Monday newspaper round-up: Bank Rate, Income tax, Cameron

Interest rates are likely to hit 5% within a decade, according to the outgoing Bank of England deputy governor for monetary policy. Sir Charlie Bean said it would be "reasonable" to expect borrowing costs to return to pre-recession levels in the long term - between five and 10 years. - The GuardianIncome tax and national insurance will be merged under plans being lined up as a key element of the next Conservative manifesto. George Osborne came "within a whisker" of implementing the plan in the budget and is now looking again at the policy for the general election. - The TimesEuropean countries have warned David Cameron that his threats about the British people voting to leave an unreformed EU may backfire, undermining the Prime Minister's hopes of winning major concessions. Diplomats from countries sympathetic to Britain have told the Foreign Office there will be a limit to sweeteners the Prime Minister can win before putting his new deal to voters in a referendum promised for 2017. - The IndependentOne of Britain's biggest institutional investors is telling companies that it wants them to use their cash to invest in the real economy rather than indulge in "fundamentally wrong" share buybacks. Nigel Wilson, the Chief Executive of Legal & General, said that he disliked companies deploying excess capital to hoover up their own shares because such financial engineering was both "unfair" and generated "illusory as opposed to real economic value". - The TimesPrivate-equity-backed flotations have risen to their highest level of all time as buyout groups rush to take advantage of London's revived equity market. Private-equity groups across Europe have launched 31 flotations, worth €33.4bn (£26.7bn), in the first half of this year, according to figures from the Centre for Management Buyout Research. The news comes as private equity is under renewed scrutiny from investors after floats backed by some of Europe's biggest buyout firms have slumped in value. - The Daily Telegraph Supermarkets are losing their grip as the dominant destination for grocery shopping in the UK, with sales from convenience stores, discounters, and the internet likely to be larger within five years. According to new data from industry body IGD, which lays bare the pressure on the "big four" supermarket chains, sales from supermarkets and hypermarkets will fall by 4% over the next five years despite a 16% rise in overall grocery sales. This means that, for the first time, sales from convenience stores, discounters and the internet will overtake supermarkets and hypermarkets by April 2019. - The Daily Telegraph AB