also rose in many major economies as a result of Fed Chairman Ben Bernanke's comments.

He had said the central bank could scale back its $85b (£54b) in monthly bond purchases later this year if the economy continued to improve.

Mr Bernanke likened any reduction in the Fed's bond purchases to a driver letting up on a gas pedal rather than applying the brakes.

He said the reductions would occur in "measured steps" and that the programme could end by the middle of next year.

Timothy Duy, a University of Oregon economist who tracks the Fed, called the statement "an open door for scaling back asset purchases as early as September."

The fact that the Fed foresees less downside risk to the job market "gives them a reason to pull back" on its bond purchases, Mr Duy said.

The central bank also said it would maintain its plan to keep short-term rates at record lows at least until unemployment reaches 6.5%.

Last month, the US economy added 175,000 jobs. But the unemployment rate is still high at 7.6%. Economists tend to regard the job market as healthy when unemployment is between 5% and 6%.

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Watchdog Urges Faster Energy Tariff Reform

The energy watchdog's proposals for a "simpler and fairer" energy market have drawn a mixed response from consumer groups, as the regulator called on suppliers to adopt them "as quickly as possible".

Regulator Ofgem has told suppliers to limit themselves to four "core" tariffs each for electricity and gas and for each type of payment, while all information suppliers send to consumers must be "simplified, more engaging and personalised".

Suppliers will use a new Tariff Comparison Rate (TCR), which the regulator claims will help to simplify the selection process for consumers.

And new enforceable standards of conduct will enable Ofgem to take action against suppliers where they have failed to treat customers fairly.

Today Ofgem launched the last statutory consultation before it decides whether to implement "the most radical reforms to the retail market since competition began".

The reforms are expected to come into effect from the summer, but Ofgem said there was nothing to stop suppliers moving to deliver them now.

Ofgem senior partner for markets, Andrew Wright, said: "Our reforms today are the blueprint for the simpler, clearer and fairer energy market that consumers deserve.

"This will provide them with the choices they want alongside the simplicity they need.

Both electricity and gas companies have used complex tariff systems

"They have been delivered following two years of engagement with consumers and industry in the most comprehensive ever review of the retail market.

However consumer watchdog Which? said it was "hugely disappointing" that Ofgem had pressed ahead with the TCR format.

Which? executive director Richard Lloyd said: "While these new rules will help make the market simpler and fairer it's hugely disappointing to see the regulator sticking to its fundamentally flawed idea of how energy prices should be presented.

"This will fail to help people find the best deal easily and could even mislead millions into paying over the odds for their energy."

Trade association Energy UK defended the firms and said: "Energy suppliers have already pressed ahead with providing customers with simpler, clearer tariffs.

"Our members have dramatically reduced the number of tariffs, simplified structures and pledged to help all customers move to the deal that suits them best."

But Energy Secretary Ed Davey has continued to push for faster reform and said: "I welcome the continued progress of Ofgem's reform of the retail energy market.

"It's simply scandalous that over eight in 10 of households, including the most vulnerable, are put off switching or engaging in the energy market.

"That's why I'm backing Ofgem's reforms to make it easier to compare tariffs and switch suppliers. These reforms are the fastest way to speed up delivery of simpler bills and a fairer system."

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Clashes In Brazil As One Million March

The Brazilian government will hold an emergency meeting later amid spiralling protests over alleged corruption and high prices which have seen one million people take to the streets.

The demonstrations, which have spread to more than 80 cities across the country, look set to continue into a second week, prompting President Dilma Rousseff to assemble her top cabinet members and forcing her to cancel an overseas trip.

In Sao Paulo state, a protester was killed when a driver - apparently enraged about being unable to drive along a street - rammed his car into a crowd of demonstrators.

Riot police in Rio were faced with the largest demonstrations

In Rio de Janeiro, 300,000 people staged a demonstration near City Hall, while in the capital Brasilia, hundreds of protesters tried to storm the foreign ministry building, leaving authorities "frightened", according to local newspaper O Estado de Sao Paulo.

Clashes have also taken place in the Amazon jungle city of Belem, in Porto Alegre in the south, in the university town of Campinas north of Sao Paulo and in the northeastern city of Salvador.

Sky correspondent Jason Farrell, in Rio de Janeiro, said protests there began with a "carnival atmosphere", as demonstrators arrived "draped in flags or with stripes of Brazil's national green, yellow and blue painted onto their faces".

More than 300,000 people joined protests in Rio de Janeiro

However, peaceful protesters were caught up in clashes between rioters and police, who fired tear gas and pepper spray into the crowds.

Law student Wallace Tarenta told Sky News: "I have come here because we need more money for hospitals and teachers and security - not more stadiums for the World Cup."

Protester Jorge Vieira added: "Brazil is a strong country, we have good natural resources and a strong government - but nothing goes to the people."

Riot police in Belem were confronted by stone-throwing demonstrators

The protests in Brazil were sparked by public anger about the rising cost of public transport.

Several city leaders have already revoked planned increases to bus and subway fares.

However, Sky's Jason Farrell said anger has now turned to a perceived lack of investment in public services, as well as the $15 billion cost of hosting next year's football World Cup.

Celebrations in Sao Paulo, where planned fare hikes have been dropped

"On the face of it, Brazil has it all: a growing economy, a World Cup and the 2016 Olympics to look forward to," he said.

"But protesters say a corrupt government is damaging the lives of working people while squandering money on showcase stadiums.

"With riots breaking out in cities across the country, the world is now watching Brazil and wondering how it will cope with the pressures of hosting two of the world's biggest sporting events."

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Chancellor Unveils Plan For State-Owned Banks

George Osborne has unveiled Government plans for the future of state-owned banks during his annual speech on the state of the UK economy.

In his remarks at Mansion House in London, the Chancellor said the Treasury was considering steps to return Lloyds bank to the private sector and that it could offer shares to the public.

But he added that the sale of the Government's stake in the Royal Bank of Scotland (RBS) remained "some way off".

Mr Osborne said he had ordered an urgent review into the possibility of breaking up RBS into a "good bank" and a "bad bank" to separate out toxic assets and risky loans from parts of the business which support the economy.

The review will particularly focus on assets in Ulster Bank and UK commercial real estate, and will not involve any further injection of taxpayer money into RBS.

The first sale of Lloyds shares is likely to go to institutional investors, but Mr Osborne said a retail offering to the general public is being considered for later - raising the possibility of a "Tell Sid" style privatisation of the kind seen in the 1980s.

In upbeat comments about the state of the UK economy, he said Britain had "left intensive care" and was now moving "from rescue to recovery".

He added: "Nothing better signals Britain's move from rescue to recovery than the fact that we can start to plan for our exit from Government share ownership to private ownership."

RBS could be broken up to separate toxic assets

The Government bought 39% of Lloyds shares and 81% of RBS in a multi-million pound bailout at the height of the financial crisis in 2008 and speculation has been mounting that the Treasury wants to begin the process of selling its stake before the 2015 general election.

Prime Minister David Cameron recently raised the prospect of selling RBS shares at a loss.

Mr Osborne today said that Lloyds was now in a "good position" with growing investor interest and shares trading at "around the price where selling would reduce the national debt".

The Government believes a sale price of 61.2p would allow it to recoup the £20bn it ploughed into the bank. Shares today closed down 0.42p at 61.76p.

Mr Osborne said: "I can announce that we are actively considering options for share sales in Lloyds.

"Of course, we will only proceed if we get value for the taxpayer. And we have no pre-fixed timescale or method of disposal.

"For the first block of Government shares, an institutional placement is likely to be the most effective way of managing risk and getting value.

There was some good news for Bank of England governor Sir Mervyn King

"So five years on from the financial crisis, we can now take the first steps to returning Lloyds to the private sector where it belongs.

"And for later sales of shares, we will consider a retail offering to the general public."

But he said RBS remained "weighed down by too many poor assets" and insisted there would be no sell-off at a loss.

Responding to the speech, shadow chancellor Ed Balls said: "We have always argued that the future of RBS and Lloyds should be driven by the best interests of the British taxpayer and the wider economy, not a political timetable.

"George Osborne has now been forced to back down from the foolhardy idea of a pre-election firesale of RBS.

"The Government's review of the future shape of RBS is welcome but it must look at all the options, including the case for splitting retail and investment banking at RBS, so that there is no return to business as usual."

Mr Osborne's speech came as Downing Street confirmed Sir Mervyn King will be made a peer upon his retirement as Governor of the Bank of England.

Prime Minister David Cameron nominated him for a life peerage for his significant contribution to public service.

In his final Mansion House speech Sir Mervyn said more money must be pumped into the economy to underpin the UK's "modest" recovery.

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Regulator Reveals £27.1bn UK Bank Shortfall

A City regulator has revealed the capital holes at UK banks total £27.1bn - with Royal Bank of Scotland (RBS) facing the biggest shortfall.

The Prudential Regulation Authority (PRA) said that while the collective 'black hole' was more than the £25bn it originally estimated, the banks involved have plans in place to raise £13.7bn by the end of the year.

The PRA put the RBS shortfall at £13.6bn, Lloyds at £8.6bn and Barclays at £3bn - all measured from the end of 2012.

The Co-op needed to raise £1.5bn and Nationwide £400m.

All the banks had previously announced ways to plug the gaps in their finances, the PRA said, while it also confirmed that HSBC, Standard Chartered and Santander UK did not need to bolster their capital cushions.

Share prices correct at 08.04am Thursday June 20

The figures were announced just hours after the Chancellor George Osborne confirmed he was progressing with the sale of the taxpayers' stake in Lloyds but had put the brakes on an imminent return to the private sector for RBS.

While those developments were digested by investors this morning, bank shares and the wider FTSE 100 were also hit after comments from the US Federal Reserve which confirmed that bond purchases to support America's economy would soon be slowed.

Barclays, Lloyds and RBS said they were confident in their ability to meet the PRA's requirements, which are designed to ensure that banks are strong enough to withstand any future financial shocks but at the same time do not hamper their ability to lend in support of the economic recovery.

Lloyds said it was making better than expected progress on boosting its balance sheet.

A spokesman said: "Lloyds Banking Group's strong capital position means that we now expect to have a fully-loaded Core Tier 1 ratio of above 9% by end of June 2013, six months ahead of our previous guidance, and approximately 10% by the end of 2013, a year ahead of guidance."

Lloyds and RBS already confirmed last month they would not need to tap investors for extra cash to shore up their finances.

RBS said actions being taken would reduce its capital shortfall to £400m by the end of the year, adding it aimed to resolve the remainder within the first quarter of next year.

Barclays said it was "confident" of boosting its capital by the end of the year and would not need to make a cash-call to investors.

It is slashing costs across the business, while also selling certain assets and confirmed plans to further boost finances through contingent convertible securities, known as CoCos, which automatically convert to equity should capital levels fall.

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UK Retail Sales Jump On Discounting

UK retail sales jumped in May as supermarket discounting and online business drove a better than expected performance for the sector.

The Office for National Statistics (ONS) said that volumes rose 2.1% in May following a 1.1% fall the previous month - partly blamed on bad weather hitting demand for summer fashions.

Today the statisticians pointed to a 3.5% month-on-month rise in food sales - the strongest rise in two years - aided by supermarkets offering promotions amid a bitter price war to secure customer loyalty.

Non-store retailing, which includes online sales, grew by 4.3%.

The performance will boost hopes that consumer spending - so crucial to hopes of a sustained economic recovery - is on the rise despite the continuing squeeze on household incomes driven by low wage growth at a time of rising prices, such as energy bills.

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Bankers Should Face Jail Terms, Report Says

By Mark Kleinman, City Editor

A new criminal offence punishing bankers for "reckless misconduct" while running their institutions is the centrepiece of proposals unveiled by a group of MPs and peers aimed at reforming the industry.

The Parliamentary Commission on Banking Standards (PCBS), which was set up after last summer's Libor-manipulation scandal led to Barclays being fined £290m, said in its final report that all areas of British banking required urgent change.

Citing "a profound loss of trust born of profound lapses in banking standards", the commission said a string of measures were needed to repair the industry's reputation.

In its 553-page report called Changing Banking For Good, the PCBS argued that individual accountability among senior bankers was lamentable, that industry pay schemes required a radical overhaul, and that executives should face a new sanctions regime that would dish out appropriate penalties, replacing a system that "looked good but achieved little".

It also said, as expected, that the Treasury's strategy for managing its 82% stake in Royal Bank of Scotland (RBS) was not working adequately and that options, including analysis of a break-up of the bank, should be conducted in the coming months.

The commission's hard-hitting recommendations underline the scale of public anger that so few British bank executives have faced punishment over the crisis that led to hundreds of billions of pounds of public money being put at risk to rescue them.

Only a small handful of senior bankers have been sanctioned by regulators for their roles prior to the bailouts of 2007 and 2008, while relatively few have been hit in the pocket despite mis-selling scandals such as the one involving payment protection insurance.

Andrew Tyrie, the Conservative MP who chaired the commission, said that senior bankers had hidden "behind an accountability firewall" but warned that governments and regulators had also been culpable for the decline in standards.

Among the concrete measures recommended by the PCBS are:

:: The introduction of a new criminal offence for reckless misconduct that would carry a custodial sentence.

:: Bankers' pay should be deferred for up to 10 years and should be more closely aligned to the safety and soundness of a firm.

:: Regulators should gain powers to cancel the pay and pensions of executives at banks which require taxpayer support.

:: UK Financial Investments, the body responsible for managing taxpayers' stakes in Lloyds and RBS, should be scrapped.

:: New senior persons and licensing regimes to ensure that regulators can take tougher action against bankers whose actions damage their employer's reputation or finances.

:: Reforms aimed at bolstering competition in retail banking, including, as Sky News revealed this month, a review of the costs and benefits of full current account portability.

Parts of the banking industry, whose main lobbying group the British Bankers' Association refused to respond on camera to the report, are expected to argue that some of the proposed reforms would undermine the City's international competitiveness.

Measures to defer pay for up to a decade would go further than any other major banking centre, but the PCBS argued that it was essential to do so if the industry's culture was to be genuinely reformed.

"The scale of remuneration in banking, the way it has been set and the form in which it has been paid have all incentivised misconduct and excessive risk-taking. The rewards for fleeting, often illusory, success have been huge, while the penalties for failure have been much smaller, or non-existent," it said.

"Many bankers were on to a one-way bet. Unlike unlimited liability partnerships, they had little or no skin in the game."

The Government is expected to consult on the PCBS recommendations that would require legislative change.

In a statement, the Treasury welcomed the commission's report, saying there were "many recommendations in it which will help the government's plan to create a stronger and safer banking system".

"The Government publicly welcomes the commission's recommendations on increased personal responsibility especially at a senior level, increased professional judgement by regulators and better functioning markets.

"We will now get on with a swift response and will report before the summer recess."

In his annual Mansion House speech on Wednesday night, George Osborne is likely to back the commission's call for a review of the options for the Government's stake in RBS, according to Treasury aides.

Vince Cable, the Business Secretary, also welcomed the report, backing calls for banks to relinquish ownership of the payments system and for a new approvals regime for bank staff.

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Cable Presses For RBS Bonus Link To Lending

By Mark Kleinman, City Editor

Vince Cable is to push for the new boss of Royal Bank of Scotland (RBS) to have his pay more closely-tied to its small business lending amid intensifying debate about its future.

Speaking to Sky News, the Business Secretary said he was also considering the case for reinstigating formal lending targets for the state-backed bank for the first time since 2010.

"I am keen for RBS to have very clear incentives and targets to increase lending to the real economy and SMEs [small and medium-sized enterprises]," Mr Cable said.

By singling out RBS, his remarks will raise the prospect of the bank remaining in majority public ownership for some time, dashing any expectations that the Government will begin to sell its 82% shareholding in the near future.

Mr Cable said the departure of Stephen Hester as RBS's chief executive later this year provided an opportunity to negotiate a new deal with his successor that emphasised RBS's role in supporting the UK economy.

His comments come on the same day that a panel of MPs and Peers published a report recommending that the Government explore the possibility of breaking RBS into separate good and bad banks.

George Osborne, the Chancellor, will accept the recommendation on Wednesday in his annual Mansion House speech, placing him on a collision course with leading institutional investors in RBS.

A return to formal lending targets for RBS would spark renewed allegations of excessive state interference in the running of the bank.

RBS and Lloyds Banking Group, which is 40%-owned by taxpayers, were forced to agree lending targets with the then Labour government during the two years after they were rescued by taxpayers in 2008.

However, the targets were seen as meaningless because of the way that lending was calculated and the absence of sanctions against the banks when they failed to hit them.

In 2011, the major banks struck a wider agreement with the Coalition - known as Project Merlin - that imposed targets on overall business and SME lending, pay and tax.

Initiated at the behest of then-Barclays chief executive John Varley, the deal was seen as problematic for banks and politicians and was quietly abandoned after a year.

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Dreamliner Diverted In Latest Boeing Setback

A Boeing 787 Dreamliner has landed safely after being diverted when pilots were made aware of a potential oil filter problem.

In the latest of a series of setbacks for the new model, United Airlines said a Dreamliner on its way to Tokyo from Denver was forced to land in Seattle as a precaution.

The planes were only recently returned to the skies after regulators grounded them worldwide due to overheating in lithium-ion batteries.

There was no initial indication that any problem with the plane on Tuesday was related to batteries.

"United flight 139 from Denver to Tokyo diverted to Seattle due to an indication of a problem with an oil filter," United said in an emailed statement.

"The aircraft landed normally and without incident and we are working to re-accommodate customers."

Boeing said it was aware of the issue and was working with United and General Electric Co on the problem.

Regulators and investors are keenly following the progress of the 787 Dreamliner, Boeing's first predominantly carbon-fibre aircraft, which was more than three years late getting into service after a number of production setbacks.

Introduced by airlines in late 2011, the Dreamliner was grounded worldwide in January after its batteries overheated on two Japanese jets in about a week.

It resumed commercial service in May after Boeing installed a redesigned battery system on the 50 jets in service.

Two other planes are known to have suffered technical problems with engines since - but none of those were understood to be serious.

One Singapore-bound Dreamliner, operated by ANA, had to turn back in mid-flight because of a problem with the anti-icing system.

Thomson Airlines and British Airways are among UK operators due to fly the planes, which remain popular with airlines because of promised lower fuel costs.

While Boeing has announced billions of dollars in deals at the Paris Air Show as well as the launch of a long version of its next-generation Dreamliner 787, it is still trailing behind Airbus in new plane orders.

So far, Boeing has racked up $29.2bn (£18.7bn) in firm orders or purchase agreements against $36bn £23bn) for the European aircraft manufacturer.

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Child Abuse Online: Web Firms To Attend Talks

By Sophy Ridge, Political Correspondent

Leading internet companies have been summoned to a Westminster meeting in an attempt to crack down on child abuse online.

Firms including Google, Microsoft and Facebook will attend a summit called by Culture Secretary Maria Miller.

They will be expected to come up with ways to stop access to child abuse images and report back with an action plan.

The meeting comes after two child killers were found to have viewed such material online.

Mark Bridger, convicted of murdering five-year-old April Jones, and Stuart Hazell, who murdered Tia Sharp, 12, both accessed images of abuse.

In the 12 days since the summit was announced, web giants have already taken some action.

Mark Bridger accessed child abuse images online before killing April Jones

TalkTalk and BT confirmed customers trying to view inappropriate material will be confronted by a pop-up warning.

And Google has pledged millions of pounds to organisations who try to tackle child abuse online, such as the Internet Watch Foundation, which maintains a blacklist of images.

Mrs Miller said: "Child abuse images are horrific and widespread public concern has made it clear that the industry must take action. Enough is enough.

"In recent days we have seen these companies rush to do more because of the pressure of an impending summit.

"Imagine how much more can be done if they seriously turn their minds to tackling the issue. Pressure will be unrelenting."

It is unclear exactly what concrete action - if any - the Government will demand from the meeting.

Companies providing internet services in Britain have already rejected a call from the Prime Minister's adviser to impose parental filters for adult content as a default setting when viewing content online.

The Internet Service Providers Association said it remained opposed to default filtering because it "can be circumvented and lead to over- or under-blocking" of offensive web pages.

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Record Air Fare Rises Push Inflation Higher

The annual rate of inflation was driven higher than expected in May as air fares rose by record levels, according to the Office for National Statistics (ONS).

The rebound to 2.7% - which followed a surprise dip to 2.4% in April - was also blamed on fuel prices increasing but the ONS said the biggest contributing factor was a 22% jump in airline ticket costs between April and May.

It was, the statistical body said, the biggest rise in fares between those two months since records began in 2001.

Stubbornly high inflation is expected to peak around 3% over the next few months ensuring a summer of pain for households, though the Bank of England has forecast it will fall back towards its 2% target more quickly than originally expected.

Rising energy bills coupled with high fuel and tuition fees have been among the inflationary pressures facing the consumer in recent years at a time of below-inflation pay rises.

The resulting squeeze in household spending has been among the factors holding the UK economy back from stronger growth.

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G8: Cameron Prepares For Tax Evasion Battle

By Ed Conway, Economics Editor

Fears are growing that David Cameron's plans to use the G8 to battle tax evasion could end in disappointment, as it emerges that his most ambitious objectives are being opposed by other world leaders.

The Prime Minister wanted a new deal clamping down on those who illegally avoid tax to be the centrepiece of this year's summit, held in Lough Erne, Northern Ireland.

But while Downing Street insiders are hopeful of progress in today's crucial talks, they have encountered more opposition than expected.

The ongoing conflict in Syria is also threatening to overshadow the summit's scheduled discussions on trade, tax and transparency.

The UK came to the G8 summit with a double-barrelled plan. First, to establish and potentially publish new ledgers of so-called beneficial ownership, documenting those who profit from tax haven schemes.

Second, to create automatic information-sharing systems to ensure different countries can compare notes on how much tax certain individuals are paying.

While the UK expects to achieve further progress on this front at the G8, campaigners say the proposals risk being watered down, with the beneficial ownership registers kept private and with information-sharing not extended to developing countries.

The Prime Minister has had international tax evasion and avoidance at the top of his G8 agenda since he unveiled his programme at the World Economic Forum in Davos.

While the Lough Erne summit is focusing specifically on illegal evasion, the G20 summit in St Petersburg will examine avoidance - where people pay less tax than they ought to, while remaining within the law.

Chancellor George Osborne will make an appearance at the summit this morning to explain the technical aspects of Britain's proposals, after which there will be a full debate.

Although most other G8 members have expressed support for his plans, Russia, the US and Canada are thought to be comparatively lukewarm.

French president Francois Hollande has also undermined Mr Cameron by wondering aloud why the focus isn't on climate change.

The first day of the summit culminated in the official launch of the EU-US trade deal - the biggest bilateral set of trade negotiations in history.

The negotiations, which will take place over the course of the following years, are expected to yield hundreds of millions of dollars worth of extra economic growth to the countries involved.

Mr Cameron said they could create a £10bn-a-year windfall for the UK.

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