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Chase Bank Limits Cash Withdrawals, Bans International... Before you read this report, remember to sign up to for 100% free stock alerts Chase Bank has moved to limit cash withdrawals while banning business customers from sending...

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Richemont chairman Johann Rupert to take 'grey gap... Billionaire 62-year-old to take 12 months off from Cartier and Montblanc luxury goods groupRichemont's chairman and founder Johann Rupert is to take a year off from September, leaving management of the...

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Cambodia: aftermath of fatal shoe factory collapse... Workers clear rubble following the collapse of a shoe factory in Kampong Speu, Cambodia, on Thursday

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Spate of recent shock departures by 50-something CEOs While the rising financial rewards of running a modern multinational have been well publicised, executive recruiters say the pressures of the job have also been ratcheted upOn approaching his 60th birthday...

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UK Uncut loses legal challenge over Goldman Sachs tax... While judge agreed the deal was 'not a glorious episode in the history of the Revenue', he ruled it was not unlawfulCampaign group UK Uncut Legal Action has lost its high court challenge over the legality...

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Eurozone retail sales fall in March

Category : World News

Retail sales in the eurozone fall for the second month in a row in March, according to the European Union’s statistics office Eurostat

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EU considering Bangladesh action

Category : Business, World News

The European Union says it is considering “appropriate action” to encourage an improvement in working conditions in Bangladesh factories.

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Google’s new bid to avoid EU fine

Category : Stocks

Google is preparing to change the way it presents search results in Europe in a bid to head off antitrust penalties from the European Union.

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McCluskey re-elected as Unite leader

Category : World News

The general secretary of the UK’s biggest trade union is re-elected for another five-year term of office.

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UK labour costs below EU average

Category : Business, World News

UK hourly labour costs have fallen nearly two euros (£1.7; $2.6) below the European Union average, data from the EU’s statistics agency show.

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Workers in the boardroom: From the archive, 9 April 1970

Category : Business

Labour party look at proposal to encourage workers to participate directly in management

The Government is considering a fundamental review of company law to allow workers to sit on boards. Mrs Barbara Castle, Secretary for Employment and Productivity (DEP), has written to employers and the Trades Union Congress (TUC) telling them of her interest in plans to encourage workers to participate directly in management. A confidential document from the DEP on industrial democracy admits that very large issues are involved, adding that they “could involve a fundamental review of company law and of the accountability of management to employees.”

The TUC yesterday set up a special working party to clarify union attitudes. Sir Sidney Greene, TUC president, is to take the chair and among other members will be Mr Jack Jones of the Transport and General Workers’ Union. The Government paper poses a series of questions about the appointment and authority of workers as directors. The TUC will give Mrs Castle a general reply before embarking on a detailed study.

TUC leaders are expected to tell the DEP that worker directors must be appointed only by the unions and not by shareholders nor by direct election from the shop floor. They believe there need be no conflict of interest between such directors and their union colleagues during plant-level wage bargaining. TUC staff point out that ordinary directors have to juggle their institutional interests and those of shareholders.

Mrs Castle draws attention to West Germany where companies have two boards – one composed of working managers and the other taking a supervisory role. The TUC has not decided whether it wants a similar set-up here and, until it does, it will find difficulty in saying whether it wants full-time voting positions on boards, union officials sitting on a part-time basis, or rank and file workers attending board meetings as advisers.

In the public sector at least, the TUC wants a much more radical approach to the whole question of worker representation. It will tell the Government that union nominees should come from the industry and the region in which they serve as part-time members, and that they should be allowed to continue to hold rank and file union positions during their terms of office.

Portugal’s prime minister plans more cuts to health and education spending

Category : Business

Pedro Passos Coelho chooses not to raise taxes again in order to meet stringent targets set by international lenders

Portugal’s prime minister has announced plans for further cuts to health and education spending rather than raising taxes again, in order to meet tough targets set by international lenders after the constitutional court threw out budget measures on Friday.

“I shall instruct ministries to implement necessary reductions in functional spending to offset what the court ruling prohibited. It will certainly be a very difficult process,” Pedro Passos Coelho said in a live broadcast on Sunday evening.. He added that while he respected the court, its ruling would hamper government plans to take back control of its own finances from international lenders next year.

The speech followed an emergency cabinet session on Saturday and a meeting between Passos Coelho and President Aníbal Cavaco Silva, who has the power to dissolve parliament but urged the government to complete a four-year mandate it won at the polls in June 2011.

On Friday the court found that proposed cuts in holiday bonuses for civil servants and pensioners were unconstitutional, as were reductions in sick pay and unemployment benefit, all of which would have trimmed €1.3bn from budget spending for this year, according to media estimates. The court, however, upheld other planned measures such as tax hikes.

Passos Coelho’s conservative Social Democrats took power after his Socialist predecessor asked a “troika” of lenders for a bailout in March 2011, before resigning. Since then, the government has imposed stringent and unpopular spending cuts totalling €13bn – about 8% of Portugal’s economic output – which have led to widespread protests in common with other eurozone countries suffering from a persistent economic slump.

The government failed to meet its budget deficit targets last year set by the European Union, the International Monetary Fund and the European Central Bank, and in order to fulfil the terms of its €78bn bailout Lisbon has pledged to trim a budget shortfall of 6.4% of gross domestic product in 2012 to 5.5% this year.

Passos Coelho survived his fourth vote of no confidence last Wednesday but faced renewed calls to resign over the weekend. Opposition Socialist leader António José Seguro accused the government of breaking campaign promises and said dole queues of almost a million people showed austerity had merely locked the country into a recessionary spiral, which might yet lead to a second bailout. Portugal’s economy shrank by 3.2% last year.

“The country needs a different exit strategy from the crisis, one that prioritises economic growth,” Seguro told state television. “The country is living in a social tragedy. This needs to change, and that change entails substituting the government.”

In crisis-hit neighbouring Spain, meanwhile, the CSI-F union for civil servants said the government in Madrid should “take note” of the Portuguese court’s decision and reimburse workers with a Christmas bonus axed last December in cuts which likewise aim to trim a yawning budget gap.

Bad weather hits British wheat crops

Category : Business, World News

Britain will become a net importer of wheat for the first time in a decade this year because of bad weather, the National Farmers’ Union says.

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Unite calls for general strike

Category : Business, World News

Britain’s biggest trade union, Unite, is calling for a 24-hour general strike against austerity measures.

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Credit unions offer viable alternative to high street lenders

Category : Business

About 400 credit unions currently operate in the UK, and their influence is growing

Britain’s youngest credit union, in the industrial Cumbrian town of Barrow in Furness, has just been celebrating its 100th membership application. Barrow and District Credit Union, the fruit of much hard work and planning over many months by a committed group of volunteers, received its authorisation from the Financial Services Authority just before Christmas.

It begged and borrowed the necessary furniture, and opened its doors of its office just off Barrow’s main shopping street in February. Since then, little by little, the money has been coming from its members. Their savings and surplus cash will form the capital pool which, in due course, the credit union will be able to lend back to those of its members in need of affordable loans.

At a time when the payday lenders have been under media scrutiny for their astonishingly high interest rates (the Guardian recently reported the case of one lender charging more than 16,000,000% APR), the credit union way of providing financial services seems almost too good to be true. Loans are currently set at a maximum rate of interest of 2% per month (26.8% APR), for example. But despite more than 20 years of trying, Britain’s credit union movement is still struggling to get attention. Compared with Australia, say, where a quarter of the population are credit union members, or the US where credit unions claim 95 million members, the British movement still has a long way to go.

Barrow certainly seems ready for its credit union. “There’s a lot of payday lenders and cash-your-cheque-here places. There are some illegal loan sharks operating as well,” says Rob Cairns, the credit union’s chairman. Having taken retirement in 2011 from his job as chief executive of the resolutely local Furness Building Society, he has since found himself back in the world of financial services, this time in a lay capacity. The plan to set up a credit union in the town goes back four years, he says, and has been actively progressed by a local steering group for two years. Until last month when the doors were opened, Barrow was the most economically deprived town in Britain without its own credit union, he adds.

His credit union is now taking it a step at a time. Its recently appointed general manager is currently being funded by a charitable foundation, but the business plan suggests full self-sufficiency within three years. The next step will be to begin lending. After that Cairns hopes the credit union will be able to encourage regular savings by partnering with local employers. “That’s on the action list – we need to get payroll schemes established,” he says. He is also keen to ensure the credit union appeals to all in the local community, not only those on low incomes. “We need people who have some spare cash, to provide the funding for those that don’t.”

Credit unions – effectively financial cooperatives, controlled by their members – are now regulated by the FSA, which means members’ savings are protected up to £85,000, in exactly the same way as they would be in banks or building societies.

Barrow’s planned route forward to long-term sustainability is one being followed more generally by Britain’s credit union movement. The main federation the Association of British Credit Unions Ltd (ABCUL) met for its annual conference earlier this month aware that the days when revenue funding support (often from sympathetic local councils) could be obtained are passing.

ABCUL’s chief executive Mark Lyonette sees benefits in sloughing off the old dependency culture. “It is actually a weakness if you come to rely on financial support,” he says. Instead, he points to three major new opportunities opened up for credit unions by legislative changes last year.

One reform is that credit unions are now able to offer interest on members’ savings, rather than simply offering subsequent dividends. “This puts us on a par with building societies and will make a big difference,” he says. A second change sees the membership ‘common bond’ broadened, making it easier for credit unions to attract members nationally. Membership is for the first time also opened to organisations, and ABCUL hopes that housing associations and community organisations among others will be tempted to put some of their reserves with their local credit union. “This will have a knock-on effect on credit union credibility,” Lyonette says.

The past decade has seen Britain’s credit unions consolidate and merge, so that from a peak of about 700 individual credit unions there are now roughly 400 operating. The two largest, Glasgow Credit Union and the police officers’ No 1 Copper Pot (Number One Police Credit Union), both have assets over £100m and offer sophisticated financial services for their members. Thirty or so offer basic current account banking and many more provide pre-paid Visa cards for members to withdraw their money through ATMs.

Lyonette sees scope for both the large professionally managed credit unions and the small-scale volunteer-only organisations, such as are sometimes linked to churches. But he also points out that relying on unpaid workers does run the risk that a credit union can simply run out of volunteers. In general, he is keen to see credit unions collaborating more with each other, including developing shared back-office processing and administration.

One possibility is that the Post Office network may be available as a point of contact for credit unions. “I think that’s likely to happen within two or three years,” Lyonette says. More generally, the government is offering up to £38m to support the infrastructure development of the movement through the credit union expansion project. Credit unions may have a key role to play later this year when benefits are reformed and universal credit introduced, not least in helping members budget to be able to pay their housing costs.

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