Ex-Army chief in Falklands warning

Ex-Army chief in Falklands warning.

British armed forces would be unable to reclaim the Falkland Islands if they were seized by Argentina, the former head of the Army has said.

General Sir Mike Jackson believes the demise of jets capable of launching from aircraft carriers would make it "just about impossible" to recover key strategic strongholds.

In an interview with The Sunday Telegraph, Sir Mike said British defences on the Falklands have improved "by a factor of several tens" since 1982. But the 67-year-old conceded losing the islands - which Argentina calls the Malvinas - is not out of the question, saying, "never say never".

He told the newspaper: "The official answer will be that it would not be possible for the Argentinians to gain a foothold on the islands, in particular to take Mount Pleasant airfield, which is key to the British defence plan.

"We have a large international-sized airfield to allow for very rapid reinforcement by air, should circumstances so require. But I suppose I have learned in life, never say never. What if an Argentinian force was able to secure the airfield? Then our ability to recover the islands now would be just about impossible.

General Sir Mike Jackson has said British armed
forces would be unable to reclaim the
Falkland Islands if they were seized by Argentina

"We are not in a position to take air power by sea since the demise of the Harrier force."

Tensions have been mounting between Argentina and the UK following months of escalating rhetoric. Buenos Aires reacted angrily in 2010 when Britain allowed offshore drilling for oil in the islands' waters, and the Argentinians were also irritated by the recent announcement of Prince William's forthcoming RAF posting to the islands.

The latest volley of comments has seen the South American country's president, Cristina Fernandez, hitting back at David Cameron, who accused Argentina of colonialism. She said: "When they say these things it's exactly because they don't have reasons or arguments."

Asked about job cuts in the armed forces, Sir Mike said the fewer numbers were not too much of a problem as long as the UK is not engaged in a one-on-one battle with another country. "This will be the smallest Army since the Napoleonic wars, he said. "My understanding is that we're heading for 82,000.

"Right now there is no existential threat to the UK. It's very hard to see when we would be involved in state-on-state warfare which threatens the existence of this country. If that were to happen, there would be time to move back to where we used to be."


© Press Association 2012

Warning over work scheme 'risks'

The Government's biggest department over-estimated how many jobseekers will be helped by a new multibillion-pound work programme, while the risk of fraud and errors going undetected has increased, according to an official report.

The National Audit Office (NAO) warned that the speed at which the Work Programme had been introduced had led to increased risks.

The programme, which replaced virtually all welfare-to-work schemes in England, Scotland and Wales last year, will help 26% of the largest group of jobseekers into work, compared to an estimate of 40% by the Department for Work and Pensions (DWP), said the NAO.

Some of the organisations delivering the programme in areas of high unemployment may struggle to meet targets and could get into "serious financial difficulty", said the report.

The NAO also revealed that the computer programme to support the new scheme was not fully functional when it was launched so that the DWP will not be able to carry out automatic checks to confirm that people who find work have stopped claiming benefits, until March at the earliest.

"The Department needs to ensure that improvements to the IT system are delivered on schedule. In the meantime there is an increased risk of fraud and error going undetected," said the report.

The National Audit Office says the
speed at which the Work Programme
was introduced
 increased the risk of fraud and error

The NAO also noted it had cost £63 million to terminate existing welfare-to-work contracts, and said that no alternatives to the Work Programme were considered, nor was it tested through pilot schemes.

Margaret Hodge, chairwoman of the Public Accounts committee, said: "The rush to get the programme up and running was so great that the supporting IT is still not in place even though the programme was launched eight months ago. This has led to an increased risk of fraud and error."

Employment Minister Chris Grayling said: "Payment by results is a totally new approach for Government and its success simply cannot be assessed in the same old ways. I'm really disappointed that the NAO is producing a report which is partially based on guesswork, when it's private companies and not taxpayers who are carrying the risks.

"Unlike the last government's welfare to work schemes, we only pay when companies succeed in getting the long-term unemployed into sustained employment."

©Press Association

Profit warnings rise at fastest rate in 10 years

LONDON (Reuters) - Profit warnings from companies jumped more than 70 percent in the final three months of 2011, the biggest quarterly rise for a decade, as markets were rocked by economic uncertainty, Ernst & Young said on Sunday.

Companies quoted on London's main list and junior AIM market issued 88 profit warnings in the final quarter, up from 51 in the third quarter, the accountancy firm said.

"As evidenced by the sharp jump in the number of warnings, 2011 was a tough year for many companies and this year is likely to continue in the same vein with the gap between the winners and losers widening," said Alan Hudson, head of Ernst & Young's UK restructuring practice.

"Many businesses are still expanding profitably, but others - the zombie companies - remain moribund by debt or defunct business models, unable to build value or gain momentum in these challenging economic conditions."

National Debate: Starts in February

The hardest hit sector was retail, where an 8 percent fall in consumers' disposable income led to the worst Christmas since 2008 for many shop groups.

Retailers issued 39 profit warnings in 2011, more than in the whole of 2009 and 2010 combined, it said.

The pain has not eased in the early weeks of 2012, with clothing chain Peacocks calling in administrators, and Tesco issuing its first profit warning in living memory.

Support services and software and computer services also suffered from weaker end markets, Ernst & Young said.

The leap in warnings could mark the start of an upward trend that could continue well into 2012, Hudson said, although he added that recent high-profile warnings had lowered profit expectations.

(Reporting by Paul Sandle; Editing by Hans-Juergen Peters)

Balls in public sector pay warning

Shadow chancellor Ed Balls has warned public sector workers he would make no promise to reverse the freeze on their pay before the end of this parliament.

He blamed Chancellor George Osborne's "mistakes" with the economy for making such pay restraint necessary.

But he said Labour would not make commitments on public spending unless they were "responsible and credible".

Mr Balls angered unions by effectively accepting the public sector pay freeze up to 2015, the year of the planned next election.

Ed Balls-Labour's economic plan must be credible

But he said: "I can't just promise to people that I can just wave a magic wand and be able to spend more and tax less.

"I cannot make commitments now for three years' time. I won't do that, it wouldn't be credible."

Speaking to BBC Radio 4's Today programme, Mr Balls said voters faced a choice between higher public sector pay or tackling rising unemployment.

"George Osborne clearly hoped he would be able to have tax cuts later in the parliament and rising public pay. It's not going to happen because of his failures," he said.

"People might expect me to come along and say 'well of course we will back higher pay'.

"It's a question of priorities. I can't say to private and public workers or to the country that Labour would put higher pay above jobs when unemployment is so high. We've got to be honest with people about the choices they face."

©Press Association

CAMERON WARNING ON THE EURO

The PM has warned the Eurozone leaders that  action is need to ensure the survival of the Euro

David Cameron issued a warning to eurozone leaders today that they need to take some "pretty decisive steps" if the single currency is to survive.

The Prime Minister said he believed the "most likely outcome" was that the euro would hold together, despite the current debt crisis.

But he stressed that in the longer term it was essential to address the "fundamental competitiveness divide" between the powerful German economy and the weaker southern states.

"I think that the most likely outcome is, yes, it will hold together but it has to take some pretty decisive steps," he told Sky News's Boulton & Co.

"There are the short-term sticking plaster steps of a proper firewall to prevent contagion around Europe, a much more decisive settlement for Greece which the problem still hasn't gone away, strengthening the European banks.

"But that is only the short term. The longer term is that you have got to address the fact that there is a lack of competitiveness between Germany on the one hand and many of the southern European countries on the other.

"You can't have a single currency with those fundamental competitiveness divides unless you have massive transfers of wealth from one part of Europe to another."

Mr Cameron stressed it was in Britain's interest to see the eurozone recover, as the current crisis was having a "chilling effect" on the UK economy.

"We have got to help deal with it," he said.

He did not rule out additional UK support for the International Monetary Fund on top of the £10 billion approved by the Commons in July - a move which would infuriate Tory MPs.

"We have set out our conditions for contributing more to the IMF. We support countries and not currencies or currency zones. The IMF shouldn't be doing what the eurozone itself should be doing," he said.

Mr Cameron acknowledged that his decision last month to wield the British veto to block a new treaty of all 27 EU member states had created a "pressure point" in his coalition with the Liberal Democrats.

However, he stressed that he continued to work closely with Deputy Prime Minister Nick Clegg.

"We both wanted a treaty at 27, but with safeguards for Britain," he said.

"We both agreed if we couldn't get those safeguards we couldn't agree a treaty. That is what happened. Of course the Liberal Democrats were disappointed with that," he said.

PA 2012