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Tuesday newspaper round-up: Carillion fall-out, household debt, Brexit blow
One in four of Britain's poorest households are falling behind with debt payments or spending more than a quarter of their monthly income on repayments, according to a study. The latest evidence of mounting debt problems for some of the most vulnerable in society is shown in a report by the Institute for Fiscal Studies, on behalf of the Joseph Rowntree Foundation, with the poorest tenth of households more likely to be in net debt, owing more on plastic or on overdrafts and loans than they hold in savings. - Guardian
Lenders to Carillion, including the state-backed Royal Bank of Scotland, are facing hundreds of millions of pounds in losses after the contractor crashed into liquidation yesterday. Thirteen banks, led by the high street lenders RBS, Barclays, Lloyds, HSBC and Santander, extended an estimated £1.6 billion in debt to Carillion that they will hope to recover through the liquidation. The debt is on top of the construction and support services group's pension liability of almost £600 million. - The Times
Troubled outsourcing company Carillion has collapsed owing up to 30,000 businesses around £1bn in unpaid costs, with many expected to go under themselves as a result. Banks which had lent to the contractor could also be exposed to up to £2bn of losses, in what is one of the most high-profile corporate collapses since the financial crisis.
The value of the pound has risen above $1.38 for the first time since the Brexit referendum, thanks to a weakening dollar and rising hopes that other European Union members will seek a relatively "soft" Brexit. Sterling climbed to a high of $1.3819 yesterday afternoon, a rise of almost four cents since Thursday and a level not seen since the surprise EU referendum result caused the pound to plunge by 15 per cent. - The Times
Theresa May has been hit with a double Brexit blow as the EU toughened up its terms for a transition period and Norway privately warned Brussels that giving in to the UK's demands for a "special" trade deal could force it to rip up its own agreements with the bloc. A leaked paper on Michel Barnier's demands for the transition period reveals that the EU plans to insist on the free movement of people throughout the transition period and the inclusion of people moving to the UK before 31 December 2020 in the terms of an agreement on rights for nationals from the rest of Europe post-Brexit. - Guardian
Councils and businesses are continuing to charge consumers for credit card payments after a new law outlawing the practice came into effect on Saturday, it has emerged. Councils including Lambeth and Isle of Anglesey, and a range of businesses were wrongly charging cardholders for payments over the weekend, MoneySavingExpert.com found. - Telegraph
Just a fifth of commuters have rated their train service as better than a year ago in a downbeat passenger survey carried out by consumer group Which? In spite of roughly £925m being spent on the railway last year and fares rising by an average of 3.4pc at the start of 2018, only 20pc said they had noticed an improvement. - Telegraph
A war of words has broken out over plans to rely on Barclays' high-risk investment banking division to honour staff pension promises. Some former senior Barclays officials and pension fund members have angrily attacked the move, which they fear could prevent them receiving their full pensions. - The Times
Spain is set to replace the United States as the world's second most popular tourism destination while France has retained the top spot, the UN World Tourism Organisation has said. It is expected that Spain will take the second position with 82 million visitors last year, UNWTO head Zurab Pololikashvili said. - Guardian
Less than ten years ago, a banking crash made Iceland a symbol of the global crisis. Today, in a reversal of fortune, house prices in Reykjavik are the fastest-growing in the world, rising 21.3 per cent in the year to September 2017, a survey of 150 cities monitored by Knight Frank. Home to only 216,000 people, it beat Toronto, Hong Kong and Budapest, all of which experienced soaring house prices in the past year. - The Times
It may feel like there's already a Costa or Starbucks on every street corner, but the number of coffee shops still rose by 5.3 per cent last year and is forecast to keep growing. According to a report from Allegra Group, a consultancy, the number of stores increased by 1,215 to 24,061 over the past 12 months, while total sales in the sector increased by 7.3 per cent to £9.6 billion, despite dampened like-for-like growth. - The Times
The government has been criticised by MPs for being slow to overhaul a "flawed and poorly resourced" safety regime for electrical white goods that has allowed 1m potentially dangerous tumble dryers to be in use in homes across the UK. The business, energy and industrial strategy select committee is also urging manufacturer Whirlpool to repair faulty machines within two weeks of being contacted by owners, or explain what action it plans to take to deal with the problem. - Guardian
Airbus said overnight that it might have to end production of the double-decker A380 superjumbo jet, having booked no new orders for the plane in two years. The European aerospace group had been banking on another big order from main client Emirates in November, but the Dubai-based airline decided instead to buy 40 of Boeing's Dreamliners. - Guardian