PRESS DIGEST - Financial Times - May 27

The Financial Times

SHARP RISE IN OVERDUE MORTGAGE PAYMENTS

New data from Standard & Poor's reveals more than a fifth of UK home buyers who have a chequered credit history have fallen behind on their mortgage payments in the first three months of this year. Based on the behaviour of home buyers whose loans have been packed into mortgage-backed securities, which account for 80 percent of the 43 billion pound sub-prime mortgage market, the data shows 21.73 percent of all borrowers with poor or no credit history had arrears of more than 30 days. While pointing to a "sharp" increase in delinquency rates among prime mortgage-holders, rising to 2.41 percent in the first quarter of 2008, S&P stressed the numbers were still very small. It said borrowers, however, were "not being helped by rising house prices as they have been in the past".

EMPLOYERS STRUGGLE WITH NEW MIGRANT LABOUR LAW

A survey by immigration consultants Sarah Butler Associates reported only 11 percent of some of Britain's biggest employers had so far applied for licences allowing them to hire migrant labour. Designed to stem the influx of low-skilled migrant workers from non-European Union countries, the points system will give preference to financial high-flyers, entrepreneurs and skilled foreign nationals. Sarah Butler, managing partner, warned of the likelihood of a rush of businesses applying to join the sponsors' register, with almost 40 percent of respondents to the survey proposing to make an application in June. "From a practical perspective this means that the UK Border Agency is likely to be swamped in June," she said.

BROWN PRESSED ON PLAN TO RAISE CAR TAX

Plans by the Prime Minister Gordon Brown for a punitive tax on inefficient cars are facing a backbench rebellion. It emerged on Monday that 35 Labour backbenchers had signed a Commons motion urging Brown to scrap proposals for an increase in vehicle excise duty on polluting cars. Taking effect next year and applying to new cars as well as vehicles bought after 2001, the new tax is designed to shift consumers towards more "green" cars. However, the Labour MP who tabled the early day motion, Ronnie Campbell, said the effect of the tax could be similar to the removal of the 10 pence tax band.

METRONET'S FUTURE IN MAYOR'S HANDS

After a court ruling last week cleared its exit from administration, the maintenance and upgrade contractor Metronet has passed into the ownership of the London Mayor's transport body, Transport for London. Responsible for maintaining eight of the 11 London Underground lines, Metronet had passed into administration in July last year after it ran out of cash. Under the previous mayor Ken Livingstone, the TFL was opposed to the public private partnership structure and wished to allow London Underground to undertake more maintenance and upgrade work itself. The position of the newly elected mayor Boris Johnson is not yet clear.

DESMOND SAYS OK TO 17 MILLION POUND GULFSTREAM JET

Accounts to be filed on Tuesday by Northern & Shell Network disclose a capital expenditure of 17 million pounds "relating to the purchase of a corporate aircraft", with Paul Ashford, group editorial director of the owner of OK magazine, saying the jet was needed as a consequence of the company becoming an increasingly international business. The accounts will also reveal that the Northern & Shell boss, Richard Desmond, will not be receiving a pension top-up this year, a contrast to last year's 40.7 million pounds.

CBS TARGETS LAST.FM FOR ADVERTISING REVENUE

Last.fm, the London-based music Web site, is to increase its efforts to generate advertising revenues from its 26 million users. CBS acquired Last.fm for 280 million dollars a year ago. Quincy Smith, president of CBS Interactive, said: "One of the main reasons Last.fm agreed to be acquired by CBS had everything to do with the fact that we have great relationships with agencies and advertisers." Last.fm currently receives more revenues from selling tracks via affiliates such as Amazon and Apple's iTunes than it does from advertising, so last week it began testing a redesign with 150 percent more advertising inventory.

O'BRIEN TAKES STAKE IN INM NEARER TO CRUCIAL 25 PERCENT MARK

Denis O'Brien has increased his stake in Independent News and Media (INME.I) to 22.7 percent, thus nearing the 25 percent level at which he could call emergency meetings and block resolutions. The Irish telecommunications billionaire, who was branded a "dissident shareholder" by INM earlier in the year, has questioned the rationale for retaining the loss-making Independent and Independent on Sunday in the UK, as well as the value of investments in Australia and South Africa. More pressure is expected to be applied by O'Brien ahead of the company's annual meeting on June 11.

RETIREMENT PLANS TAKE A BACK SEAT FOR PESSINA