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Jeremy Hunt got the job as Chancellor because he is very different from his predecessor. If Kwasi Kwarteng was rash and unpredictable, Hunt is calm and dependable, if a little dull. Those characteristics will be reflected in Hunt’s Budget, which he will unveil in the Commons this afternoon at 12.30pm. There are unlikely to be any rabbits coming out of his hat. Hunt’s headline measure is an increase in the pensions lifetime allowance from £1.07 million to £1.8 million. The Chancellor hopes that this benefit, which will affect up to two million people, will encourage older workers to delay retirement if it allows them to build up a bigger pension

Is the UK’s labour market cooling down? While unemployment remains unchanged at 3.7 per cent, according to today’s update from the Office for National Statistics, the number of job vacancies ‘fell on the quarter for the eighth consecutive period’, down 51,000. The overall number of vacancies, however, still remains above a million. But the biggest indicator things are changing is wage growth: the rise in average total pay fell to 5.7 per cent between November last year and January this year, down from 5.9 per cent in the previous three months. Adjusting for inflation, this means real wages fall by 3.2 per cent – the biggest fall since the pandemic hit, not

Tech start-ups tend to involve taking big risks on ideas which are untested both in terms of technology and the market place. Yet it isn’t blind faith in new ideas that is threatening to bring down scores of British tech start-ups over the next few days: it is boring old bonds. Many start-ups have relied for financing on Silicon Valley Bank UK, an offshoot of its larger US parent. Over the last few years, the institution has in turn relied on taking bets on government bonds whose value had been inflated by near-zero interest rates. As interest rates have risen, those bets have gone sour. On Friday, the Bank of

Supermarkets are once again back in the firing line. Henry Dimbleby, the Leon co-founder turned government food tsar, has blamed the current food shortages on their ‘weird culture’. When food is scarce UK supermarkets won’t raise their prices, he claimed. It leads to growers selling less here and more in Europe, exacerbating shortages. He wasn’t alone in blaming supermarkets. Last month, in an attempt to absolve the government of blame, food and farming minister Mark Spencer demanded the heads of big chains join him for a discussion on ‘what they are doing to get shelves stocked again.’ In the end, only middle-management showed up.  The average supermarket stocks 20,000 items with around

This morning’s release from the Office for National Statistics shows the UK economy grew by 0.3 per cent in January – an improvement on December 2022 figures, which saw the economy contract by 0.5 per cent. There are no revisions to the last update: the UK still avoids the technical definition of recession, and January’s growth was higher than expected (the consensus was that it would be 0.1 per cent). But overall, the economy remains stagnant: the three months to January produced precisely zero growth. What really sticks out in today’s release is just how dependent the UK economy is these days on one-off interruptions. January’s rebound is largely credited to the return of

Shadow chancellor Rachel Reeves has promised to tackle what businesses tend to fear the most: instability. ‘In recent years, corporation tax has gone up and down like a yo-yo, while the government has papered over the cracks with short-term fixes like the super-deduction,’ Reeves told the manufacturing group Make UK’s annual conference this morning. Under a Labour government, she pledged, there will be a clear ‘roadmap for tax which lasts over a parliament’. Reeves said this would give business leaders a better sense of what to expect, hopefully creating an atmosphere for investment. Promising a review also puts pressure on Reeves to come up with answers to some of the

As tax rates rise in the UK, so do business jitters. The windfall tax on oil and gas companies – raising tax on profits to 75 per cent this year – has energy companies openly discussing plans to divert money elsewhere. The looming hike in corporation tax – from 19 per cent to 25 per cent for the largest companies – also has the businesses talking about future investment strategies.  So far, Chancellor Jeremy Hunt seems unconvinced that investment threats will amount to much. His Budget next week is expected to confirm the corporation tax rise in April. But the backlash is growing: from MPs in his own party who are worried

It would have been bad enough if just one major British company had decided to list its shares in New York rather than London in the space of a single week. But two? First it was the chip-maker Arm, one of the UK’s very few major technology companies. Then came the building materials giant CRH. Shell also said they came very close to shifting their base to the US. The moment has surely arrived for the UK to radically deregulate its listing regime – or else watch the City slowly wither away. At this rate, within a few years there might only be a couple of retailers and a bus

Fulfil your civic duty. Get married. Have children. That was the message from Miriam Cates, the increasingly prominent Conservative backbencher, to guests at a drink reception earlier this week. In what even her fiercest critics would have to concede was an impressively bold speech, Cates suggested that many of her female constituents want to work less and spend more time with their children. She claimed that politicians belonged to a class that had been protected by marriage and family, insulated from family breakdown to such a degree that they fail to realise how important it is. Few politicians can ride out a Twitterstorm without some sort of retraction, and Cates is no

There have been celebrations this morning about a government surplus of £5.4 billion last month, and people are even talking about a ‘windfall’ for Chancellor Jeremy Hunt in next month’s Budget. But all this shows is how conditioned we have become to appalling economic news – and that we will grab at anything which seems to indicate a shaft of light. Nevertheless, any talk of a government ‘surplus’ masks the very real problem the government still has While any surplus is to be welcomed – and last month’s borrowing figures are far better than the Office for Budget Responsibility predicted – we would be in serious trouble if the government had not

Do over-fifties need to get back off the golf course and into work? That’s the narrative that ministers have been pushing recently, with Jeremy Hunt saying later life ‘doesn’t just have to be about going to the golf course’. Work and Pensions Secretary Mel Stride is conducting a review of the factors keeping people out of the workplace in time for next month’s Budget. But a report out today from pensions consultancy LCP suggests ministers might be barking up the wrong tree. LCP’s analysis points out that there are fewer people of working age who are retired now than at the start of the pandemic, and that the missing workers

It was only a few weeks ago that Liz Truss started commenting on domestic policy again, speaking to The Spectator not just about what happened during her time in No. 10, but about what she sees as prescriptions for Britain’s stagnant economy. Today she weighs back in on foreign policy. In Tokyo this morning, the former prime minister made her first international speech since leaving office and it combined her favourite topics: economic freedom and taking a tough stance on China. Truss is calling for world leaders to band together and create an ‘economic Nato’ – which would include agreeing to a tough package of economic sanctions on China, were

Inflation remains at near a 40-year high – but finally, we’re starting to see some signs of good news. This morning’s update from the Office for National Statistics shows CPI falling to 10.1 per cent in the 12 months to January 2023, down from 10.5 per cent in December 2022.  It’s a better update compared to January, which revealed a much smaller dip in CPI between November and December last year. Core inflation – which excludes energy and food – fell too, from 6.3 per cent on the year in December down to 5.8 per cent in January. Crucially, this easing beat the consensus, both for CPI (the expectation was

The latest labour market update – published by the Office for National Statistics this morning – looks a lot like last month’s update: that’s to say, a mixed bag of news. Unemployment rose again, up 0.1 per cent between October to December, to 3.7 per cent. But this quarterly rise was once again off-set by a fall in economic inactivity: down 0.3 percentage points, largely thanks to young workers entering (or re-entering) the workforce.  Overall, it’s a trade-off worth making: the official unemployment figure has failed for some time to reflect the true number of people out of work, as over two million people of working age are thought to be

We’re all familiar with the usual trade union cliches: it’s not about us, it’s about passenger safety; staff morale is low; and strikers are being ‘victimised’. Or, in the words of Aslef general secretary Mick Whelan on ITV’s Good Morning Britain, train drivers are being ‘demonised’. More so than government ministers, who are forever portrayed by union leaders as callous evil-doers?     But it is what Whelan said next that really catches the ear. Asked whether he thought the public should be sympathetic towards train drivers on £60,000 a year turning down an offer which would take their pay to £65,000 a year, he said: ‘It isn’t about what we earn, it

It is ‘obscene’ and ‘an insult to working families’, according to the TUC. If there was one thing more predictable than the doubling of profits of the energy giant Shell – given that the stuff it sells has soared in price over the last year – it was the storm of protest that it ran into following the announcement today. ‘No company should be making these kind of outrageous profits out of Putin’s illegal invasion of Ukraine,’ said the Lib Dem leader Ed Davey. Inevitably, there are now calls for higher windfall taxes, and even for state-ownership. But hold on? Shouldn’t we celebrate a major British company making lots of

It will be a charter for fraudsters. It will usher in an open-season mindset for money launderers and criminals. And it will drag down the reputation of the City. There will be plenty of critics of today’s government decision to push forward with a regulated cryptocurrency market in London. In the wake of the FTX scandal, one of the largest in corporate history, many would rather see it banned completely. But crypto is more resilient than that – and the UK, if moves quickly, it can carve out a lucrative space as its leading hub.  No one could accuse Rishi Sunak or Jeremy Hunt of taking any risks with the

Just what is a UK government supposed to do to keep the IMF happy? This morning it has issued a bulletin predicting that the UK will be the only major economy to shrink in 2023 – by 0.6 per cent – and blaming it on ‘tighter fiscal and monetary policies’. This represents an even-bleaker outlook than the IMF foresaw in October, when it pencilled in growth of just 0.3 per cent. Yet this is the same IMF which last September condemned Kwasi Kwarteng’s mini-Budget for slashing taxes, saying 'given elevated inflation pressure in many countries, including the UK, we do not recommend large and untargeted fiscal packages at this juncture, as

As the UK – and indeed the world – faces the prospect of an economic downturn this year, what exactly can the government do about it? This remains an ongoing debate within the Tory party, as Rishi Sunak continues to emphasise the importance of stability, while Liz Truss’s most loyal supporters keep pressuring the government to revive her focus on economic growth.  This morning a trio of cabinet members showed up in the City to suggest that it doesn’t have to be one or the other. Culture Secretary Michelle Donelan, Business Secretary Grant Shapps and the main act, Chancellor Jeremy Hunt, opened this morning’s conference at Bloomberg by insisting the