US Jobless Rate At Lowest For Five Years

The unemployment rate in the United States dropped to 7% in November, the lowest figure for five years.

The sharp drop in the rate, from 7.3% in October, was unexpected and raised the odds that the Federal Reserve could soon begin moving away from its huge stimulus plan.

Meanwhile, the number of non-farm jobs in November went up by a net total of 203,000, which beat analysts' expectations.

The strengthening job market is likely to fuel speculation that the Federal Reserve may scale back its bond purchases when it meets later this month.

The economy has now generated an average of 204,000 jobs from August through November. That is up from 159,000 a month from April through July.

Many of the November job gains were in higher-paying industries. Manufacturers added 27,000 positions, the most since March 2012. Construction firms gained 17,000. The two industries have created a combined 113,000 jobs in the past four months.

Another month of robust hiring follows other positive economic news.

The economy expanded at an annual rate of 3.6% in the July-September quarter, the fastest growth since early 2012, the government said.

Still, nearly half that gain came from businesses building their stockpiles. Consumer spending grew at the slowest pace since late 2009.

Greater hiring could support healthier spending as job growth has a dominant influence over much of the economy.

If hiring continues at the current pace, a virtuous cycle starts to build. More jobs usually lead to higher wages, more spending and faster growth.

Roughly half the jobs that were added in the six months through October were in four low-wage industries - retail, hotels, restaurants and entertainment, temp jobs and home health care workers.

The Fed has pegged its stimulus efforts to the unemployment rate and chairman Ben Bernanke has said the Fed will ease its monthly purchases of $85bn (£51bn) in bonds once hiring has improved consistently.

The bond purchases have kept long-term interest rates low.

The recent economic upturn has been surprising. Many economists expected the government shutdown in October to hobble growth, yet the economy motored along without much interruption.

Early reports on holiday shopping have been disappointing.

The National Retail Federation said sales during the Thanksgiving weekend - probably the most important stretch for retailers - fell for the first time since the group began keeping track in 2006.

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NatWest Website Hit By A 'Surge Attack'

The NatWest personal banking website has been hit by a cyber attack in the wake of its IT woes earlier this week, Sky News has confirmed.

Some customers trying to log on to the website found it impossible to enter the site.

NatWest, which is owned by the Royal Bank of Scotland Group, said there had been a deliberate swamping of its site.

An RBS spokesperson told Sky News: "Due to a surge in internet traffic deliberately directed at the NatWest website, customers experienced difficulties accessing some of our customer web sites today.

"This deliberate surge of traffic is commonly known as a distributed denial of service (DDOS) attack.

"We have taken the appropriate action to restore the affected web sites. At no time was there any risk to customers. We apologise for the inconvenience caused."

The bank stressed that the problems on Thursday night and Friday were not connected with its banking blackout which began on Cyber Monday - the biggest online retail day of the year - and stretched into Tuesday.

Some technical problems continued until Wednesday and thousands of customers who were unable to use the banks' websites or card services vented their fury online.

The group chief executive Ross McEwan described the earlier glitch as "unacceptable" and added: "For decades, RBS failed to invest properly in its systems.

"We need to put our customers' needs at the centre of all we do. It will take time, but we are investing heavily in building IT systems our customers can rely on.

"I'm sorry for the inconvenience we caused our customers. We know we have to do better.

"I will be outlining plans in the New Year for making RBS the bank that our customers and the UK need it to be.

"This will include an outline of where we intend to invest for the future."

As well as this week's problems, a glitch in May left RBS and NatWest customers using mobile apps unable to access their accounts online.

That followed a major fiasco in June last year which saw payments go awry, wages appear to go missing and home purchases and holidays interrupted - and cost the group £175m in compensation.

:: Watch Sky News live on television, on Sky channel 501, Virgin Media channel 602 and Freeview channel 82

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Autumn Statement: The Key Points At A Glance

The main measures and forecasts as outlined by the Chancellor George Osborne in his Autumn Statement:

ECONOMY

:: Aim is "To fix the roof while the sun is shining" rather than spend beyond our means.

:: "We will not let up in dealing with our country's debts."

:: OBR expects national debt to be 75.5% of GDP this year, £18bn lower than forecast.

:: OBR says 2013/14 borrowing forecast is revised down to £111bn - £9bn less than expected.

:: OBR forecasts underlying measure of deficit revised down to 6.8% this year, no deficit by 2018/19.

:: OBR forecasts 7.6% jobless rate in 2013, falling to 7% in 2015.

:: Doubling export finance capacity to £50bn.

:: Britain is currently growing faster than any other major world economy.

:: OBR GDP growth forecast for 2014 rises to 2.2% from 1.8%.

:: Office for Budget Responsibility (OBR) more than doubles forecast for GDP growth in 2013 to 1.4% from 0.6%.

:: Pays tribute to "the sacrifice and endeavour of the British people."

:: "Britain's economic plan is working but the job is not done."

TAX

:: New £1,000 transferable tax allowance for married couples from April. Allowance to be uprated.

:: Levy on bank balance sheets to rise to 0.156% - to raise £2.7bn in 2014/15.

:: Capital Gains Tax to be paid by foreign sellers of UK homes from April 2015.

:: Tax and fraud measures to raise £9bn over five years.

WELFARE

:: Increase in state pension age to 68 in mid 2030s and 69 in late 2040s.

:: State Pension to rise by £2.95 a week from April.

JOBS

:: To promote youth employment, National Insurance contributions removed for workers aged under 21.

TRANSPORT

:: Plans to increase train fares by 1% above inflation from January cancelled, so they go up in line with inflation.

:: Fuel Duty rise cancelled for next year.

ENERGY

:: Green levies on energy bills rolled back by average £50 per household.

BUSINESS

:: To help improve shop vacancy rates in town centres, discount in business rates for small retailers in England.

:: Extending small business rate relief. Rate rises capped at 2% from April.

EDUCATION

:: 30,000 more student places next year with cap abolished in 2015 - Higher education investment funded by sale of old student loan book.

:: 18 to 21-year olds required to undertake training or lose benefits.

:: Free school meals for all children in reception, year one and year two.

HOUSING MARKET

:: OBR forecasts house prices 3.1% lower in 2018 than 2007 peak.

:: Bank of England has power to take action to ensure a functioning, stable housing market.

:: £1bn of loans to unlock large housing developments outside London.

SPENDING

:: £100m more of Libor fines to be made available to Armed Forces and emergency service charities.

:: Government's contingency reserve reduced by £1bn this year and departmental budgets by similar amount in the next two years, saving £3bn - NHS, schools and security services exempted.

:: Whitehall spending cut by £1bn over next two years.

:: To cap total welfare spending from next year though state pension excluded.

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Autumn Statement: 'The Plan Is Working'

Chancellor George Osborne has told the country "Britain's economic plan is working but the job is not done".

Making his Autumn Statement, Mr Osborne delivered good news for the economy with a freeze in fuel duty as well as help for young people seeking work and for small businesses.

Mr Osborne announced revised figures that doubled growth forecasts for this year. Borrowing is down to just £2,500 for every household, he said, and the country's debt was £18bn lower than forecast in March.

But he warned of "more difficult decisions", setting the tone for a statement that would contain little respite from the tough austerity measures of previous years.

 "The hard work of the British people is paying off and we will not squander their efforts," he said.

Mr Osborne said Britain was growing faster than any other major economy as he announced that the Office for Budget Responsibility (OBR) had more than doubled its growth forecast for this year from 0.6% to 1.4%.

Mr Osborne and chief secretary to the Treasury Danny Alexander

He said that instead of forecasting growth of 1.8% for 2014 they were now predicting 2.5% and, similarly, the forecasts for growth for the next four years had been increased.

However, he stressed that the country could not stop fighting for its recovery as a reassessment by the Office for National Statistics showed that the 2008/9 recession had been worse than thought - with £112bn wiped off the British economy. 

The statement had been so widely trailed that it contained few surprises. Mr Osborne outlined a number of smaller measures to target the cost-of-living crisis but concentrated on a continued and strong recovery.

Key measures included:

:: Pensions to be increased by £2.95 a week from April - with state pension age raised to 68 by the mid 2030s.

:: The 2p rise in fuel duty next year is cancelled.

:: £1,000 off bills for all small high street retailers in an attempt to revitalise town centres.

:: £50 off annual energy bills by rolling back green levies.

:: Tax breaks worth £200 for married couples who will be able to transfer personal allowances.

:: A new capital gains tax for foreign investors aimed at preventing a property bubble in London and the South-East.

:: £375bn of planned public and private investments in infrastructure projects to 2030 and beyond.

:: Free school meals for children up to the age of seven.

:: Job seekers aged 18 to 21 without basic maths or English to be forced to agree to training or lose benefits.

:: A 2% cap on business rates and an extension of the rate relief scheme for small businesses

:: Employer national insurance contributions for under 21s removed

:: An extra 20,000 higher apprenticeships to be offered in 2014/15

:: £11m space technology centre named after "God particle" scientist Peter Higgs to be built in Edinburgh. 

Ed Balls responds to the Autumn Statement

Mr Osborne announced that while the NHS would be protected from spending cuts, welfare spending would be capped.

He said: "Welfare budgets were completely out of control when we came to office and the number of households where no-one had ever worked nearly doubled.

"We have taken very difficult decisions to bring benefit bills down - and saved £19bn a year for the taxpayer. We need to maintain that discipline."

Mr Osborne also said that the budget of Britain's spies would be protected amid public disquiet over the reach of the intelligence services.

Shadow Chancellor Ed Balls accused Mr Osborne of being "out of touch" and said he had done nothing to improve living standards.

He said "living standards are not rising, they are falling year after year, after year", and pointed out that working people were £1,600-a-year worse off now than they were when the coalition came to power in 2010.

Reaction to Mr Osborne's statement was mixed, while small business groups welcomed many of the measures others said little had been done to help households struggling with debt.

Mark Serwotka, leader of the Public and Commercial Services union, said: "This is not an economic plan, it's austerity for austerity's sake, as the Tories - propped up by the Lib Dems - look to reshape our society for years to come and make the poor, sick and unemployed pay for the greed and recklessness of wealthy elites."

However, John Allan, chairman of the Federation of Small Businesses, said: "The statement is a sobering reminder about the scale of the deficit the country faces and the tough choices which need to be made. We therefore welcome the use of what spare resources the Chancellor could find to focus tax cuts on encouraging firms to take on younger workers, which must be an overriding priority."

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The Autumn Statement: What's Expected?

Longer Wait For Pensions Revealed

Updated: 12:33am UK, Thursday 05 December 2013

By Sophy Ridge, Political Correspondent

People will have to work until they are 68 years old before receiving a state pension from the mid 2030s, in a move that will raise around £400bn for the Treasury.

Chancellor George Osborne will also announce the age will rise to 69 in the 2040s in his Autumn Statement.

The changes will affect people aged 40 or younger.

A Government source said: "This is part of the Government's long-term plan to secure a responsible recovery.

"It is a difficult decision to make sure there is a fair deal across future generations and that the country can live within its means.

"It will help make sure the country can offer people decent pensions in their old age in a way that with increasing life expectancy the country can also afford."

Currently the state pension age is due to rise to 68 from 2046 and to 69 in the late 2040s.

The news - released by the Treasury ahead of the Autumn Statement - is intended to show the Government is determined to keep making tough decisions to drive down the deficit despite improving economic figures.

Most government departments also face a 1% cut in their budgets for the next three years, which will save £1bn a year.

Health, schools, international aid, local government, HMRC and the security services will be exempt because their budgets are protected.

In an interview with Sky News, Prime Minister David Cameron said: "The truth is you're not really delivering a higher level of standards and actions on the cost of living unless you secure a long term growth and success of the British economy. From that everything else will follow.

"But should we at the same time try to help families with their budgets? Yes of course we should."

The Autumn Statement's good news is likely to be focused around the cost of living, to counter Ed Miliband's pledge to freeze energy bills for 20 months.

Labour argues most people are not benefiting from the improving economy because of rising prices and stagnating wages.

The Chancellor will also announce a £50 cut in the average energy bill and free school meals for every child under seven years old.

Firms will see a business rates capped at two per cent, while the Chief Secretary to the Treasury Danny Alexander has confirmed £375bn of planned public and private investment in infrastructure.

For the first time since becoming Chancellor, George Osborne is expected to announce more positive economic figures to show growth is returning.

:: Watch live coverage of the Autumn Statement throughout Thursday on Sky News HD

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Autumn Statement: Longer Wait For Retirement

By Sophy Ridge, Political Correspondent

People will have to work until they are 68 years old before receiving a state pension from the mid 2030s, in a move that will raise around £400bn for the Treasury.

Chancellor George Osborne will also announce the age will rise to 69 in the 2040s in his Autumn Statement.

The changes will affect people aged 40 or younger.

A Government source said: "This is part of the Government's long-term plan to secure a responsible recovery.

"It is a difficult decision to make sure there is a fair deal across future generations and that the country can live within its means.

"It will help make sure the country can offer people decent pensions in their old age in a way that with increasing life expectancy the country can also afford."

Currently the state pension age is due to rise to 68 from 2046 and to 69 in the late 2040s.

The news - released by the Treasury ahead of the Autumn Statement - is intended to show the Government is determined to keep making tough decisions to drive down the deficit despite improving economic figures.

Most government departments also face a 1% cut in their budgets for the next three years, which will save £1bn a year.

Health, schools, international aid, local government, HMRC and the security services will be exempt because their budgets are protected.

In an interview with Sky News, Prime Minister David Cameron said: "The truth is you're not really delivering a higher level of standards and actions on the cost of living unless you secure a long term growth and success of the British economy. From that everything else will follow.

"But should we at the same time try to help families with their budgets? Yes of course we should."

The Autumn Statement's good news is likely to be focused around the cost of living, to counter Ed Miliband's pledge to freeze energy bills for 20 months.

Labour argues most people are not benefiting from the improving economy because of rising prices and stagnating wages.

The Chancellor will also announce a £50 cut in the average energy bill and free school meals for every child under seven years old.

Firms will see a business rates capped at two per cent, while the Chief Secretary to the Treasury Danny Alexander has confirmed £375bn of planned public and private investment in infrastructure.

For the first time since becoming Chancellor, George Osborne is expected to announce more positive economic figures to show growth is returning.

:: Watch live coverage of the Autumn Statement throughout Thursday on Sky News HD

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RBS And NatWest Glitch: Problems Persist

RBS and NatWest customers are still reporting problems with their accounts after a third major glitch in 18 months hit the banking group's IT systems nationwide.

Thousands vented their anger on Twitter after all of the high street banks' systems went down for three hours on one of the busiest shopping days of the year, Cyber Monday, and the fury continued to be felt by the bank on Tuesday.

As well as bank cards, there were problems with RBS and NatWest's websites and smartphone apps.

The banking group said that while the technical issue had now been resolved, its 15.7 million customers should visit their local branch or contact one of its helplines if they were still experiencing problems with their accounts caused by the resulting backlog of transactions.

It promised anyone left out of pocket as a result of the failure would be compensated and there would be further investment in its technical systems to help prevent more disruption in future.

The group chief executive Ross McEwan described the latest glitch as "unacceptable" and added: "For decades, RBS failed to invest properly in its systems.

Complaints piled up on Twitter as customers could not access cash

"We need to put our customers' needs at the centre of all we do. It will take time, but we are investing heavily in building IT systems our customers can rely on.

"I'm sorry for the inconvenience we caused our customers. We know we have to do better.

"I will be outlining plans in the New Year for making RBS the bank that our customers and the UK need it to be.

"This will include an outline of where we intend to invest for the future."

Customer services director Susan Allen told Sky News: "We know it was a very busy time of people doing their shopping before Christmas.

"Clearly, we deeply apologise for the inconvenience we've caused."

RBS' apology, along with an earlier tweet about mobile banking problems

Ms Allen insisted the problems were "completely unrelated" to high transaction volumes on Cyber Monday but was unable to give an explanation for the failure, saying it was still under investigation.

It is understood that hacking has been ruled out, although some customers told Sky News they were being targeted by phishing emails in the wake of the meltdown, an issue RBS said it was looking into.

Others complained about accounts being closed, suddenly overdrawn or unavailable to access online.

The group said Ulster Bank, which is also owned by RBS, was "partly affected" by the outage.

Reports started to emerge of bank cards being refused at around 6.30pm on Monday.

One customer from Canterbury, Kent, tweeted: "NatWest down again. Looked like a melt in Londis when my card got declined for milk and tuna."

Josh Barlow, a Sheffield Hallam journalism student, wrote: "This is happening every month, if not more, and it's getting ridiculous."

RBS and NatWest came under fire in March after a "hardware fault" meant customers were unable to use their online accounts or withdraw cash for several hours.

A major computer issue in June last year saw payments go awry, wages appear to go missing and home purchases and holidays interrupted for several weeks, costing the group £175m in compensation.

The latest meltdown will heap more embarrassment on the banks because it came on so-called Cyber Monday, when retailers expect their busiest day of the year as pre-Christmas shoppers search the internet for bargains.

Trade union Unite, which represents RBS staff, called for the bank to halt its cost cutting programme, which has seen thousands of jobs axed and IT functions sent abroad, in the wake of the IT problems.

National officer Dominic Hook said: "It is unacceptable that the bank's customers are once again facing inconvenience. Unite has grave concerns that staffing challenges are exacerbating the problems facing the bank."

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Eurostar: Government's 40% Stake Up For Sale

The Government is to sell its 40% stake in Eurostar as part of a plan to privatise £20bn of financial and corporate assets by 2020.

The announcement is contained in the new national infrastructure plan (NIP) which sets out over £375bn of planned public and private investments to 2030 and beyond.

The plans include a new target for selling off financial assets, doubling the amount from £10bn to £20bn including shareholding in the cross-channel train operator.

It comes just weeks after ministers were criticised for undervaluing the Royal Mail before its flotation.

Ministers have been given a boost by major insurers, who have announced plans to invest £25bn in UK infrastructure projects over the next five years.

Last month Eurostar revealed it had seen an increase in revenues and passenger numbers compared with last summer.

Sales revenue for the period July-September 2013 reached £207m - a 10% increase on the same period last year - and passenger numbers in summer 2013 rose 5% to 2.7 million.

The planned infrastructure investment has increased from £309bn last year to more than £375bn, with 291 of the 646 projects and programmes already under construction.

The decision by insurers Legal and General, Prudential, Aviva, Standard Life, Friends Life and Scottish Widows to invest in infrastructure follows changes in European rules pushed for by the UK which incentivise investment in a wider range of assets.

Danny Alexander will announce the plans

Treasury Chief Secretary Danny Alexander will unveil the NIP alongside Commercial Secretary and former London Olympics chief Lord Deighton.

Mr Alexander will say the announcement is a "massive vote of confidence in the UK economy".

"It supports the wider £100bn public investment to rebuild Britain over the next seven years that I announced at the Spending Round 2013. Underground, overground, onshore, offshore, wired or wireless, tarmac or train track. You name it, we're building it right now.

"This is great news for the people of the UK because after years of neglect, the UK's energy, road, rail, flood defence, communications and water infrastructure needs renewal."

Shadow chief secretary to the Treasury Chris Leslie said: "Scheme after scheme has been announced to great fanfare but then little actually delivered.

"Yet another announcement from ministers about possible future investment will do little to reassure business that warm words will finally translate into diggers in the ground."

Other measures being announced include:

:: The scrapping of plans to create the UK's first toll road for a decade. Motorists will not be charged to use the A14 between Cambridge and Huntingdon once the improvement scheme, due to start in 2016, is completed.

:: A further £50m will be allocated to redevelop the railway station at Gatwick Airport.

:: A Government guarantee could support finance for the development of a new nuclear power station at Wylfa on Anglesey.

:: The £1bn Northern Line extension to Battersea in south west London will also be guaranteed by the Government.

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RBS And NatWest IT Problems On Cyber Monday

RBS and NatWest are trying to fix a computer glitch which left customers having their debit and credit cards declined in shops across the UK.

Thousands of people have been venting their anger on Twitter after all the high street banks' systems went down on one of the busiest shopping days of the year. 

As well as bank cards, there are problems with RBS and NatWest's websites and smartphone apps.

RBS - which owns NatWest - issued a statement, saying: "We are very sorry for the system issues that affected our customers this evening. Our customers are reporting that services are coming back on line.

"We will confirm when all systems have returned to normal service.

"If customers have been left out of pocket as a result of these system problems, we will put this right.

Complaints piled up on Twitter as customers could not access cash

"If any customer is unable to resolve an issue caused by the disruption, they should get in touch with our call centres or come into a branch in the morning where our staff will be ready to help."

The group said Ulster Bank, which is also owned by RBS, is "partly affected" and several customers in Ireland have reported problems.

Reports started to emerge of bank cards being refused at around 6.30pm on Monday.

One customer from Canterbury, Kent, tweeted: "Natwest down again. Looked like a melt in Londis when my card got declined for milk and tuna."

RBS' apology, along with an earlier tweet about mobile banking problems

Josh Barlow, a Sheffield Hallam journalism student, wrote: "This is happening every month if not more and it's getting ridiculous."

RBS and NatWest came under fire in March last year after a "hardware fault" meant customers were unable to use their online accounts or withdraw cash for several hours.

It cost the group £175m to put right and came less than a year after it was hit by a major computer issue.

The latest meltdown will heap more embarrassment on the banks because it came on so-called Cyber Monday, when retailers are hoping for their busiest day of the year as pre-Christmas shoppers search the internet for bargains.

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Households Raid Savings At Record Rate

By Ed Conway, Economics Editor

Households are pulling money out of their savings accounts at the fastest rate in modern record, according to Bank of England figures.

In the past year, families have withdrawn £23bn from their long-term savings account to convert into cash and put into current accounts - the equivalent of around £900 for every household in the country.

It is the most dramatic evidence yet that Britons are paying for the rising cost of living by raiding their savings accounts.

Analysis of the Bank's figures by Sky News shows that in the year to October, the amount of cash in time deposits and cash ISAs fell by 4.7%, while the amount families have in their instant-access current accounts or in their pockets rose by 11.2% - some £71bn.

According to economists, the shift of cash is the biggest since comparable records began in the 1970s, and reverses much of the sharp increase in saving that happened at the height of the recession.

On Thursday, the Chancellor's Autumn Statement is expected to focus on measures to help households deal with the rising cost of living, including energy bills.

Since the recent recession began, millions of workers have suffered repeated effective pay cuts as inflation has outstripped pay rises.

As well as paying for household bills, economists also believe that people's use of savings may have contributed to recent economic growth.

The news comes amid growing evidence that consumers' appetite for spending is on the rise in the run-up to Christmas.

Consumer spending was one of the main contributors to the sharp rise in gross domestic product in the third quarter, and a further strong increase is implied by the Bank's money figures.

But while the figures suggest that the economy is strengthening, they will also be taken as further evidence that savers are being deterred from putting money aside by record low interest rates.

According to new figures from the Bank, the average interest rate on long-term savings accounts has now dropped to 2.4% - the lowest level since comparable records began in 1999.

Some also suspect that with households still facing a significant squeeze as a result of higher living costs, many are having to dig into their savings in order to afford day-to-day items.

Simon Ward, chief economist at Henderson Global Investors, pointed out that on top of the £900-per-household shift of cash out of long-term savings, families have also put £21bn (a further £800 per household) which might normally have gone into savings accounts into their spending money.

He said: "Consumer strength usually reflects increased borrowing but this hasn't been the key factor recently.

"Instead, households have been running down their savings accounts balances, probably in reaction to the pathetic interest rates now on offer.

"Increased spending is lifting growth and incomes, and money is flowing back to other households, in a virtuous circle."

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Energy Bills 'To Fall By £50' Under Govt Plan

Household energy bills will be reduced by an average of £50 a year under plans by the Government which will see a cut in green levies.

David Cameron and Nick Clegg confirmed the plan to reduce the burden on consumers by cutting the green taxes, which add £112 to each bill.

The cost of the Energy Company Obligation Scheme, which funds energy efficiency measures for low-income households and makes up the vast majority of the environmental levies, will be halved under the plan.

Around £12 of the £50 savings to bills will come from a reworking of the Warm Home Discount in a £300m deal. The remainder will come by switching the funding for energy measures to general taxation.

The reductions are expected to be finalised in negotiations taking place with the big six power firms this weekend and are to be disclosed by the Chancellor, George Osborne, in his Autumn Statement on Thursday.

They will also include the announcement of a £1,000 grant for energy efficiency measures for anyone buying a new home, which will be funded by a fresh crackdown on tax avoiders.

The two leaders insist the plan is 'serious and credible'

Labour and the Conservatives have been scrapping to gain ground with the public on energy prices as the cost-of-living looks likely to take centre stage in the run-up to the General Election.

Labour leader Ed Miliband announced in his party conference speech in September that if he was in power would freeze energy prices for 20 months.

It was followed by a series of eye-watering price increases by the so-called Big Six energy firms.

In response, Mr Cameron insisted he would roll back the green levies and in return, the energy companies should bring down prices.

However, the Liberal Democrats have insisted that environmental measures - one of their election pledges - should not be dropped and have fought to find alternative ways of funding them.

Bills are burned during a protest this month against prices and budget cuts

Mr Osborne today insisted that the energy firms would not just pocket the green levy reductions and that the Government had been "absolutely insistent that this is passed on".

"We are doing it in the way that government can do it, which is controlling the costs that families incur because of government policies.

"We are also doing it in the way that is not going to damage the environment or in any way reduce our commitment to dealing with climate change," he told BBC's Andrew Marr Show.

The Shadow Business Minister Chuka Umunna told Sky's Dermot Murnaghan that the measures were a "pale imitation" of Labour's plans to freeze energy prices and reform the market.

Ed Balls, Shadow Chancellor, told Andrew Marr: "Anything they do is better than nothing" but that shifting the cost to households from bills to taxes was simply "taking with one had to give with the other".

In a joint article for The Sun on Sunday, Mr Cameron and Mr Clegg wrote: "Later this week, we'll announce further help: proposals that will be worth around £50 on average to energy bill-payers.

"We're doing it without taking any help away from poor families or sacrificing our green commitments; and in a way that will keep Britain's lights on in the long-term too."

The pair added: "Alongside the Green Deal, when you buy a new home, you could get up to £1,000 from Government to spend on important energy-saving measures - equivalent to half the stamp duty on the average house - or even more for particularly expensive measures.

"It's an all-round win: better insulation means cheaper bills; it's how we cut carbon emissions; and it will boost British businesses who provide these services."

EDF, one of the Big Six welcomed the move, and said it did not expect to raise prices again before 2015.

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Cameron Arrives In Beijing For Trade Talks

The Prime Minister will champion a free trade agreement between the EU and China today which could be worth £1.8bn to the UK alone.

David Cameron arrived in Beijing at the head of the largest British trade delegation ever to visit the country, which has become the world's second biggest economy in recent years.

He said he wanted to use the three-day visit to "take the British/Chinese diplomatic and political relationship to a new level".

Speaking to reporters on board his flight to Beijing, Mr Cameron left no doubt that the main purpose of the trip is to put Britain in pole position to expand trade with China.

Mr Cameron visited a Jaguar Land Rover training facility

The European Commission is due to begin investment treaty negotiations with China early next year to reduce some of the barriers to trade.

Mr Cameron will hold talks with premier Li Keqiang and has promised to throw his full political weight behind the agreement which could face stiff resistance from some EU states who fear their markets would be flooded with cheap Chinese imports.

One of the first things on the itinerary was a visit to the Jaguar Land Rover academy in Beijing, where Chinese staff are trained to service and sell the British-designed luxury cars.

Speaking to TV cameras at the plant, Mr Cameron denied he was steering clear of speaking about human rights in order to avoid offending his Chinese hosts.

"Not at all," said Mr Cameron. "We have a very strong and full relationship between Britain and China and that includes a human rights dialogue.

Mr Cameron with the delegation at Heathrow Airport

"We are one of the few countries to have that relationship with China."

Writing in Chinese magazine Caixin, Mr Cameron declared his ambition to use this week's visit to help forge "a partnership for growth and reform that can help to deliver the Chinese dream and long-term prosperity for Britain too."

He welcomed signals from last month's crucial Third Plenum of the ruling Communist Party that China is ready to open up further to the rest of the world under the leadership of President Xi Jinping, who took up office a year ago.

Mr Cameron wants to improve his relationship with Mr Keqiang

And he said that he wanted to send the message that "an open Britain is the ideal partner for an opening China".

"Britain is uniquely placed to make the case for deepening the European Union's trade and investment relationship with China," said Mr Cameron.

"Building on the recent launch of EU-China negotiations on investment, and on China's continued commitment to economic reform, I now want to set a new long-term goal of an ambitious and comprehensive EU-China Free Trade Agreement.

"And as I have on the EU-US deal, so I will put my full political weight behind such a deal which could be worth tens of billions of dollars every year."

The PM, who raised the possibility of a free-trade deal at talks with EU partners in Lithuania last week, believes that eliminating tariffs in the 20 sectors where they are highest - such as vehicles, pharmaceuticals and electrical goods - could save UK exporters £600m a year.

During the first day of his second trip to China as PM, Mr Cameron was due to attend the official opening of a new academy in Beijing for training technicians, salesmen and service staff for Jaguar Land Rover, who were signing a £4.5bn agreement to provide 100,000 cars to the National Sales Company in China over the next year.

JLR chief executive Ralf Speth was among the 120-strong business delegation accompanying Mr Cameron, along with executives from major exporters like Rolls-Royce, BP, Royal Dutch Shell, Barclays, HSBC, GlaxoSmithKline, Arup and Virgin.

But the bulk of the delegation was made up of smaller businesses, such as Westaway Sausages of Devon, Moulton bicycles and the Cambridge Satchel Company, which Mr Cameron believes have considerable opportunities in the fast-expanding consumer markets of China.

Also travelling with the PM were representatives of British football, including Premier League chief executive Richard Scudamore, former England and Chelsea star Graeme Le Saux and West Ham United vice-chair Karren Brady.

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BoE Boss Warns Homeowners Over Rate Rise

Homeowners must find a way to pay their mortgages if interest rates rise because they will not be guaranteed a helping hand, the governor of the Bank of England has warned.

Mark Carney's message came after BoE figures showed mortgage approvals hit their highest level since February 2008, while total household debt reached a new record last month.

The recently-appointed Canadian governor urged would-be buyers to think of the debts they were taking on and whether they would be able to repay a 25-year or 30-year mortgage rather than relying on rising property values.

He told The Guardian: "Are you going to be able to service that mortgage five years from now, 10 years from now, if interest rates are higher?

"Or are you counting, even subconsciously, on the price of your house keeping going up and if something happens an ability to sell it quickly and not facing the consequences of not being able to pay?"

Against the market background where there is strong demand among would-be buyers to get on the property ladder, Mr Carney noted his concern about the lack of new homes being built.

It is hoped that strategic decisions made now to try to control mortgage lending will avoid the need for severe and drastic policy actions to be taken if there is a bubble in the property market.

Mr Carney says people with mortgages must think of the consequences

Mortgage approvals are running at levels not seen since Northern Rock was nationalised in February 2008.

Mr Carney said: "The right way to do policy - to protect against the boom and bust cycles - is to act early in a graduated, proportionate way - and that reduces the probability of having to act in a bigger way later."

Earlier this week the BoE confirmed its Funding for Lending Scheme (FLS) would no longer support mortgage borrowing from January to help prevent the market overheating and future debt risks.

The project, which was introduced in August 2012, offers lenders cheap money in return for loans to customers. It is to be limited to business lending from 2014.

Mr Carney said to try to use interest rates as a way of cooling down the housing market would be a "very blunt tool" as it could hurt recession-hit sectors of the economy which are starting to make a comeback.

He also called for "prudence" from lenders.

The BoE could also keep a watchful eye on the situation, he suggested, and try to head off a housing bubble by calling on regulators and lenders to cap the size of a mortgage compared to the value of the house - the so-called loan-to-value (LTV) ratio.

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Energy Bills 'To Fall By £50' Under Govt Plan

Plans to reduce the cost of soaring energy bills by an average £50 a year as a result of cuts in green levies a year have been confirmed by the Government.

Prime Minister David Cameron and his Liberal Democrat deputy Nick Clegg confirmed that funding of insulation and other efficiency techniques for vulnerable households was being reworked and would reduce the burden on consumers.

The cost of the Energy Company Obligation (ECO) scheme could be halved by giving power firms two years longer to hit targets, while other charges will be funded from general taxation in future.

Ministers are expected to fund a £300m plan for a £12 rebate on all household electricity bills and homebuyers are set to be handed £1,000 to spend on energy-saving measures.

The reductions are expected to be finalised in negotiations taking place with the 'Big Six' power firms this weekend and full details of the deal are to be announced by George Osborne in his Autumn Statement next week.

In a joint article for the Sun on Sunday, Mr Cameron and Mr Clegg wrote: "Later this week, we'll announce further help: proposals that will be worth around £50 on average to energy bill-payers.

The two leaders insist the plan is 'serious and credible'

"We're doing it without taking any help away from poor families or sacrificing our green commitments; and in a way that will keep Britain's lights on in the long-term too."

The pair added: "Alongside the Green Deal, when you buy a new home, you could get up to £1,000 from Government to spend on important energy-saving measures - equivalent to half the stamp duty on the average house - or even more for particularly expensive measures.

"It's an all-round win: better insulation means cheaper bills; it's how we cut carbon emissions; and it will boost British businesses who provide these services."

Downing Street sources indicated the grants would be available for purchases of new-build or older housing stock, with the amount depending on the property's energy efficiency and how much work needs to be done.

EDF welcomed the move, and said it did not expect to raise prices again before 2015.

Bills are burned during a protest this month against prices and budget cuts

The intervention by Mr Cameron and Mr Clegg marks a concerted effort to regain the initiative on the energy issue, which has dominated the political agenda since Ed Miliband promised to freeze prices for 20 months if he wins the general election.

The coalition leaders accused Mr Miliband of "taking people for fools".

"Energy companies would hike up prices both before and after the freeze - so families would end up paying more," they wrote.

"Not only that - by cutting investment in green energy, their freeze would threaten thousands of jobs. Labour's con is the worst of all worlds. When an offer sounds too good to be true it usually is."

However, shadow chancellor Ed Balls accused the Government of "half measures and panicky climbdowns", insisting that "only a price freeze will do".

"After last year's Budget, Chancellor George Osborne was forced into chaotic U-turns on the pasty tax, the caravan tax and the charities tax," he wrote in the Sunday Mirror.

"This time the U-turns have started before he's even made his speech. With four days until the Autumn Statement, we've already had panicky changes in Government policy: on payday loans, cigarette packaging, energy subsidies and bank lending...

"On energy, the test for George Osborne is this: whatever he announces must both stop bills rising this winter and make the energy companies pay for it, not the taxpayer."

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