Category Archives: Economic policy

Disabled people among hardest hit by cost of living crisis, finds study

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People with disabilities more likely to cut back on energy use and food, Resolution Foundation says

Disabled people in the UK are much more likely to struggle to heat their homes and cut back on food this winter, according to a report highlighting “massive” income gaps amid the cost of living squeeze.

Research from the Resolution Foundation found people with disabilities had an available amount to spend that was about 44% lower than that of other working-age adults, exposing them hugely to the rising cost of essentials.

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Welsh Labour is readying for snap general election, says Mark Drakeford

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First minister claims Tories in Westminster are ‘staggering’ and could be months away from collapse

The Welsh first minister has told the Labour party in Wales to be prepared for a general election in the new year, believing the UK government could be months away from sudden collapse.

Mark Drakeford claimed the Conservative government in Westminster was “staggering”, and that at any moment it could be “overwhelmed” and forced to call a snap UK election.

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Inflation, waiting lists, strikes, rail chaos, climate emergency: the 2022 polycrisis

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Almost every facet of life in the UK – courts to cost of living, transport to healthcare, environment to asylum system – is at breaking point

In mid-November Rishi Sunak was asked in a Channel 4 interview to name one public service that “was working, adequately, working properly”.

The prime minister didn’t give a direct answer. But the exchange feeds into an ever-more-common discourse: that the UK is facing “polycrisis” in almost every facet of life in Britain. From courts to the cost of living, transport to healthcare, environment to the asylum system – everywhere appears to be affected.

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Chuka Umunna advises Czech tycoon accused of Royal Mail plot

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Ex-Labour MP and former critic of privatisation risks claims of hypocrisy over advisory role with Daniel Křetínský

The MP turned banker, Chuka Umunna, is advising a Czech tycoon who was accused of planning a secret takeover of Royal Mail by union leaders.

The former Labour MP is one of a team of bankers working on Daniel Křetínský’s British business interests, many of which are held within Vesa Equity Investment, including a 23% stake in Royal Mail’s parent company, International Distributions Services (IDS).

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UK rail system described as ‘broken’ as 2022 data reveals extent of disruption

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Delays and cancellations linked to 20 years of privatisation, rising costs and labour shortages worsened by pandemic, say experts

Rail passengers have been delayed or disrupted on more than half of all train services departing from 15 of Great Britain’s busiest stations in the last year, Guardian analysis shows, exposing what has been described as a “broken” railway system that cannot easily be fixed.

Experts said the figures – which show rail services in the north and Midlands as the hardest hit – demonstrated the impact of two decades of privatisation, which had increased costs and public subsidies, combined with labour shortages exacerbated by the pandemic.

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UK government looks to lure early retirees back to work, reports say

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People who quit during pandemic may be offered ‘midlife MOT’ as way to address labour shortage

Plans to coax middle-aged retirees back into work to boost the economy are being considered by the government, according to reports.

Older people who have given up work could be offered what is being described as a “midlife MOT” to entice them back into employment, the Times has reported.

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Elon Musk polls Twitter users over stepping down as CEO – business live

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Elon Musk says he will honour the results of a Twitter poll asking whether the should resign as head of the social media platform

Telsa investors seem to pleased with the way that Musk’s Twitter poll is leaning towards his potential resignation, with shares up 4% in pre-market trading:

Economic data interlude:

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Bank of England raises interest rates to 3.5% in ninth increase in a year

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Majority of MPC rate-setters back hike of 0.5 percentage points despite fears UK is entering a long recession

Mortgage payers are braced for higher borrowing costs, after the Bank of England pushed up its base rate by 0.5 percentage points to 3.5% despite saying inflation has peaked and Britain is about to enter “a prolonged recession”.

The Bank hiked interest rates on Thursday for the ninth time in a year, to the highest level in 14 years, but told borrowers to prepare for fresh increases in the new year.

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Scotland to spend extra £1bn on health by raising taxes on higher earners

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Scottish government promises to tackle health and social care crisis to protect weakest and poorest

The Scottish government has promised to spend another £1bn on tackling the crisis in health and social care by raising taxes on higher earners and holiday homes.

John Swinney, Scotland’s acting finance secretary, said the burden of increasing NHS funding would fall heavily on everyone earning more than £43,663 in Scotland as part of a “social contract” to protect the weakest and poorest.

The abolition of a cap on council tax increases next year, alongside £550m extra for councils.

The uprating of all Scottish welfare benefits by 10%, increasing welfare spending by £433m.

£222m on school support for the poorest and extra free school meals in primaries.

£15m for a pilot project to scrap peak-time rail fares.

£336m on home energy efficiency and reducing fuel poverty.

The abolition of non-domestic rates for 100,000 smaller shops and businesses and a freeze in business rates charges, which would cost £356m.

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Kwarteng had ‘all the advice’ but disregarded warnings on mini-budget, MPs told

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Treasury officials tell select committee they set out impacts of £45bn plan for former chancellor

Kwasi Kwarteng disregarded warnings that his £45bn mini-budget could trigger a backlash on the financial markets, Treasury officials told MPs today.

The department’s permanent secretary, James Bowler, said he was “absolutely confident Treasury officials set out the right advice” to the then chancellor.

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Liz Truss and I ‘got carried away’ writing mini-budget, admits Kwasi Kwarteng

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Sacked chancellor says he and ex-PM failed to consider political and economic consequences

Kwasi Kwarteng has admitted he and Liz Truss “got carried away” when they wrote the disastrous mini-budget that led to both of them leaving their jobs just weeks after they entered Downing Street.

Kwarteng announced a raft of tax cuts without any reduction in spending in September, which led to the pound crashing against the dollar, pension funds nearly collapsing, a £65bn Bank of England bailout, soaring mortgage costs, and the cost of government borrowing increasing. He also said he would remove the cap on bankers’ bonuses.

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Is the UK really facing a second winter of discontent?

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Comparisons with 1979 are misleading – strikes over pay now are smaller in scale and focus, and stoked by inflation

Britain is facing a winter of strikes, as industrial action on the railways spreads to the health service and other key sectors of the economy. Such is the wave of discontent that more than 1m working days could be lost to disputes in December, the most since 1989, during Margaret Thatcher’s final years in power.

With inflation at the highest rate in 41 years amid the cost of living crisis, it’s not difficult to see why workers are pushing for better pay. Coming after the worst decade for average wage growth since the Napoleonic wars, including deep real-terms pay cuts for many in the public sector, it’s even less surprising still.

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RBA interest rates: Reserve Bank raises official cash rate to 3.1%, the eighth increase in as many months

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More pain for borrowers with interest rates to rise again after central bank lifts cash rate 25 basis points to the highest level since the end of 2012

Hopes for a “Santa pause” on interest rates have been dashed with the Reserve Bank lifting borrowing costs for a record eighth time in as many months at its last meeting for the year.

The RBA on Tuesday raised its cash rate 25 basis points. Most economists had expected the quarter point increase to 3.1%, the highest level since the end of 2012.

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Timetable of trouble: the wave of strikes set to hit the Tories this winter

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Rampant inflation and government policy has brought matters to a head: so where is disruption going to hit and what are the unions asking for?

Strikes are not something most managers think about. The oft-mentioned “winter of discontent” and year-long miners’ strike were features of the late 1970s and mid-1980s. Since then, industrial action in the private and public sectors has fallen to a level so low that academics have given up studying it.

When pay talks began a year ago for the current financial year, inflation was rising, but the Bank of England was reasonably certain it would be temporary. Union leaders prepared for a post-pandemic battle over pay, but not one that would probably end in strike action.

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UK house prices fall at fastest pace since 2020 amid fallout from mini-budget

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Nationwide warns inflation and rising interest rates will weigh down housing market

UK house prices have fallen at their fastest rate for two and a half years as the fallout from Liz Truss’s disastrous mini-budget put buyers off according to Nationwide, which warned inflation and rising interest rates would weigh on the market in the coming months.

The price of an average home dropped 1.4% to £263,788 in November, according to the lender’s house price index, accelerating a slowdown that saw prices fall 0.9% in October. It was the third monthly fall in a row, and the biggest drop since June 2020.

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Amazon’s UK tax bill could rise by £29m amid business rates overhaul

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Hikes set to hit warehouses and online retailers hardest in 2023 as UK government addresses ‘brick v clicks’ tax gap

Amazon’s UK tax bill jump could jump by £29m next year as a result of changes to business rates that are scheduled to hit warehouses and online retailers the hardest.

The online retailer is likely to be among firms facing big tax rises following the chancellor’s autumn statement, according to analysis from the real estate adviser Altus Group.

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Keir Starmer walks fine line in shifting Labour’s stance on immigration

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Party leader is reluctant to hint he will allow thousands into UK but wants to avoid upsetting his pro-migration MPs

In his speech to a hall packed with business leaders, Keir Starmer came with the message that Labour had changed, hoping to sweep away the years of antipathy between his party under its previous leadership and growth-hungry executives.

But another change in position was clear to see: on immigration, Starmer held up the recruitment of overseas workers as a sticking plaster solution to the problem of significant worker shortages in the UK.

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Immigration is still the nettle preventing Tory detente with business

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Rishi Sunak’s visit to CBI conference found old allies keen to mend fences, but impeded by hard politics of immigration

Amid the steady grey Birmingham drizzle, Britain’s leading business lobby group tried to walk a careful path on immigration.

Members of the Confederation of British Industry (CBI), present in greater numbers than in recent years at its annual conference, have been clamouring for more flexibility on hiring foreign workers, as a tight labour market wreaks havoc on their businesses and drives up wages.

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Luxury goods boom in Britain as the young, rich and mortgage-free buck the recession

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Rich kids of Insta use strong dollar to fuel sales of high-end brands such as Burberry, Louis Vuitton and Gucci

They’re young, rich and mortgage-free, and the scions of the 1% are having a roaring twenties.

Despite the economic gloom currently shrouding the UK and many other western countries, sales of luxury brands have been booming and growing numbers of buyers are young adults.

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How the autumn statement brought back the ‘squeezed middle’

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IFS and Resolution Foundation say Jeremy Hunt’s policies will shock middle England, with higher taxes here to stay


Traditionally elections in Britain are decided by swing voters in a relatively small number of seats. Parties go to considerable lengths to tailor their policies to the perceived demands of those getting by on average incomes. Pollsters have even coined names for the archetypal electors that need to be wooed: Basildon man and Worcester woman.

So it will be of some concern to government strategists that the post-autumn statement analysis by thinktanks focused heavily on how the measures announced by Jeremy Hunt had an effect on those not particularly poor but not especially rich either. Both the Resolution Foundation and the Institute for Fiscal Studies highlighted the return of the “squeezed middle”.

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