PRESS DIGEST - Financial Times - Oct 18

The Financial Times

DARLING TO FAST-TRACK PUBLIC SPENDING

Alistair Darling is drawing up plans to push through billions of pounds of public spending on building projects such as schools and hospitals in an emergency measure designed to boost the UK economy as it falls into recession. The chancellor's move will see cash being transferred from budgets scheduled for 2010/11 - a year after the general election - to fund current projects. The plans will be presented in next-month's pre-Budget report, which will be hampered by a soaring deficit, with borrowing expected to exceed 70 billion pounds next year.

BRITISH BUSINESS REJECTS BRIBERY WARNING

The CBI employers' organisation has rejected claims by the Organisation for Economic Co-operation and Development that foreign multinationals and institutions trading with UK firms should take more care - and spend more money - to avoid involvement in corruption. The warning came in a report on London's failure to act over BAE Systems' (BAES.L) Saudi Arabian arms deal and other cases of suspected bribery. Gary Campkin, head of the CBI's international group, rejected the OECD's notion that companies would incur higher costs in dealing with British firms because they would have to conduct extra checks: "There is nothing in that report to back up the claims."

DIGITAL ECONOMY TO 'REBOOT' BRITAIN

Lord Carter, the communications minister, is set to prepare a report on measures to boost the telecoms, media and technology sectors as part of an effort to shore up the economy. Carter said Lord Mandelson was "absolutely convinced the digital economy can be a key part of a rebooting of the economy". Carter is due to present an interim report on how to boost the communications sector in January, but will also undertake longer-term work that could result in legislation. Carter said that with the current turmoil in financial services it was time to turn to the communications sector, "something we are extremely good at, quite well positioned in and could be even better positioned."

AVIVA'S ONE BILLION POUND POLICY PAY-OUT IN JEOPARDY

A promised one billion pound pay-out for over a million of Aviva's (AV.L) policyholders is at risk due to sharp falls in equity and bond markets. The insurer said in July that its policyholders would receive an average of 1,000 pounds as part of an agreement, but Philip Scott, finance director of Aviva, said: "If current market conditions were to persist, then the terms of the offer could change". Scott said a final decision would be made next year and the agreement was "not an absolute commitment." The distribution also requires the approval of the Financial Services Authority.