Money

Is it time for a windfall tax on energy companies? Judging by a poll during the first lockdown – which found more than half of the UK public would welcome an additional tax on businesses that had thrived because of the extraordinary circumstances of the pandemic – it would be a popular measure. A windfall is typically something you get for free, after all. Energy policy has become increasingly muddled in recent years Advocates often reference Chancellor Gordon Brown’s windfall tax on privatised utilities in 1997, which raised £5.2bn over a number of years and was justified on the grounds that corporate profits had risen due to failed government policy.

When the whole opioid crisis blew up, the Sackler family — whose fortune was substantially built on getting thousands of Americans debilitatingly addicted to OxyContin — withdrew for a period from their charitable giving. It was reported yesterday, though, that they’re back in the philanthropy business, and last year gave £3.5 million to various British causes — among them the Oxford Philharmonic Orchestra, the Watermill Theatre, King’s College, London, the homelessness charity Amber Foundation, various churches, academies and conservation projects. ‘The return of the Sacklers to philanthropy in the UK,’ the report stated confidently, ‘will cause outrage’. Really? I remember being similarly perplexed when green campaigners were protesting about the National

Many of the thorniest problems of politics come down to the same thing: timeframes. Big problems generally require solutions that take a long time to develop and implement. But the decision to do this must be made by politicians who work to much shorter timetables: news cycles measured in days and weeks, ministerial appointments that last months, and elections that are never more than a few years off. The approaching pain of rising energy prices is a case in point. It may well be surprising and new that European wholesale gas prices rose by 800 per cent last year. It is neither surprising nor new that the UK depends for

For once, yesterday’s Downing Street press conference included a worthwhile question, and not of the ‘why aren’t you locking us down?’ variety. In fact, it had nothing to do with Covid at all. Harry Cole of the Sun asked why, given that the Prime Minister had once cited the ability to remove VAT from fuel bills as a tangible benefit of leaving the EU, he was not now taking advantage of his new-found freedom, especially as bills are heading sharply upwards. Boris Johnson mumbled something about not wanting to help people who could easily afford their energy bills and that the government might consider more targeted help instead. The VAT

Twelve months after a comprehensive trade deal was signed with the EU, where are we now? How has the UK performed? Even arch Remainer Andrew Adonis admitted last year that ‘the UK government clearly did a better job than the EU in procuring vaccine supplies and putting in place urgent industrial production’. Yet so far we’ve had no financial or employment deregulation, we’ve signed up to a minimum corporation tax (like the EU), and we haven’t reformed our commitment to the European Court of Human Rights. If Brexit were a pupil, what would its 2021 report conclude? Has the UK proven itself a strong independent learner, or should it try

After the pandemic, is energy the next European crisis? Gas prices have hit new records, reaching $180 per barrel in the Netherlands, representing a fivefold increase over the past six months. This is driven by news that Russia has diverged gas flows from its main European pipeline to one that is going east via Poland. Experts are pondering over the reasons, be it geopolitical muscle-flexing or the fact that Russia is hit by a cold front of minus 20 degrees. The results are the same: Vladimir Putin promised more gas for Europe, and it is still not coming. The prospect of a Russian invasion in Ukraine just adds more uncertainty

After growing calls from retail and hospitality for financial support to weather the ‘unofficial lockdown’ plaguing these industries, the Treasury today has responded. After a week of conversations with business leaders, Chancellor Rishi Sunak has announced a £1 billion support package this afternoon, which includes one-off grants worth up to £6,000 for hospitality and leisure businesses in England, as well as government cover of Statutory Sick Pay for workers off with Covid-related illness, which can be claimed by small and medium-sized firms. Sunak’s decision to deliver a support scheme isn’t all that surprising, given the Chancellor’s generous track record with these packages in the past. While businesses legally remain open,

The cabinet will meet this afternoon, with more restrictions and even a new lockdown on the agenda. But have ministers been given the information they need to make an informed decision? There are rumours of briefing documents being sent around over the weekend with a pro-lockdown bias (i.e., heavy on the worst-case scenarios and not much said about potential side-effects). But the Times today reports that this time around the cabinet wants a full discussion — with at least ten ministers demanding a better quality of briefing before decisions are made that affect the lives of millions. The below is a list of questions that ministers need answered: 1. What

The Omicron variant of Covid-19 is rampant. Bars and restaurants are in crisis as thousands of bookings are cancelled. And travel restrictions are back in place, with a full lockdown looming. To make matters worse, so far there is little sign of the Chancellor Rishi Sunak stepping in with any support.  Most businesses probably imagined that the very last thing they would have to cope with right now was a rise in interest rates. As a result, there will be plenty of business owners complaining that the Bank of England’s decision to up rates to 0.25 per cent will be the final blow that will push the economy back into recession. But hold on.

Yet again, inflation has surged past expectations – this time hitting 5.1 per cent in November, a ten-year high, up from 4.2 per cent in October. This threatens a political crisis as well as tough economic times: unless inflation is quelled, next year will be one of declining living standards for most people. Anyone whose pay is not rising by at least five per cent will, in effect, feel like they’ve experienced a pay cut. It was assumed that five per cent would be about as high as inflation would go but all this is proving hard to predict. This has gone past the Bank of England’s peak forecast, which

It wasn’t long ago that we were fearing the end of the furlough scheme might be accompanied by a significant rise in unemployment. According to the latest labour market figures released by the Office of National Statistics (ONS) this morning, that doesn’t appear to have happened. What they do show, however, is that the pandemic has led to growth in a section of the population which generally receives little comment: adults of working age who are economically inactive – i.e. not in work and not seeking work either. Moreover, those who are in work are working fewer hours than they did before the pandemic. The figures cover the period August