The biggest worry for new boss Philip Clarke is that there is no single answer to that £5billion poser. There's a whole raft of reasons.
This year's Christmas crackers were Waitrose, Marks& Spencer and Sainsbury's, who catered best for families with cash to splash.
Meanwhile Aldi and Asda were flavour of the month with families anxious to make their budgets stretch.
Tesco appears to have got stuck in the middle of the road - and been run over by rivals.
Britain's biggest grocer was also a victim of its owns success.
Much of its growth in recent years, has come not from food but from selling TVs, computer games, toys, furniture, etcetera.
As we also saw at Argos, sales of gadgets and other presents suffered this year as shoppers had less spare cash to spend.
There's also doubtless been a backlash against a company seen by many as too powerful, crushing competition, killing High Streets and brutally squeezing suppliers.
While millions of shoppers still vote with their wallets and shop at Tesco, a growing number would not be seen dead in one of the big beast's stores which even Clarke admits have been run with too few staff.
Even when it has tried to do the right thing it has made a muddle.
Tesco claimed its Big Price Flop, sorry Drop, was an attempt to help families struggling to make ends meet.
But it robbed customers of other benefits, such as double Clubcard points, to help foot the £500million bill, leading to claims of smoke and mirrors.
What's more, rivals - notably Sainsbury's - came up with their own price promotions and communicated them much more clearly.
The big question now is can Clarke repair the damage? His predecessor Terry Leahy always claimed Tesco was a well-oiled machine that would keep running smoothly without him.
But the Tesco juggernaut has been slowing almost ever since he quit. Now other top brass are leaving Clarke with a lot on his plate, a lot of work to get Tesco bringing home the bacon again.
Whether he can pull it off or not remains to be seen but one thing seems certain. Tesco will try to turn the heat up on its rivals and more cutthroat competition between the grocers will mean better deals for shoppers.
The true cause of Antonio Horta-Osorio's illness emerged yesterday as he was passed fit to return to work in January.
"When he started he threw himself into the job, working like a dog," said a Lloyds spokesman. "He was working so hard he found it hard to switch off and that meant he couldn't sleep. That led to sleep deprivation which left him physically exhausted."
Lloyds' chairman Sir Win Bischoff confirmed yesterday that Mr Horta-Osorio had been passed fit by his doctors.
The Lloyds' board then met and "unanimouly" agreed he should return to work after a Christmas holiday on January 9.
Asked how the 47-year-old chief executive was when he met him Sir Win said: "Bushy tailed. Terrific. Big smiles."
He was well enough today to splash out on 600,000 Lloyds shares - a clear sign he is backing the Black Horse to be a winner.
He can clearly afford it. He received a £4.6million golden hello when he joined Lloyds. His salary is £1million and the bank put £600,000-a-year into his pension.
He stood to earned another £6.6million from bonuses if he hit all his targets, though that now seems unlikely.
City experts believe Lloyds is taking a risk by allowing Mr Horta-Osorio to return to such a stressful job.
But Sir Win is convinced the Portuguese banker, poached from rival Santander at the start of the year, is still the best man for the job.
But he said Mr Horta-Osoria, whose hobbies include swimming with sharks, had agreed to change his methods, sharing more of the workload with senior colleagues.
"Antonio realised he can't come back BAU - business as usual,' he said.
"There is a strong team in place and the idea is that they carry some of the load rather than it all falling on Antonio's shoulders."
Insisting he did not believe there was a risk of a relapse, Sir Win admitted his own job would be under threat if he was wrong.
"I would have to consider my position but I don't believe it will come to that," he said.
]]>He did his best to make it look good and rise above the opposition heckling. But it was deflating within of minutes of being dished up.
This was meant to be a recipe for growth but he was forced to admit the economy will slow sharply again next year.
It was supposed to be a boost for jobs but again he got his fingers burned with fiigures from the official bean counters showing things will get a lot worse before they get better.
The Office for Budget Responsibility said unemployment, already at a 17-year high of 2.6 million, would jump by another 200,000 next year. Other economists were even bleaker, warning the total could hit three million by 2013.
Slasher Osborne had hoped to use his 45 minutes centre stage to convince us his deficit reduction policy was simmering nicely.
Again, the data made a mockery of that. Slower growth and rising unemployment will blow a hole in the Treasury's finances.
This means the Chancellor will be forced to borrow another £480billion over the next five years.
That is a jaw-dropping £111billion more than he predicted just eight short months ago in his main Budget in March.
Other parts of the Chancellor's croaky speech also resembled an Eton mess.
If he thinks freezing working tax credits while giving those on benefits a 5.2% rise is encouraging people to get a job he's in cloud cuckoo land.
Many people on benefits would prefer to be working but not if they're barely any better off.
Scrapping the 3p-a-litre increase in fuel duty and limiting rail fare rises will mean lslightly less pain for millions of commuters but will be of little help to the growing number with no job to travel to.
Likewise, making it cheaper for small firms to borrow is all well and good but it will mean diddly squat to companies whose order books are drying up as people are forced to rein in spending.
And don't be fooled by suggestions this is a bank-bashing Budget. It is true he increased the levy but this was only because, with even those businesses shrinking, it had failed to raise the £2.5billion he'd banked on - another missed target.
The bottom line is that the Chancellor's speech was long on perspiration (ie if you're lucky enough to have a job you'll be working harder for less) but short on inspiration.
There was no BIG idea.
There was also precious little to inspire confidence.
And without that key ingredient, his recipe for recovery looks half-baked at best.
]]>The bid price - a cheeky nod to his airline by Virgin's marketing genius - may be low but there is plenty of turbulence ahead for the banking industry.
At least this is a start in clawing back the billions of taxpayers' cash used to bail out the banks.
The deal will see the Rock, which symbolised the credit crunch, finally put out of its misery.
Seeing the Rock name scrapped will upset some, mainly in the north east, but the mourning wont last long if Virgin can pose a real challenge to Britain's "Big Five" banks.
So can Branson break their stranglehold? Let's hope so. If Virgin is a success taxpayers will reap another £280million.
But there is a bigger prize. If Branson writes that second cheque it will mean Virgin has seriously rattled the Big Five who have ridden roughshod over customers for too long, selling duff products with sting-in-the-tail charges.
Some fear Branson may have bitten off more than he can chew, pointing out that Virgin will still be a minnow, dwarfed by industry giants such as Lloyds, HSBC and Barclays.
But Branson is well used to punching above his weight in such uneven contests. His airline has been a constant thorn in British Airways' side.
Only time will tell if he can pull it off but one thing is certain. He can't do it alone.
For Virgin to really fly, customers must shake off the apathy which sees so many stubbornly stick with the same bank even when they're being shortchanged.
The 38% fall from a year ago, signals the leanest bonus season for almost a decade, according to a report.
The Centre for Economics and Business Research, which also forecasts 27,000 City job losses this year, blamed "turmoil" caused by the Eurozone debt crisis which hit profits at many banks.
But while the fat cats are getting thinner the pay-outs were still large enough to spark fury.
TUC General Secretary Brendan Barber said: "With the banking sector on the verge of another trillion euro bailout and small businesses struggling for credit, banks should not be siphoning off billions better spent supporting the real economy on undeserved mega bonuses.
"If the City thinks a £4 billion bonus pool is a lean year, they should see how the other 99.9 per cent that have bailed them out are coping."
Lord Oakshot, the LibDem peer who resigned in protest at the coalition's failure to curb bank bonuses, said: "Real incomes are now being seriously squeezed in the rest of Britain but City pay just sails merrily on."
But the CEBR points out that while individual workers are receiving lower pay-outs the biggest loser is the Treasury.
The taxman will take a £2.5billion slice of the £4.2billion bonanza through a combination of 50% income tax and national insurance payments.
But this is well short of the £6.8billion collected in 2007/08, prior to the credit crunch.
Douglas McWilliams, Cebr chief executive, comments, "Although I wouldn't want to be a Porsche salesman now with the fat cats having to tighten their belts, the real losers from falling bonus payments are the Treasury and the taxpayer."
]]>David Cameron's decision to haul power suppliers over the coals smacks of shameless double standards.
Few people would dispute that the energy market needs a massive shake-up.
Record profit margins of £125 per customer amount to a £3billion bonanza for the Big Six.
The fact that there is so little difference in prices they charge suggests a dreadful lack of competition.
At the same time, the bewildering range of tariffs mean we're a million miles from the "simple, transparent and trusted" market Cameron and his sidekick Chris Huhne claim to want.
Yet the PM could hardly have chosen a worse time to jump on this particular political bandwaggon.
At the very moment he is grandstanding - accusing the firms of fleecing people - his government is slashing support for pensioners and vulnerable families living in fear of spiralling bills.
While busy bleating about recent price rises which will add around £100 to the typical bill, Cameron's coalition cronies are cutting Winter Fuel Payments by, yes, you guessed it, up to £100. You couldn't make it up.
It means pensioners aged over 80 will see the £400 they have received for the past three years cut to £300. Meanwhile, younger pensioners aged will see their windfall payments fall by £50 to £200.
At the same time the government has instructed the firms to replace complex social tariffs with the Warm Home Discount. While this will mean automatic rebates of £120 for some pensioners, it will leave many more poor families on benefits out of pocket.
What is more there is a feeling of Groundhog Day - that we have been here before - about all this.
The Coalition talked tough about bank bonuses while doing next to nothing to rein them in and even axing the tax imposed by Labour.
Now, after reversing Labour's decision to give extra help to pensioners facing the stark choice between heating and eating, we are being subjected to yet more than hot air.
They stirred up a right hornets nest yesterday by highlighting the huge profits being raked in by the power companies.
It is the kind of furore usually sparked by consumer watchdogs or price comparison websites eager to trigger a fresh stampede of switching.
The report could hardly have been better timed to provoke anger. The only thing missing was the first freeze of winter. And that may not be far away.
Suggesting the energy giants are stashing the cash at the very moment family budgets are being strangled to death is a surefire way to make people's blood boil.
Of course energy firms need to make money to invest in new power stations, more storage and greener fuels but they should not be allowed to rip off customers.
The companies argue that their wedge will shrink in the months ahead but people need help now.
There has long been a view that the "Big Six" are only interested in lining the pockets of shareholders and banking bumper bosses' bonuses.
They're quick to put up charges when wholesale prices rise but seem slow to pass on the benefits when costs come down.
The evidence provided by Ofgem's beancounters will only fuel this suspicion of profiteering - that they're abusing their power.
The Bank of England's decision to pump an extra £75billion into the system is a desperate bid to stop us sinking back into recession.
Most experts had expected Governor Mervyn King and his fellow beancounters to wait until next month to launch the lifeboat, with most betting on a £50billion rescue.
The fact that the Guv'nor flicked the switch sooner, and piled extra cash on board, reflects how loud the alarm bells were ringing.
The mercy mission came just 24 hours after data showing the UK economy growing half as fast as previously thought.
At the same time, a separate report showed household spending at a 10-year low as wages fail to keep pace with the rising cost of living.
Then just hours before the Bank's decision, a survey from the Halifax, which the wonks see in advance, showed house prices lurched lower again last month.
But the problems are not confined to the UK. It's getting worse nearly everywhere, growth slowing in the US, the eurozone and even China.
The Bank's move will not make a blind bit of difference to what is happening there. It will do nothing to tackle inflation either, the other major cloud hanging over families struggling to make ends meet.
The move got the seal of approval from the City, where share prices surged but that is because they stand to make some money.
Whether it will make any difference to the real economy and the wealth and job prospects or ordinary people - only time will tell.
]]>The shambles started when the £140,000-a-year PM, with two houses, two cars and no bills to pay, had the nerve to tell hard working people to pay off their credit and store card bills.
Patronising? You bet! But that didn't stop Cameron's spindoctors peddling the idea in order to grab some headlines.
But the idea also showed just how behind the times and out of touch the Bullingdon Boy is.
Many families can barely afford to heat their homes, run their cars and put food on the table. In fact a growing number are relying on their credit cards to pay those essential bills as wages fail to keep pace with inflation.
People who can afford to pay down their debts have been doing it for the best part of five years. That's why the nation's credit card debt has fallen by £12billion since 2006.
A gaffe? Too right!
When this finally dawned on someone in Tory Towers the No10 speechwriters were forced to scramble for the Tipp-Ex and redraft his weasle words.
What's more his masterplan was not just insulting but also fatally flawed.
Clearing debts will not kick-start the economy which, figures showed yesterday, has been flatlining for months.
Paying your Visa bill will not drum up orders for struggling firms or give them reason to hire more staff.
The Conservatives have been trumpeting the decision to freeze council tax next year. But that jam tomorrow is a fraction of the sums people are forking out right now due to higher VAT.
Cutting council funding seems certain to force town halls to scale back services and even cull jobs, all bad news for the growth which is proving so elusive.
If household chose to use their supposed windfall to reduce their debts it would suck even more money out of the economy, accelerating the downward spiral.
Classy Dave? Clueless more like!
We're still struggling out of the last one which cost 150,000 jobs within the industry alone.
The crippling cost of bank bail-outs also sucked billions out of the Treasury's coffers triggering government spending cuts and countless more redundancies.
So those who blame the banks for the catastrophe will be jumping with joy as the ICB applies the thumbscrews.
If banks get in a hole in future they must to dig themselves out or go bust. At least that's the theory.
But the fly in the ointment is they're certain to pass on the huge cost of the shake-up to customers.
This could add around £20,000 to the cost of a £175,000 mortgage over 25 years say experts.
While this would be a fraction of the colossal cost of bailing out the banks it would put huge strain on millions of household and business budgets.
A better solution would have been to put the fear of God into the banks through fiercer regulation.
As well as greed the crises at Northern Rock and Lehman Brothers et al were due to bosses and regulators being asleep at the wheel.
Tougher sanctions, such as jail and life-time City bans for those at the top, would put a stop to the reckless lending which brought the banks to their knees - without consumers being fleeced again.
What's more they could have been in place long before 2019 - the ludicrously long deadline for banking's brave new world. A timescale so generous many feel the banks have been let off the hook.
]]>That's the initial view of the Competition Commission which has spent the past year examining the couch potato market.
It says the satellite broadcaster is abusing its position, exploiting the fact that it has sewn up exclusive deals with all six of the major Hollywood studios.
It is likely to be another 9-12 months before the final ruling but one of the possible solutions suggested by the Commission yesterday is restricting the number of exclusive studio tie-ups Sky is permitted.
This would free up some rights for rivals in a similar way to buy in the same way ESPN has been able to buy some Premier League games.
But there are two major problems with this idea.
Firstly, if what happened with the football is anything to go by, it could end up costing movie buffs more not less.
Football fans who want to be able to see all the premier League games must now PAY TWICE, once for the Sky games and again for the ESPN matches.
Secondly, most of Sky's existing deals with the film studios, for which it pays around £250million a year, have 3 to 5 years to run.
If the Commission tries to force Sky to break some of those agreements it is likely to face the full force of the broadcaster's legal team (and they can clearly afford top briefs).
The alternative is to wait until those contracts end which means a very long wait for the supposed rip-off to end.
It seems as if it could be a very long time before this saga reaches its climax.
]]>It means the number signing on has grown by more than 100,000 since the start of the year, with many of them young women.
If that isn't grim enough, beware - the government spending cuts are only just starting to bite.
That means the number being paid to do nothing seems certain to grow. And that in turn will mean fewer people paying the taxes that are needed to meet the nations running costs.
At the same time, millions of those in work are seeing their spending power plummet as wages fail to keep pace with the cost of living.
Less spare cash in their pockets means less business for shops, restaurants etc., continuing the downward spiral.
City experts said yesterday that interest rates could be frozen for another two years after a U-turn by two members of the Bank of England's Monetary Policy Committee who had been calling for an increase.
Good news, you may think, if you have a big mortgage but it is a big blow to millions of savers.
More worrying is that it highlights just how badly the economy has stalled.
The Bank of England gurus are so fearful of the damage it would do, that they dare not raise interest rates to rein in inflation.
Almost 950,000 of the jobless are young people aged under 24. Many in this generation are facing a bleak future, their hopes and ambitions crushed by lack of opportunities.
It may be why this age range were to blame for much of the recent rioting and looting.
It can't in any way justify or excuse the mindless mayhem but it may go some way towards explaining it.
A generation with little hope and too much time on their hands is a toxic cocktail spelling trouble.
This is particularly true when coalition cuts are ripping the heart and soul out of the police force, allowing gang culture to flourish.
The Chancellor's father is the founder of fancy fabrics and wallpaper business Osborne & Little and boy George has a £30m stake in the business in a trust fund.
But no matter how hard he tried to dress it up yesterday the flaws in the economy were plain to see.
It has basically been flat-lining for the past nine months and the chances of it hitting official growth forecasts of 1.7% are zero.
Most experts agree UK Plc will now be lucky to expand by 1.25% this year.
That is half what's expected in the US and barely third of forecasts for Germany and would mean we're enduring the slowest recovery in nearly 100 years.
Yet Osborne continues to try glossing over the facts by blaming everything from the Royal Wedding to the Olympics for the feeble figures.
The truth is that while government spending cuts and tax increases are only just kicking in they are already crushing confidence.
Families are fearful for their jobs and while wages fail to keep pace with the spiralling cost of living they have slammed the brakes on spending.
As orders dry up businesses cut spending, freeze expansion plans and, if it persists, lay people off.
It is time for a makeover in the Chancellor's thinking and new measures to stimulate growth and get the country back in the black.
The action centres of two of the UK's biggest mobile phone firms.
The spat followed O2's launch this week of Priority Moments, with offers including half-price cinema tickets from Sunday to Thursday.
It seemed to be a real kick in the teeth for Orange Wednesdays, which offer customers two tickets for the price of one but only one day a week.
Perhaps the most surprising thing was that both offers are with Odeon, suggesting someone at Orange had dropped a clanger by failing to make its long-standing deal exclusive.
But Orange has hit back by suggesting the O2 agreement may only last for a few months.
What's more June was the biggest month ever for Orange Wednesdays with film buffs snapping up more than 800,000 tickets.
So who comes out on top apart from consumers?
The Odeon which seems to be selling its popcorn and eating it.
]]>Millions of workers - men and women - face the stark choice between delaying retirement or somehow making do with less money.
One group of women in particular will be penalised and have found themselves being used as political footballs.
Business Editor CLINTON MANNING explains how we got in this mess and explores possible solutions.
Q - WHY IS THE GOVERNMENT SO KEEN TO RAISE THE RETIREMENT AGE?
A - Reform is being driven by two things - the poor state of the nation's finances and increasing life expectancy.
The 1960s baby boom also means there are a growing number of people approaching retirement and fewer workers born since then paying the taxes needed to fund pensions.
Every year that ministers push back the retirement age saves £13BILLION although it will not help the Coalition tackle the current deficit as any savings don't kick in until 2016.
Q - HOW MUCH LONGER ARE PEOPLE LIVING?
A - After the Second World War, when the state pension age was set at 65 for men, their average life expectancy was 66.4 years and women's was 72.5 years. Today it is 77 for men and 82 for a woman.
Latest estimates suggest this will increase again by 2056, to 84 and 89 years respectively.
Q - WHY HAVE THE GOVERNMENT PLANS CREATED SUCH A STORM?
A - The pace of change is what has caused the controversy. Most experts agree that the current system is unaffordable. In fact the previous Labour government had outlined plans to increase the retirement age for men and women to 66 by 2026.
Q - SO WHAT'S CHANGED?
The government has been accused of "moving the goal posts" and giving people too little time to plan for the changes.
Women born after 1950 had been due to see their pension age gradually rise from 60 to 65 over 10 years.
Now it is proposed to jump to 65 in six years by 2016 and then rise again to 66 by 2020.
By contrast men will see the retirement age rise by a year to 66 between 2018 and 2020 when it will be the same as that for women.
Q - WHAT DOES THIS MEAN?
A - While millions of people are seeing the age at which they thought they may be able to retire pushed back. But one group of women in particular, those born in the mid 1950s, are baring the brunt of the changes. Some of them will be forced to wait two years longer for their pension. Campaigners fear the changes mean many elderly people will die before getting back a penny of the money they've been shelling out for all their lives.
Michelle Mitchell, Age UK's Charity Director, said: "These proposals are a slap in the face for millions of older people, particularly the very poorest, who are unable to work for longer.
"Anyone who is worried about the pace of change should contact their local MP and urge them to oppose the plans."
Q - IS IT RIGHT THAT MEN AND WOMEN RETIRE AT THE SAME AGE?
A - It probably is. In fact it has been a bit of anomaly that women have been able to retire five years earlier as they generally live longer and therefore draw their pensions longer.
Q - SO WHAT'S THE FUSS?
A - Around 330,000 women who will see their pension age rise by up to two years are getting only six years' notice of the changes, giving them little time to even try to save more for their old age. By contrast, men are being given seven years' notice of a 12-month increase in their retirement age.
Q - HOW MUCH WILL IT COST THEM?
A - It could be as much as £13,000 or even more if the government presses ahead with plans to create a simpler, universal state pension paying the equivalent of £140 a week in today's money.
They will also be forced to wait for other benefits linked to the state pension such as free prescriptions and eye tests.
The government will also rake in extra tax revenue - estimated at up to £8 billion - if people are forced to carry on working.
Q - SO IS THERE MUCH OPPOSITION TO THE GOVERNMENT PROPOSALS
A - Yes. More than 180 MPs have signed a motion opposing the changes, including 26 from the Coalition. Dr Ros Altmann, a former Treasury adviser and now director general of Saga, is also lobbying hard against the changes she says may be open to legal challenge.
Q - SO WHY WONT THE GOVERNMENT BACK DOWN?
A - Apart from the cost any concessions on this issue could knock-on to the fracas over public sector pensions which are threatening to trigger a rash of strikes.
Q - IS THERE ANYTHING THE WOMEN COULD DO?
A - The sad truth is very little. If the government presses ahead with its timetable they will be pay a big penalty, being forced to work two years longer. As if that wasn't bad enough many women of this age, if they did work, were often not allowed to join company pension schemes. Their generation also invariably took lengthy periods off work to bring up children so have not made enough National Insurance contributions to qualify for a full pension.
Q - SO IS THERE ANYTHING THEY CAN DO?
A - If they have the money they may be able to purchase extra years worth of National Insurance contributions. The cost is £627 for every year but money well spent if they have it.
Otherwise the only thing they really can do is look for ways to improve their finances and invest any savings in a private pension or tax-free ISA accounts.
Tom McPhail, pensions expert at Hargreaves Lansdown, said: "Most of us have not been saving enough for retirement.
"We need to save more but will still have to face up to the prospect of working longer and retiring with less to live on."
with pic of sisters Carol Fowler
By CLINTON MANNING, Business Editor
SISTERS Carol Fowler and Christine Ratcliffe show how unfair the government's proposals are.
Despite being born just 12 months apart, Carol will have to work three years longer than her sister before she can retire.
Purely because she was born in March 1954, Carol, a mum of two, will not be able to draw her state pension until she is 66.
By contrast Christine, who was born in 1953, will be able to retire at the age of 63.
"It's grossly unfair," said Carol, a mum of two from Northampton.
"I left school when I was 15. Apart from about eight years off to bring up my children and put myself through college I've been paying National Insurance contributions since 1969.
"For most of my working life I was expecting to retire at 60. Now, when I would have been just seven years from retirement I'm suddenly told I will have to wait until I'm 66.
"My sister on the other hand is unaffected by the latest changes and will still be able to retire when she is 63."
Fortunately Carol and her husband Neil are not in dire financial straights as they have two incomes but she knows many women her age will be hammered by the changes.
"The thing that makes me mad is I feel as if there was a contract between me and the government and they've ripped it up.
"David Cameron says we're all in this together but that's clearly just not the case."