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Stories Report on Business is following today:
U.S. bills BP, others
The U.S. government has sent BP PLC and others involved an initial cleanup bill for $69.09-million (U.S.) for the mess in the Gulf of Mexico, the White House said this afternoon.
"The Administration will continue to bill BP regularly for all associated costs to ensure the Oil Spill Liability Trust Fund is reimbursed on an ongoing basis," the White said in a statement via the Deepwater Horizon Unified Command. "As a responsible party, BP is financial responsible for all costs associated with the response to the spill, including efforts to stop the leak at its source, reduce the spread of oil, protect the shoreline and mitigate damages, as well as long term recovery efforts to ensure that all individuals and communities impacted by the spill are made whole."
The statement came as BP chief executive officer Tony Hayward reported what could be some success in containing the damage in the Gulf since the Deepwater Horizon disaster several weeks ago. Mr. Hayward said the company cut away part of the spewing well, and will know in up to two days whether it succeeds in capping it.
Earlier, in an interview with the Financial Times, Mr. Hayward said the energy giant was not totally prepared to deal with, and lacked some of the equipment needed, for the massive oil spill in the Gulf of Mexico. "What is undoubtedly true is that we did not have the tools you would want in your tool kit," he said, though he added that the containment measures on the surface of the Gulf have been successful and "considering how big this has been, very little has got away from us."
Separately today, Moody's Investors Service noted that insurers have boosted their policies for rigs in deep seas by 50 per cent since the disaster on the Deepwater Horizon drilling rig several weeks ago. "Pricing for offshore energy liability insurance is sure to trend higher as insurers and reinsurers take stock of their losses and re-evaluate the complex risks associated with drilling in deep waters, analyst James Eck said in a report.
Two credit rating agencies also today downgraded the company.
Eric Reguly: Why BP's Tony Hayward must go
Pension funds take on Magna, Stronach
The Canada Pension Plan Investment Board and the Ontario Teachers' Pension Plan are opposing the $863-million (U.S.). deal by Magna International Inc. to buy out the multiple-voting shares of founder Frank Stronach. Magna proposes paying Mr. Stronach, the legendary founder of the auto parts giant, $300-million in cash and 9 million of new Class A shares. The CPPIB said it doesn't like dual-class structures but that the premium is "totally unreasonable," there was no recommendation on fairness from the Magna board's special committee and no fairness opinion from adviser CIBC. Later in the day, Teachers' said it, too, would oppose the agreement. The fund holds just one share of the auto parts giant, which it purchased so it could vote against the deal at a special meeting June 28. Magna would not comment. Read the story
Workplace absenteeism high and rising
Canadian workplace absenteeism rates are high by global standards and are on the rise, and the costs are "striking," a study released today shows. But employers "appear relaxed" in understanding, monitoring and managing shorter-term, casual absences, The Conference Board of Canada study says.
"On average, Canadian organizations report an annual absenteeism rate of 6.6 days lost per full-time employee, which costs organizations an average of 2.6 per cent of payroll," the study says, compared to 5.3 days in the U.S. and less than 5 days in Britain.
"Statistics Canada has suggested that a range of factors account for the rising trend in absenteeism rates, including ... an aging demographic; an ever-increasing proportion of women in the work force with multiple responsibilities (such as child care); rising levels of work-related stress; and the increasing prevalence of liberal leave policies as a source of recruitment and retention in today's workplace."
The group says the costs of sick leave and short-term disability may far surpass those of longer-term disability, and advises employers to identify causes of absenteeism, take steps to improve employee health, focus on communication and education, and become involved early when employees are absent.
No deal on bank tax expected
Officials gathering for the meeting of G20 finance ministers and central bankers in Busan, South Korea, believe there is little chance they will agree to a global bank tax, a victory for Canada, which has strongly opposed an international levy. Prime Minister Stephen Harper and Finance Minister Jim Flaherty have oft said Canadian banks should not be punished given how well they came through the financial crisis. And while there is support for a new tax among some in Europe and the United States, it appears there's not enough to push for a wide agreement. "I don't think we're on the verge of a global consensus," U.S. Treasury Secretary Timothy Geithner told reporters. "... There's not universal support for that across the G20, at least at this stage, and I don't think that's going to change in Korea."
Dow Jones Newswires also reported this morning that a draft of the comminique to be completed by the officials at the meeting Friday and Saturday shows little movement toward an international tax. The draft says only that the G20 financial officials "agreed to develop, with input from the IMF, a set of principles on how the financial sector could make a fair and substantial contribution" to the costs associated with the financial crisis. Read the story
JPMorgan fined in Britain
Britain's financial regulator has fined the London operation of JPMorgan Chase & Co. £33.3-million, or almost $49-million U.S., a record, for not properly segregating client money in its futures and options business. On average, JPMorgan Securities Ltd. did not properly keep separate $8.6-billion, the regulator said. Read the story
Xstrata shelves Australian projects
Xstrata PLC is turning up the pressure on Australia's government to pull back on its proposed new "supertax" on mining profits, warning today it plans to shelve hefty spending on projects there. The projects involved are worth some $5.6-billion (U.S.).
"The [Resource Super Profits Tax]has created significant uncertainty for the future of mining investment into Australia and would impair the value of previously approved projects and exploration to the point that continued investment can no longer be justified," chief executive officer Mick Davis said in a statement.
Xstrata is the first among the world's major producers to announce such a move, but Australia's Prime Minister Kevin Rudd told reporters that "this is part and parcel of what will be the normal argy bargy of a very tense debate between parts of the mining industry and the Australian government."
Maytag recalls dishwashers
The famous Maytag repairman is about to have his hands full. Maytag Corp. says it is recalling some 1.7 million dishwashers, about 160,000 of them in Canada, due to fire hazard. There have been 12 reports, and no injuries. Read the story
From today's Report on Business