Valet parking: hand over your keys … and your car insurance can go too

Of 233 comprehensive car insurance policies, 49% excluded valet parking. Photograph: Rex

Do you hand over your keys to a valet parking service at the airport before flying off on holiday? You could be left with a large bill: research by comparison site Gocompare.com found that half of all insurancepolicies do not cover damage to a vehicle while it is in the control of valet parking.

Gocompare.com reviewed 233 comprehensive car insurance policies and found that valet parking was excluded by 49% of policies. Scott Kelly, Gocompare's head of car insurance, said: "Valet parking, once the preserve of Hollywood movies, is becoming a popular option in the UK with many airports, major hotels and entertainment venues now offering 'meet and greet' services. Valet parking is a convenient way to park your car, especially at airports where it will save you having to drag heavy luggage on to a car park shuttle bus, but you need to consider the implications for your car insurance."

Some valet parking companies claim drivers are covered by their own insurance. But Gocompare said the terms and conditions offer little peace of mind. "Generally operators offer very limited cover for damage to your car, which you will need to spot and report to them on collection, and possessions left in your car are generally excluded."

Meet and greet parking services generally cost little more than the price of 10 days in a long-stay car park, but although many people are happy with the service, it is a business plagued with horror stories.

This summer, BBC1's Your Money, Their Tricks programme tested six different services at three major airports. Each car was fitted with a tracking device which told the programme's investigators whether it actually went to the car park that was promised and, crucially, whether it stayed there.

At Heathrow, the service was precisely as advertised. But at Gatwick, the tracking device found that the car, although initially taken to a secure car park, was 24 hours later driven to a residential address in Crawley – which the programme makers said appeared to be the home of the company's employee. Later, it was returned to the car park.

The other car in Gatwick, and the two in Luton, were taken to compounds that the programme makers alleged were not secure sites monitored by CCTV.

Royal Marines general calls for lenient sentence in Afghan 'execution'

Major-General Julian Thompson. Photograph: Stephen Kelly/Press Association

A distinguished Royal Marines general has called for leniency towards a fellow commando who executed an injured Taliban insurgent in Afghanistan.

Major-General Julian Thompson refused to condemn the marine, who was convicted on Friday of murdering the seriously wounded prisoner in Helmand Province two years ago.

Thompson, who led 3 Commando Brigade during the Falklands War, told The Times a five-year prison term would be more suitable than life imprisonment.

The serviceman, a sergeant known as Marine A, was found guilty of murder following a two-week court martial and faces a mandatory life term.

Two others, known only as Marines B and C, were cleared of the same charge.

Thompson said the shorter prison term was more appropriate for a crime committed under the unique pressures of war.

He said that "obviously it was wrong and everyone in the Royal Marines is quite clear about that".

But he added: "The Royal Marines are a family and it feels as though a member of the family has transgressed.

"I am sad for the man who did it, in that he probably had a moment of stupidity. I feel for him as I would my own son who might do something stupid."

He said accepting an enemy's surrender on the battlefield was "a very, very dangerous time", and told the Daily Mail: "I have no sympathy for the man who was killed but Marine A did the wrong thing by shooting him.

"But I'm not going to stand around bad-mouthing him. I won't condemn him. It is like a member of the family who has broke the law – you don't reject them, but you support them

Co-op Bank's future in the hands of its small investors

The Co-op's small retail investors will need to approve its restructuring or else the bank could be nationalised or wound down. Photograph: Alamy

Nearly 13,000 private investors, many of them pensioners, could hold the key to the future of the Co-operative Bank after it unveiled a revised rescue plan that won't go ahead without their stamp of approval.

It is high-stakes stuff because if the proposed restructuring isn't approved by enough of these people holding Co-op Bank bonds and preference shares, the bank is likely to fall under the control of the Bank of England, and/or it could be nationalised or wound down.

The hurdles that have to be jumped are high: there will be four separate votes of bondholders and preference shareholders, and the bank says that if any one of these doesn't succeed, the rescue will fail.

Under the proposed package, the wider Co-operative Group will own just 30% of the bank; the rest will be owned by its bondholders. Those include a group of hedge funds, led by the US-based Silver Point and Aurelius.

The 12,800 or so retail investors hold "perpetual subordinated bonds" (known as Pibs) or preference shares, and this week, as part of the new proposals, they have been offered improved terms.

Many had bought the bonds to provide a secure retirement income – they offered annual interest ranging from 5.5% to 13% – and some had formed an action group to fight the original plans to offer them shares in the bank. They have now been offered an alternative that will still leave them out of pocket, but by much less than many originally feared.

Holders of the 13% bond will be offered a choice of continuing the 13% income a year until 2025, but losing all their underlying capital, or getting 9.2% a year until 2025 and 84% of their capital back. A similar deal is on offer to 9.25% preference shareholders, while investors with the 5.5% bonds will be offered a new bond paying 5.8% a year, but will lose nearly half of their underlying capital.

Bond expert Mark Taber of the Co-op Bank Retail Investors Campaign says the outcome is the best small investors could have hoped for. "This deal has been extremely hard-fought and is now a much better solution for retail holders and pensioners. It is now up to all holders to decide whether to accept. We now hope that our support of the offer will play its part in the future success of the bank under the innovative hybrid structure which enshrines co-operative values while providing sound governance and access to capital markets."

The campaign was started in June in response to requests from hundreds of pensioners and retail investors who were concerned about the future of the bank, and the impact the proposed exchange of their bonds into equity would have on their income. The number of retail investors registered with the campaign quickly grew to around 2,500.

"The majority of these are pensioners in their 70s, 80s and 90s who acquired Co-op Bank bonds for pension income," says Taber.

The challenge now will be getting all these people to vote and securing the necessary majorities. The bank is keen for people to get their vote in by 29 November at the latest. The deadline is 6 December, but the terms of the offer are more favourable if enough investors participate by the earlier date.

"We've got to get them through the gate. That's the logistical operation that's under way," says Niall Booker, the bank's chief executive.

The bosses warn that if the rescue fails, and the bank were to enter into a bank insolvency or administration procedure, "holders of relevant securities would receive no recovery at all".

With all of this going on, it's perhaps not surprising that the Co-op Bank has been losing out in the battle to attract customers switching current accounts. It said there had been a "material reduction" in the number of people moving their accounts to it since the seven-day switching service was introduced in September, but insisted it had not seen huge customer outflows.

The bank has also stated that the Co-op group's ethics and values would be "legally embedded" in the bank's constitution, and protected on an ongoing basis by an ethics committee of the board with an independent chairman.

These "articles of association" cannot be changed without the support of the Co-operative Group. If whoever was running the bank in future were to ditch the wording about ethics, they would no longer be entitled to use the Co-operative name.

Euan Sutherland, chief executive of the Co-operative Group, has refused to criticise the hedge funds, describing them as "very economically rational people" who were investing in the bank because they believed it could become profitable again. He said the bank had lost its way during the last few years.

However, at least 50 branches are to be shut and a "significant" number of jobs will go – though the bank had already embarked on a branch closure programme.

G4S set to expand contract despite freeze on government work

A wing in Brook House immigration removal centre, where G4S intends to expand capacity. Photograph: Gareth Fuller/PA

The Home Office is drawing up plans to scale up a G4S-run immigration contract despite a government-wide freeze on new dealings with the company while it is being investigated for allegedly defrauding the Ministry of Justice.

According to information obtained by the Guardian, the private security firm is preparing to expand capacity by 30% at one of the two immigration removal centres it runs on behalf of the Home Office, even though it is facing a formal investigation by the Serious Fraud Office for claims it overcharged the government in electronic tagging contracts.

Labour said it was bizarre and wrong that the company was being rewarded with bigger contracts while it was under investigation.

Brook House removal centre, near Gatwick, holds people due for deportation from the UK, and currently has space for 426 male detainees. Last month, while hosting a reception for outside contractors, the centre's director, Ben Saunders, said the company intended to increase this by 60 and then another 70 places over "the earliest possible timeframe".

On Monday, the Serious Fraud Office launched a formal criminal investigation into G4S after the justice minister, Chris Grayling, revealed in the summer that its staff had been billing the Ministry of Justice for tracking the movements of offenders who had gone abroad, been returned to jail or even died.

Grayling promised that G4S would not be awarded any new contracts by his department until investigations into G4S billing practices had been completed.

The Cabinet Office confirmed this pledge was binding across all government departments and was itself auditing several other G4S contracts.

Grayling said he had no direct evidence of dishonesty. G4S said its internal investigation had found no evidence of fraud and the security multinational was co-operating with the SFO investigation.

Last month, the head of UK and Irish operations for G4S , Richard Morris, resigned in a move understood to help patch relations between the company and the government.

The gambling machines helping drug dealers 'turn dirty money clean'

The Gambling Commission admitted in September what has long been privately acknowledged: FOBTs present a 'high inherent money laundering risk'. Photograph: Alamy

Dressed in a grey hoodie and jeans, James, 24, looks like just another lost soul in the high street, shuttling between the six betting shops in an east coast seaside town. It's a weekday morning and if you catch up with him inside a bookmaker, you'll find him peering intently into the green glowing screen of an electronic gambling machine – feeding in £200, "a score at a time".

But this is not a young gambler blowing his meagre wages. James is a drug dealer and his interest in the bookmakers – and the fixed-odds betting terminals (FOBTs) in each shop – is all about laundering money. "That's what turns dirty money clean," he says. Dealers feed their drug money through the machines, losing a little and then cashing out with the vast majority of their stake, James says. They can then collect a printed ticket showing they have gambled that day – meaning that if stopped by police, they can answer questions about why an apparently unemployed young man carries hundreds of pounds in rolled-up cash.

The FOBTs are probably the single most profitable pieces of property in the town centre's shabby pedestrian precinct. Each machine, according to industry figures, grosses about £900 a week. The 24 FOBTs within a few minutes' walk are worth an estimated £1m a year in profits to the betting industry.

The terminals arrived in Britain in 2001 and were lightly regulated from the outset. Punters in bookmakers found that they could bet £100 every 20 seconds on roulette. The temptation of high-speed, high-stake casino games in the high street proved irresistible: there are now 33,345 FOBTs in the UK.

However, several high-profile cases have exposed a seamier side to the rise of the machines. Earlier this month the Gambling Commission, the industry regulator, fined Coral bookmakers £90,000 in profits it made from one drug dealer who had laundered almost £1m in its shops. Last month the industry regulator also publicly admitted what has long been privately acknowledged: FOBTs present a "high inherent money-laundering risk". In a letter to the industry trade association, the commission warned about "a retail betting model that includes high volumes of cash transactions, particularly where this includes low individual spend and a high level of anonymity... especially where that model also offers (FOBTs)."

What the machines provide is the chance for criminals to convert quickly large sums of money from the real world into virtual cash that can later be converted back into the real thing. There is little official research into the scale and extent of such operations. The 2005 Gambling Act, which regulates the terminals, says one of its primary objectives is "preventing gambling from being a source of crime or disorder, being associated with crime or disorder or being used to support crime".

However, it has long been obvious to the public that criminals can convert their loot into a clean win on an electronic roulette table. Surveys for the commission show that 40% of the public regularly identify gambling with criminal activity. The industry regulator found one in 14 respondents associated money laundering with gambling.

The Guardian persuaded a number of drug dealers to talk about their criminal pursuits. What was remarkable was that they saw FOBTs as both a nuisance and necessary, trapping "weaker" people into addiction while allowing the "strong" to prosper. All exchanged tips with fellow dealers on the best ways to launder money; all were surprisingly frank about their methods.

James's strategy is simple: £20 on black, £20 on red and £2 on zero. A press of a button and the wheel spins before the ball lands on red. That's a loss of £2. The money placed on the zero is the only risk James is taking with his cash. If the ball does land on zero, he wins £72.

With no horses to run or dealer to shuffle and just the 20-second spin of an electronic roulette wheel to wait for, it takes a little over a minute for this drug dealer to cash out. James says he knows that unless he gambles at least 40% of the float money he has put in the machine, an alert will pop up on the staff computer warning them of suspicious activity. So he methodically places the same bet to make sure that he has wagered enough.

To ensure that his winnings are not an unlikely round number, he loses some more money on the one-armed bandit. Leaving the tea brought over by the shop manager to go cold, James wanders over to the counter to collect his winnings in the form of a receipt – transforming the money he made from cocaine into apparent gambling winnings. He has lost a little more than £10. "You have to make it realistic," he says. "Bookies get nervous if you come in and just lose the same amount every day. So I vary it a little."

Drug dealers say the reason fixed-odds betting terminals are used is precisely because they are so lightly policed. James is careful not to visit the same shops in a pattern. Handily there are 15 betting shops in the town within walking distance of the main bus routes that snake through the suburbs and along the Thames estuary. "Smart dealers don't drive around here. You are more likely to be stopped by police driving around late at night doing deliveries than if you are taking a bus somewhere into town."

Then there are favoured bookies. Ladbrokes, says James, is useful because you can transfer winnings in the shop to an online gaming account. In William Hill's you can ask for your winnings to be credited directly to your debit card, with the cash landing up in your bank the same day. "Look at my account and I am a very successful punter," he says.

The economics of drug dealing make it cost-effective to pay 5% to 10% to betting shops to launder the illicit profits. James claims to have "about 100K" in his bank account. He sells about 56g (2oz) of ordinary cocaine a week and another 28g of a purer, more expensive version. "Normal customers like teachers, doctors they get the ordinary stuff. The cleaner gear is for the City boys."

Selling cocaine in 0.8g wraps, James, a dealer, says he turns over about £5,500 of drugs – of which half is profit. Photograph: Andy Rain/EPA

James left school at 16 and worked in shops and restaurants before ending up in the City of London. "That's where I saw people using coke and I was asked if I could get some. I knew some people and I did. Never looked back. How long would it have taken to save £100,000 if I just continued doing admin in a bank?"

Selling cocaine in 0.8g wraps, in a week James turns over about £5,500 of drugs, of which half is profit. "I buy it on tick so you end up carrying a lot of money around. The trade is run by Albanians around here, so it's best to have cash ready if you need to pay it back in a hurry."

Almost all his money is laundered via FOBTs. James calculates he is worth £15,000 a year to the betting industry. "Valued customer," he grins. "I'd say there were about half a dozen of us [dealers] around here using machines. We swap tips – where to go, least crowded, staff not bothered, that sort of thing. You don't want to be recognised too many times."

In opening up to the Guardian, James says there is a risk that bookmakers in the coastal town will tighten up on who enters and who leaves. "Sure, they could stop us, but in the end they want the money.We can hang back for a bit and go somewhere else. Pretty soon they will relax and welcome us all back."

Bookmakers essentially regulate themselves: deciding whether to bar problem gamblers, call the police over violent behaviour or report crime. As the machines contributed £1.4bn to its bottom line last year, there have been suspicions that the industry has played down the shadier side of the terminals.

Adrian Parkinson, a former regional machines manager at the Tote, now with the Campaign for Fairer Gambling, said: "Money laundering on FOBTs has been a problem since their introduction. Whether it's cleaning notes from the proceeds of crime or drug dealers legitimising profits, it is well known in the industry that it goes on.

"I raised the issue some years ago at the Tote after being swamped with incidents of money laundering following a series of armed robberies but it's still going on."

Even worse, Parkinson says, the technology is outpacing the law. He says by the end of the year, customers in Coral will be able to transfer any FOBT winnings to their online account. "The staff won't be able to intervene, whatever their suspicions. The industry is riding rough shod over the licensing objectives. Keeping crime out of gambling has to take precedent over profit."

The Association of British Bookmakers said the industry complied fully with the law. William Hill said it had "robust systems" to meet its regulatory obligations. In a statement, Ladbrokes said: "Any criminals attempting to launder large sums are placing themselves at high risk of detection as they will be on CCTV and staff are trained to spot suspicious behaviour. Given most stakes in shops are small, any large transactions are easily recognisable. Any attempt to transfer money to online accounts will require identity verification at account opening or first transactions which in conjunction with CCTV would be an excellent source of evidence for the police."

The media have helped to cement the place of gambling in the national psyche. Advertising during televised football matches exhorts audiences to have a flutter. Electronic gambling has found a younger audience through online role-playing games such as World of Warcraft, in which players have been able to set up virtual casinos. This year the United Nations Office on Drugs and Crime warned that such games were being used by organised crime to launder cash.

Also helping to rehabilitate gambling is a new range of interactive TV programming. Late-night shows such as ITV's Jackpot247 – in which television viewers place bets online or over the phone, playing along to a live presenter-hosted roulette show – repolish gambling's image by treating electronic betting as a form of mainstream entertainment.

This shift in the marketing of electronic gambling has taken place as suspicions emerge that the industry has been targeting poor people. Last December, in a paper for the Journal of Gambling Studies, Heather Wardle, a former project director of the British Gambling Prevalence Survey, warned that gambling machines were more likely to be found in areas of high socioeconomic deprivation. Earlier this year, the Guardian revealed that in the 50 parliamentary constituencies with the highest numbers of unemployed people, punters visited 1,251 betting shops and wagered an astonishing £5.6bn through 4,454 fixed-odds betting terminals.

Salford has 72 people chasing each vacancy. It was the only part of Greater Manchester which last year recorded a rise in numbers on jobseeker's allowance. Photograph: Christopher Thomond for the Guardian

The presence of these machines appears to have a distorting effect on these moribund local economies. In a pub near Salford's Duchy estate, close to where rioting took place in 2011, two young men nursed pints of soft drink and explained how a vortex of soft drug sales, payday lenders and betting shops kept the local economy afloat. Salford has 72 people chasing each vacancy. It was the only part of Greater Manchester which last year recorded a rise in numbers on jobseeker's allowance (JSA).

Unemployed Jake, 28, sells marijuana on the local streets and smokes some of the profit. He recoups any losses by gambling and taking out loans at payday lenders. He points out the brown shopping arcade in Salford lined with bookmakers and loan companies. "It's the only thriving industry around here," he says.

"There are six bookmakers, one more is on its way, and five loan shops. Even if you are on JSA you can borrow money from Speedy Cash. It's the main business around here.Take dole, turn it into weed, sell them, take your profits and put them into the machines. If you win, you are quids in. If you lose, you get cash from the money shops to cover your losses. Back to dole and buying drugs. There's nothing else around here to do."

The drug dealer admits that he is "a bit" addicted to gambling, comparing the thrill of betting on the electronic spin of a roulette wheel to the rapid highs and lows of drugs. "You get a buzz. Which is why you might lose £16 or £1,600 and not notice until it's too late. I've done both."

The spread of betting shops in this part of the north-west is astonishing. Manchester city centre has 26. A few miles away in deprived Cheetham Hill, dubbed the "Bronx of Britain" for gang violence, there are four bookies in the high street, with another scheduled.Such bunching could be linked to the fact that bookmakers are limited to four machines a shop. As the machines are hugely lucrative the betting industry has bypassed the restriction by opening branches in high streets – "clustering" in poorer areas.

A betting shop manager in Greater Manchester, who agreed to be interviewed anonymously, said the FOBTs in Cheetham Hill easily earned £10,000 a week, four times the over-the-counter trade, and that local mobsters gambled heavily. "We get punters who lose big time on the FOBTs, punch them, chuck them to the ground. Smash them. We tell staff to play it cool. Don't call police. We don't want to arouse suspicions. It's madness. We employ young mothers in those shops.

"You have people laundering money every day with cash from robberies and drugs. Do you know that dyed notes from bank robberies can be submitted to the Bank of England and the company gets reimbursed? Staff know what pays their wages. They stay quiet."

Iran nuclear deal hopes rise as foreign ministers fly into Geneva

The US secretary of state, John Kerry, arrives in Geneva for Iran nuclear talks after a stormy meeting with Israel's prime minister, Binyamin Netanyahu. Photograph: Denis Balibouse/AP

John Kerry, William Hague and foreign ministers from France and Germany all made unplanned flights to Geneva on Friday in an attempt to seal a nuclear deal with Iran and end a decade-long impasse with the country.

There were also reports on Friday night that the Russian foreign minister, Sergey Lavrov, was flying in, despite earlier official denials that he would attend. The convergence on Switzerland of ministers from major world powers was meant to boost negotiations that have been under way since Thursday among senior officials.

As the talks closed on Friday night, officials were saying that the negotiations had been productive and that they would resume again on Saturday morning.

Kerry put off a planned trip to Morocco and Algeria to focus on the Geneva talks, while Iranian journalists were told to delay flights back to Tehran.

The focus of the talks shifted from formal sessions at Geneva's Palace of Nations to impromptu meetings at the European mission hosted by the EU foreign policy chief, Catherine Ashton. Kerry, Hague, the French foreign minister, Laurent Fabius, and his German counterpart, Guido Westerwelle, gathered there. After night fell, Ashton and Kerry met the Iranian foreign minister, Mohammad Javad Zarif, for three-way discussions that western officials described as the key session of the talks so far.

The officials said Kerry's arrival did not signal that a deal was ready to be signed but rather that the issues dividing the sides had risen to a level that only foreign ministers, in consultation with their heads of government, could resolve.

The aim of the talks is to agree a joint statement laying out a roadmap towards a peaceful resolution of the nuclear standoff. Iranian officials said a draft of the statement had been completed by the time Ashton, Kerry and Zarif met at the EU mission.

According to Zarif and western officials, it was to include details of an interim deal that would slow down Iranian uranium enrichment and relax some sanctions, providing time to work out a more comprehensive, long-term agreement. The outline of that goal would also be sketched out in the joint statement, on Iranian insistence. Zarif has said he does not want to negotiate piecemeal accords without knowing what the end point of the process would be.

Kerry arrived in Geneva in the early afternoon after a stormy meeting with the Israeli prime minister, Binyamin Netanyahu, who made clear that he rejected the intended interim deal with Iran on the grounds that it represented a step towards dismantling sanctions without a total halt to Iranian enrichment.

Western officials said Netanyahu's remarks were aimed at his own rightwing supporters and that his vocal opposition would eventually make it easier to "sell a deal" to the Tehran leadership and Iranian public.

The White House said President Obama called Netanyahu on Friday to smooth things over. "The president provided the prime minister with an update on negotiations in Geneva and underscored his strong commitment to preventing Iran from obtaining a nuclear weapon, which is the aim of the ongoing negotiations between the P5+1 and Iran," according to a White House description of the call. "The president and prime minister agreed to continue to stay in touch on this issue."

On arriving in Geneva, Kerry said he had come at Ashton's invitation to help close the deal with Iran.

"I want to emphasise there are still some very important issues on the table that are unresolved. It is important for those to be properly, thoroughly addressed," the US secretary of state said. "We hope to try to narrow those differences, but I don't think anybody should mistake that there are some important gaps that have to be closed."

Fabius, who arrived two hours earlier, said he had made the impromptu trip "because these negotiations are difficult but important for the regional and international security".

He said: "It is a question of reaching an agreement which represents a first solid step in addressing the international concerns over the Iranian nuclear programme. There has been a lot of progress, but so far nothing has been finalised."

Majid Takht-Ravanchi, an Iranian deputy foreign minister, confirmed in the afternoon that a draft agreement had been drawn up and would be discussed at the crucial meeting involving Ashton, Kerry and Zarif.

"The text is ready and the initial negotiations about this text will be made in this trilateral meeting," Takht-Ravanchi was quoted as saying by the semi-official Mehr news agency.

He added: "We have announced that banking and oil sanctions should also be discussed in the first step."

If that is true, and Iran is insisting on such large-scale sanction relief as part of the first step, it would signal a serious obstacle to agreement. Senior US officials have made it clear they do not think major oil and banking sanctions should be part of an initial confidence-building accord.

Meanwhile, the International Atomic Energy Agency (IAEA) confirmed that its head, Yukiya Amano, would visit Tehran on Monday in an attempt to accelerate parallel long-running talks between Iran and the agency aimed at clearing up allegations about past Iranian nuclear work.

Iran has claimed the allegations are based on forged evidence, but western intelligence claims that until at least 2003 Iran had a large-scale programme to create weapons. The IAEA has frequently complained that the previous Iranian government did not co-operate with its investigation, but agency officials have said since the election of reformist president Hassan Rouhani in June that the situation has improved.

Philippines: 'bodies in the streets', with many feared dead in typhoon Haiyan

A flooded street filled with debris in Tacloban Photograph: Reuters TV

At least 100 people have died in the Philippines from the impact of super typhoon Haiyan, a senior government official said on Saturday.

Many bodies were lying in the streets of the central city of Tacloban, according to reports received by Captain John Andrews, deputy director general of the Civil Aviation Authority of the Philippines.

Andrews told the Associated Press the "reliable" information about the deaths was relayed to him by his staff in Tacloban, but communications with the capital Manila were only possible every few hours.

Officials said most of the houses in Tacloban, a city of about 220,000 people, had been destroyed in a surge of flood water and high winds, according to Reuters.

Before communications were cut on Friday, city officials had reported heavy flooding. Mobile phone networks, power lines and trees were toppled and most roads were cut off.

"Almost all houses were destroyed, many are totally damaged. Only a few are left standing, but with partial damage," said Major Rey Balido, a spokesman for the national disaster agency.

Cabinet secretary Rene Almendras, a senior aide to President Benigno Aquino, said that the number of casualties could not be immediately determined, but that the figure was "probably in that range" given by Andrews. Government troops were helping recover bodies, he said.

US marine Colonel Mike Wylie, who surveyed the situation in Tacloban in preparation for possible American assistance, said the damage to the runway at the seaside air terminal was significant, but military planes were still able to land with relief aid.

"The storm surge came in fairly high and there is significant structural damage and trees blown over," he told the AP.

Vehicles piled up in a flooded street in Tacloban. Photograph: Reuters TV

The Philippine television station GMA reported its news team saw 11 bodies, including that of a child, washed ashore on Friday and 20 more bodies at a pier in Tacloban hours after the typhoon ripped through the coastal city.

At least 20 more bodies were taken to a church in nearby Palo town that was used as an evacuation centre but had to be abandoned when its roofs were blown away, the TV network reported. TV images showed howling winds peeling off tin roof sheets during heavy rain.

Ferocious winds felled large branches and snapped coconut trees. A man was shown carrying the body of his six-year-old daughter, who drowned, and another image showed vehicles piled up in debris.

Haiyan, one of the strongest storms ever to hit land, was leaving the Philippines behind on Saturday, having flattened houses, triggered landslides and floods and knocked out power and communications across a number of islands. More than 750,000 people were forced to flee their homes.

The toll of death and damage is expected to rise sharply as rescue workers and soldiers reach areas cut off by the massive, fast-moving storm, now heading towards Vietnam.

Authorities in 15 provinces in Vietnam started to call back boats and prepare for possible landslides. Nearly 300,000 people were moved to safer areas in two provinces alone – Da Nang and Quang Nam – according to the government's website.

Forecasters said the storm was expected to pick up renewed strength over the South China Sea.

There were hopes the Philippines had avoided a worse disaster because the rapidly moving typhoon blew away before wreaking more damage, officials said.

But because communications were severed, it was impossible to know the full extent of casualties and damage.

Southern Leyte governor Roger Mercado said the typhoon ripped roofs off houses and triggered landslides that blocked roads. The dense clouds and heavy rains made the day seem almost as dark as night, he said.

"When you're faced with such a scenario, you can only pray and pray and pray," Mercado told the Associated Press by telephone. He said mayors in the province had not called in to report any major damage.

"I hope that means they were spared and not the other way around," he said. "My worst fear is there will be massive loss of lives and property."

People trapped in a house by floodwaters in Mindoro. Photograph: AP

Eduardo del Rosario, head of the disaster response agency, said the speed at which the typhoon sliced through the central islands helped prevent its 375-mile band of rain clouds dumping enough of their load to overflow waterways. Flooding from heavy rains is often the main cause of deaths from typhoons.

"It has helped that the typhoon blew very fast in terms of preventing lots of casualties," regional military commander Lieutenant-general Roy Deveraturda said. He said the evacuation of so many villagers before the storm also saved many lives.

As relief workers began assessing the damage, US secretary of state John Kerry said his country stood ready to help.

"Having so recently had my own visit to the Philippines prevented by another powerful storm, I know that these horrific acts of nature are a burden that you have wrestled with and courageously surmounted before. Your spirit is strong," Kerry said in a statement.

Among the evacuees were thousands of residents of Bohol who had been camped in tents and other makeshift shelters since a magnitude-7.2 earthquake hit the island province last month.

Relief workers said they were struggling to find ways to deliver food and other supplies, with roads blocked by landslides and fallen trees.