Report: Average House Price Up 8.8% In 2013

UK house prices climbed by an annual rate of 8.8% in January, extending the fastest pace of increase since 2010.

According to the Nationwide, values were up in January by 0.7% month-on-month, making the average home worth £176,491.

The high street lender said it was the 13th continuous monthly rise as confidence in the economy returns.

But it said prices are still around 4% beneath the peak levels of 2007.

The results come just a day after the Office for National Statistics revealed UK economic growth in 2013 reached 1.9%, with four quarters of growth.

Nationwide's chief economist Robert Gardner said: "The housing market is continuing to gather momentum on the back of further solid gains in employment, record low mortgage rates and rising confidence."

Mr Gardner said indications were that the sector is approaching pre-recession "normal levels".

HM Revenue and Customs revealed that last month a total of 103,000 house sales occurred across the country.

That figure was a rise of 30% on the same month in 2012.

The British Bankers' Association recently said that mortgage approvals hit 46,000 in December and the figure was the highest number for six years.

Mr Gardner added: "The pick-up in activity appears to be fairly broad-based, and it is encouraging that first-time buyers are a key driving factor behind the upturn."

On Tuesday, the Government said that nearly 13,000 Help To Buy scheme new build loans occurred since its launch nine months ago.

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PayPoint To Name Warren Tucker As Chairman

By Mark Kleinman, City Editor

The listed payment services provider PayPoint is poised to name a former executive at engineering group Cobham as its next chairman, bringing the incumbent's 15-year reign to a close.

Sky News understands PayPoint is close to appointing Warren Tucker to the post as the company targets an ambitious expansion of its network.

Mr Tucker, whose arrival could be announced as soon as this week, will succeed David Newlands, who has been PayPoint's chairman since 1998.

He will take over a decade after PayPoint became a public company.

The finance director of Cobham until last year, Mr Tucker previously worked for British Airways and Cable & Wireless. He is now a non-executive director of Reckitt Benckiser, the consumer goods group, and the travel company Thomas Cook.

PayPoint, which has a market value of more than £700m, has grown into one of the biggest networks of retail payment services in the UK, handling more than £14bn from 760 million transactions each year.

Its name is ubiquitous across British high streets, with terminals in retailers such as the Co-op, Sainsbury's Local, Tesco Express and Londis, as well as thousands of independent outlets.

PayPoint terminals process energy meter prepayments, bill payments, mobile phone top-ups, transport tickets, TV licences and cash withdrawals and are benefiting from the rapid growth of mobile commerce and the automation of financial services.

The company also operates a consumer parcel drop-off and collection service using its retail network through Collect+, a joint venture with the delivery group Yodel.

Customers of the service include Amazon, eBay, ASOS, New Look, Boden, John Lewis, House of Fraser and Asda Direct. 

The company also has 3,400 LINK-branded cash machines, while 8,000 of its terminals provide debit and credit card acceptance for retail partners.

In a trading update last week, PayPoint said it was performing in line with City expectations.

"Our retail businesses are continuing to generate satisfactory growth this year," it said.

"Bringing the (e-commerce and mobile commerce) businesses under single management will provide the opportunity to unlock better growth, which should lead to improved returns on our invested capital in these businesses."

PayPoint declined to comment.

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Economy Grows At Fastest Rate Since Crash

The British gross domestic product (GDP) figure for the fourth quarter of 2013 stood at 0.7%, with growth for the full year reaching 1.9%.

Output for 2013 reached its fastest annual rate of growth for six years, according to the Office for National Statistics (ONS).

The figures were in keeping with forecasts made by economists.

The preliminary result shows the important service sector - which accounts for around three-quarters of the economy - was up 0.8%.

The ONS said construction was 0.3% down on the previous three months, due to weak figures being recorded in November.

Agriculture was up 0.5% in the October to December period, while production was up 0.7% in the same three months.

Manufacturing was up 0.9% in the quarter, which was its biggest quarter-on-quarter rise since Q3 in 2010.

ONS chief economist Joe Grice said the service sector is now above the pre-recession levels, but both production and construction are still below that level overall.

Mr Grice said: "We have now seen four successive quarters of significant growth and the economy does seem to be improving more consistently.

"Today's estimate suggests over four-fifths of the fall in GDP during the recession has been recovered, although it still remains 1.3% below the pre-recession peak."

The latest figures have given a boost to the Chancellor and come just weeks after the International Monetary Fund (IMF) did a U-turn on its forecast for the UK economy.

George Osborne told Sky News: "I think these numbers represent a real boost to the economic security of hard-working families.

"And the good news is the recovery is broadly balanced with manufacturing growing the fastest of any sector, so there's evidence that our long-term economic plan is working, but I am the first to say the job isn't done and the biggest risk to the recovery would be to come off that economic plan, and that would damage job creation and mean we don't have such bright economic prospects."

He added: "Where I have had the opportunity I have focused the effort on those on low and middle incomes.

"That's my priority, that's where my tax-cutting priorities lie becaue I want to help those hard-working families who have got more economic security because jobs are being created, but of course have had a very dififcult time because our country went through such a terrible economic period."

The IMF now forecasts growth in 2014 of 2.4%, a figure which is in line with the Office for Budget Responsibility.

The Bank of England's current forecast is for growth of 2.8% in 2014.

Shadow chancellor Ed Balls told Sky News: "This is not yet the strong and balanced recovery we need.

"It's not a recovery driven by business investment - that's still very flat - or by exports - they've been weak -  what's going on at the moment is consumers are saving less and consumer spending is picking up somewhat.

"That's happening because housing demand and house prices are going up.

"We're not building the houses we need to match that that's why construction output is still falling. There's a lot more to do."

Mr Balls added: "For working people facing a cost-of-living crisis this is still no recovery at all."

Robert Johnson, managing director of Craftsman Tools, an engineering firm in Otley, West Yorkshire told Sky News: "I think the growth is real.

"We have seen a 10% growth last year and we are predicting growth of 30% over the next three years."

But one of the biggest problems his firm faced was getting skilled workers.

Mr Johnson said: "We feel we have got to invest in advanced machinery and equipment which we can do, but getting skilled people is the hardest thing.

"We have had to start our own apprentice school two years ago, and we are training our own apprentices to fill the skills gap."

And a skills shortage risked holding the economy back, he warned.

"It's a mixture of skilled people and advanced machinery that will help us go forward," said Mr Johnson.

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Nintendo Profit Plunges 30% On Wii Woes

Japanese games manufacturer Nintendo has seen its nine-month profit plunge by 30%, prompting its boss to cut his pay in half.

The slump was blamed on poor sales of the Wii U console as gamers flock to the Microsoft Xbox One and Sony PlayStation 4.

Company president Satoru Iwata said he would slash his salary for five months to atone for the firm's woes.

He said other directors would see their pay cut by an average of 25% in the same period.

Sales falls occurred in all territories, with the biggest decline in the home Japanese market being 13% compared to the previous year.

The popularity of smartphones, tablets and other gadgets has been drawing some consumers away from consoles.

Nintendo's announcement comes shortly after it warned of making a loss and a drastically reduced its forecast for full-year sales.

It said earnings reached £60m in the nine months to December, with revenue down 8.1% - £255m - to £2.9bn

The company's operating loss in the period was £9.2m, down from a profit of £33m. It now expects a full-year loss of £145m.

Total hardware sales across its Wii U, DS, 3DS and Wii brands fell by six million units, year-on-year. No brands increased sales.

The high margin software sector saw sales fall by 21.5 million units year-on-year, with DS software down 71% and Wii down 48%.

However, it did see software growth in the Wii U of 37% and 3DS of 45%.

Nintendo owns the Donkey Kong and Super Mario brands and its shares have dropped more than 11% in a month.

The plunge started after it reassessed the Wii U sales forecast from nine million consoles to 2.8 million for the year.

Experts have slammed the new system's limited game selection, preferring the additional features available on competitors' products.

By comparison, Sony has sold more than 4.2 million PlayStation 4 consoles by the start of this year, less than two months after its release.

Microsoft's Xbox One sold more than 1.1 million consoles in its first day of release last November.

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Sainsbury's Shares Drop As Justin King Quits

What Has Justin King Done As CEO?

Updated: 11:17am UK, Wednesday 29 January 2014

The outgoing chief executive of Sainsbury's, Justin King, has been credited with turning the retailer around during the last 10 years, with an impressive list of achievements and awards racked up by company and staff.

• Around 24 million transactions a week in 2014 (vs 14 million in April 2005)

• Winner of 14 of 30 Mystery Shopper customer service awards for Service & Availability in 2013/14 (The Grocer)

• Supermarket of the Year 2013 (6th time in eight years – Retail Industry Awards)

• Brand of the Year 2013 (Marketing Society)

• FTSE100 Business of the Year 2013 (National Business Awards)

• Incremental sales up £9.5bn, up from £16.1bn in 2004/5 to £25.6bn for 2012-13

• Seventh biggest clothing retailer in the UK by volume and the 11th by value

• It is the seventh biggest general merchandise retailer in the UK by value

• Now has over 400 stores with full general merchandise range, with 33% of the population within a 15-minute drive

• Convenience stores numbers up 127% to 596 since 2004-5

• Awarded Convenience Chain of the Year (4th consecutive year – Retail Industry Awards)

• £1bn online grocery business with over 190,000 orders each week

• Online Retailer of the Year 2013 (2nd consecutive year – Grocer Gold Awards)

• Five consecutive years of profit growth for Sainsbury's bank

• Acquisition of remaining 50% stake from Lloyds Bank Group completes on 31 January 2014

• Leading positions on nutritional labelling, British sourcing, Fairtrade, RSPCA Freedom Foods and MSC

• £136m worth of Active Kids equipment donated since 2005

• First sole-sponsor of the Paralympic Games, in 2012

• Record levels of employee - known as colleagues - engagement (as measured by its annual Talkback survey)

• Only food retailer accredited to Gold Standard by Investors in People

• £520m given to employees in bonuses between 2005-6 to 2012-13)

• Employer of the Year 2013 (Retail Week Awards)

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Mulberry Value Plunges After Warning Issued

Luxury British fashion firm Mulberry has seen up to £140m wiped from its value, after issuing a dramatic profit warning.

It said annual profit would be "substantially" below forecasts due to heavy discounts in the Christmas period in Britain.

The company's share price dropped more than 15% before extending losses to more than 27% in mid-morning. It later eased to around 24% down.

As a result the firm saw its value drop to around £400m.

Here is the latest share price.

Chief executive Bruno Guillon said: "Due to tough trading conditions over the Christmas period which saw significant discounting across the market, Mulberry has experienced lower than expected UK retail sales."

It said total retail sales for the 17 weeks to January 25 were down 3% compared to a year ago.

Mulberry also said weak demand in South Korea was behind the profit drop.

Mr Guillon added: "Together with wholesale order cancellations from Korea, (this) will adversely impact our profit this year."

The Somerset-based firm has been reinvented from a trusted briefcase and wallet maker into an international fashion powerhouse with a clutch of celebrity fans.

But the company said that the all-important Christmas period, recorded as the eight weeks to January 25, were down 7%.

Many retailers depend on the festive season to support lighter sales periods elsewhere in the year.

UK sales represented 65% of the group's revenue in 2012-13 and the results suggest the home market is dragging the company down.

At the time Mulberry reported strong international sales growth of 34% in the same eight weeks.

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Lloyds Eyes Takeover Deals In 'Symbolic' Move

By Mark Kleinman, City Editor

Lloyds Banking Group has begun scouting for takeover deals that would mark a symbolic step in its recovery from the financial crisis that left UK taxpayers as its largest shareholder.

Sky News has learnt that Lloyds is at the early stages of examining acquisitions that could bolster its presence in the consumer credit, home insurance and credit card markets.

Under the state aid deal with Brussels that cleared the way for the last Labour government to inject more than £20bn into Lloyds to keep it afloat, the bank is not allowed to pursue takeover deals above a modest size until after it has met conditions including the spin-off of more than 630 of its branches.

That network, which has been rebranded under the TSB name, is being floated on the stock market this year in a move that will see Lloyds ultimately relinquishing ownership of it.

The new acquisition drive is being spearheaded by Toby Rougier, a senior Lloyds executive, although insiders said he had not yet put any proposed deals to the bank's board.

Any deal which entailed Lloyds growing its presence - even in areas where it is comparatively small - might attract political attention in the wake of the Labour leader Ed Miliband's call for major banks to face a cap on their share of the current accounts market.

Lloyds, which owns the Halifax network, is by far the biggest player in high street consumer banking, but has a smaller share of the market for lending to small and medium-sized companies.

It also has a 17% share of the consumer credit sector; 15% of home insurance; and 16% in credit cards, according to people close to the bank.

A source said that Lloyds, now 33%-owned by taxpayers, was concentrating on organic growth opportunities, but conceded that acquisitions were now "back on the agenda" for the first time in five years.

LDC, the group's private equity arm, has been permitted to pursue takeovers during the last five years but these have been relatively small in scale.

Another symbolically important moment is expected to arrive with Lloyds' full-year results next month, when analysts expect Antonio Horta-Osorio, its chief executive, to announce it has been given the green light to resume paying dividends.

Lloyds' focus since the bail-out has been on shedding assets, including its stake in Sainsbury's Bank, billions of pounds-worth of shipping and property loans, and the fund manager Scottish Widows Investment Partnership.

The bank has also been shedding tens of thousands of jobs, with the latest 1,300 roles to be axed being announced earlier this week.

A Lloyds spokesman declined to comment on potential acquisitions.

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West End Theatre Ticket Sales At Record High

Charlie and the Chocolate Factory and The Book of Mormon helped London's West End enjoy a record year for ticket sales.

Box office figures released by the Society of London Theatre (SOLT) showed overall attendances were up 4% from the previous year to 14,587,276, while sales rose 11% to £585,506,455.

It comes as seven of the largest ticketing companies have agreed to display their compulsory charges on their websites.

Over 37,000 people have signed a Which? petition for all fees to be shown at the start of the booking process.

The company said ATG Tickets, Ticketmaster, See Tickets, BH Live Tickets, Stargreen, Ticket Soup and Ticket Web will put the changes into practice in the next weeks and months.

The campaign was launched after event-goers complained that they were paying up to 40% of the ticket's face value in extra fees and charges.

Many people said the charges had put them off booking tickets online.

Book of Mormon has been a huge West End hit

But it seems thousands of people are still flocking to theatre in the capital.

More than half a million people have been to see Charlie And The Chocolate Factory, which stars Douglas Hodge as Willy Wonka.

SOLT president Mark Rubinstein said: "I am delighted that we can announce a record year for London theatre attendances as well as a tenth year running of year-on-year growth in ticket income.

"These figures pay testament to the quality, vibrancy and enduring popularity of the London stage, which, despite a difficult economic climate, continues to pull in the crowds thanks to the world-class entertainment on offer and inclusive pricing structures.

"With the combined box office advance sales also reaching new heights in December, we are looking forward to another year of success stories for our theatres in 2014."

The society represents 52 major theatres in central London.

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Carney Warns Of Risks Of Scots Independence

By Ed Conway, Economics Editor

Scotland will have to settle for less independence than most other nations enjoy if it secedes from the United Kingdom, the Bank of England Governor has warned.

Mark Carney warned of "clear risks" associated with the economics of Scottish independence, adding that the country would have to surrender some of its sovereignty if it were to retain the pound.

In a closely-watched speech in Edinburgh he said: "A durable, successful currency union requires some ceding of national sovereignty."

He said that might entail having to sign up to stringent fiscal rules to ensure an independent Scotland does not overspend, or allowing London a degree of control and oversight in its finances.

Although the Governor was at pains not to spell out whether Scotland would be better or worse off under independence, his speech raised the prospect of a euro-style crisis, warning that the currency union was largely responsible for "sovereign debt crises, financial fragmentation and large divergences in economic performance".

The speech is likely to come as a disappointment for the Yes campaign, which has sought to reassure Scottish voters that a Yes vote in September would not leave the country prone to economic instability.

First Minister Alex Salmond met Mr Carney ahead of the speech and told Sky News the two had had a productive meeting.

Mr Carney and Mr Salmond after their private meeting

The Governor's speech warned of two primary areas of concern in the event that Scotland became independent and sought to keep the pound.

The first was that in order to maintain competitiveness with the rest of the United Kingdom, without having control over its own interest rates, the country would need to keep tight control on public spending.

Without its own currency to depreciate, it would also potentially have to impose deeper wage cuts on workers in the event of a crisis - such as is happening currently in Greece and Spain.

Second, the Governor said that an independent Scotland would probably need to establish a banking union with the UK, if it wanted to maintain the Bank of England as a potential Lender of Last Resort in the event of a banking crisis.

This would, again, entail potential interference from London.

He concluded: "Decisions that cede sovereignty and limit autonomy are rightly choices for elected governments and involve considerations beyond mere economics.

"For those considerations, others are better placed to comment."

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Flooding: Cameron Vows Rivers Will Be Dredged

David Cameron says he will "rule nothing out" in tackling flooding in the Somerset Levels, as he warned that political arguments must not delay help for frustrated residents.

The Prime Minister told MPs that the current situation was not acceptable and that rivers will be dredged.

Speaking in parliament today, Mr Cameron said dredging would begin once water levels had receded to safe levels. 

"I can confirm that dredging will start as soon as it's practical, as soon as the waters have started to come down," he told MPs.

"The Environment Agency (EA) are pumping as much as possible given the capacity of the rivers, but I've ordered that further high volume pumps ... will be made available to increase the volume of the pumping operation.

"We're urgently exploring what further help the government can give to locals to move around and I rule nothing out for the days ahead to get this problem sorted."

Mr Cameron's comments came ahead of another meeting of the Government's emergency Cobra committee to discuss ways to help flood-hit residents.

The EA has issued some 24 flood warnings and 151 flood alerts, mostly for areas in the South East and the South West.

Many of those in flood-hit areas are calling for immediate action to alleviate what some residents have described as "Third World" conditions.

Parts of the Levels have been under water since Christmas. There are fears that it may be months before the water is entirely pumped away.

Further showers have fallen across England and Wales today. Rain is also expected to spread across the Republic of Northern Ireland tomorrow, and there will be more patchy rain for parts of England.

The further weather warnings came as it was revealed insurance claims from the floods and storms over Christmas and the New Year could reach £426m.

A number of farmers in Somerset have been hit by the weather

The Association of British Insurers (ABI) says that between 23 December 2013 and 8 January 2014, insurers dealt with some 174,000 claims for damage to homes, businesses and cars.

Aidan Kerr, ABI spokesperson said: "Insurers are playing a crucial role in helping customers affected by the storms and floods recover.

"Together with loss adjusters, insurers reacted quickly to help flood victims get through Christmas. Insurers will continue to work closely with customers to ensure the repair process is completed as soon as possible.

"This was a traumatic event for those affected, and shows the importance of having adequate property insurance. The insurance industry is fully prepared to deal with the damage caused by bad weather like this."

The Environment Agency has advised claimants to request insurance pay for repairs that will better protect properties from flooding in future.

Claimants should also mark the height of flood water on the wall with a permanent marker in all flooded rooms and take pictures of property damage.

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