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Summary

  1. City Link owner defends handling of firms administration
  2. Russia's economy shrank 0.5% in year to November
  3. Greece to hold crucial third presidential vote

Live Reporting

By Matthew West and Ian Pollock

All times stated are UK

Matthew West

Business Reporter

That's it for a reasonable busy first day back at school. Tomorrow we have November house price data from the Land Registry and December house price data from Nationwide. Plus Aga publishes its annual results. We'll see you at 06:00.

Ofcom boss reveals Murdoch Sky bid concerns

Rupert Murdoch, executive chairman of News Corporation
Reuters

The outgoing head of Ofcom has accused the government of showing favouritism to Rupert Murdoch's companies. Ed Richards told the

Independent he was "surprised" at the level of informal contact between Mr Murdoch's executives and government ministers during the failed bid by News Corp for BSkyB in 2011. News Corp abandoned the controversial deal when it emerged journalists at the News of the World ordered the phone of murdered schoolgirl Milly Dowler to be hacked.

Network Rail

BBC Radio 4

The head of Network Rail, Mark Carne, is on the World at One today, on Radio 4. Presumably to talk about those engineering "over-runs" at Kings Cross and Paddington at the weekend. And whether or not he may be receiving his bonus of about £135,000.

City Link

City Link's Motherwell depot on 29.12.14
PA

Mick Cash, head of the RMT union, has told the PA news agency about events at City Link depots today. "Our organisers were out at depots across the country this morning and have reported scenes of absolute chaos," he says. "The staff are angry and disgusted and up for a fight", he adds.

£100 coin

The Royal Mint has unveiled the UK's first £100 coin.

The Daily Mail reports the coin will feature Big Ben on the reverse side with the Queen's head, as usual, on the front. Only 50,000 commemorative coins are being minted, in order to mark the New Year. The last time the Royal Mail issued a commemorative coin was when Prince George was born last year. On that occasion the Royal Mail minted the UK's first £20 coin.

Greece

The Athens stock market plunged by as much as 11.3% before recovering a little, after the Greek parliament's failure to elect Stavros Dimas as president. The stock market remains 7.3% lower at the moment.

Greece

Why should we care if there is a new left-wing government in Greece? Linda Yueh, the BBC's chief business correspondent spells it out: "If Syriza wins the upcoming election and stands by its pledge to challenge the austerity programme, then it again raises the spectre of euro break-up." She adds: "More Greeks want to return to the drachma than keep the euro. It raises the spectre of Greece's exit from the single currency or "Grexit" once again."

Greece

Greek and EU flags
BBC

So, it has happened. The Greek Parliament has

failed to accept Stavros Dimas who was nominated as President by the Prime Minister Antonis Samaras. Under the rules, there will now be a general election early in the New Year. Will the eurozone be able to tolerate the (widely expected) election of a new government led by the left wing Syriza party?

Keep interest rates at 0.5%?

The Bank of England's interest rates should be kept at 0.5% throughout next year. Says who? Says a think-tank called the Institute for Public Policy Research (IPPR). Its argument is that there is no danger of inflation picking up, even if the economy continues to revive, thanks to falling oil prices and the slow growth of salaries and wages.

ABN Amro stock market float

Dutch bank ABN Amro is expected to float itself on the stock market in the New Year, with a valuation of £12bn according to a report in the

Daily Mail. But the Dutch government is expected to only recoup a fraction of the £22bn it injected into the bank to bail it out during the financial crisis, the newspaper adds. ABN Amro was bought by Royal Bank of Scotland (RBS) in 2007 in a £55bn deal but has been controlled by the Dutch government since it was part-nationalised the following year.

Glasgow Rangers

Shareholders arrive at Ibrox Stadium in Glasgow, ahead of the 2014 Rangers AGM
PA

The Scottish Football Association (SFA) has confirmed that it prevented Newcastle United owner Mike Ashley's Mash Holdings from increasing its stake in Glasgow Rangers to 29.9%. Rangers had already announced that the SFA rejected the attempt on 23 December. The SFA board decided unanimously that the application should not be granted. It adds: "the board...... is required to have due regard to the need to promote and safeguard the interests and public profile of association football, its players, spectators and others involved with the game." Mash Holdings retains its 8.92% stake as a result.

Market update

The

FTSE 100 index is up 14.5 points to 6,624 following the Christmas break, setting the market on course for its eighth straight session of gains. Mining giants
BHP Billiton,
Rio Tinto and
Anglo American are all up about 2%. Shares in newcomer Indivior fell 3% as some of the euphoria over the drug firm's recent creation, after a demerger from Reckitt Benckiser, started to fade.

Lord King

BBC Radio 4

"We have made the banking system safer that is true," says Lord King. "But I don't think we are yet at the point where we have made it completely safe." He adds that he doesn't think the next crisis will come from the banking sector. But at the same time he doesn't think the problem of the imbalances between different economies in the world. or within economies, has been solved. "The idea that we can go on indefinitely with very low interest rates doesn't make much sense," he says. That doesn't mean he's calling for interest rate rises jut yet though. In fact, Lord King thinks if interest rates were to rise immediately they would cause another downturn.

Lord King

BBC Radio 4

"Financial markets themselves did not think banks were really at risk and it came as an enormous surprise to everyone when people found that markets no longer trusted banks, Lord King adds.

Lord King

BBC Radio 4

Was light-touch regulation to blame for the banking crisis in the UK? Lord King says he doesn't think the reason the banks are still not lending to one another is because of tighter regulation that came in following the financial crisis. Instead, he suggests, it's more about psychology. There is more fear about the credit-worthiness of other banks than there was before the crisis, he argues. That's not something that is easy to change, he adds. The amount by which the banks were leveraged before the crisis was "absurdly high and should have been much, much lower," he admits. But, Lord King says, the Bank of England didn't have regulatory responsibility for that sort of thing.

Lord King

BBC Radio 4

"I worked very hard to make sure there were moments of laughter," Lord King says of the financial crisis and his relationship with his colleagues during the crisis. But he adds, more seriously: "I don't think you can go back and say could any one country on its own has found a way through the crisis."

Network Rail

Railway workers on the tracks outside King's Cross, London on 27th December 2014
PA

Louise Ellman, the Labour MP, who chairs the Commons Transport Select, is not happy with Network Rail's engineering over-runs that led to Kings Cross and Paddington stations being closed for longer than expected at the weekend. "If Network Rail decide to close part of the system down at a busy time of year, they have to be absolutely sure it's going to work as planned and it is going to re-open as planned," she tells the

Today day programme. But she declines to criticise the Network Rail chief executive for being on holiday while the work was going on.

Ben Bernanke

BBC Radio 4

A red phone
Getty Images

A bit more from Mr Bernanke. He tells the

Today programme that during the crisis, the mornings would start with a conference call with six or eight people sat around a "red phone sitting on a coffee table". There was a "certain emergency feeling to everything that was happening every day," he adds. No mention of batphones though.

Ben Bernanke

BBC Radio 4

Mr Bernanke adds that there were one or two US Fed meetings that were "extremely exciting". He cites the October 2008 meeting which followed the collapse of Lehman Brothers and the meeting of the G7 nations where he and Lord King "tore up the communique' and really rolled up our sleeves and thought about what we were going to do." He adds: "That was a tremendously important meeting."

Ben Bernanke

BBC Radio 4

Former Federal Reserve Chairman Ben Bernank
AP

Lord King has interviewed Ben Bernanke for the

Today programme and they discuss the financial crisis of 2008 in which they both played a pivotal role. In a rare human moment for a central banker, Mr Bernanke tells Lord King that most US Federal Reserve meetings, while they get lots of attention, are "deadly boring". He adds: "They are very scripted and the staff do most of the work and they write the the communique' in advance of the decision making."

City Link

BBC Radio 4

More from Mr Moulton on

Today: "In the intervening 18 months it [City Link] would have paid a fortune to the government in PAYE, value added tax and the like. The government will be a net beneficiary of Better Capital's investment in this company he added," he stressed. Mr Moulton added that he had lost £2m of his own money due to the City Link collapse.

City Link

BBC Radio 4

Mr Moulton, speaking to

Today, points out that City Link could in fact have been closed down 18 months ago when his firm Better Capital bought it for just £1. He denies that the taxpayer will suffer because the government will now have to pay the workers' redundancy payments. "The taxpayer has certainly made an enormous amount of money out of private equity companies and their trading and success," he says.

City Link

BBC Radio 4

Jon Moulton of Better Capital, the investment firm that owns City Link, defends his firm's ownership of the now closed City Link. "We chased every possible way to save this company," he tells

Today. He says the company had simply failed, and that delaying the closure over Christmas had not been an option, as trading while insolvent was a criminal offence. Could the affair have been better handled? "Not particularly, no," he says.

Network Rail boss

Network Rail boss Robin Gisby
PA

The Network Rail boss who presided over what is being dubbed the Christmas trains fiasco will not receive a "golden goodbye" bonus of £371,000. Robin Gisby will leave his post as managing director of network operations early next year, a spokeswoman for Network Rail said. Mr Gisby is leaving the company at the end of February. But the decision to withhold his bonus is not linked to the overrunning engineering work at Kings Cross and chaos that ensued at the weekend.

Russian economy

The Reuters news agency reports that Russia's economic output (as measured by gross domestic product) shrank by 0.5% in the year to November. This is the first time the economy has shrunk since since October 2009 and reflects the effects of international economic sanctions and the falling oil price.

Eurozone crisis

BBC Radio 4

Marie Diron, the senior vice president at rating agency Moody's tells

Today that the probability that Greece will leave the euro is pretty small compared to 2011. She says the euro itself has remained pretty resilient to crisis events citing the failure of a Portuguese bank last year as one example. "Saying the height of the crisis is behind us does not mean that everything will be smooth from now on," she says. Eurozone growth will be weak this year and deflation, or very low inflation, remains a big risk this year too.

City Link

A Citylink worker and van
PA

Better Capital explains that it had tried to sell the business but failed, and pulled the plug on the loss-making firm because keeping it going would have meant throwing good money after bad. "In light of continued substantial losses, City Link could not continue as a going concern, which resulted in the appointment of Ernst & Young as administrators on 24 December 2014," it says.

BreakingBreaking News

City Link

Better Capital has been explaining itself in a statement just issued to stock market investors. It says: "Unfortunately the appointment of an administrator was leaked to the media ahead of the intended announcement. The directors very much regret the impact on the employees of City Link receiving such bad news on Christmas Day." So it seems the Christmas day announcement was not intended.

City Link

Jon Moulton
PA

Jon Moulton, the man whose private investment firm Better Capital owned - and is now shutting -

City Link, is going to explain himself. He's fronting up on the Today programme on Radio 4 at 07:50 to explain why he decided to close the courier business. He's been quoted in the FT as saying he explored "every possible way" to keep the firm going, and that he lost several million pounds of his own money.

Lord King

BBC Radio 4

Mervyn King, former governor of the Bank of England
PA

Lord King is on the

Today programme. He's talking about the financial crisis and how he and US Federal Reserve president Ben Bernanke responded to it. He says the biggest problem both men had was explaining to people that they were taking measures that were "quite exceptional to try to prevent something terrible happening." He also suggests quantitative easing - buying government bonds - was not an unusual policy measure but that it hadn't been used for a very long time. Bank of England governors had spent the post war period trying to prevent money growing too quickly in the economy, "now we were trying to stop it falling and trying to inject money into the economy," he says

The Interview

Sony appear to be trumpeting the fact that

The Interview (hated by North Koreans) has become the most downloaded new film yet produced by the company. The controversial comedy was downloaded two million times between the 24th and 27th December, taking nearly £10m. Is that a lot to shout about?

Greece

Radio 5 live

Members of the Greek cabinet with Prime Minister Antonis Samaras
European Photopress Agency

The Greek parliament is to make a third and final attempt to elect a new president. On

Wake Up to Money, Constantine Michalos, chairman of the Athens Chambers of Commerce and Industry, said he expected the vote to fail, automatically triggering a swift general election. "It looks increasingly unlikely, if not impossible, that the government will succeed in getting a positive Parliamentary presidential vote," he said. "The choice that the Greek people will be called upon to make in a few weeks time is the possibility of an instant death, because we've heard the main opposition, and the economic policy they will follow, which is totally opposite to the one the eurozone has been dictating over the last four and a half years."

Eurostar ban?

The

Daily Mail has a report today that Eurostar has banned a passenger for life after "kicking him off a train" for complaining about the strength of his cup of tea. Daniel Confino, a financial expert who the newspaper says was instrumental in saving the foundering Eurotunnel project in the 1990s, now intends to have the ban ruled illegal at the High Court. He ordered two teas at £2.20 each - and asked for an extra bag so he could have a strong cuppa. But when he was charged £2.20 just for the third tea bag, he complained.

Lord King

BBC Radio 4

Lord Mervyn King, the former governor of the Bank of England has a new job - for just one day. He is the guest editor of the Today programme on Radio 4.

And his big interviewee is Ben Bernanke, who was his counterpart as head of the US Federal Reserve during the great banking crisis a few years ago. Will they admit to any failings? Find out just after 08:00.

Good morning

Ian Pollock

Business reporter, BBC News

Welcome back to the digital coal face. We hope you have enjoyed your Christmas holiday so far. If you would like to get in touch with us you can do so via email at bizlivepage@bbc.co.uk or on twitter

@bbcbusiness.

Mathew West

Business Reporter

Morning folks. Former Bank of England governor Lord King is guest editing the Today programme. Greece holds a crucial presidential vote, which could have implications for its International Monetary Fund (IMF)/European Union (EU) bailout. And the search continues for the missing Air Asia flight QZ8501. So plenty to digest this morning. Stay with us.