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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’

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

In politics as in everyday life it is possible to be right at the same time as being terribly, terribly wrong. Look no further than Liz Truss instructing her lawyers to send a ‘cease and desist letter’ to Keir Starmer demanding that he stops accusing her of “crashing the economy”. The claim, she alleges, is not only false but contributed to her losing her South West Norfolk seat in last year’s general election. Truss is right, as it happens – the mini budget delivered by her Chancellor Kwasi Kwarteng during her micro-premiership may have precipitated a run on bond markets, but it had little effect on the economy, and Britain did

The new year may have rustled up some surprise stand-offs for the Labour government (mainly calls from X founder Elon Musk for Keir Starmer to resign), but the rise of new problems does not mean the old problems have disappeared. A harsh reminder has been dished out this morning, as long-term borrowing costs reached a 27-year high, calling into question yet again exactly how the Treasury is going to make good on its spending commitments while sticking to the Chancellor’s own fiscal rules. Thirty-year gilt yields hit 5.21 per cent this morning – a level that surpasses the surge in borrowing costs following Liz Truss’s mini-Budget in 2022. The ten-year

When the British government spent £400 million on the satellite internet start-up OneWeb back in 2020, it was seen as precisely the kind of active, tech-led industrial strategy that could re-boot the British economy. There were hopes the deal would help secure a place for the UK at the heart of the emerging space economy. Then prime minister Boris Johnson saw it as a key part of launching ‘Galactic Britain’. But four years on, the taxpayer is on the hook for a £300 million paper loss after shares in OneWeb’s parent company sank to a record low. The money poured into OneWeb has proved to be remarkably poor value Even

This is hardly how 2024 was supposed to end for Labour. Free from the shackles of ‘14 years of Tory misrule’, the economy was supposed to take off. ‘Growth, growth, growth,’ Keir Starmer told us, a little unconvincingly, were going to be the government’s three main priorities. Indeed, Britain was going to tear away as the fastest-growing economy in the G7 – although he never offered us any explanation as to why this would be the case, still less which of his policies was going to achieve it. This morning’s revised GDP figures from the Office for National Statistics (ONS) reaffirm just how big a failure the government’s economic policies

More than half of Britons receive more from the state than they pay in taxes, according to figures from the Office for National Statistics. The proportion of those receiving more through benefits than they paid in taxes last year fell slightly to 52.6 per cent, down a percentage point compared with the year before. The data – which factors in use of public services, such as schools and the NHS, as well as welfare payments and benefits – highlights the fundamental problem underlying the British state: how do we support a population that is aging, getting ill and becoming increasingly workshy? As you’d expect, more than 85 per cent of

Interest rates have been held at 4.75 per cent. The Bank of England’s Monetary Policy Committee voted 6-3 to maintain the base rate, with the minority voting to further reduce rates by 0.25 percentage points. This is an unsurprising move from the Bank of England. Markets weren’t optimistic that another rate cut would follow so soon after last month’s 0.25 percentage point cut. But after this week’s labour market data – showing that wages are up – and inflation data – showing prices up, too – it was highly unlikely a cautious Bank was going to push ahead with another rate cut this month. Today’s minutes reflect these concerns. ‘Services consumer price inflation has remained

Donald Trump is right that some of Nato’s European members are essentially freeloaders. That these countries are holding talks about increasing the alliance’s target for defence spending to 3 per cent of GDP at its annual summit next June comes too little, too late. Countries like Germany and France have consistently underspent on defence, leaving Europe reliant on the United States as an ultimate guarantor of the continent’s security. When he takes office in January, Trump won’t stand for this. The political chaos in France is unlikely to reassure the president elect that Europe has got its act together when it comes to defence spending. The fall of Michel Barnier’s

At last some good news for owners of second homes: Ofgem has ordered electricity providers to offer tariffs which have no standing charges, but where instead householders pay more per unit of electricity consumed. True, it isn’t second-home owners which Ofgem had in mind when it came up with the idea, rather low income consumers whom it believes are losing out under the current system. But there is no question as to whom will be the biggest beneficiaries: people who only use their properties occasionally. If you visit your Cornish clifftop mansion for only four weeks a year you stand to make a substantial saving. Standing charges have become the

The economy would crash, the markets would be in open revolt, and he would swiftly be evicted from office by the IMF, and replaced by some ‘grown-ups’. When Argentina elected its chainsaw-wielding, libertarian President Javier Milei a year ago, the economic and political establishment confidently predicted he would only last a few weeks. And yet, not only has Milei managed to stay in power, all the evidence suggests that he is turning Argentina around. The real question now is this? Will a stagnant and moribund Europe pay attention? With inflation running at 25 per cent a month, with the largest IMF loan in history to pay back, and with the