Newspaper round-up: Friday's top business stories

LONDON (Reuters) - Here is a round-up of the top business stories from Friday's British newspapers.

RUNAWAY BORROWING TO TRIGGER TAX RISES

The Treasury has announced annual public borrowing might reach as high as 120 billion pounds over the next two years. Borrowing was expected by most City observers to reach 6 percent of the national income, or 90 billion pounds, in the next financial year, but the Treasury has forecast borrowing of eight to nine percent of national income over 2009 and 2010. This gives the Treasury its figure of 120 billion pounds, which is three times the deficit limit of the European Union.

CBI HEAD SEEKS BORROWING PLEDGE

The director-general of the Confederation of British Industry, Richard Lambert, has called on the government to complete its recapitalisation of banks so that lending can be revived and business confidence regained. Mr. Lambert noted that even companies that were still performing well were extremely nervous about which direction the credit crunch will take in the future. He also supported the Treasury's plan for a fiscal boost, which will be outlined in the pre-budget report on Monday. "In normal circumstances, members would say it would be crazy to support either higher spending or lower taxes when the public finances are in the state they're in but our view is that a fiscal stimulus is appropriate, provided it leads to immediate economic activity", Mr. Lambert said.

DOWNTURN HITS 30 BILLION POUND EFFICIENCY SAVINGS PLAN

Plans to save over 30 billion pounds for the public purse through efficiency savings are likely to be adversely affected by the fall in commercial property prices and the credit crunch. The chief secretary Yvette Cooper said the sale of public sector buildings and land would be less profitable, whilst at the same time public-private partnerships would be made more difficult by the financial crisis. "It will be more challenging in the short term in terms of private sector investment", she told a conference on government asset management in London.

HIGH STREET SPENDING DEFIES FORECASTS

Official figures have indicated that the volume of retail sales in Britain during the three months to October was flat. Sales over the past month fell by 0.1 percent, which still left them 1.9 percent higher than over the same period in 2007. These results were better than those expected by the British Retail Consortium, the CBI employers' group and the Bank of England's agents' survey. Some analysts, however, noted that the month-on-month drop was the second in a row, and a notable divergence was appearing between food and discretionary non-food sales. This indicates that consumers are increasingly only spending their money on essential purchases.