Portugal is to face austerity measures imposed by Brussels under threat of punitive sanctions, makin...
Portugal is to face austerity measures imposed by Brussels under threat of punitive sanctions, making it the first country to lose control over tax and spending policy as a result of joining the euro, says this morning's Daily Telegraph.
The European Commission said yesterday that it was legally obliged to take action against Portugal after it emerged that the country's budget deficit was far above the 3% of GDP limit established by the EU's Growth and Stability Pact.
The shock figures were announced by the new centre-right prime minister, Jose Manuel Durao Barroso, who accused the outgoing socialist government of "reckless mismanagement" and concealing the disastrous state of national finances.
While Lisbon will be encouraged to come with its own proposals to control spending, it will do so knowing that EU finance ministers have the treaty power to order "deficit reduction measures" and can ultimately impose fines of up to 0.5% of Portugal's annual GDP, equivalent to £4-£5 billion.
The steel group owned by Lord Paul, the Labour peer, will today become the first company to face industrial action over pension scheme closures, amid predictions of a wave of strikes to defend beleaguered company plans, says the Times.
Workers at the Scunthorpe plant of the Caparo Group will today refuse to work overtime in protest at the company's plan to close its generous final salary scheme.
Caparo intends to replace the plan, which promises a pension based on years in service and final pay, with a stakeholder pension run by Schroder, the fund manager.
The workers' response comes in the wake of predictions by Amicus, the UK's second largest union, that pensions are set to replace pay as the biggest cause of industrial action in the workplace.
US authorities filed criminal charges against three British bankers on Thursday for their involvement in off-balance sheet partnerships at Enron, the failed energy trader, says the FT.
The complaint, filed by the Justice Department, accuses the men of committing wire fraud by siphoning off $7.3m in income from the partnership that rightfully belonged to their bank, National Westminster.
The three charged with one count of wire fraud were former NatWest employees Gary Steven Mulgrew, head of structured finance, Giles Robert Hugh Darby, an energy banker, and David John Bermingham, head of the structuring group.
The charges involve an entity called Campsie Limited, which was affiliated with NatWest. The fund was one of the original outside investors that contributed $15m to LJM Cayman - one of the infamous off-balance sheet partnerships devised by Andrew Fastow, Enron's former chief financial officer.
In all the coverage of Gordon Brown's Mansion House speech on Wednesday night, it went largely unnoticed that he had in effect declared that one of the five tests for euro entry had been passed, shows the FT.
Mr Brown referred his audience of bankers to the Treasury's 1997 assessment of the fourth test, the effect on financial services, which concluded "the benefits and the opportunities from the single currency will probably be easier to tap from within the eurozone".
He added: "We reaffirm that the decision on EMU must ensure that the UK remains an attractive location for financial services."
The Accountancy Foundation is considering radical plans to prevent accounting firms going ahead with audits where the regulator believes the work would be inadequate because the fees are too low, continues the FT.
Allegations persist that the big four accounting firms engage in "low-balling", where they take losses on audit contracts because of competition and the desire to secure lucrative non-audit work.
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Senior Managers Regime
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FCA made demands last week