Money

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

Every month, we are bombarded with the Consumer Prices Index (CPI), the main inflation measure. It is currently running at 10.5 per cent, and although this is slightly down over the past two months, it is still far, far above the Bank of England’s target of two per cent. But what about inflation for people who are running businesses? The Office for National Statistics (ONS) also publishes a Producer Price Index (PPI) covering inflation for commercial organisations. If you think living costs for consumers are high, count yourself lucky you are not running a factory: the PPI of input prices (i.e. prices of raw materials and other goods) for December has come

Rishi Sunak ruffled his own party’s feathers last week when – in reference to last autumn’s market turmoil – he told an audience in Lancashire: ‘You’re not idiots, you know what’s happened.’ This was quickly interpreted as the Prime Minister branding the MPs and business leaders calling for immediate tax cuts as ‘idiots’, sparking not only backlash but also another round of debates on a topic that has been dividing the Tory party since last summer. Just how quickly and aggressively can the party start to cut the tax burden down from its 72-year high? Today’s public sector finance update for the month of December certainly doesn’t settle this debate,

I have to tip my hat to Civitas. The ‘Tufton Street’ think tank made quite a splash on Monday, including bagging the front page of the Daily Mail, with two striking claims. One was that more than half of UK households now receive more in benefits from the government than they pay in tax. The other is that the top 10 per cent of earners pay more than half of all income tax. Both headlines are correct, but a bit more analysis is needed to interpret these figures properly. For a start, this is not new information. The Civitas report acknowledges that it is simply repackaging data which was first published by the Office

When Rishi Sunak laid out his five pledges at the start of the year, his first and most prominent one was to halve inflation in 2023. A few weeks on: how’s that going?    This morning’s inflation figures would suggest not so well. Inflation fell in the 12 months leading up to December 2022 to 10.5 per cent, down from 10.7 per cent in November. So prices are moving in the right direction, but at a snail’s pace. Ross Clark has the details here, where he highlights how the rising cost of food and domestic services is cancelling out falling energy prices. Inflation is still projected to fall significantly by the time

Economic optimism is in short supply these days – but has pessimism about the UK’s economy been overegged by the likes of Sadiq Khan? The verdict of chief executives from around the world suggests as much: Britain has been ranked in the top three markets for investment, according to PricewaterhouseCoopers’s (PwC’s) annual Global CEO Survey. Today’s report follows the latest growth update that revealed that the economy did not contract in November as had been widely predicted, but grew slightly by 0.1 per cent. It marks a sharp contrast from the recent warnings of the London mayor, who said that ‘Brexit isn’t working’. The survey, timed to be published as the business

The political and financial elite are gathered in Davos in Switzerland for the World Economic Forum’s (WEF) annual meeting, which starts today. Yet before the conference has even kicked off, the narrative around it has already been crafted: the WEF will have to pivot away from the free-market and globalist outlook Davos usually promotes, and switch its focus to inequality instead. In a cost-of-living crisis, images of the glamorous Swiss resort and delegates quaffing champagne are not a good look.  This problem was pre-empted by many. Neither Rishi Sunak nor his chancellor Jeremy Hunt will be attending this year’s conference (trade secretary Kemi Badenoch and business secretary Grant Shapps will

Whatever happened to the economic boom that was supposed to follow the Covid pandemic? The 2020s, some argued, would be like the 1920s, with an economy roaring its way out of recession, to be remembered as a time of unprecedented wealth and opportunity. That is not how things have turned out so far.  While economic growth in the UK during 2022 is still likely to come out positive, the growth was concentrated in the first half of the year – in the third quarter GDP fell by 0.3 per cent. The economy, according to the Office of National Statistics, is now 0.8 per cent smaller than it was on the eve of

Britain’s ageing health infrastructure comes close to breaking point every winter, but this year something is going to give way. On top of the usual litany of complaints about funding and increasing demand on the NHS from an older population, we can add covid backlogs, waiting times stretching into multiples of nominal targets – and now even the workforce downing tools and walking out. As usual, the government is going to try to keep things functioning with short-term sticking plasters. There will probably be more millions shovelled onto the ever-burning furnace of the NHS budget, with little to show in terms of patient outcomes. There will, at some point, be

There is no Christmas story like A Christmas Carol, and few seasonal characters as iconic as Ebenezer Scrooge; the ‘clutching, covetous old sinner’ who finds redemption in the abandonment of sound business sense and the joy of Christmas cheer. Scrooge’s name has become a byword for miserly conduct, with Jeremy Hunt the latest to claim the mantle as he raised taxes last month. But this depiction of Scrooge as Mr Bah Humbug is deeply unfair. He deserves better. For economists like me, there is much to admire about Scrooge the moneylender, who did rather more for human welfare than the late-in-the-day Scrooge filled with the spirit of Christmas. Even Dickens concedes

Economic growth is the third quarter was known to be depressed, but the Office for National Statistics (ONS) has this morning upped its estimate of the retreat in GDP for the third quarter, from a fall of 0.2 per cent to a drop of 0.3 per cent. That need not be too alarming in itself – September was always going to be a difficult month owing to the period of mourning for the Queen and the extra bank holiday for her funeral. The ONS has already reported its first estimate that growth in October rebounded by 0.5 per cent. But it is the detail which is more concerning. While the

Has inflation peaked? The Consumer Prices Index fell to 10.7 per cent last month, down from 11.1 per cent in October. This follows predictions that October would be the month in which inflation peaked – so this morning’s figures from the Office for National Statistics will raise hopes that the worst may be behind us. This doesn’t appear to be a blip. The market expects this to continue for the next two years before bottoming out in 2025. There will be optimism, too, that we can look forward to a sharp fall in the CPI over the next few months as the surge in energy prices begins to drop out of