I’m informed that a compromise will be presented soon after 5pm which could bring the Somme-like battle in the House of Lords to an end after weeks of late-night sittings and abrasive filibustering. Although one source tells me it may turn out to be less of a “compromise” and more of a potential way out of the impasse.

More here when it happens: For now here is Nick Watt at the Guardian explaining the situation earlier this afternoon.

UPDATE:

Lord Strathclyde, the government’s leader in the House of Lords, has confirmed a deal that is designed ensure the AV referendum should now go ahead on May 5.

He told peers there had been an agreement on a timetable for the Bill’s committee stage, which will now end later this week. This will be followed by a “package of concessions” at the bill’s report stage next week.

This should allow the government to hit the February 16 deadline imposed by the Electoral Commission – which gives 10 weeks preparation before the referendum.

The compromises are likely to include brief public inquiries to make sure the boundary changes take into account local people’s worries. But it won’t be long enough to prevent the redrawing of the electoral map by the next general election.

The proposed solution to the impasse is likely to bring to an end a curious fortnight which has seen some peers sleeping in the Lords to get through the marathon sittings.

David Cameron had previously threatened an unprecedented “guillotine” motion to end the interminable debating – now on its 15th day – but failed to get the support of crossbench peers last week.

It’s not quite Keys/Gray but amusing enough. You need to listen to this recording quite closely, the key moment is 17:01:45. You can hear an MP – I believe it’s Eric Ollerenshaw, Tory MP for Lancaster and Fleetwood – chatting to another member of the localism bill committee.They are about to take evidence from companies including Barrett, Taylor Wimpey and Redrow.

“We’ve got the bloody builders next,” he whispers.

We’re having problems with the video technology but here is a link to the clip.

George Osborne could begin the sell-off of RBS early next year, marking the start of Europe’s biggest every privatisation, as my colleagues report this morning. If the bank is profitable by the turn of the year – and if the share price is substantially higher – an initial tranche of £5bn could be sold.

Intriguingly, I’m hearing separately that Lloyds Banking Group could be even earlier off the blocks, with ministers keen to start the LBG sell-off first. In theory this process could begin before Christmas.

Then again, progress at RBS and LBG alike have to wait for the Vickers banking review in September; a decision to dismantle the Lloyds-HBOS merger (which is possible) could set back the Lloyds privatisation by quite some time.

My former colleague Fiona Harvey revealed last October that Chris Huhne’s plan for a green investment bank was being thwarted by Treasury officials, who wanted it to be more like a fund. Then in December Mr Huhne let the cat out of the bag in public when he admitted that the Treasury had won the battle and the new entity probably wouldn’t have the powers to issue bonds*.

Without leverage, the fund will only have £1bn to spend (plus £1bn from asset sales) rather than the £4-6bn demanded by the renewables industry.

My colleague Beth Rigby writes in this morning’s FT that the Treasury took its stance because it didn’t want the extra liabilities on the national balance sheet.

The other big question someone should ask Huhne – or David Cameron – is why progress on the bank/fund is so incredibly slow. The original £1bn is earmarked for 2013/14. That is more than three years into the current parliament, which ends in 2015. (Meanwhile the other £1bn will come from asset sales which haven’t yet happened).

Funds typically take a long time to examine propositions and allocate funding to projects, which then take years to build. If this was a truly green government, as ministers would like us to think, why is this project moving forward at a snail’s pace?

*UPDATE: One source familiar with the talks tells me that the new bank could still be given the power to issue bonds after all. The big debate, he claims, is whether it will be a “public” or “private” (ie with government stake) entity. The latter would be off-balance sheet, as George Osborne wants. But the latter has various advantages; it would have cheaper finance, it would not be entirely profit-focused and it would have no conflicts of interest.

There is increasing concern at the highest levels of the coalition that its own “localism” agenda has the potential to hamper economic growth in the coming months – just as the government is at its most vulnerable to any sign of downturn. Ministers at Eric Pickles’ communities department believe that many of their localist policies will help business to grow; but others suspect that the general theme – handing more power to communities – will instead empower “nimbies” who want to stop development.

Against this backdrop we revealed this morning that Vince Cable and George Osborne are drawing up plans for several planning changes which could be announced in the spring Budget. The proposals come as the new head of the CBI warned that the ”jury is still out” over whether Mr Pickles’ new planning system will “deliver”. Here are the ideas:

1] Reviving enterprise zones: A handful of these were championed by Margaret Thatcher in the 1980s to help stimulate redevelopment in some of the most rundown parts of the country. Canary Wharf is probably the most obvious example of how this kind of project – involving tax breaks and total relaxation of planning – can transform an area. But if the zones involved tax cuts would they be affordable in the current climate?

2] Allow new building in the “green belts” which surround major conurbations. Ministers are very keen to see homebuilding rise from its current paltry level, the lowest seen for half a century. One way to do this is to revisit the broad question of whether development has been limited to too small a proportion of Britain’s land mass for too long. Any changes to the current green belt policy is likely to be hugely controversial, however.

3] ”Land auctions” which would give councils a share of any uplift in land value resulting from their decision to grant planning permission. The idea is rather complex but for your handy guide to how it would work you should read this article, in the FT, written by academic Tim Leunig of the LSE and now business minister Ed Davey three years ago. I’m told that the current proposals are remarkably similar to this model.

4] Reforms to “change of use” rules. Developers often complain about the paperwork they have to endure to shift a building designated for one purpose (eg offices) to another (eg retail).

It has become a favoured accessory of the modern political leader; the personal trainer. David Cameron is often spotted jogging around with his fitness coach, who also works for comedians James Corden and Michael McIntyre. Even Gordon Brown had one by his side to keep him in, er, peak physical shape.

Now my colleague James Crabtree has revealed that Ed Miliband has hired a personal trainer to get him into shape. It will be interesting to see how this pans out for Miliband, who – up til now – hasn’t shown much aptitude in the sporting sphere.

Note: I’ve been asked to clarify that the trio in the photo are Cameron’s friends, not angry members of the public.

As I revealed before Christmas, Network Rail has agreed to pay for an independent inquiry into allegations of misuse of public funds that have dogged the publicly funded company for months. You can read the full story here. The state-funded track operator believes it has no case to answer but wants to “close this chapter” through a QC-chaired investigation. There will be a “statement of full exoneration” if the key allegations prove to be groundless. As I disclosed:

Chaired by QC Antony White, the inquiry will begin at an undisclosed London location by February. In a letter to Network Rail’s 100 members, Mr Haythornthwaite said the inquiry would focus on allegations against Iain Coucher, former chief executive. He told members he wanted a “focused and effective gathering of hard evidence” that would “establish the truth around specific allegations of fraud”.

I wrote in yesterday’s FT about Caroline Spelman’s plans to sell off much of the Forestry Commission’s estate.

The environment minister is keen to rebut the idea that she is poised to flog every tree in Britain to private companies who will then chop them down and replace them with golf courses, leisure centres and business parks.

So what is her plan? Put simply there are two legs to the strategy.

1] The commercial forestry estates – largely monoculture conifers – which mainly grows logs for commercial sale, could be sold off under one of four options put forward. This could raise several hundred million pounds. As Julian Glover at the Guardian suggests: “The state has no business being a lumberjack.” Much of the forestry that covers the uplands of the north and Scotland is so unlovely that perhaps it might as well be in private hands. Alternatively, community groups could club together to buy some of this land and – perhaps – turn it back to native deciduous habitat.

Military police have been called in to examine allegations of improper conduct during bidding for the £6bn privatisation of the search and rescue helicopter service.

It has brought the deal to the brink of collapse.

We’ve broken the story online because the redoubtable Cathy Newman of Channel 4 News has been chasing the same tale. The main elements are:

– MoD police are investigating the access to information given to bidders and the relationship between a military officer, who has since left the forces, and CHC, a Canadian helicopter operator that is part of the Soteria consortium chosen as preferred bidder.

– Royal Bank of Scotland have pulled out of the Soteria consortium because their concerns over the allegations. It will make it much harder for the deal to be revived, even if the concerns over improper conduct prove to be unfounded.

– Ministers are urgently examining options on how to proceed, including re-tendering the contract and scrapping the private finance initiative model altogether.

This is the deal, remember, that so angered Prince William he raised his concerns with the prime minister.

Read on for more details.

David Cameron is not always a perfect performer at the weekly prime minister’s questions – sometimes the charming confidence tips over into a somewhat bullying manner.

But today showed why he is so effective in the post. In an otherwise unmemorable PMQs, Cameron demonstrated how to neutralise difficult questions by displaying a degree of candour.

Asked at the start by Ed Miliband what he thought of the disappointing growth figures, Cameron simply said: yes he was disappointed, progress would be choppy, and the data would have been glum even if the ONS had stripped out the freezing weather.

When Miliband came back with a follow-up question, Cameron replied: “It’s exactly what the figures show, yes.”

Asked later about youth unemployment, Cameron didn’t try to spray out a list of job creation schemes, apprenticeship programmes and so on. Instead he conceded this was a challenge – albeit a structural problem that had been growing for many years.

Can you imagine Gordon Brown responding in this kind of way?

PMQs later descended to the usual insult-hurling when Cameron labelled Miliband and Balls as “Gordon Brown’s two henchmen“; but the visiting dignatories from Bangladesh had witnessed a reasonably dignified debate.

UPDATE: One reader writes in to point out that it was Miliband who helped create a more civilised debating platform by asking measured questions in a level manner; that is true.