RBS Ditches Double-Salary Bonuses For Bankers

Taxpayer-backed Royal Bank of Scotland has ditched a proposal to give bankers bonuses of up to twice their salaries.

The bank had wanted to give workers lucrative and competitive bonuses, despite making a pre-tax loss of £8.2bn in 2013.

British taxpayers own 81% of the bank, which received the biggest bailout in history following the financial crisis.

UK Financial Investments, which manages the Government's stake, said it would not support the proposal.

As a result, RBS said a planned vote at the bank's annual general meeting (AGM) in June would not take place.

The Treasury rebuked the bonus plan and said "an increase to the bonus cap cannot be justified and the Government made clear it would not have supported such a proposal".

Last year the European Parliament agreed to cap bonuses for bankers at their fixed annual salary, or twice that sum if shareholders approve.

Mindful of London's importance in world finance, the Government remains opposed to the EU 2:1 bonus-to-salary cap.

A Treasury spokesman said: "The European bonus cap is not a well-thought out idea and will not support stronger and safer banks, which is why the Government is challenging it in the European Court.

"But while it exists, we will make sure it is applied fairly.

"Under the new strategy set out by RBS chief executive Ross McEwan, RBS is heading in the right direction, but it has not yet completed its restructuring and remains a majority publicly-owned bank."

RBS also said Mr McEwan and chief financial officer Nathan Bostock would not receive bonuses from 2014.

But it said they would still receive share-based "long-term incentive awards" that vest in five years.

The RBS bonus block comes just a day after a heated Barclays AGM saw jeering from shareholders and a partial rejection - reaching 24% of votes - of its remuneration proposals.

And on Friday, 38.5% of pharmaceutical firm AstraZeneca shareholders rejected a lucrative management remuneration plan.

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Starbucks Sales Fall For First Time In 16 Years

Starbucks' turnover dropped last year for the first time, in the wake of revelations about its corporate tax practices.

Sales for the year to September 29 were £399m, a decline of 3.4% compared to the previous year.

The company said the decline, the first since it started UK operations 16 years ago, was due to the closure of unprofitable outlets and not the result of other reasons.

It reduced its average UK workforce by 11.6% in the financial year to 7,726.

Starbucks was able to increase its gross profit by 13% to £79.7m, before deductions of £100.5m were taken into account.

Its pre-tax loss was £20.4m in the period, down from the £30.4m recorded in the 2011-12 financial year.

The company's tax liability in the period was £3.4m, but including deferred taxation was reduced to £2.25m.

A Starbucks spokesman told Sky News: "The UK business is moving in the right direction, but the turnaround will take time.

Protests outside Starbucks stores were held during this accounting period

"The continued loss is largely because the reforms we have introduced are yet to take full effect.

"Many of the expensive leases we have renegotiated occurred after our financial year started in October 2012. The benefits of this action will be shown in the accounts for this current year."

It said the £10m fall in the pre-tax loss was largely due to the rise in gross profits. Its staff costs dropped £13.5m in the tax year compared to the previous year.

In October and December 2012, key executives were grilled by MPs about multinational corporate (MNC) arrangements.

Revelations about royalty, licensing and transfer pricing structures used by MNCs to minimise UK tax burden became a focus for Westminster's Public Accounts Committee.

Seattle-based Starbucks was quizzed on why it remained a loss-making business for tax purposes while telling investors it was profitable.

Groups such as UK Uncut urged boycotts of Starbucks and organised store protests and the company's unmoderated website blog was flooded with hundreds of critical comments.

But the company said the latest sales drop was not related to the 2012 tax furore and says Britain is its star EU performer.

Executives from Amazon, Google and Starbucks were grilled by MPs in 2012

"The UK is our fastest growing market in Europe. We are on schedule to open 100 new stores this year and expect the business to continue to grow as economic growth picks up," the spokesman said.

However, the latest accounts filed with Companies House show that it is acutely aware of the impact certain issues may have on the company.

It said there was potentially a "significant risk" of "adverse impacts resulting from negative publicity regarding the company's business practices".

Responding to the widespread criticism in late 2012 it offered to pay a voluntary £20m in tax over two years, and has already given £15m of that to HM Revenue and Customs.

It also dropped total remuneration for its three directors by almost a fifth to £886,000, with the highest paid executive's salary falling by more than half to £268,582.

At the end of last September Starbucks had 549 company-operated stores in the UK, down 44 in the period.

It also had 125 licensed and 57 franchised operations. Although it has a planned franchise expansion, the company's website says it is not looking for new partners.

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Mortgage Lending Clampdown Comes Into Force

Homebuyers will face more scrutiny by mortgage lenders under new regulations which take effect today.

The industry-wide changes affect home buyers and people looking to re-mortgage and they will mean that lenders have to take a much stronger interest in people's spending habits and how their life plans could affect their ability to meet their repayments.

Mortgage applicants will need to sit through longer interviews, and provide more evidence that they can afford a home loan before being offered one.

Each lender will have their own interpretation of the new rules, but in general people are likely to be asked for more detail about regular outgoings such as childcare, food, household bills, loans, credit cards and leisure activities.

The changes also mean lenders will have to test whether homebuyers will be able to afford their mortgage payments if interest rates rise sharply, to 7% or above.

The Mortgage Market Review (MMR) rules aim to ensure there is no return to any irresponsible lending practices of the past, but there are some concerns that it could slow down the housing market.

The changes come amid growing consternation about rising house prices

Paul Broadhead, head of mortgage policy for the Building Societies Association, said: "The Mortgage Market Review was introduced in order to ensure that a common sense approach to mortgage lending is applied by all lenders and that people are not borrowing more than they can afford to pay.

"A number of building societies implemented the process early and have been lending this way, without problems, for a number of weeks."

Andrew Montlake, a director at broker Coreco, said that for people considering applying for a mortgage: "It's important for people to prepare a lot earlier, potentially six months before you apply. Start looking through your documentation and go through a budget."

He said most lenders will want to know whether mortgage applicants are planning to increase their spending for any reason in the near future and if they are expecting a change in their income.

Martin Wheatley, chief executive of the Financial Conduct Authority was asked this week about reports that some people are being asked if they are planning to have children.

He told the Daily Mail: "If you are eight months pregnant, that is a reasonable question. But most of the time that is probably too invasive - and that is not committed expenditure. People have a right to a certain degree of privacy.

"People should be expected to talk about known costs, such as school fees and car loans, but planning for future unknown events is a much more difficult space."

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Barclays Board Face Angry Shareholders At AGM

Senior management of Barclays bank have faced angry shareholders at the bank's annual general meeting, with its chairman forced to defend its bonus payments.

Sir David Walker told shareholders there would have been an exodus of top executives if it did not raise bonus levels.

The meeting, held at London's Royal Festival Hall and attended by 840 people, was the scene of successive hostile questions and jeering from the audience.

Laughter erupted after one angry investor told the board of directors: "We're paying for Manchester United but we are getting Colchester United."

Outside the venue, protesters took potshots at the board over bonuses and alleged tax haven support.

In 2012 Sir David Walker told MPs that banking culture must change

Despite the criticism, the proposals to pay £2.4bn in bonuses in 2013 were rejected by just 24% of shareholders who voted while a resolution to pay bonuses of 200% salary in future was overwhelmingly supported.

Standard Life - with a 1.9% stake in the bank - went public ahead of the vote and said it would not support the remuneration committee's proposals.

Standard Life governance and stewardship director Alison Kennedy said its remuneration report recommendations had harmed the bank's brand.

"We are unconvinced that the amount of the 2013 bonus pool was in the best interests of shareholders," she said.

"Particularly when we consider how the bank's profits are divided amongst employees, shareholders and ongoing investment in the business."

CEO Antony Jenkins did not take a bonus last year over the pay furore

On Tuesday, Sky News City Editor Mark Kleinman revealed the board would receive a mixed response from its powerful institutional investors.

The chairman told the AGM the bank was losing staff to US rivals as they paid up to 15% more.

He said the resignation rate for senior Barclays employees in the US almost doubled in 2013, amid increasing rejection of job offers at his bank.

Sir David said: "The challenge was the need for damage limitation and franchise protection... Despite all the reservations that have been expressed, I remain confident in my view that we took the right decision."

Chief executive Antony Jenkins also faced the hostile shareholders.

He has come under increasing criticism for bonus awards approved under his tenure.

Mr Jenkins is reviewing the future of the group's investment bank and will unveil the details on May 8.

As previously revealed by Kleinman, the CEO is expected to axe thousands of jobs to cut costs and help improve returns.

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PM Rules Out Further Onshore Wind Farms

David Cameron has told Sky News the country does not need any more onshore wind farms as he defended Tory plans to scrap subsidies for future schemes.

The Prime Minister also said there would be measures in the planning system to ensure local people's views were not "overridden" if the Conservatives win next year's general election.

But the pledge by Tories to ditch subsidies for newly-planned onshore turbines and give councils power to block new schemes was branded "disastrous for business and jobs" by Ed Davey, the Lib Dem Energy Secretary.

Conservative insiders said the proposals, which would be implemented within six months of a Tory win, would "effectively curtail further large-scale onshore wind developments".

Ed Davey says the Tory plans would be "disastrous for business and jobs"

Speaking to Sky News, Mr Cameron said: "Onshore wind has an important role to play in generating electricity in our country. We want a varied supply of electricity.

"We're going to have a decent number of onshore wind turbines but the fact is we don't need any more than what we've got in the planning system."

He added: "A future Conservative government would no longer subsidise onshore wind and would have proper safeguards in the planning system so that local views are paramount and not overridden by national imperatives.

"It's not the end of onshore wind and it will make an important contribution to our country's electricity, but you won't see lots of new large-scale wind farm developments."

However, Mr Davey said: "Putting the brakes on onshore wind would be disastrous for business and jobs in our growing green economy.

"Onshore wind is one of the cheapest forms of green energy, so cutting it could lead to higher bills.

"You can't trust the Conservatives on their own to build a fairer society. Only with Liberal Democrats in Government can we build a stronger economy and a fairer society."

Environmental campaigners have also criticised the Conservative policy, warning it would increase bills and damage efforts to tackle climate change.

According to figures from the Department for Energy and Climate Change, wind farms with a combined capacity of 13.8GW have already been built, are under construction or have planning permission.

It said the figure is enough to meet targets of 11-13GW, even if some projects fail through a lack of finance or other problems.

Onshore wind farms already have enough electricity to power up to four million homes, with this figure forecast to rise to seven million by 2020 under the coalition's plans.

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Starbucks Sales Fall For First Time In 16 Years

Starbucks' turnover dropped last year for the first time, in the wake of revelations about its corporate tax practices.

Sales for the year to September 29 were £399m, a decline of 3.4% compared to the previous year.

The company said the decline, the first since it started UK operations 16 years ago, was due to the closure of unprofitable outlets and not the result of other reasons.

It reduced its average UK workforce by 11.6% in the financial year to 7,726.

Starbucks was able to increase its gross profit by 13% to £79.7m, before deductions of £100.5m were taken into account.

Its pre-tax loss was £20.4m in the period, down from the £30.4m recorded in the 2011-12 financial year.

The company's tax liability in the period was £3.4m, but including deferred taxation was reduced to £2.25m.

It said the £10m fall in the pre-tax loss was largely due to the rise in gross profits. Its staff costs dropped £13.5m in the tax year compared to the previous year.

Executives from Amazon, Google and Starbucks were grilled by MPs in 2012

In a statement given to Sky News, Starbucks said: "This has been another quarter of strong growth for Starbucks across the EMEA region, with profitability more than tripling year-on-year and revenue growth of 13% the highest in two years."

In accounts filed with Companies House the firm said of its British operations: "The company is being supported by an improving economic environment in the UK which is predicted to continue through 2014.

"This in turn is expected to lead to an increase in comparable (like-for-like) sales per store and, alongside the realignment of our portfolio, a further reduction in the loss before tax next year."

The company's accounts started on September 30, 2012 and in October and December of that year key executives were grilled by MPs about multinational corporate (MNC) arrangements.

Revelations about royalty, licensing and transfer pricing structures used by MNCs to minimise UK tax burden were explored by the Public Accounts Committee.

Seattle-based Starbucks was quizzed on why it remained a loss-making business for tax purposes while telling investors it was profitable.

Groups such as UK Uncut urged boycotts of Starbucks and organised store protests and the company's unmoderated website blog was flooded with hundreds  of critical comments.

But the company said the latest sales drop was not related to the 2012 tax furore.

However, the latest accounts filed show that it is acutely aware of the impact certain issues may have on the company.

It said there was potentially a "significant risk" of "adverse impacts resulting from negative publicity regarding the company's business practices".

Responding to the widespread criticism in late 2012 it offered to pay a voluntary £20m in tax over two years, and has already given £15m of that to HM Revenue and Customs.

It also dropped total director remuneration by almost a fifth to £886,000, with the highest paid executive's salary falling by more than half to £268,582.

At the end of last September Starbucks had 549 company-operated stores in the UK, down 44 in the period.

It also had 125 licensed and 57 franchised operations. Although it has a planned franchise expansion, the company's website says it is not looking for new partners.

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Gym Fees 'Could Stop Mortgage Approvals'

By Ed Conway, Economics Editor

Homebuyers could find themselves turned down for a mortgage because of their gym memberships, phone bills and pension payments, under new rules introduced this weekend, experts have warned.

Mortgage advisers said new restrictions introduced under the Mortgage Market Review (MMR) would drastically increase the intrusiveness of checks undergone by applicants.

The warning coincided with advice from economists, who claim the rules could dampen down activity in the housing market.

The new rules, part of a push to prevent lenders handing out loans to those unable to afford them, will stipulate banks and building societies must inspect customers' spending commitments to ensure they can keep up their monthly payments.

Those commitments might include items as innocuous as informal club memberships, according to Peter Marriott of Westexe Mortgage Solutions.

He said: "They might have a gym membership, they might be contributing to a pension plan - anything that's deemed by a mortgage lender to be a commitment could be held against them as an ongoing expense, which would in turn affect the affordability and the lender's decision on how much they can borrow."

The MMR changes will also mean lenders have to test whether homebuyers will be able to afford their mortgage payments if interest rates rise sharply, to 7% or above.

The Bank of England's Financial Policy Committee has recommended it should be able to change the suggested stress test rate in future, giving it an extra lever to influence house prices.

The changes come amid growing consternation about rising house prices.

According to the Office for National Statistics, house prices across the UK have increased by 9.1% in the past year.

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Travis Perkins Sales Up As Housing Market Warms

Building supply firm Travis Perkins has seen its first quarter like-for-like sales rise by 12.7%, after weaker trading in the same period last year.

Total sales in the three months to the end of March were up 14.2% on a comparable trading day basis.

The Northampton-based company has been boosted by the upturn in building work and the ongoing strengthening of housing sales.

It said the gains were made after the weaker trading period last year and growth of its market share.

The results come after Britain suffered wet and windy weather in the first two months of the year, which hampered building work.

The Office for National Statistics said construction output fell to £5.8bn in February, down 2.8% from January.

It said February's foul weather wiped more than a quarter of a billion pounds from the sector.

But the industry was expected to see renewed growth as repairs and renovations got under way.

Chief executive John Carter said: "All of our businesses recorded strong sales growth in the first quarter of 2014 and lead indicators for our different markets are encouraging ... and we remain on course to meet our targets set out in February.

"We are confident that the plans we have in place will support our drive to outperform our markets, improve earnings and ultimately increase return on capital."

Travis Perkins has more than 600 outlets across the UK, and specialises in supplying the trade sector.

Like-for-like sales in its general merchandise division rose by 16.6%.

Sales were up 6.9% in its consumer division, which includes the Wickes home improvement chain.

The company also saw a jump of 13.2% in its plumbing and heating business.

Travis Perkins entered the blue chip FTSE 100 index last June and its shares have risen by around 25% since then. Shares in the company were up more than 1% in early trading on Thursday.

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Eurotunnel On Track Amid Freight Truck Boost

Channel Tunnel operator Eurotunnel has kept its revenue rise on track, driven by a rise in shuttle train usage by trucks.

Eurotunnel Group said income for the first quarter topped €260m (£220m), up 8% on the same period last year.

It said the increase included a 5% rise in revenue from shuttle train service, reaching €106.5m (£89m) in the first three months of the year.

Freight vehicle numbers rose 4% to 347,000 in Q1, while car shuttle usage was lifted by 1% to 448,000.

It also saw a 13% surge in so-called through freight trains, operated by third parties, to 706 in the period.

But it said passenger coach numbers were down by 6%, which was because of this year's late Easter break.

Groupe Eurotunnel chairman and chief executive Jacques Gounon said: "There is a very positive trend marking the start of the year. The upturn in the UK economy is lifting the Eurotunnel Group's activity."

A Eurostar train exits on the France side of Eurotunnel's undersea link

In December, Eurotunnel successfully appealed against an competition ruling stopping it from also running ferries between Calais and Dover.

More than 50% of all cross-Channel travel is now done via the 31-mile undersea link, which was opened in 1994.

On Wednesday, cross-Channel train service Eurostar reported a 7% increase in Q1 revenue, boosted by a rise in business travellers.

Sales between January and March topped £227m, as the record income for the period.

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Eight Renewable Energy Projects Get Go-Ahead

Plans for eight renewable energy projects - expected to generate enough clean power for three million homes - have been approved by the Government.

Contracts for schemes including offshore wind farms and the conversion of coal-fired power stations to run on biomass, are set to support 8,500 jobs and attract up to £12bn in private investment.

Once built, the projects will contribute around 4% of the nation's total energy supply.

The schemes - five of which are offshore wind farms - are being taken forward under the Government's Contracts for Difference (CfD), under which generators and developers receive a fixed price for the electricity they produce for 15 years.

These contracts aim to give investors the guaranteed income they need to pay the up-front costs of major new construction projects.

Government measures are set to increase household bills by 2%, but energy secretary Ed Davey said the policy would bring down overall costs.

He told Sky News: "It's a real boost to green energy and will help ensure we have green energy too."

"It will really add to our electricity supply, we reckon about 4% of our total capacity. So it is really helping to ensure we can keep the lights on and do it in a green, affordable way."

Mr Davey has also confirmed that the Government is looking at changing trespass laws to enable companies to carrying fracking under private land.

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Sports Direct Slams £73m Boss' Bonus Rejection

High street retailer Sports Direct has slammed shareholders who failed to support a £73m bonus share scheme proposed for founder Mike Ashley.

The comments come as the company reported a rise in fourth-quarter sales to £360m in the nine weeks to March 30.

It said its core sports retail sales were up 11% in the period.

In early April, the company halted the proposed £73m bonus for Mr Ashley, its majority shareholder, after failing to gain sufficient investor support.

"The board was extremely disappointed to withdraw the resolution regarding a proposed share scheme award to Mike Ashley," Sports Direct chief executive Dave Forsey said in a statement.

"The most disappointing aspect was where large shareholders gave their support only to then vote differently.

"This outcome is likely to lead to further uncertainty in the future."

Sports Direct has around 400 stores in the UK and another 200 stores in Europe.

Sales in its smaller fashion arm, trading under the USC and Cruise brands, rose 0.7% in the period.

Shortly after the bonus rejection for Mr Ashley, who does not receive salary or bonus from the company, it saw a share price dip.

The decline came after he reduced his stake by 4% to 57.7%.

It now plans to include Mr Ashley in a company-wide share scheme eligible for all staff and executives.

The group also moved to expand its foothold in other groups, and bought an 11% stake in retailer House of Fraser amid its tie-up negotiations with China's Sanpower group.

It had earlier snapped up more than 4% of Debenham's shares before selling the tranche shortly afterwards.

Sports Direct said it expected to meet its full-year forecast of £310m, before staff bonuses are deducted.

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Primark Sees Profit Up 26% In Last Six Months

Discount fashion chain Primark has seen its half-yearly operating profit rise 26% to £298m.

Owner Associated British Foods (ABF) said its retail arm saw the surge in profit in the 24 weeks to March 1.

Revenue in the period for Primark was up 14%, to £2.278bn.

While like-for-like sales growth was 4%, its aggressive expansion plans with larger new stores helped drive the increase in revenue.

ABF shares were trading more than 8% up on Wednesday morning.

The chain saw double-digit growth in Spain and Portugal, along with "very strong" growth in northern Europe.

It now has 269 stores with a total selling space of 9.6 million square-feet and expects store expansion to increase by a third more than that achieved last year.

Its operating margin increased by 13.1%, brought about by improved warehouse and distribution efficiencies and lower freight rates.

ABF revealed more details about compensation for workers in Bangladesh, following the collapse of an eight-storey factory in capital Dhaka, which claimed the lives of 1,100 people a year ago.

Primark has paid compensation over the collapsed Rana Plaza in Dhaka

It said $2m (£1.18m) has been paid in short-term aid to the families of all the workers employed at Rana Plaza, most of whom it claims were making clothes for its competitors.

ABF has further agreed to pay $1m (£595,000) to the Rana Plaza Donors Trust Fund, chaired by the International Labour Organisation (ILO).

A further $9m (£5.34m) is being paid in long-term compensation to the affected families.

ABF said the total compensation totaled $12m, of which $7m was included in last year's results and $5m factored into this year's results.

It said: "We support the ILO in urging other retailers sourcing from Rana Plaza to donate to the trust fund so that it can pay out in full to the remaining victims."

ABF has also announced a decision to take the Primark brand to the United States.

It will open a 70,000 square-foot store in Boston, ahead of further expansion plans in the north-east of the US during 2016.

Overall the company, which also has interests in groceries, sugar, agriculture and ingredients supply, saw group revenue down 2% to £6.2bn and pre-tax profit up 4% at £468m.

ABF owns brands including Twinings tea, Kingsmill bread, Jordans, Ryvita and Silver Spoon sugar.

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Tourism: Storm-Hit Dorset Gets Easter Boost

By David Crabtree, Sky News Correspondent

Early indications suggest the storm battered south-west coast has enjoyed a much-needed boost in tourism over the Easter weekend.

The area was hard hit in the worst winter on record and business owners reported that in places trade was down by as much as a third.

But good weather in this holiday period has brought the tourists back in great numbers and, once the figures are in, tourism bosses hope they will show the region is back on track.

In Lyme Regis, bed and breakfast accommodation and most of the local hotels were full and the beaches busy.

David Tucker, who runs the Lyme Regis Museum, said footfall was clearly down in the early part of the year but he expected the area to recover quickly.

"The images of Lyme Regis and elsewhere being battered and damaged by the storms are bound to have a lasting effect on people," he said.

Waves batter Lyme Regis in December

"All we can say is that everything is back to normal and this is a beautiful place to come and visit."

Mark Callaghan, who owns The Terrace cafe and shop in Lyme Regis, said: "We are economy-driven as well as weather-driven here and we are constantly at the mercy of both.

"People who a couple of months ago may have tried and failed to get here because of the weather are certainly coming back. It might be a gradual process.

"We have had to expand our online business so we can keep going forward."

The Environment Agency announced today that it has repaired 350 flood defences, including the sea defences at Weymouth and the dune system on the Lincolnshire coast.

The Government says the Environment Agency has been provided with an extra £270m to maintain the defences.

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GSK In £8.5bn Deal With Swiss Rival Novartis

British drug giant GlaxoSmithKline (GSK) is to sell its oncology business to Novartis for $14.5bn (£8.5bn) and will buy the Swiss company's vaccines division.

Novartis is expected to pay another $1.5bn (£900m) if certain milestones on the deal are met.

Under a "major three-part transaction" GSK and Novartis have agreed also to create a consumer healthcare business, GSK confirmed in a statement.

GSK will own 63.5% of the newly-created consumer healthcare business.

The British firm said it would use proceeds from the deals to return £4bn to its shareholders.

Shares in the company were up more than 4% in early Tuesday trades.

GSK chief executive Sir Andrew Witty said the deals are expected to be completed during the first half of 2015.

He said they would accelerates the firm's "strategy to generate sustainable, broadly sourced sales growth and improve long-term earnings".

Novartis confirmed it signed several multi-billion dollar deals with GlaxoSmithKline and US company Eli Lilly, which may affect up some 15,000 of its employees.

It will sell the vaccines business to GSK, excluding its flu sector, for $7.1bn (£4.2bn), plus royalties.

Eli Lilly will buy the Basel-based firm's animal health division for about $5.4bn (£3.2bn)

No details have been released on the potential impact of the deal on jobs for the Brentford-based GSK.

Sir Andrew added: "Opportunities to build greater scale and combine high quality assets in vaccines and consumer healthcare are scarce.

"With this transaction we will substantially strengthen two of our core businesses and create significant new options to increase value for shareholders."

Meanwhile, US pharma giant Pfizer may renew its bid for British drug company AstraZeneca, after its reported £60bn takeover approach was rejected.

AstraZeneca topped the FTSE 100 top risers on Tuesday morning, up more than 7% on the potential deal.

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David Moyes Sacked As Manchester United Boss

Keeping Moyes 'A Bigger Gamble Than Hiring Him'

Updated: 9:28am UK, Tuesday 22 April 2014

By Paul Kelso, Sky News Sports Correspondent

David Moyes lost the faith of Manchester United's owners the Glazer family, and with it his job, because sticking with him represented a bigger gamble than hiring him in the first place.

Moyes was hired, exclusively on the advice of his compatriot Sir Alex Ferguson, with what now looks like negligent haste. The Glazer family chose to ignore the claims of other candidates, including Jose Mourinho, to give Ferguson's protege a six-year contract.

If that was a risk it was as a calculated one. Moyes' 10 years at Everton did not yield a trophy but they did merit respect, and a chance to prove he could step up to the very highest level.

The answer, after nine months and two transfer windows, was a resounding "no".

Moyes is a fine manager and a decent man but he seemed overwhelmed by the scale of the challenge. Where once he was certain, he second-guessed. Having run Everton in his own image, at United he could not escape his predecessor's shadow.

It left the Glazers with an even bigger decision than the one they faced last summer.

It is beyond question that United's squad needs a fundamental overhaul. It is a £150m project that will set the foundations for the next three to five years.

So the question for Old Trafford's Floridian absentee landlords was whether to trust it to a man struggling with the demands of the job, amid growing hostility from some players and colleagues.

Friction with senior figures including Ryan Giggs and Paul Scholes, and disaffection from players such as Danny Welbeck offered them little comfort, and humiliating defeats to Liverpool and Manchester City chipped away at Moyes' credibility.

Despite this the Glazers were still looking hard for evidence that he could be trusted with the club's future on and off the field. They appear to have found none.

There is simply too much risk for owners who need success to drive the commercial performance that pays the interest on the loans with which they bought the club. Ferguson guaranteed that. The only guarantee with Moyes is uncertainty.

So after nine years of stability under Sir Alex, the Glazers are searching for their second manager in nine months. They can ill-afford to get it wrong again. Expect the new man to have Champions League experience and an international profile.

The new coach will also mark a new era.

When Ferguson recommended Moyes he was promoting a principle as well as a pal. In his fellow Glaswegian he saw a man who would maintain the values he instilled, the commitment to the long-term and developing their own talent.

That idea of United as a special club, one that does not panic, sack its manager and buy its way out of trouble, may die with Moyes' departure.

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Co-op Admits 'Disastrous Year' Amid £2.5bn Loss

The embattled Co-operative Group has confirmed a loss of £2.5bn for 2013, in what it described as a "disastrous year".

The loss comes on the back of a £529m figure recorded in its 2012 results.

Interim group chief executive Richard Pennycook said: "2013 was a disastrous year for the Co-operative Group, the worst in our 150-year history.

"Today's results demonstrate that but they also highlight fundamental failings in management and governance at the group over many years.

"These results should serve as a wake-up call to anyone who doubts just how serious the challenges we face are."

It said most of the losses were from "discontinued operations" of its banking arm, which totaled £2.1bn.

Group sales were £10.5bn, down from the £11bn recorded in the previous year.

Profit from its food division were down 8% at £247m but it also recorded a goodwill impairment charge of £226m for its purchase of Somerfield stores.

The Co-operative Group consists of a number of divisions

However, it recorded more encouraging figures for some other divisions.

General insurance profit jumped from £13m in 2012 to £33m last year.

The pharmacy chain, which is being offered for sale, saw profit rise by about a fifth to £33m.

And its funeral services business saw sales up 3% to £370m and profit up £2m to £62m.

Co-operative Group chair Ursula Lidbetter said: "During 2013, it became apparent that our governance had fallen far short of the standards to which we aspire as a co-operative society.

"Now is the time to put that right through fundamental reform - we have to act with urgency if we are to lay the foundations for a stronger, healthier co-operative business in the future."

The group's bank division revealed a £1.5bn capital black hole last year and then in March announced a plan to raise another £400m.

Amid risks of the bank's collapse, the group reduced its stake in the institution to 30% as private equity bondholders provided capital - raising concerns of how it would maintain its 'ethical' stance.

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British Gas Bonus Claims To Be Investigated

Claims that British Gas workers have been paid large bonuses to inflate customer bills are to be investigated by the energy regulator, Ofgem.

It comes after a former employee claimed the energy company encouraged its sales staff to sign up charities, churches and small businesses to its highest-priced tariffs in order to boost their own earnings.

British Gas has strongly denied the allegations.

The whistleblower, who worked for the company between 2010 and 2013, told the Daily Mail the firm's policies were designed "to rip off" customers.

He claimed sales agent typically earned between £4 and £37 in commission per deal if they persuaded existing customers to renew contracts.

But by moving a customer to a more expensive deal they could earn more than £400 a time, he alleged.

"People were desperate to make the salaries they had been promised, so everyone inflated the prices," he told the paper.

"Scout clubs was a favourite one; churches, charities, small businesses, where people would just go for the maximum 5p notch-up," he added.

Ofgem will investigate whether the sales activities were 'honest and fair'

A British Gas spokeswoman said: "British Gas strongly refutes any suggestion that employees are paid commission on any prices charged to residential customers."

British Gas Business managing director Stephen Beynon said his sales agents are paid commission, but he denied any suggestion that contracts were negotiated inappropriately.

"This is a highly regulated market, and every part of the sales negotiation process is closely monitored," he said.

"Sales agents in British Gas Business do receive commission, but we are reducing its importance.

"We're leading the way in addressing the variability in price that customers face in this market, and we'll continue to do so."

Ofgem said in a statement: "There are strict rules in place which require suppliers to take all reasonable steps to ensure information provided is accurate and not misleading, and that sales activities are conducted in a fair, honest, transparent and professional manner.

"Ofgem is an evidenced-based regulator and we would encourage anyone with information that an energy company is not complying with Ofgem rules to provide us with this."

Energy and Climate Change Secretary Ed Davey said: "This is a very serious and deeply disturbing allegation that comes as we are doing all we can to make the energy markets work better for all consumers - whether domestic or businesses.

"The Government fully supports Ofgem's recommendation for a full market investigation.

"In the meantime, we'll continue to help people pay less for the energy they use, driving the competition that has seen the number of energy suppliers triple since 2010 and people switching supplier in record numbers."

The allegations come days after Ofgem fined British Gas Business for a series of failures including blocking firms from switching to other suppliers.

Ofgem said British Gas Business would pay a total penalty of £5.6m of which £800,000 would be in fines, on top of £1.3m already paid to 1,200 customers who paid higher bills because they were not notified when their contracts were due to expire.

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Best Of British Gear Up For China Car Show

Some of Britain's most famous cars are on parade today at one of the most important days in the motoring calendar.

Ford cars on display at the 50 years celebration ceremony of Ford

UK brands such as Rolls-Royce, Jaguar and Land Rover are showing their new models at the China Motor Show in Beijing to help boost sales in an intensely competitive market.

An original 1965 Ford Mustang Convertible alongside today's model

More than 1,100 vehicles will be on display at the exhibition which will also be attended by General Motors, Toyota, Volkswagen and Hyundai, along with SAIC and Dongfeng, China's domestic carmakers.

Although sales growth is forecast to slow from last year's 15.7% to 8 to 10% this year, China remains the world's biggest auto market with 17.9 million vehicles sold last year.

Car sales are expected to slow in China this year

The expo comes as a growing number of Chinese cities are restricting the number of cars on the road in a bid to battle pollution and congestion, moves that analysts warn could cut into purchases.

The eastern city of Hangzhou, a popular tourist destination, last month became the sixth major city to implement such a restriction, with some estimates placing the limit at 80,000 cars a year.

More than 1,100 vehicles will be on display at the exhibition

The boss of Mercedez-Benz in China told Sky News earlier this year that survival in the automotive industry is based largely on success in China.

German auto giant Daimler also announced recently it had signed a $1.4bn deal with Chinese partner Beijing Automotive Industry Corporation to expand production at their joint venture in Beijing.     

Among the cars on display at the exhibition will be one of the first 1965 Ford Mustang Convertibles.

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