Spain braces for further cuts amid national uproar

Spain, whose economy – the fourth largest in the eurozone – is staggering under a burden of debt, is preparing for further austerity measures after its finance minister revealed that the 2011 budget deficit was substantially higher than expected. The deficit came to 8.51% of GDP – far higher than the European Commission’s own forecast of 6.5%. Brussels will now effectively dictate the 2012 budget ceiling which Spain will announce on Friday. The country will have to come up with more than 40 billion euros in savings to meet that target. However, most economists say the planned cuts are impossible as the economy is already slipping into recession. Spain has been in the eye of the European debt crisis storm ever since its Socialist government racked up one of the bloc's largest budget deficits. The Socialists were trounced for mishandling the crisis.  As a result, a new conservative government began a four-year term in December. It faced a wave of massive protests when it swiftly introduced tax hikes and spending cuts to the tune of around 15 billion euros. More anger followed when the new prime minister, Mariano Rajoy, introduced a labor decree making it easier for employers to fire workers. His reforms are said to be part of a program aimed at creating jobs: the country has the developed world's highest unemployment rate, at 23%. But the new legislation sparked an outbreak of discontent with hundreds of thousands taking to the streets of Madrid and other major cities.  The unemployment rate for Spaniards aged between 16 and 24 stands at 48.6%, and 39% for those between 20 and 29, according to this month’s government report. There are no official statistics but estimates suggests thousands are emigrating monthly and the country last year saw more people leave Spain than arrive in the country for the first time in a decade. One of the main sources of discontent is bad real-estate debts left over after Spain's housing bubble burst. The debt crisis led to a crash in Spanish real estate with thousands of new houses standing empty, resulting in a rash of so-called ghost-towns country-wide. Spaniards now accuse the government of enormous waste which left them without houses, work or money. “When the crisis started, the real estate bubble burst, and of course companies started going bankrupt. Public administrations started not receiving incomes they were accustomed to and the whole economy blew up,” Prof. Manuel Balmaseda, an economist from the ICAI School of Engineering, told RT. The property crash continues to hit people hard, but a nationwide movement is now fighting back. Banks prefer to repossess the homes of those who cannot afford the mortgages taken out when the outlook was more positive. Among the worst affected are Spanish youngsters and immigrants. The situation has sparked regular protests against banks, the government and the austerity cuts which are widely seen as provoking a further slowdown of the economy, which is set to shrink this year by 1.7%.

Scotland Yard lent police horse to Rebekah Brooks

 

The former Sun and News of the World editor was lent the horse in 2008, the year after Clive Goodman, who worked for her as royal editor of the News of the World, was jailed for phone-hacking along withe the private investigator Glenn Mulcaire. Officers from the Metropolitan Police Mounted Branch visited Mrs Brooks's home in the Cotswolds to check she had suitable facilities and was a competent rider before the horse went there. A spokesman for the Metropolitan Police pointed out that it is routine for retired Mounted Branch horses to be lent out to members of the public at the end of their working lives, but the arrangement is likely to raise fresh questions about the Met's relationship with Mrs Brooks. The news comes a day after the Leveson Inquiry was told that Mrs Brooks was briefed by a senior Met officer on the progress of the original phone-hacking inquiry and even consulted on how far she thought the investigation should go. Mrs Brooks, who is married to the former racehorse trainer Charlie Brooks, kept the horse at her home in the Cotswolds for two years before giving it back to the Metropolitan Police in 2010.  It was then found a new home in Norfolk with a serving police officer. Dave Wilson, Mrs Brooks's spokesman, said: "It's well known by people in the horse world that the Met looks for homes for horses once they retire. Rebekah took on a horse and effectively acted as a foster parent for it for a year or so. "The Met horse team comes out to make sure your facilities are right and proper. It's just a way of giving a temporary home to a horse that has had a distinguished service in the Met. It went off to a retirement paddock in Norfolk once it couldn't be ridden any more." At the time Mrs Brooks took on the horse, she was editor of The Sun, but had given evidence to a committee of MPs five years earlier admitting that the News of the World had paid policemen when she was editor of the Sunday paper between 2000 and 2003. By the time she gave the horse back to the Met she was chief executive of News International and the Met was facing calls to re-open its investigation into phone hacking following the disclosure that thousands of names of potential victims appeared in Mulcaire's notebooks. A spokesman for Scotland Yard said: "When a police horse reaches the end of its working life, Mounted Branch officers find it a suitable retirement home. Whilst responsibility for feeding the animal and paying vet bills passes to the person entrusted to its care at its new home, the horse remains the property of the Metropolitan Police Service. "Retired police horses are not sold on and can be returned to the care of the MPS at any time. In 2008 a retired MPS horse was loaned to Rebekah Brooks. The horse was subsequently re-housed with a police officer in 2010." The Metropolitan Police website states that: "At the end of the police horse's working life the animal is re-homed at one of many identified establishments who have previously contacted the Mounted Branch with a view to offering a home. "The Mounted Branch is looking for suitable homes for retired horses, that is homes where the horse will not be ridden. Anyone in the southeast of England offering such a home will be considered first."

Bank tax dodges halted by retrospective law

 

A bank in the UK has been forced to pay more than half a billion pounds in tax which it had dodged by using "highly abusive" tax avoidance schemes. One tax dodge involved the bank claiming it should not have to pay corporation tax on profits made when buying back its own IOUs. The government said it would change the law retrospectively and immediately to stop anyone else using the scheme. The identity of the bank has so far not been revealed. Announcing the crackdown, the Exchequer Secretary to the Treasury, David Gauke, said the bank should never have devised the schemes in the first place. "The bank that disclosed these schemes to HM Revenue & Customs (HMRC) has adopted the Banking Code of Practice on Taxation which contains a commitment not to engage in tax avoidance," he said. "The government is clear that these are not transactions that a bank that has adopted the code should be undertaking. "We do not take today's action lightly, but the potential tax loss from this scheme and the history of previous abuse in this area mean that this is a circumstance where the decision to change the law with full retrospective effect is justified," he added. The second tax avoidance scheme, designed by the same bank, involved investment funds claiming that non-taxable income entitled the funds to tax credits that could be reclaimed from HMRC. The Treasury described this as "an attempt to secure 'repayment' from the Exchequer of tax that has not been paid". Compulsory notification A Treasury source suggested that outlawing the tax dodges immediately would save the government a further £2bn in tax that would otherwise have been foregone. The bank in question in fact disclosed the two schemes to the tax authorities under rules which have been in place since 2004. Anyone, such as a bank, accountant, lawyer or tax adviser, who devises a seemingly legal tax avoidance plan, is obliged to tell the tax authorities about it within a few days of using it or marketing it to clients. More than 2,000 schemes have been disclosed in the past eight years. "Quite a few of the disclosures have come from banks in the past," said John Whiting, of the Chartered Institute of Taxation (CIOT). "They are usually intended to sell to others such as clients." New code The banking code on taxation was first introduced by the Labour government in June 2009. It followed reports that some big banks used large scale tax avoidance schemes involving complex transactions and financial instruments. The code - which was supported by the incoming coalition government the following year - demands that banks which sign ensure that their tax and the tax obligations of their customers are observed. It says they should not go out of their way to avoid tax for themselves or clients. The 15 biggest banks operating in the UK have signed up. 'Treated even-handedly' In a separate development, HMRC said it would appoint a senior official to act as an "assurance commissioner" for any tax deals struck with big companies for more than £100m. The job of the commissioner will be to make sure taxpayers in general do not suffer from any such settlements. The move follows severe criticism last December from MPs on the public accounts committee who denounced HMRC for appearing to cut contentious tax deals with companies such as Vodafone and Goldman Sachs. Lin Homer, the new HMRC chief executive said: "This commissioner will take the role of challenging whether any proposed settlement secured the correct amount of tax efficiently and that taxpayers had been treated even-handedly." "The commissioner will also make sure that the governance procedures have been followed," she added.

The daily Sun had systematically paid large sums of money to “a network of corrupted officials” in the British police, military and government.

A day after presiding over the publication of his new, damn-the-critics Sun on Sunday tabloid, Rupert Murdoch was confronted with fresh allegations from a top police investigator that the daily Sun had systematically paid large sums of money to “a network of corrupted officials” in the British police, military and government. Connect With Us on Twitter Follow @nytimesworld for international breaking news and headlines. Twitter List: Reporters and Editors Readers’ Comments Share your thoughts. Post a Comment » Read All Comments (130) » The allegations, part of a deepening criminal probe into The Sun and Mr. Murdoch’s defunct News of the World, highlight the challenges to Mr. Murdoch and his News Corporation as he seeks to minimize the threat to his British media holdings. They also cast a harsh spotlight on the freewheeling pay-for-information culture of the British media. In public testimony on Monday, Deputy Assistant Commissioner Sue Akers, who is leading the criminal investigation into Mr. Murdoch’s newspapers, said The Sun, long a source of special pride and attention for Mr. Murdoch, had illegally paid the unidentified officials hundreds of thousands of dollars in exchange for news tips and “salacious gossip.” She said the payments had been authorized “at a very senior level within the newspaper.” Her comments, unusual during a continuing criminal inquiry, directly undercut Mr. Murdoch’s campaign of support for the embattled newspaper. On Feb. 17, the 80-year-old Mr. Murdoch made a grand entrance into the Sun newsroom, where, marching around in shirtsleeves, he vowed to reinstate journalists suspended in the criminal investigation, offered to pay their legal bills, issued a robust statement about the paper’s probity and announced that he was defying conventional industry wisdom by starting a Sunday issue. Ms. Akers said illegal activities had been rife at the paper. “There appears to have been a culture at The Sun of illegal payments, and systems have been created to facilitate such payments whilst hiding the identity of the officials receiving the money,” she told the Leveson Inquiry on media ethics and practices, led by Lord Justice Leveson. The payments involved “frequent and sometimes significant sums of money” to public officials, she said. In a statement, Mr. Murdoch said that “the practices Sue Akers described at the Leveson Inquiry are ones of the past, and no longer exist at The Sun.” He remained publicly bullish, helping promote the new Sun on Sunday in newspaper stores and announcing on Twitter that it had sold 3.26 million copies. In another blow to Mr. Murdoch, related this time to The News of the World, a lawyer for the Leveson Inquiry said Rebekah Brooks, a former Murdoch executive, was apparently informed by the police in 2006 that detectives had evidence that the cellphones of dozens of celebrities, politicians and sports figures had been illegally hacked by an investigator working for the newspaper. The disclosure, contained in a September 2006 e-mail from a company lawyer to the editor of The News of the World, Andy Coulson, is highly significant. Until late in 2010, Mrs. Brooks, Mr. Coulson and other officials at News International, the British newspaper arm of News Corporation, repeatedly asserted that the hacking had been limited to a single “rogue reporter” — the paper’s royal correspondent, Clive Goodman. The assertion was rendered implausible, at best, by the fact that the police had information that so many hacking victims existed, and that so few of them had anything to do with the royal family. Monday’s disclosures could not have come at a more inopportune time for Mr. Murdoch. In recent weeks, morale at The Sun hit a low point after a number of senior editors and reporters were arrested on suspicion of illegally paying sources. At the same time, journalists at The Sun and elsewhere released a stream of angry attacks at the police, saying the investigation had gone too far and was targeting reporters for what they said was normal behavior in the British tabloid press like taking sources out to lunch or paying whistle-blowers. “The Sun journalists who have been arrested are not accused of enriching themselves — they were simply researching stories about scandals at hospitals, scandals at army bases and scandals in police stations that they believed their readers were entitled to know about,” Kelvin Mackenzie, a former editor of The Sun, wrote in The Daily Mail. “If the whistle-blower asks for money, so what?” The Metropolitan Police Service’s highly unusual decision to release specific details of a continuing investigation seemed designed to rebut such criticism. “The cases we are investigating are not ones involving the odd drink, or meal, to police officers or other public officials,” Ms. Akers said. “Instead, these are cases in which arrests have been made involving the delivery of regular, frequent and sometimes significant sums of money to small numbers of public officials by journalists.”

A glamorous French politician is set to become France’s first ever ‘MP for Britain’ to represent more than 100,000 Gallic expats living in the UK.

A glamorous French politician is set to become France’s first ever ‘MP for Britain’ to represent more than 100,000 Gallic expats living in the UK.

Emmanuelle Savarit, 39, is leading the race to be elected to France’s newest overseas constituency - based in London’s well-heeled Kensington.

The member of Nicolas Sarkozy’s conservative UMP party is the clear frontrunner among five hopefuls vying for the seat of northern Europe.

Hopeful: Emmanuelle Savarit, 39, is leading the race to be elected to France's newest overseas constituency - based in London's well-heeled Kensington

The radical plans to create 11 foreign constituencies to represent French abroad were approved by the Paris parliament three years ago.

 

More...

• Dominique Strauss Kahn to be grilled in New York next month over 'sadistic and violent attack' on hotel maid

 

Britain is part of the northern Europe constituency, which also includes the Irish Republic, Scandinavia and the Baltic states.

But within the new seat, 113,655 French voters are registered in the UK, compared with 27,076 in all the other countries put together.

Divorced mother-of-two Ms Savarit’s main rival is equally glamorous 36-year-old socialist Axelle Lemaire, a London-based lawyer.

Competition: Divorced mother-of-two Ms Savarit's main rival is 36-year-old socialist Axelle Lemaire, a London-based lawyer

But the French media predict the right-winger’s victory will be ensured by wealthy expats based mainly in west London when the first election takes place in June.

Ms Savarit, who has a doctorate in Psychology, describes herself
on her campaign website as ‘a tough cookie’, but adds: 'That’s not necessarily a fault when you’re in politics.'

The new foreign constituencies are the brainchild of former French interior affairs minister Alain Marlaix.

Vital: The importance of the French expat vote was highlighted when President Sarkozy came to London to give a speech to thousands of French voters ahead of his 2007 election campaign

He said: 'This is the first time in any country in the world that something like this had been done.

'The new overseas MPs will have identical status to any other MP based in France, and vote in parliament in Paris.

'They will be elected in the same way and speak for the French expatriates they represent.'

Government advisor Herve Fabre-Aubrespy, who is overseeing the new constituencies, said: 'It is a challenge for us, because nothing similar has ever been done anywhere.

'No one has carved the world up into constituencies in this way.'

The new constituencies are part of a larger parliamentary shake-up, with seats being merged or enlarged across France so that the total number of 577 MPs still remains the same.

The importance of the French expat vote was highlighted when President Sarkozy came to London to give a speech to thousands of French voters ahead of his 2007 election campaign.

But French socialists have claimed the new overseas seats are ‘closet gerrymandering’ - where constituencies are created to the benefit of the ruling party.

A socialists’ spokesman said: 'Studies show French people living abroad are more likely to vote for a centre-right party than a left wing one.
'This is being proposed as something that is good for French expatriates, but in fact it is just a way for the government to give itself another 11 safe seats.'

Six of the 11 new constituencies will be in Europe, but others are based in Canada and the US, central and South America, the Middle East, Arica and Asia, representing more than million French people living abroad.