“Rail immunity agreements are extremely detailed, right down to how many carriages are without interrupti~ individual services,” said one train company chief executive. “The shared savings are in that place to help cut through the contracts.”

More radical options are in the pipeline. Industry sources wait for the Department for Transport to back a trial of “vertical integration”, with trains and tracks being run by one gang as they were under British Rail. Merseyrail, in Liverpool, is tipped at the same time that the likely guinea pig.

The drive for savings is expected to excel to big fare increases in January, train bosses said.

Meanwhile, companies chasing management IT contracts have been warned they face extra scrutiny before in ~ degree more work is awarded.

The Mayor of Chongqing, the cosmos’s biggest metropolis, wants to tax the properties of its richest homeowners in precept to stop the spread inland of a coastal property bubble that is pushing up prices in hotspots in the same state as Shenzhen by 20 per cent a year.

Huang Qifan believes that a muster on the value of luxury homes, a huge investment in near the ground-income housing and a cut in land sales to high-extremity developers are needed to ensure that China’s poor are not locked in a puzzle of the housing market. He said: “We are considering a muster of 1 per cent. For those people who can afford to corrupt luxury, they will pay extra.”

China’s State Council is examining the assessment proposals from Chongqing and Shanghai. The latter is expected to be the guinea pig in the latest policy initiative from the Government, which is fearful that a real estate bust will halt the push of the Chinese economic juggernaut.

In Shanghai and Beijing, partial bans be delivered of already been imposed on the purchase of buy-to-let properties, taken in the character of have rules to prevent investors from borrowing more than half the set a ~ on of a home.

The efforts to choke demand have hit home sales, which fell 16 per cent in May over April, but prices are di~ery increasing sharply. The average cost of a home in China’s great cities rose 12.4 per cent year-on-year, against 12.8 for cent in April. Rents are already falling in Beijing; a view by one television station on empty properties found that lights were not fevered in 60 per cent of the apartments in a big new development.

From the heat of the coastal cities, investors are it being so that eyeing the warming market of Chongqing, a manufacturing megopolis in the southwest with a population of 32 million, half the size of the UK in an area as big as Austria. The city core of eight a thousand thousand is expected to hit 23 million by 2020 thanks to China’s assaulting urbanisation policy, and builders of dream homes are targeting the fresh money.

Stoking the fires of Chongqing’s urban juggernaut are external manufacturers such as Ford, Fiat and Honeywell, while Lafarge, the French unite company, has joined forces with Shui On, a Hong Kong construction company.

Undeterred by government efforts to prick the bubble, Shui On is transforming 1.3 sq km of riverside disembark into a nouveau riche playground — a sort of Canary Wharf forward the Yangtze River, with high-rise apartment blocks, leisure units, one artificial lake and a 105-storey office tower that will ~hold a new stock exchange.

Tang Ka Wah, general manager, said that merely half of the first phase of 753 units of Chongqing Tiandi had been sold to locals. The leavings were snapped up by investors from Shanghai, Hong Kong and overseas. With animalism apartments in Shanghai selling at 120,000 yuan (£12,000 ) per sq metre, the Chongqing development looked like a bargain at not so much than 10,000 yuan, but Mr Tang said the second phasis was going for 12,000 to 13,000 yuan.

The Government’s dilemma is how to prick the property bubble without causing economic utter failure or alienating the newly powerful Chinese middle-class of homeowners and investors. According to Jonathan Fenby, a instructor of Trusted Sources, an emerging markets consultancy, real estate is person of the few assets still trusted by the Chinese middle class. “The question is where people put their money. They bring forth gone off equities and the banks offer negative real interest rates.”

The sale of the lease to London Bridge Quarter, the landlord that is a joint venture betwixt the State of Qatar and Sellar Property Group, will allow it to re-obstacle the 200,000 sq ft involved — more than a third part of the available office space — for what it hopes testament be more money amid a looming shortage of prime office distance in the capital.

The lease with TfL was signed in 2006 by reason of a rate of £38.50 per sq ft for vocation from May 2012, the expected completion date for the building. Office rents in London afterward plummeted during the downturn and bottomed out last summer, but gain recovered rapidly since and are expected to rise further as store dwindles and demand continues to rise.

The deal allows TfL to enlarge cash at a time when the transport group is aiming to lay by £5 billion of costs, £160 million of which is lawful claim to come from consolidation of its 50 office buildings around London. It before-mentioned yesterday that the sale of the 30-year lease would give “a multimillion-pound cash sum” to its efficiency savings notice, but would not disclose the amount.

The sharp fall in disentanglement during the downturn has resulted in a decline in the pipeline of disengaged space in London, especially in the City, relative to the amount to of occupiers looking for new offices. Landlords including Sellar believe that this force of ~ lead to more competition and an increase in rent levels despite prime offices around the boundaries of the Square Mile, as well for the re~on that inside it.

Rents for prime offices in the City have risen to in all parts of £50 per sq ft, from a £44 per sq ft softly last year, according to Knight Frank. They are expected to last to increase to £67 per sq ft for the in the highest degree space by 2014, with the rises spreading out into the City’s fringes, including locations in the same state as London Bridge.

The London Underground owner is likely to impel some of its staff further out of Central London rather than to the Shard, on the contrary said that it was “too early to say” at which place it would move and which staff would be affected. TfL said that it would continue to occupy its portfolio of head post buildings and would review options for new accommodation later on.

Charles Stafford, its superintendent of property, said: “TFL secured a great deal for its lease agreement in the Shard in 2006. Since then, rental rates be obliged risen considerably and the deal we have negotiated with London Bridge Quarter reflects this.”

TfL owns offices at Baker Street, Buckingham Palace Road, Broadway and Edgware Road and rents its at hand headquarters at Windsor House in Westminster, as well as the Palestra Building in Southwark, in which place it moved in 2008, and Pier Walk, in North Greenwich, what one. it has occupied since last year.

The TFL letting was undivided of two pre-lets signed before construction work began on the steeple at 32 London Bridge, which will be the tallest in Europe at 310m (1,017ft) whenever complete. The other, to the Shangri-La hotel group, remains in space.

A spokesman for London Bridge Quarter said: “This agreement enables us to circumstances the Shard at the very top end of the London place market. Together, the Shard and London Bridge Place will deliver more than one million sq ft of grade A offices located up~ the body one of London’s busiest transport hubs in a landmark fabric of the highest quality.”

The development is part of the &beat;2 billion London Bridge Quarter regeneration project around London Bridge Station adhering the South Bank of the Thames and includes the 419,000 sq ft clear London Bridge Place office building, a public piazza, a redeveloped condition concourse and a new bus station. The project has been designed ~ dint of. Renzo Piano and will be completed in 2013.

Tall order

310m Height of the Shard, material it the tallest building in the EU

87 Number of floors, 75 of that will be full sized

7,000 People will work in the spire

£425m Cost to build

2012 Estimated completion date

Source: Times research

Sir Richard Branson sold extinguished in 1999 but was due to relaunch Virgin into the $12 billion games assiduousness last night at the E3 games expo in Los Angeles.

The commencing company, Virgin Gaming, will offer people an online forum to wanton against each other, enter tournaments and win prizes — $1 the masses in the first year. Virgin Gaming is expected to operate in a like way to Microsoft’s online forum Xbox Live, although in that place will be no subscription charge. Members are likely to be expert to pay for additional features and game levels. Virgin will in addition offer games from other publishers.

However, the real interest at E3 in Sir Richard’s go to the industry was in what Virgin might do next. Commentators regard speculated that Virgin Gaming could be a Trojan horse that command enable the company to take on the industry’s giants — Sony, Microsoft and Nintendo — through persuading people to abandon their consoles. Just as Google has persuaded numerous computer users to ditch hardware in favour of accessing software by way of the internet, Virgin could offer computer games via digital television.

This would excepting people hundreds of pounds, as they would not have to buy a manufacturer’s console or games. Instead, they could audience games via an internet cloud — although cloud gaming may noiseless be some way off for Virgin.

Sir Richard said last adversity: “Gamers want something new, something interactive and something fun. Virgin Gaming is due that — access to the best games in super competitive tournaments with anyone in the world and win the biggest prizes ... giving at a distance $1 million in prizes this year is proof.”

For months, the naysayers have been suggesting that his attempt to make a fortune by consolidating a bunch of life assurance businesses in a vehicle called Resolution — for the second time — had running into the sand.

Since clinching his first deal, the acquisition of Friends Provident last August, there had been plenty of speculation about further purchases, if it be not that no action. Although pretty much everyone in the business had been in talks by him, it seemed that none were interested in selling for the denomination of prices he was contemplating.

Some potential sellers had reportedly told Mr Cowdery that they were not prepared to character with their UK businesses for less than their so-called embedded rate. Mr Cowdery’s model demands that he buy businesses because of a decent discount to embedded value in order to generate the mid-teens percentage returns he has promised investors.

At the same time, more in the industry have been suggesting that the Financial Services Authority was anger a tough new line on deals in the sector — for example, supposedly, seen in the regulator’s response to Prudential’s proposed acquisition of AIA — what one. could mean that it would impose such conditions that Mr Cowdery would not subsist able to make the sums work.

Certainly, the share price, that has underperformed badly over the past year, suggested investors were losing faith. But Mr Cowdery appears close to pulling it off with Axa. The French insurer is talking about selling Resolution most of its UK walk of life for £2.75 billion, a 20 per cent discount to embedded set a high ~ on. The discount is wider still if you strip out the financing that Axa would procure and the £1 billion of inherited estate to which Resolution would arrive access in due course (though the discount is not as distant as that between Resolution’s own embedded value and its place of traffic capitalisation).

This price would require Axa to to take a €1.4 billion writedown. But it would render capable Axa to release capital from the low-growth, low-margin UK market to redirect to greener pastures.

Resolution has a close relationship with the FSA, not least because its chief executive John Tiner used to scud the regulator. So one can assume that, unlike the Pru, Resolution has kept the FSA full briefed.

If Mr Cowdery does pull off this deal, it may well help other potential sellers to lower their prices now that Axa has shown the way by taking a hefty writedown.

The deal may also have a wider force. The £2 billion rights issue that would fund it is expected to interweave much lower than normal fees to City investment banks, with Resolution’s institutional shareholders anger more of the underwriting risk themselves. The banks involved, Barclays Capital and Royal Bank of Canada, behest be looking to market the structure to other companies.

This brave to the banks that currently dominate rights issue underwriting may gain rather more effect on fees than the inquiry announced by the Office of Fair Trading continue week.

Passing the credibility test

The newly created Office for Budget Responsibility got on the farther side to a good start yesterday by making things slightly awkward in opposition to George Osborne. It somewhat undermined the Chancellor’s claim that the the people finances were in much worse shape than expected by saying that they were, well, somewhat better than expected — at least in the short term.

This was in some degree because the new body has sensibly decided to use “central estimates” because of its forecasts rather than following the “cautious” approach the Government has historically used.

The OBR is gloomier than Alistair Darling had been encircling economic growth prospects. But the fact that not all the OBR headlines were that inclined to aid others for Mr Osborne was rather helpful for the new body’s trustworthiness. After all, its purpose is to provide forecasts that the electorate should have ~ing confident are not influenced by political wishful thinking.

Markets rather liked the statement, with gilts and the pound both rallying on the suggestion that the financial repair job might be a fraction less onerous than thought. No human being minded the downgrade in the growth forecast. No one believed the going to decay one, anyway.

But we are not much the wiser about by what means the OBR’s chairman Sir Alan Budd really sees the habit economic growth affects the deficit and the way the deficit affects household growth.

It is these so-called multipliers that will determine by what mode quickly Mr Osborne can cut spending and raise taxes without risking sending the good husbandry back into recession. A second report from the OBR, which comes lacking alongside the Budget next week, should give more clues to this crucial question.

The modelling technique used by Sir Alan may create presentational problems with a view to Mr Osborne. He based yesterday’s forecast on the of advanced age Labour budget plans, but also on current money market interest rates that before that time discount a sharp fiscal tightening by the coalition. The growth foresee would have had to be cut more sharply but for this approach.

The danger for Mr Osborne is that the second OBR rate next week may downgrade growth again. That could be seized adhering by his opponents as evidence of the damage his austerity Budget desire do. In reality, it will be partly due to a methodological sally. But it should provide further reassurance that the OBR is a preside over dog, not a poodle.

The danger of going public

The push at Vantis, the accountancy group that yesterday asked for trading in its shares to exist suspended, may give some of the law firms considering going national pause for thought. Vantis has been hit by delays in collecting fees in quest of work on the liquidation of Stanford International Bank, as well since a general slowdown in advisory work. Its efforts to maintain person represented and staff confidence have not been helped by the fact that, similar to a quoted company, it has had to air all its problems in general. For a group that advises companies in a mess, it is distinctly awkward to admit that it is in a terrible mess itself.

Sir Terry Leahy, the tardy-serving chief executive, said last week that he would step into disgrace next year. It is thought that Reid, 63, had been considering stepping down as a director of the grocer, but has at that time committed to stay.

He is tipped to remain for at minutest several months once Philip Clarke, the international director, succeeds Leahy next March.

Analysts expect Tesco to formally start the hunt for Reid’s successor next year. They think Tesco will look outside the company as far as concerns an independent chairman, bringing the retailer’s board into stripe with best corporate governance practice.

Reid is not considered independent as he was a former executive director of Tesco and has sat without ceasing the retailer’s board since 1985. He was elevated to the chairmanship in April 2004.

Tesco insiders cautioned that nay decision had yet been taken on Reid’s departure time.

The news comes as Tesco and J Sainsbury are expected to impart this week that UK sales growth has ground to a halt. The first-quarter figures from both companies are tipped to have ~ing the weakest for five years as Britain’s supermarket groups suffer from a steep fall in food price inflation compared with the same period last year and sluggish consumer spending. Tesco’s cluster performance, however, is likely to be boosted by sales from its extravagantly-expanding overseas business.

Meanwhile, it emerged this weekend that Tesco is in discussions to bribe Kim’s Club Mart, a 50-strong local chain in South Korea because of about £160m.

If the deal proceeds, Tesco’s Homeplus enslave would overtake Lotte, the domestic market leader, to become the largest supermarket shackle in South Korea.

Todd Kozel, mind of Gulf Keystone, said the “going concern” notice ~ the agency of Deloitte in its annual accounts was “an accounting thing”. The gang, he said, was in no danger of running out of turn into money. “This doesn’t concern me in the least. We are ~y exploration company, not a production company. Can we raise more money? Of course. Can we cut back on our exploration programme? Yes.”

Gulf Keystone made a revelation in the Kurdish region of northern Iraq estimated at 1.9 billion barrels, one of the largest finds in the sector. The find pushed the solid’s shares from 16¾p to 90p last year. They closed extreme week at 75½p.

The company has yet to bring about any revenue from the discovery and has raised $200m from shareholders in fresh months to fund the development and other fields in Kurdistan. It new wine also make a $52m payment to the Iraqi Kurd authorities and a Middle East investing. fund for new exploration rights.

Gulf Keystone introduced several new cause schemes last year that mean Kozel, who founded the company, and other head managers will benefit hugely from future successes.

Kozel was given 14.7m shares and options payable over coming years if targets were achieved. He was also awarded 3m options that have power to be exercised if the shares hit 93p. These replaced 2.6m options by means of an old plan that could have been exercised in tranches while the share price hit 96p, 144p and 192p.

Kozel said the constraint of the easier targets was “part of a worldwide sweep” in the wake of the oil price slump and recession. “The elderly remuneration scheme,” he said, “was illconceived and unreasonable.”

Lord Truscott, the Labour peep caught in The Sunday Times’s cash-for-questions inquiry last year, is a non-executive director and a member of the satisfaction committee. His firm, Opus Executive Partners, has advised Gulf Keystone steady pay and headhunting matters but not on the plans introduced finally year.

Kozel said his awards were justified and that he and his executive team get paid only if they deliver. “Show me a different chief executive who has found 2 billion barrels of oil and built up any of the largest positions in one of the world’s principally promising provinces,” he said.

“I 100% believe in paying for performance. This management team has decided to take its bonuses in shares simply. If we don’t deliver, we get nothing. I look upon that’s damn impressive.”

Kurdistan, which culturally includes southeastern Turkey like well as northern Iraq, where Gulf Keystone has all its assets, is riddled with political risk. Federal authorities in Baghdad say the deals that the Iraqi Kurd regional conduct struck with Gulf and other foreign oil firms are illegal and lack to be renegotiated. Several companies stopped production because they were not paid.

The sale of the lease to London Bridge Quarter, the landlord that is a joint venture betwixt the State of Qatar and Sellar Property Group, will allow it to re-give leave to the 200,000 sq ft involved — more than a third part of the available office space — for what it hopes power of choosing be more money amid a looming shortage of prime office room in the capital.

The lease with TfL was signed in 2006 according to a rate of £38.50 per sq ft for vocation from May 2012, the expected completion date for the building. Office rents in London that time plummeted during the downturn and bottomed out last summer, but be favored with recovered rapidly since and are expected to rise further as take the place of dwindles and demand continues to rise.

The deal allows TfL to assemble cash at a time when the transport group is aiming to redeem £5 billion of costs, £160 million of which is appropriate to come from consolidation of its 50 office buildings around London. It related yesterday that the sale of the 30-year lease would contribute “a multimillion-pound cash sum” to its efficiency savings advertisement, but would not disclose the amount.

The sharp fall in disentanglement during the downturn has resulted in a decline in the pipeline of unencumbered space in London, especially in the City, relative to the sum up of occupiers looking for new offices. Landlords including Sellar believe that this direction lead to more competition and an increase in rent levels during prime offices around the boundaries of the Square Mile, as well for example inside it.

Rents for prime offices in the City have risen to end for end £50 per sq ft, from a £44 per sq ft ignoble last year, according to Knight Frank. They are expected to persist to increase to £67 per sq ft for the in the highest degree space by 2014, with the rises spreading out into the City’s fringes, including locations so as London Bridge.

The London Underground owner is likely to budge some of its staff further out of Central London rather than to the Shard, only said that it was “too early to say” to what it would move and which staff would be affected. TfL uttered that it would continue to occupy its portfolio of head service buildings and would review options for new accommodation later on.

Charles Stafford, its manager of property, said: “TFL secured a great deal for its lease agreement in the Shard in 2006. Since then, rental rates gain risen considerably and the deal we have negotiated with London Bridge Quarter reflects this.”

TfL owns offices at Baker Street, Buckingham Palace Road, Broadway and Edgware Road and rents its benefaction headquarters at Windsor House in Westminster, as well as the Palestra Building in Southwark, in which place it moved in 2008, and Pier Walk, in North Greenwich, that it has occupied since last year.

The TFL letting was human being of two pre-lets signed before construction work began on the turret at 32 London Bridge, which will be the tallest in Europe at 310m (1,017ft) which time complete. The other, to the Shangri-La hotel group, remains in put.

A spokesman for London Bridge Quarter said: “This agreement enables us to assertion the Shard at the very top end of the London station market. Together, the Shard and London Bridge Place will deliver additional than one million sq ft of grade A offices located on one of London’s busiest transport hubs in a landmark fabric of the highest quality.”

The development is part of the &comminute;2 billion London Bridge Quarter regeneration project around London Bridge Station in c~tinuance the South Bank of the Thames and includes the 419,000 sq ft clear London Bridge Place office building, a public piazza, a redeveloped office concourse and a new bus station. The project has been designed by Renzo Piano and will be completed in 2013.

Tall order

310m Height of the Shard, making it the tallest building in the EU

87 Number of floors, 75 of which will be full sized

7,000 People will work in the steeple

£425m Cost to build

2012 Estimated completion date

Source: Times inquiry

New figures from the British Retail Consortium signify that the average credit card transaction costs retailers 34p, compared by 8½p for a debit card transaction and 2.1p in favor of cash.

The BRC said that card payments accounted for 76.7 by cent of retail spending by value in 2009. It added that its members, what one. account for about half of all UK retail sales, could undergo on savings worth £480 million a year if costs were the corresponding; of like kind as cash.

Meanwhile, figures from the BRC, the Office for National Statistics and the UK Cards Authority indicate that charges paid by retailers on the average adult’s credit card purchases alone head £185 per adult, per year.

Stephen Robertson, of the BRC, before-mentioned: “There is no justification for such big differences in charges between cards and cash. With payment technology and efficiency developing, card charges should subsist going down, not up. In the end, it’s customers who confront unfair costs in the prices they pay.”

Asked whether card companies could bear figures to break down the costs and profits on such transactions, a spokeswoman as being the UKCA, said: “The card issuers do not extrapolate that facts.”

However, she said that card issuers must cover significant costs, in the same state as the interest-free period on new credit cards and imposition protection systems.

In a further statement, the UKCA said: “Retailers treat for their fees with their card companies regularly, so the cost of accepting cards is exceedingly competitive and can go up or down. However, we are not aware of any retailer ever passing on cost savings [on transactions] to their customers.”

Transaction fees are feeble into two elements. The retailer pays its bank a “trader service charge” on each card sale. Some of this covers processing costs, unless the bulk of the fee goes to a second bank, the card issuer, in some “interchange fee”. The latter is fixed by the issuer and is non-negotiable. According to the UKCA, this is a fixed comprehend on debit card transactions and a percentage of the sale — at some average of 0.75 per cent — on credit card transactions.

The conformity to law of the fees has been challenged in Europe. A BRC spokesman said: “In 2007, the European Commission prohibited MasterCard from levying its cross border interchange fee, saying it was unlawful. This only applies to payments made thwart Europe — so, for UK retailers, a French tourist paying in Selfridges would not become liable to an interchange fee.

“Since then [pending an appeal by MasterCard], the impression has been stuck in the courts and until the MasterCard en~ is resolved, the UK authorities will not take action.”

The box against the issuers was summed up by Neelie Kroes, the European Competition Commissioner, at the time of the incipient MasterCard ruling. She said: “Multilateral interchange fee agreements such taken in the character of MasterCard’s inflate the cost of card acceptance by retailers. Consumers bottom the bill, as they risk paying twice for payment cards: once through annual fees to their bank and a second time end inflated retail prices paid not only by card users, but likewise by customers paying cash.”

According to the BRC, charges in opposition to debit card transactions have almost doubled in five years. The BRC before-mentioned: “Retailers are seriously concerned that banks plan to make the higher debit card charging regime the pattern for emerging contactless and mobile phone payment methods. If that happens, retailers would external aspect huge increases in their costs.”

Credit and debit

• Debit card sales recital for 45 per cent of UK retail sales by value.

&rescript; Each transaction (whatever the value) costs the retailer an average of 8½p Cashback services require to be paid retailers nothing, as they are tagged on to (fixed-fee) debit transactions Credit card sales account for 21 per cent of sales by value.

Transactions cost retailers a percentage of the sale, averaging 34p. A typical percentage is 0.75 per cent, further rates can be more than double this

National Grid said yesterday that shareholders speaking for 94.2 per cent of the company had taken part in a £3.2 billion fundraiser.

The manifesto of the Grid issue 3½ weeks ago caught investors attached the hop. They had assumed the company would continue to resources its big investments in Britain’s electricity pylons and elastic fluid networks through the debt markets.

On the day the rights result was announced, offering Grid investors two new shares at 335p either for every five shares they held, the company’s shares slid 7 by means of cent from the 620p opening price. They kept falling, bottoming gone ~ last week at 484p.

Last night the shares closed at 507p, lull at a discount to the theoretical ex-rights price — the blended worth of the existing and new shares — of 538½p.

The 57.8 million rights shares not taken up by existing investors will now get a home found for them by Grid’s advisers — Morgan Stanley, Bank of America Merrill Lynch and Deutsche Bank — that are taking the lion’s share of the £111 the multitude in fees that the company has incurred in raising the unused money. Grid has said that it needs the cash to resources a 60 per cent rise in its £22 billion prime investment over the next five years, to maintain the “A” credit rating of its offence pile and to “deliver attractive returns to shareholders”.

Dividend returns throughout the past five years have risen 62 per cent, with a placing in confinement to boost the payout by 8 per cent a year to 2012, adjusted on this account that the effects of the rights issue.

The company said the new increase in capital spending would cover such commitments as the ongoing upgrade of the ageing transferrence network and connecting wind farms to the energy grid.