Category Archives: Economic policy

Rishi Sunak faces Tory clamour to act now on cost of living crisis

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Conservative MPs to urge chancellor to tackle inflation with VAT cuts, energy bill support and improved benefits

Tory MPs are piling pressure on Rishi Sunak to take decisive action to deal with the cost of living crisis with measures such as cutting VAT, increasing energy bill support and raising benefits, as inflation is forecast to top 9% on Wednesday.

A string of Conservatives from across different wings of the party called on the chancellor to intervene within weeks, amid dire economic predictions about the squeeze on households.

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Boris Johnson claims planned Northern Ireland protocol law is ‘insurance’ in case talks fail – live

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Latest updates: UK prime minister meets Sinn Féin and DUP as Mary Lou McDonald suggests forming Stormont assembly is not UK government priority

This is from my colleague Jennifer Rankin in Brussels on the UK government’s mixed messaging over the Northern Ireland protocol.

Taoiseach Micheál Martin and Sinn Féin’s leader in Northern Ireland, Michelle O’Neill, have said they recognise there are “serious issues” in relation to the implementation of the Brexit protocol that Boris Johnson is planning to override in part.

They expressed serious concern about possible unilateral moves on the protocol by the British government, which would have a destabilising impact on Northern Ireland.

They recognised that there are genuine issues regarding aspects of the implementation of the protocol but these can be taken forward in the context of EU-UK discussions.

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Rishi Sunak: windfall tax an option if oil firms fail to invest in UK

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Chancellor says he is ‘pragmatic’ about introducing a levy on energy companies to ease cost of living crisis

Rishi Sunak has insisted he is “pragmatic” about the idea of a windfall tax on energy companies, claiming “no options are off the table” in the clearest sign yet that the government is planning measures to tackle the cost of living crisis.

Labour has been calling for a windfall tax on oil firms, which have benefited from rocketing global prices, with the shadow chancellor, Rachel Reeves, suggesting the proceeds be used to cut domestic energy bills.

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Queen’s speech: Boris Johnson ‘bereft of ideas’ to tackle cost of living crisis

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Despite 38 new bills, opposition accuses government of failing to act to protect people amid soaring inflation

Boris Johnson was accused of being “bereft of ideas or purpose,” after a Queen’s speech that included 38 new bills but offered no specific measures to tackle the immediate cost of living crisis.

Instead, the speech, delivered by the Prince of Wales amid the pomp of the state opening of parliament, included plans to tear up the Human Rights Act, make it harder for councils to rename streets and privatise Channel 4.

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Shock interest rate rise shows Australia’s economic exceptionalism is fading

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RBA’s decision is, in the words of one economist, ‘a radical revision’. Could this turn a plateauing of property prices into a rout?

In a world of economic shocks, the questions left by Tuesday’s surprisingly large increase in the official interest rate include what will bring the next thunderbolt.

After all, not one of 32 economists surveyed ahead of the Reserve Bank’s monthly meeting predicted the board would emerge with a 25 basis point cash rate increase, finally liberating it from the record low 0.1% it had hovered at since November 2020.

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Clive Palmer’s campaign pledge to cap home loan rates ‘utterly irresponsible’, experts say

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United Australia party plan to combat rising rates an ‘just an attention grabber’ and not genuine policy, critics say

Clive Palmer’s centrepiece campaign pledge to cap homeowners’ interest rates for five years has been dismissed by economists as “radical”, “crazy” and “utterly irresponsible” even though it will probably appeal to some gullible voters.

According to the United Australia party’s website, the mining billionaire’s “economic plan for freedom and prosperity” pledges to set a maximum 3% interest rate for all home loans to head off a looming mass default as lending rates start to rise.

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National insurance rise forces UK employers to shoulder £9bn tax burden

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Bosses say 1.25-point rise heaps pressure on firms already enduring soaring costs linked to Covid and Brexit

Britain’s employers are being forced to shoulder a £9bn tax rise after the government pushed ahead with raising national insurance on Wednesday despite stiff opposition.

Company bosses said the 1.25-percentage-point rise in national insurance contributions (NICs), which is paid by workers and their employers, would add to already severe pressure from runaway inflation and soaring business costs this year linked to Covid, Brexit and Russia’s war in Ukraine.

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Benefit rises will take 18 months to catch up with inflation, OBR chair tells MPs – UK politics live

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Latest updates: warning comes as chancellor is to face Commons Treasury committee this afternoon amid criticism over his spring statement

Q: Is it right for trans women to be able to compete in women’s sports?

Starmer says that should be a matter for the sporting authorities.

I spent a lot of my working life dealing with violence against women and girls first-hand, and I know from that experience, just how important it is to fight for women and fight for equality.

We have had legislation in this country which makes it clear that in some circumstances, particularly at the moment under the law when you’ve gone through a process, you can be recognised in the gender of your choosing, that’s been the position for over a decade now ...

But I equally - I want to be really clear about this - I am an advocate of safe spaces for women.

I don’t think that discussing this issue in this way helps anyone in the long run.

What I want to see is a reform of the law as it is, but I am also an advocate of safe spaces for women and I want to have a discussion that is ... anybody who genuinely wants to find a way through this, I want to discuss that with, and I do find that too many people - in my view - retreat or hold a position of which is intolerant of others.

Of course there are circumstances and anybody who insults family members excites something quite emotional in all of us.

But, on the other hand, to go up and hit someone in that way is wrong, I’m afraid. It was the wrong thing to do.

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Rishi Sunak to promise ‘security for working families’ in spring statement

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Chancellor expected to announce fuel duty cut in package of measures to tackle cost of living crisis

Rishi Sunak will promise “security” to cash-strapped families as he announces a fresh package of measures to tackle the cost of living crisis on Wednesday, but will continue to underline the importance of fixing the public finances.

The chancellor has been under intense pressure to take action to help households with the rocketing cost of fuel and other essentials. The financial expert Martin Lewis told MPs on Tuesday that many households are facing a “fiscal punch in the face” when the energy price cap rises next month.

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Rishi Sunak handed borrowing boost before spring statement

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Figures improve chances of fuel duty or other tax cuts but inflation drives up cost of government debt

Rishi Sunak has been handed a boost from figures showing lower government borrowing than official estimates on the eve of the spring statement.

The figures come despite a sharp rise in debt interest payments last month amid soaring inflation.

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Priority is to cut taxes, says Rishi Sunak before spring statement

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Chancellor believed to be considering cut in fuel duty among measures to tackle cost of living crisis

Rishi Sunak has promised that tax increases are “done”, as he dropped a heavy hint that he is preparing measures to tackle the rising cost of living in next week’s spring statement.

The Institute for Fiscal Studies (IFS) said this week that Sunak had announced more tax rises in two years – worth 2% of GDP – than Gordon Brown did in a decade.

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UK wages fall at fastest rate since 2014 as cost-of-living squeeze bites

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Unemployment rate falls below pre-Covid level but rising prices and energy bills hitswages

Unemployment in the UK has fallen below pre-Covid levels, but high inflation amid Britain’s cost of living crisis means average wages fell at the fastest rate since 2014.

The Office for National Statistics said the unemployment rate fell to 3.9% in the three months to January, dropping below the 4% rate in February 2020 before the coronavirus pandemic took hold in the UK.

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Johnson’s Germany comparison highlights UK’s low sick pay

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Proportion of UK worker’s salary covered is typically less than quarter of Germany’s 100% in first six weeks

Asked this week about whether his move to drop Covid isolation requirements would drive infectious workers into the office, Boris Johnson said UK workers should learn from their German counterparts and stay home when unwell.

The prime minister did not mention the stark differences in the support available for British workers compared with Germany and the rest of the world, and whether this could explain their reluctance to take a sick day.

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Men on high incomes to take lion’s share of Coalition’s $184bn tax cuts, analyses find

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Government’s ‘trickle down disaster’ will further entrench inequality between men and woman, Greens say

Tax cuts planned to take effect in 2024-25 are highly regressive and would pay male beneficiaries twice as much as women, separate analyses by the Australia Institute, the Greens and the Australian Council of Social Service have found.

The so-called stage-three tax cuts will remove the 37 cents in the dollar tax bracket, lower the 32.5 cent bracket to 30 cents, and raise the top tax bracket to start at $200,000 compared with $180,000 now. All up, the cuts will cost about $184bn over the first decade, the groups said.

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UK and Scottish government agree deal on freeports in Scotland

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Plan proposes two ‘green freeports’ based around low-emission industries

UK ministers and the Scottish government have reached a deal over proposed freeports in Scotland, after months of disagreement over what No 10 has billed as one of the main economic benefits of Brexit.

The Scottish government had resisted the idea of freeports – specific areas that offer tax breaks and other incentives to investors – which are intended to revitalise deprived areas but have been accused of encouraging tax avoidance and lower regulation.

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‘Secret sauce of success’: levelling-up report co-author on why UK should be like Renaissance Florence

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Andy Haldane says city’s crucible-like atmosphere created ‘combustion’ for economic prosperity

The government’s new levelling-up strategy should help Britain’s left-behind towns and cities emulate Renaissance Florence in cooking up the “secret sauce” of economic success, according to its co-author Andy Haldane.

The hefty report, published on Wednesday, was mocked by some for its frequent historical references – including to 15th-century Florence under the Medici – but Haldane, a former Bank of England chief economist, is deadly serious.

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Levelling up? It’s a lot of talk, say sceptical Wolverhampton public

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Of those who have heard of it, many doubt the policy will do much to improve their quality of life

It may have been dominating conversation in Westminster on Wednesday, but questions about levelling up were met with blank stares among shoppers on Wednesfield high street in Wolverhampton.

Most had never heard of the concept, while of those who had, many doubted it would do much to improve their quality of life.

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So no one’s going to Davos: our guide to the big issues that won’t be tackled

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We bring you Not the World Economic Forum, where monetary hawks fly and bankers explain why China is all right, really

The purpose of this column is usually fairly clear: to look ahead at the biggest event in the coming week. But this time we are breaking with tradition to bring you the week’s biggest non-event: Davos.

Every year the great and the good gather in the Swiss Alps at the grandly titled World Economic Forum to give their answers to the big questions. But Covid-19, running now into its fourth calendar year, has seen it called off again.

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One year on, most voters say Brexit has gone badly

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An Opinium poll also found that 42% of people who voted Leave in 2016 had a negative view of how it had turned out

More than six out of 10 voters believe Brexit has either gone badly or worse than they expected – a year after the UK left the EU, according to an anniversary poll for the Observer.

The Opinium survey – coming a week after the minister in charge of Brexit, Lord Frost, resigned from Boris Johnson’s government – also found that 42% of people who voted Leave in 2016 had a negative view of how Brexit had turned out so far.

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Brexit one year on: so how’s it going?

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Those promised rewards for Britain of leaving the EU should surely be with us by now. What have been the costs and gains of ‘taking our country back’?

• UK and the EU set to remain best of enemies as 2022 dawns

On New Year’s Day the UK will have been fully out of the European Union for a year: out of its political and legal structures, out of its single market, out of its customs union.

This was what Boris Johnson and Michael Gove – who led the Leave campaign – had wanted. No awkward halfway house like Theresa May had negotiated. No Brexit light. Out completely. Gone. Brexit well and truly done.

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