Money

Tory Nimbys are walking into Starmer’s trap

The government has yet to formally announce its widely trailed decision to expand Gatwick, Heathrow, and Luton airports. But that hasn’t stopped six MPs from writing to Transport Secretary Heidi Alexander with a pre-emptive attack. The four Green MPs, perhaps, plus a couple of anti-capitalist hard left Labourites? Nope. Four Lib Dems and two Conservatives – one of whom is, astonishingly, Andrew Griffith, the Shadow Business Secretary. The idea of the Shadow Business Secretary campaigning against a core component of economic growth would be funny if it wasn’t so utterly damning Griffith tells Alexander that local residents’ “life is blighted every single day by the noise of take-offs and landings

Ross Clark

Why are so many MPs still clueless about the cost of net zero?

Donald Trump has withdrawn the United States from the Paris Climate Change Agreement for the second time and reiterated his desire that America should ‘drill, baby drill’. The US president’s decision exposes the naivety of MPs in Britain who, in 2019, nodded through a legal commitment to reaching net zero by 2050, with the hope that it would inspire other countries to follow our example. The Climate and Nature Bill risks taking Britain back to the dark ages In fact, Britain is pretty well alone in voluntarily choosing to ‘leave it in the ground’, as anti-fossil fuel activists like to put it. The US has been following an unashamed policy

Rachel Reeves is getting an expensive lesson in economics

It may prove to be just the first of many screeching U-turns. Whilst hobnobbing among the plutocrats in Davos this week, the Chancellor Rachel Reeves has admitted that she may have to tweak her clamp-down on non doms, to make it less punitive for anyone who isn’t British, and happens to have a bit of money, to live in the UK. Sure, it is good that Reeves is learning from her mistakes. The only trouble is it is going to prove a very expensive education for the rest of us.  It is only a couple of months since Reeves’s Budget introduced tough new rules for non doms, but it already

The EU’s decarbonisation plan can’t survive Donald Trump

As in a more delirious version of Bill Murray’s Groundhog Day, Donald Trump withdrew from the Paris Climate Accord on his first day in office, again. In a thinly-veiled attempt to mend Beijing’s relations with Europe, Chinese foreign ministry spokesman commented: “Climate change is a common challenge facing all of humanity. No country can stay out of it, and no country can be immune to it.” Whatever their views on climate change, Europeans and British would do well to realise that decades-long effort to reduce emissions through multilateral deals is over. Continuing on one’s own – after America’s explicit repudiation of the COP framework, and in light of the track record

Ross Clark

Rachel Reeves’ tinkering won’t rescue Britain’s economy

The news just seems to get worse for Rachel Reeves. After the slight relief of last week’s inflation and GDP figures, this morning brings headlines that are even grimmer than economists expected. The government was forced to borrow £17.8 billion in December, more than twice the £6.7 billion which Rishi Sunak’s government borrowed in December 2023. In just one month, taxpayers had to spend £8.3 billion to service the government’s debt. Interest payments are now consuming over 8 per cent of government expenditure – more than is spent on education or defence – and very nearly as much as the welfare bill, which is itself ballooning. The Chancellor’s immediate problem is that

Kate Andrews

Donald Trump has promised the world

‘The golden age begins right now’ said the 47th President of the United States as he began his inauguration speech in the Capitol Rotunda. What followed was a 30-minute speech, during which Donald Trump stayed both on script and on message, reiterating his promise to declare a border crisis, deport foreign criminals, return America’s title of energy independence and to ramp on tariffs on foreign countries to ‘protect American workers and families’.  Trump aides had promised that, eight years on, the President’s second swearing-in speech would be different. Gone were the days of promoting ‘American carnage’. Today, the message was to be one of unity.  Here, the President took baby

Will the SNP come to its senses on North Sea oil?

Drill, baby drill. The mood on Net Zero is changing in the Scottish parliament where a majority of MSPs have signed a petition calling for a reversal on the ban on new oil and gas licenses in the North Sea. This sea change in attitudes to the black stuff, if you’ll excuse the pun, could portend a dramatic reversal of the Scottish government’s opposition to fossil fuels in SNP leader John Swinney’s long-delayed energy strategy. The “presumption against offshore drilling” has been the centrepiece of SNP energy policy since Cop26 in 2021, when Nicola Sturgeon posed for selfies with Greta Thunberg. Sturgeon is gone, of course – and her clean

Kate Andrews

Will the IMF regret its backing for Labour’s Budget?

International investors may be jittery about the UK’s future, but the International Monetary Fund appears to be more optimistic. The IMF has published its World Economic Outlook report for January, which forecasts the UK will have the third-fastest growth in the G7 this year. It revises upwards its projection for 2025, by 0.1 per cent, to 1.6 per cent. The UK falling in after the United States and Canada does not make good on Labour’s promise to be the fastest growing advanced economy. But after a tumultuous week of gilt fluctuations, bad growth figures and an even worse retail sales update, it’s a good way to be ending the week.

Rachel Reeves tries deregulation, but she’s bad at that too

If it was a Netflix mystery series, it would be the moment for the ‘big reveal’. After months of boasting about how she would make the UK the most competitive, dynamic, and indeed fastest growing economy in the G7 we finally have some idea of what Rachel Reeves is going to do to deregulate the UK. There is just one problem. She has opted for the worst possible way of loosening the rules – and Reeves will end up sparking an asset bubble.  After summoning regulators to Downing Street yesterday to tell her how to boost growth, some details have started to emerge of what Reeves is planning. According to

Regulators don’t create growth 

Perhaps you could gather a group of traffic wardens and ask them how to build a racetrack. Or get the leaders of the Salvation Army over to suggest some cool ideas for a cocktail bar. Think up any improbable brainstorming sessions, and it will still be hard to imagine anything more awkward than the gathering of regulators Chancellor Rachel Reeves summoned to Downing Street today to give her some ideas on growth. After all, that is her job, not theirs.  Just the concept of frog-marching regulators into the Chancellor’s office and demanding ‘growth ideas’ is ridiculous It hardly sounds like fun. The chief executives of such august sounding bodies as

Kate Andrews

The UK economy is in a rut

The UK economy has grown for the first time in three months. The Office for National Statistics (ONS) reports that the economy expanded by 0.1 per cent in November after it contracted by 0.1 per cent in both September and October. This uptick is largely thanks to an increase in services output, which grew by 0.1 per cent in November 2024, after falling by 0.1 per cent in October (a downward revision from last month’s estimate that there had been no growth. So has the economy turned a corner? It’s very difficult to spin this morning’s news in a wholly positive light. Yes, it’s good that the economy did not

Why inflation figures may have given Labour false confidence

The relief from Downing Street at yesterday’s inflation data – which showed that it dipped to 2.5 per cent in the 12 months to December, down from 2.6 per cent the month before – was palpable. Darren Jones, the Chief Secretary to the Treasury, cast a breezy image as he described his boss, the Chancellor Rachel Reeves, as “brilliant”. The choices facing Reeves and Starmer would be bleak Keir Starmer will now be able to offer his Chancellor more than lukewarm assurances that she is not facing the chop. The news will abate the recent cycle of media criticism and with President Trump’s inauguration next week, focus will soon turn elsewhere.  Her

Kate Andrews

Inflation dip marks a welcome surprise for Rachel Reeves

Rachel Reeves has found brief respite this morning, with the Office for National Statistics confirming that inflation dipped to 2.5 per cent in the 12 months to December, down from 2.6 per cent the month before. This is a smaller rise than had been expected (the consensus was 2.6 per cent) and roughly in line with the Bank of England’s forecast from November, which had predicted a 2.4 per cent increase. It’s welcome news for a Chancellor who is under pressure. Core inflation slowed too, from 3.5 per cent in the year to November, to 3.2 per cent in December. This competes for the best news in the update, as core

How much longer will Starmer back Reeves?

It’s not been a happy new year for Sir Keir Starmer. The Prime Minister’s Treasury minister Tulip Siddiq has been forced out following an anti-corruption investigation in Bangladesh. Siddiq’s job became untenable following questions over links to her aunt, the former prime minister of Bangladesh, Sheikh Hasina. Siddiq has denied wrongdoing and an independent investigation found that she had not breached the Ministerial Code, but it was clear over the weekend that Siddiq’s position was untenable. Starmer, however, bafflingly allowed to her to stay on until yesterday afternoon. ‘Starmer dithered and delayed to protect his close friend,’ says Tory leader Kemi Badenoch. It’s hard to disagree with that assessment. Reeves’

Kate Andrews

Rachel Reeves is getting ready for the next market test

Rachel Reeves did her best to keep today’s China visit statement on topic. The Chancellor wanted to talk about ‘cooperation’, ‘competing where our interests differ,’ her efforts to break down market barriers and the £600 million she secured in investment. But other MPs had other ideas.  ‘I know the Chancellor has been away,’ said the Shadow Chancellor Mel Stride. ‘So let me update her on the mess she left behind.’ So began the battle between the Chancellor – to stay on topic – and her opposition to bring up the long list of economic woes that have come to the forefront this week: not just the substantial rise in borrowing

James Kirkup

Why Westminster is wrong about gilt yields

It’s gilts season at Westminster. This is one of those unpredictable events, like the passing of a comet, that sees the residents of the political village staring at the skies and imputing all sorts of divine causes to the curious flashing lights they see there.   Because of the ongoing excitement in the markets, a lot of political folk have, in the last few days, become authoritative commentators on yield curves. Welcome to the party, guys. A very long time ago, I covered bond markets for a City newswire, and hated pretty much every minute of it. I claim no particular expertise as a result, but I am still confident in

Ross Clark

Europe’s car industry is under attack on all fronts

It is half a century since Britain’s native car industry embarked on its long, painful decline, precipitated by Austin Allegros with rear windows falling off, endless strikes over the length of tea breaks and terrible commercial decisions such as to cede the hatchback market to overseas competition. But where Britain led, Germany and France now seem to be following. How much longer before names like Peugeot, Renault, and even Volkswagen, either disappear or become reduced to mere badges affixed to Chinese-designed and produced vehicles? The retreat of the European car industry has cropped up from time to time in recent months. In October, Volkswagen announced, for the first time, its intention to

Trump’s team will show Rachel Reeves how it’s done

As Trump Treasury Secretary nominee Scott Bessent rises, full of promise for his confirmation hearing in Washington next week, the UK is still reeling from a plunge in the value of the pound and a sharp rise in borrowing costs, directly tied to Rachel Reeves’s economic policies. The contrast in the approaches of these respective leaders could hardly be more stark. Bessent, a figure whose appointment has Wall Street buzzing with optimism, contrasts sharply with Rachel Reeves, whose policies, compounded by the net zero fanaticism of Ed Miliband, are proving to be the harbinger of economic catastrophe. This comparison isn’t just about individual competence; it’s about the contrasting philosophies of

Ross Clark

AI won’t save Britain with one quick trick

Obviously, artificial Intelligence (AI) is a boom industry that will transform many other industries and make fortunes for some people. Anyone should want Britain to be involved and earn itself a slice of the AI pie. Why, then, does the government’s AI Opportunities Action Plan depress me? Apparently, according to Keir Starmer, it is going to turn Britain into an ‘AI superpower’. There are going to be AI growth zones, and the public sector is going to be at the forefront. AI is going to help teachers plan lessons, help councils speed up decisions on planning applications, even help mend potholes – all the biggest public sector failures, in other

Ian Williams

Labour’s kowtowing to China will cost Britain

When the security services accessed the mobile phone of Yang Tengbo, the alleged Chinese spy who became a confidant and business partner of the Duke of York, they found a document in which Yang said of the duke, ‘He is in a desperate situation and will grab onto anything’. We can only assume there are memos circulating in the Chinese Communist Party (CCP) this week describing the visit by Rachel Reeves in similar terms. Starmer and his ministers appear to be competing to see who can kowtow the lowest before Xi The hapless duke’s entanglement with Yang, whose exclusion from Britain was confirmed shortly before Christmas, was held up as