Private firm may track all email and calls

‘Hellhouse’ of personal data will be created, warns former DPP

The private sector will be asked to manage and run a communications database that will keep track of everyone’s calls, emails, texts and internet use under a key option contained in a consultation paper to be published next month by Jacqui Smith, the home secretary.

A cabinet decision to put the management of the multibillion pound database of all UK communications traffic into private hands would be accompanied by tougher legal safeguards to guarantee against leaks and accidental data losses.

But in his strongest criticism yet of the superdatabase, Sir Ken Macdonald, the former director of public prosecutions, who has firsthand experience of working with intelligence and law enforcement agencies, told the Guardian such assurances would prove worthless in the long run and warned it would prove a “hellhouse” of personal private information.

“Authorisations for access might be written into statute. The most senior ministers and officials might be designated as scrutineers. But none of this means anything,” said Macdonald. “All history tells us that reassurances like these are worthless in the long run. In the first security crisis the locks would loosen.”

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Definitive proof that the Bank of England saw the financial crisis coming

Looking back in our archives this Christmas I came across a rather important article which I had half forgotten about. It dates from 2006, when the credit crisis was a mere apple in the financial system’s eye and the City was enjoying one of its biggest booms in history. The article, which can be found here, reveals that the Bank of England knew precisely what risk was posed by the dangerous build-up of debt which was brewing in the economy.

More strikingly, its Financial Stability Report from 2006 was as far as I can tell the first major institutional missive explicitly warning about the dangerous funding gap building up in the British banking system.

Read moreDefinitive proof that the Bank of England saw the financial crisis coming

Recession is predicted to cost Britain 1m jobs

I am sure that things will turn out to be much worse than what this report predicts because the economic crisis has just begun.

• Businesses call for minimum wage freeze
• Report warns of ‘winter surge’ in unemployment

Next year will be the worst for jobs for almost 20 years, with a net reduction of at least 600,000 people in employment, according to a report published today.

The Chartered Institute of Personnel and Development (CIPD) is predicting a “winter surge” of redundancies in the first quarter of the year that could see as many as 300,000 lose their jobs.

The institute warned that unemployment would continue to rise in 2010, taking the total number of jobs projected to be lost over the course of the recession to about 1 million.

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Big Brother CCTV to spy on pupils aged four – complete with CPS evidence kit

    Tim Loughton
    Shadow Children’s Minister Tim Loughton is chairman of Classwatch

    Schools have installed CCTV cameras and microphones in classrooms to watch and listen to pupils as young as four.

    The Big Brother-style surveillance is being marketed as a way to identify pupils disrupting lessons when teachers’ backs are turned.

    Classwatch, the firm behind the system, says its devices can be set up to record everything that goes on in a classroom 24 hours a day and used to compile ‘evidence’ of wrongdoing.

    The equipment is sold with Crown Prosecution Service-approved evidence bags to store material to be used in court cases.

    The microphones and cameras can be used during lessons and when a classroom is unattended, such as during lunch breaks.

    But data protection watchdog the Information Commissioner has warned the surveillance may be illegal and demanded to know why primary and secondary schools are using this kind of sophisticated equipment to watch children.

    Read moreBig Brother CCTV to spy on pupils aged four – complete with CPS evidence kit

    Violent protests at Israeli Embassy in London

    Protesters attempt to break through barriers to the Israeli Embassy in Kensington, west London

    Violent confrontations broke out at the Israeli Embassy in London today as up to 1,500 protesters against Israel’s Gaza campaign gathered in a vociferous demonstration.

    Campaign supporters, Palestinians and British Muslims stood on the pavement of High Street Kensington, west London, and chanted in unison: “Five, six, seven, eight – Israel is a terror state.”

    Riot police were brought in to control the crowd, some of whom turned violent. Witnesses said some protestors were forcibly removed and others were seen with bloodied faces as violence erupted.

    One campaigner was seen throwing a bag and what appeared to be a book over some gates towards the embassy and another was seen throwing red liquid. Officers retreated from the immediate scene as the crowds swelled, and some appeared to be trying to break through barriers to access the embassy.

    The protesters waved Palestinian flags and held up placards, including some which read: “Holocaust in Gaza” and “no peace, no justice.”

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    British banks may face second credit crunch in the New Year

    Rising unemployment may prompt new capital raisings

    The worsening economic slowdown is increasing fears that Britain’s banks will have to raise still more capital next year in a market starved of investors.

    Investment bankers are preparing for a second round of capital raising by UK lenders on top of the £65bn already declared. Having rebuilt their balance sheets after toxic debt writedowns, the banks face an increasingly dire economic outlook that threatens to take ordinary loan impairments from individuals and businesses to levels not seen since the early 1990s.

    Under those worst-case conditions, impairment charges at the domestic banks – Barclays, Royal Bank of Scotland and the combined Lloyds Banking Group – could hit £60bn next year, according to Credit Suisse analysts.

    “There could be a second credit crunch for banks, with a whole new round of writedowns late in 2009 as the economy filters back to banks,” a senior investment banker said. “They have so far only provisioned for the credit crunch – so they will need to undertake a whole new round of capital raising.”

    A trading update earlier this year from HBOS, which will be bought by Lloyds next month, made grim reading for the sector. Impairments from commercial and residential property shot up, and the bank warned of more bad news to come as unemployment, the biggest driver of bad debts, continues to rise.

    Read moreBritish banks may face second credit crunch in the New Year

    Britain’s GDP will decline at fastest pace since the 1940s

    Getting closer to the truth….’The Great Depression of 2009.’
    For the US it will be the Greatest Depression with the dollar and the financial markets collapsing.

    The UK economy looks set to contract at its fastest pace since the 1940s next year, according to a report by an independent group of economists.

    The Centre for Economics and Business Research (CEBR) expects the UK’s gross domestic product to decline by 2.9 per cent in real terms over the next year, the biggest annual fall since 1946, when the country faced mass de-mobilisation after the Second World War.

    Business investment – forecast to collapse by more than 15 per cent in 2009 – is pegged to pose the biggest risk to the economy while household expenditure is expected to fall by 1.8 per cent in the New Year.

    CEBR’s managing director, Mark Pragnell, said his team “had to get the history books to find a year with as a large a fall in national output as we expect for 2009.”

    Read moreBritain’s GDP will decline at fastest pace since the 1940s

    Labour planning secret tax on ‘nice houses’

    Millions of middle-class home owners living in desirable neighbourhoods are facing higher council tax bills after the next election following a secret Government exercise to assess the “niceness” of different areas.

    Labour planning secret tax on 'nice houses'. (Pictured: Holland Park, London)
    Cities are being divided up under the new tax plans, with desirable neighbourhoods being charged higher rates. Tories plan to publish a dossier on the system today.

    Tax inspectors have divided England into 10,000 new “localities” with each neighbourhood ranked on the socio-economic class of its residents and environmental factors such as crime and traffic levels.

    The inspectors have even purchased demographic data disclosing how many company executives, pensioners or students live in particular streets, The Daily Telegraph has learned.

    This has been collated on a secret database which is being used to assess the desirability of neighbourhoods to help determine council tax bills if Labour wins power again at the next election. (It really does not matter who you vote for, because those politicians are all puppets.)

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    Families turning to insurance fraud to beat credit crunch

    Hard-up families are increasingly turning to insurance fraud to help see them through the credit crunch.

    Insurers have seen an 80 per cent increase since last year in the number of bogus household and vehicle claims, many of which are being made by middle-class families struggling to pay their bills.

    Typical scams include householders hiding their valuables and staging a burglary in an attempt to claim thousands of pounds in cash, or dropping their old television down the stairs so they can claim for a new flatscreen model.

    In 2007 the insurance industry detected 91,000 frauds, which is set to rise to more than 160,000, in 2008.

    Fraud costs the insurance industry an estimated £1.6 billion every year, adding £40 to the average annual household premium.

    Read moreFamilies turning to insurance fraud to beat credit crunch

    Labour MPs revolt over Brown’s plan to charge 27% interest on emergency loans to poor

    Gordon Brown and his Work and Pensions Secretary James Purnell were last night accused of behaving ‘like loan sharks’ over plans to slap punishingly high interest rates on vital loans to the poor.

    In an astonishing move, rebel Labour MPs joined forces with David Cameron’s Tories to accuse the Government of penalising hundreds of thousands of families on benefits who get interest-free cash advances to cover the cost of unforeseen crises.

    More than one million individual loans worth over £600million were paid out from the Government’s social fund last year to hard-up people – many of them disabled – who struggled to afford to repair a broken boiler or cope with some other domestic emergency.

    Under Fire: Gordon the ‘loan shark’ and James Purnell

    However, in a provocative move, Mr Purnell wants to start charging 26.8 per cent on new loans – the sort of punitive rate found on High Street store cards and way above normal credit-card rates.

    This would add nearly £50 to the cost of an average £433 loan and saddle the borrowers, who are almost all on State benefits, with an extra four weeks of repayments.

    Read moreLabour MPs revolt over Brown’s plan to charge 27% interest on emergency loans to poor