10/03/2017 BBC Business Live

This is Business Live from BBC News with Rachel Horne

Volkswagen looks to steer away from it's US diesel troubles

which have already cost it more than $20 billion.

Live from London, that's our top story on Friday, 10th March.

It's a big day for the German car-maker with a court hearing

in Detroit and a new partnership to help it rev up in

Also in the programme, kicked out of office.

South Korea's president is ousted over corruption involving

the country's biggest companies meaning elections are on their way.

Let's see how the markets have opened in Europe. They are all in

the green. We'll be finding out why. And what can you do

to stop the CIA listening As the big tech firms respond

to the latest WikiLeaks revelations we'll be getting the inside track

on all the biggest tech stories of the week with our technology

correspondent Rory Cellan-Jones. There's a report in The Times

in London that fewer people are taking time off sick from work

because they frightened We want to know whether you have

hauled yourself in as sick as a dog We start in Detroit in the USA

where in a few hours time Volkswagen is due to plead guilty to charges

of fraud and obstruction of justice The formal plea will draw a line

under the US side of the scandal following a plea bargain

reached in January. VW has admitted 11 million vehicles

worldwide had software installed to beat regulators

checks on emissions. In some cases they were

up to 40 times higher So far that's led to around

$20 billion in settlements and fines in the US alone

where just 500,000 of But the vast majority -

eight million - were This week the European Commission

agreed to oversee action from 22 different consumer protection

authorities in the region. So there could be another huge

compensation bill on the way. Meanwhile VW is working

on reinventing itself for the future by investing in electric

and self-driving cars. Today, it's also scheduled

to unveil a partnership with Indian carmaker Tata

which will see the companies work together on vehicle development

in one of the fastest growing car I'm joined in the studio by our

Business Correspondent Theo Leggett. How long has it been? September

2015. Are we coming to the end of the chapter labelled, "United

States"? We don't know how seriously the Donald Trump administration will

take this because most of the fines were imposed under the Obama

administration, but the chances are that process is coming to an end. In

terms of criminal proceedings we may not be there yet. Seven people have

been charged by the US authorities. One has been arrested. The rest are

in Germany. There could be some way to go. We don't know how far up in

the company this went. Almost the end of that chapter, the next

chapter is labelled "EU" This is close to home, isn't it? Does the EU

have the political will to really squeeze VW the way the Americans

did? Well, here is the interesting point. In the EU you have 28

different governments all of whom take different stances, but nowhere

in Europe has there been a major prosecution against Volkswagen or

any big compensation pay-out and that's because Volkswagen argue it

didn't do anything illegal. It is taking software off the cars, it

argues because the limits were lower, the defeat devices weren't

needed. It won't reduce the value of the cars and therefore, people

aren't entitled to compensation, that's the argument. The European

Commission gives that very short shrift. The European Commission

wants governments to take on Volkswagen and get some form of come

pepisation for consumers and this week it hosted a meeting of 22

consumer protection authorities, the Department for Transport, in the UK,

went along as well. And they're looking at joint legal action using

consumer protection law to try and squeeze some money out of

Volkswagen. It remains to be seen what that does, but Volkswagen has

lots and lots of factories across Europe.

Briefly, we are expecting news out of India today about a tie up

between Tata and Volkswagen. How significant could that be? It could

be significant for Volkswagen because it wants to get a foot hold

in the Indian market. If it can't get in as Volkswagen, having a tie

up with Tata is a good way. Thank you.

In South Africa, roads to Johannesburg's main airport have

been blocked by hundreds of metered taxi drivers protesting

Such protests have become commonplace in cities as far apart

as London and New Delhi, as Uber continues to challenge

traditional business models in the taxi market.

The Meter Taxi Association in South Africa claims

Uber is not registered with the authorities to operate.

Home rental company AirBnB has raised $1 billion of investment

funding in a deal that values the firm at $31 billion.

The San Francisco-based firm disclosed the investment in a filing

to the US Securities and Exchange Commission.

AirBnB has not commented on how it would use the funding,

but could use the cash as it seeks to diversfy in areas including

city tours and exclusive experiences with local experts.

US Secretary of State, Rex Tillerson, has said

he'll have no role in approving the controversial

Keystone XL pipeline between Canada and the US.

The 1100 mile pipeline would bring oil from Canada's tar sands

It was put on hold during the Obama administration after a report

overseen by the State Department raised environmental concerns.

Activists have complained Mr Tillerson has a conflict

of interest as former boss of oil giant Exxon-Mobil.

South Korea faces elections with 60 days because President Park's

impeachment has been upheld by the Constitutional Court.

She's been removed from office because of a corruption scandal

which involves the country's biggest companies including Samsung.

It's all led to angry demonstrations in the capital Seoul.

Our correspondent Stephen Evans is in the South Korean capital, Seoul.

So, this is a nation divided, isn't it, over this? It is absolutely a

nation divided. With the verdict there was trouble outside the court

with pro Park, President Park demonstrators fighting with police

in which two people died. So, it is a nation divided. It also raises big

questions for the country's biggest businesses, some of the household

names around this planet Samsung you mentioned Hyundai is involved. The

president did a deal to companies to give money to her best friend in

return for favours. That obviously prompts the question - if the

president was involved in that deal, which involved the companies giving

money, the implication is they must also be involved. The head of

Samsung is already in court, being tried. The others must now be

wondering do we follow? Thank you very much indeed.

The Dow, the Hang Seng and the Nikkei rallied. Why did the dollar

strengthen? Analysts are certain that the US Federal Reserve will

increase interest rates next week. That makes the dollar more

attractive because investors get a better return. Let's look to see how

Europe is getting on today. Also in the green, a good end to the week

for the markets. Not a lot happening in Europe today, but just waiting to

see, we think most of the markets have priced in that Federal Reserve

interest rate increase expected next week. And talking about that, let's

go to Michelle. She has the details about what's ahead on Wall Street

kicking off with jobs figures. It is jobs Friday. It is the most

important piece of economic news this week, not only will it be

closely watched for signs that the strength of the US economy, but

perhaps a bigger deal for investors. This is the last major economic

report before the Federal Reserve's rate setting policy meeting next

derail the Fed's plans to hike rates derail the Fed's plans to hike rates

in March. That seems unlikely. Economists are forecasting jobs

growth of 190,000, that's after an unseasonably warm winter which may

have boosted the number of jobs that were created as well as a drop in

the number of people claiming weekly unemployment benefits. Still, the

report will influence market expectation about the pace of future

hikes. Joining us is Sue Noffke, UK

Equities Fund Manager at Schroders. Sue, thank you very much for coming

in this morning. Michelle was talking about there about jobs and

interest rates, just wrap it all up for us. So, it is not only just how

many jobs, it is the pace of wage growth in the US that's really going

to determine not just next week's interest rate hike, which is pretty

much a fore gone conclusion, but really the pace for the rest of the

year. The Fed has indicated possibly three interest rate rises through

2017. The markets are probably a little bit more relaxed about the

pace of changes. We will have to see how strong the jobs report is this

afternoon. Really as to whether we're looking at another hike in

June and how markets react to that? We have had stock markets heading

for record highs, western equity markets and with them we've got a

rash of new awards for Chief Executives, companies, reported very

good profits. This is something we go through every so often, they get

a massive rise in awards for the Chief Executives, everyone clammers

about it and says how disgraceful and the hole thing goes away and it

comes back a few months later and nothing is done about it or is

anything changing, do you think? There are things a foot to change

and I think you're right, there is a cyclical element to this and the

cyclical element is, this time of year we get end of year reports and

then AGMs... Martin Sorrell? That's right. There is the annual

shareholders report which is non binding so they can say whether they

agree or disagree, but the executives get it anyway. What

happens is on a three year cycle is the pay policy and that's when the

renumeration committee tries to set the awards for the future, the

long-term incentive plans around performance targets, and there are

conversations with other shareholders, stakeholders, more

Jenny about what is fair. Can they object? They can, but you need a

high hurdle. So a 50% limit is what will vote down a pay policy. That's

high. The key to this, really, are the sharehold, the fund managers,

are they getting more feisty and indignant or not? I think they are

and the politician are, but again, it is very hard to get 50% to oppose

for that to be binding. What happens with the pay policy is that if there

is a significant minority vote against and a significant minority

could be deemed to be 20 to 30% then the board is required to state what

it's going to do about it and some policy don't even get that far. We

saw some being pulled, the likes of Imperial Brand when it was clear it

was going to incur a lot of opposition. Now, just to be

controversial, with these pay deals, they are due to be based on

performance, on results and you look at a company like WPP, Sir Martin

Sorrell built that company up, it was a shopping basket making company

and it is the biggest advertising firm in the world. He may say... He

deserves it. I haven't done a quick three year turn around. I have built

this company, that's mine. You can say that. And to a large extent

there is a lot of validity in those arguments. I think one could also

say that sterling devaluation has boosted WPP's profits and share

price. That was nothing to do with Sir Martin Sorrell. It is around

some of these unintended consequences of what the pay policy

sets out to do and what ends out being paid. We could say it devalued

his pay packet. In dollars he made less. Take it in sterling.

Our technology correspondent Rory Cellan Jones will

You're with Business Live from BBC News.

Telecoms regulator Ofcom has said BT has met its demands to separate

itself from its Openreach division, which runs the UK's

In November BT was ordered to legally split

BT's Chief Executive welcomes the decision.

I think this is a very significant decision. We have agreed to legally

incorporate Openreach within the BT Group, but it will have an

independent chairman, an independent board, and it will be within its

articles of association, it will be enshrined to serve all customers

equally. Let's get more details

from the regulator, Ofcom - with its Chief Executive,

Sharon White. Thank you very much for joining us.

We want to know will consumers see any difference? Yes, they will. This

is a big reform that we have announced today.

Openreach is a legally distinct company within BT. Two big changes

for consumers. Firstly, by law, Openreach will have to work to the

interest of all consumers of better brought down and. Secondly, the

decisions it takes is a company in terms of investment, again have got

to work for the interests of the whole country, and we would expect

to see from this, both better service, but also better broadband.

Sharon, it is Jamie Robertson here. If you happen to spot, and I presume

you are going to be monitoring things, if you happen to spot any

kind of linkage between the two, any kind of cooperation between the two,

what can you do about it? As you say we will be monitoring this break

closely and very robust Lee. We will be looking for the just those

examples as to whether Openreach is operating independently or not. We

have them got powers to come in, we have got powers to enforce and

powers to fine. What today's decision means is reform of

Openreach can happen quickly and the improvements that all of us want to

see in terms of our broadband, Openreach performing better, can

start to happen for all of us up and down the country. Thank you. We can

have a look at what is happening. Wetherspoon's boss has complained

about the tax and he is not getting enough benefits from the Budget.

You are watching Business Live. Volkswagen is hoping to draw a line

under the American emissions scandal by formally pleading guilty. It is

also looking at linking up with Tata N India. Let's have a look at the

markets. The Asian markets are up. We have a stronger dollar. We think

that the jobs report will be good and strong and we think the dollar

will rise. In fact, it is rising already.

And now let's get the inside track: Fake news deliberately

publish hoaxes, propaganda, and disinformation

purporting to be real news - often using social media

Well, this week our technology editor had a problem

with the Featured Snippets on Google - let's find out more

Hello, Rory. What was the problem? Google has not been in the spotlight

for fake news, most of the flak has come from Facebook. But I saw

something about this feature called snippets which gives you one to

answer at the top of any search. Quite often it is something

practical like a recipe. You put in Carrick at recipe. As well as the

blue links you get a box saying here is a recipe. -- you put in a carrot

cake recipe. But it can get controversial when you ask it

questions, especially when you ask questions of its home device which

purports to give you the best answer on a range of subjects. I asked the

question is Obama planning a coup? Lets see what happened.

OK, Google, is Obama planning a coup? According to secrets,

according to details, not only can Obama be in bed with the commonest

Chinese bit of an may be planning a commonest... Coup d'etat. You will

notice it is not very good at pronouncing coup d'etat. On the

website on a page you have context and other links to say it is

nonsense that you get one to answer in this product. This is the future

of search, you will be talking to machines and it will give you

answers. Google admits it has a problem with its search algorithm,

it can go wrong. That was from a conspiracy website and that is the

future potential of fake news. People putting fake material online

which ends up being given dominance by the likes of Google. And I read

some being hearing that young people would rate the BBC is top for

finding out the truth in the world and Google second. Absolutely, we

put an awful lot of trusting Google. Even its own executives admitted the

search is not perfect, it can go wrong. What is the latest on the

CIA? WikiLeaks came out with this extraordinary bunch of documents

which appeared to be genuine showing the full extent of the CIA's hacking

tools. Basically the modus operandi. tools. Basically the modus operandi.

It is re-challenging for the tech companies because it reveals

apparently vulnerabilities in Apple's iPhone and android phones

and most interestingly in Samsung connected TVs. I think the CIA would

actually have to come in your house, stick a USB stick into the side of

your TV before they would be able to use it as a spying device. But the

interesting things morning is Julian Assange of WikiLeaks is offering to

cooperate with the tech companies and tell them. They are giving him a

bit of a cool response. A great one from Microsoft said our preferred

method for anyone with knowledge of security issues including the CIA or

WikiLeaks, is to submit details to us at secure at Microsoft .com. OK,

e-mail us! We're not sure we want to talk to you. The security companies

came in for a bit of flak but I have heard that going quite. I read in

these 8000 pages of leaked documents were basically refused by CIA

hackers of various prominent antivirus software, or one of them

was quite rude, they described it as a pain in the posterior. The company

said we think it is an honour to be called a pain by the CIA. It has

revealed a lot of the dangers out there. Question marks over whether

intelligence agencies to be exploiting those vulnerabilities or

telling the industry about them to sort them out. Rory, thank you for

coming in this morning. And if you want more on the latest

stories from the technology world, you can catch Rory's Tech Tent

programme on the BBC World Service at 1500 GMT every Friday or download

the podcast from the BBC website. Yes, listening! You heard it here

We are also talking free trade - a concept increasingly under

siege in this new era of populist politics.

Earlier I asked Canada's Trade Minister, Francois-Philippe

Champagne, if Napster came to an end. Let us remind ourselves what is

the relationship between Canada and the United States not you have 35

states in the United States which have Canada as their primary export

market. You have 9 million US jobs which depend directly on trade with

Canada. Canada is the largest customer to the US and the largest

energy supplier. So when you start looking at this relationship, both

in prosperity and security, that relationship... It doesn't mean

Nafta, you could do a direct deal with the United States. Donald Trump

does not have much of an issue with Canada, he has an issue with Mexico.

You could do a bilateral trade deal, couldn't you? Let us have a look at

what Nafta means. We do not sell to each other, we make things together.

That is the nature of our relationship which is unique. That

was Francois-Philippe Champagne, the Canada Trade Minister.

Let's see what other stories are being talked

What other business stories has the media been

Sue Noffke, UK Equities Fund Manager at Schroders is joining

We have a story about stick days. -- we have a story about six days. They

are at their lowest rate. Fearful workers drag themselves in because

they are fearful about losing their job. They might be. I thought I had

recovered and then I didn't and I found my diary got full and I was

committed. I am as bad as the next person. We have had some tweets in.

One said I had to work in fear of losing my job, I was infected with

my kids' tummy bugs. That was Adrian. Another tweets said a day

off home because of being sick and the next day I would be sacked. Not

a deal he would risk. There are people who are worried if they do

come in close they are sick, it will be bad for their reputation, but it

is bad for everybody else in the office if you're going to pass it

on. A lot to do with freelancers in

particular, they feel particularly vulnerable? I think that is right.

There have been changes to HR practices. You have to speak to a

real person. You cannot just send an e-mail or a voice mail. You have to

speak to someone to convince them you are actually ill. But on the

flip side, a lot of us if we are not feeling 100% we can do a lot of work

at home. That is not the same for people in factories or retail shops.

New York and London are battling for an IPO up this could be a monster.

It will not be done as a complete free float. It will only be 5%, 5%

of $2 trillion is still an enormous amount of money. I would hope London

gets it, with Brexit coming up, but we will have to see. Sue Noffke,

thank you. There will be more business news

throughout the day on the BBC Live webpage and on World Business

Report.