Category Archives: Economic policy

Johnsonism wins budget battle but will Sunakism win the war?

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Analysis: chancellor left with little choice but to go PM’s way, though one passage of his speech was telling

Rishi Sunak may see himself as a future prime minister but this budget confirmed he is very much Boris Johnson’s chancellor.

Rumours about ructions between the pair have gripped Westminster for months. Sunak, who told last year’s Tory conference his party had a moral duty to fix the public finances, was known to be queasy about the government’s national insurance increase, for example.

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‘Economically illiterate’: PM’s Tory conference speech gets frosty reception

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Next boss, thinktanks and unions criticise Boris Johnson, saying ‘shortages cannot be blustered away’

Boris Johnson’s vision for the UK has had a frosty reception with business and union leaders, with one thinktank condemning the prime minister’s speech to Conservative conference as “economically illiterate”.

The Adam Smith Institute’s head of research, Matthew Lesh, also called Johnson’s address “bombastic but vacuous”, while the travel industry union chief, Manuel Cortes, said it was “nothing but hot air”.

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Boris Johnson: petrol crisis and pig cull part of necessary post-Brexit transition

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PM’s remarks come as Liz Truss insists it’s the role of business, not ministers, to resolve such problems

Queues for petrol and mass culls of pigs at farms because of a lack of abattoir workers are part of a necessary transition for Britain to emerge from a broken economic model based on low wages, Boris Johnson has argued.

His comments, on the first day of the Conservative conference, came as Liz Truss, the foreign secretary, insisted it was the role of business, not ministers, to sort out such problems.

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Xi Jinping’s drive for economic equality comes at a delicate moment for China

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President wants to spread ‘common prosperity’ but Covid and material shortages could spell trouble

For decades the aim in China has been the pursuit of growth, building the world’s second-largest economy from a relative backwater on the international stage. Now, the promise from Beijing is to enlarge the economic pie and divide it well.

President Xi Jinping announced plans this month to spread “common prosperity” in what is one of the world’s most unequal major economies, signalling a shift from his predecessors’ pursuit of growth and heralding a tough crackdown on wealthy elites – including China’s burgeoning group of technology billionaires.

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Food, beer, toys, medical kit. Why is Britain running out of everything?

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Poor pay and conditions for HGV drivers and the loss of many thousands of EU workers are plunging the UKs supply chain into crisis

Gaps on supermarket shelves. Fast food outlets pulling milkshakes and bottled drinks from their menus. Restaurants running out of chicken and closing. Empty vending machines. Online grocery orders full of substitutions. Fruit and vegetables rotting in the fields.

These are just some of the most visible signs of Britain’s deepening supply chain crisis, which has seen stocks in shops and warehouses slump to their lowest levels since the Confederation of British Industry began surveying in 1983.

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China rushes through law to counter US and EU sanctions

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Foreigners could be placed on an anti-sanctions list and denied entry into China or expelled from the country

China has passed a law to counter foreign sanctions in response to US and EU pressure over trade, technology, Hong Kong and Xinjiang.

Individuals or entities involved in making or implementing discriminatory measures against Chinese citizens or entities could be put on an anti-sanctions list and may be denied entry into China or be expelled from the country. Their assets within China may be seized or frozen and they could be restricted from doing business there.

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Italy’s birthrate is falling. Can the storks help?

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Last year, the population of Europe’s fourth biggest economy dropped by the equivalent of a city the size of Florence. Yet the northern hamlets of Val d’Ultimo have found ways to buck the trend

Read more: As the global family shrinks, migrants and the planet benefit

As if having a baby wasn’t expensive enough, fathers of newborns in the mountain hamlets that make up Italy’s Val d’Ultimo have an additional cost.

In a revival of an ancient myth that white storks deliver babies, carved wooden storks carrying a newborn child in a sling are a common feature outside homes in the valley.

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Are there too many people? All bets are off

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For decades, scientists and economists have been making wagers about the outcome of human population growth. Now, more than ever, their speculations need to be taken seriously

In 2011, when the global population hit 7 billion, economist David Lam and demographer Stan Becker made a bet. Lam predicted food would get cheaper over the next decade, despite continuing population growth. Becker predicted that food prices would go up, because of the damage humans were doing to the planet, which meant that population growth would outstrip food supply. Becker won and, following his wishes, Lam has just written out a cheque for $194 to the Vermont-based nonprofit Population Media Center, which promotes population stabilisation internationally.

$194, about £140, equates to the amount by which a basket containing five food types – oils and fats, cereals, dairy, meat and sugar – and worth on average $1,000 in the decade to 2010, increased in price over the following decade, according to the UN Food and Agriculture Organization’s Food Price Index (FFPI) and allowing for inflation.

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‘Out of Trump playbook’: UK accused of ‘abandoning’ women with cuts to aid

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Charity warns of 22,000 additional deaths in poorest countries if Wish reproductive health programme ends

The director of a leading sexual and reproductive health charity has accused the government of “abandoning” women and girls it promised to help, as aid cuts derail a leading Tory programme to reduce maternal deaths and prevent unsafe abortions in poor countries.

The threat to the women’s integrated sexual health (Wish) programme could mean 7.5m additional unintended pregnancies, 2.7m unsafe abortions and 22,000 maternal deaths over the next year, said Dr Alvaro Bermejo, director general of International Planned Parenthood Federation (IPPF).

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Gordon Brown calls for G7 to act on Covid vaccine ‘apartheid’

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Former prime minister says group should commit to global vaccine drive and slams UK’s foreign aid cut

Preventing poor countries suffering from vaccine “apartheid” will require the G7 group of rich nations to commit $30bn (£22bn) a year to a global immunisation drive, Gordon Brown has said.

The former Labour prime minister said the UK should use June’s G7 summit in Cornwall to rekindle the moral purpose of the Make Poverty History campaign of 2005, paying for its share of the new fund by reversing the government’s “misguided” cut to the foreign aid budget.

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Amid unease on the left, Starmer aims to ‘bring Labour home’

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A year on from landing the party’s top job, the leader plans on taking his message directly to the voters

Keir Starmer plans to spend the summer months criss-crossing the country to make his pitch directly to voters at scores of town hall-style meetings, in an attempt to “bring Labour home” to its traditional supporters.

A year after his election, with his personal poll ratings slipping and amid growing internal unease about his leadership, Starmer’s team say he hopes to emulate David Cameron, who fielded voters’ questions face to face on his “Cameron Direct” tour in 2008.

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A year of Covid crisis: a glimmer of economic hope at the end of the tunnel

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Twelve months after the pandemic struck the Guardian’s economic tracker reveals real risk of lasting damage

When Boris Johnson announced the first stay-at-home order, effectively shutting down whole sections of the economy, it was hoped the tide could be turned within 12 weeks. As many months later, lockdown measures are being relaxed for a third time and Britain still faces a lengthy road to recovery from the worst recession for 300 years.

As restrictions ease, the chief economist at the Bank of England, Andy Haldane, warned that despite the reopening of the economy, the risk of a “jobs equivalent of long Covid” remains for workers across the country.

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Budget 2021 live: Sunak to freeze income tax thresholds and raise corporation tax to pay for Covid recovery

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Latest updates: chancellor extends furlough, universal credit uplift and stamp duty holiday

Sunak turns to corporation tax.

Sunak says he will announce two measures now to address the borrowing.

The government’s response has been fair, he says.

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Rishi Sunak to offer ‘help to grow’ training for SME managers

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Small businesses will receive help in Wednesday’s budget to boost tech and management skills

The bosses of small businesses are to be invited back to school to brush up on their management skills, under plans to be announced in the budget designed to help close Britain’s productivity gap with rival nations.

As part of the attempt to speed up the UK’s recovery from the Covid-19 pandemic, the chancellor, Rishi Sunak, will unveil a “help to grow” scheme that will offer the leaders of up to 130,000 small and medium-sized enterprises (SMEs) the chance of MBA-style management training.

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England’s poorest areas hit by Covid ‘perfect storm’ – leaked report

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Exclusive: government analysis reveals unmet financial needs of many people needing to self-isolate

A “perfect storm” of low wages, cramped housing and failures of the £22bn test-and-trace scheme has led to “stubbornly high” coronavirus rates in England’s most deprived communities, an unpublished government report has found.

A classified analysis by the Joint Biosecurity Centre (JBC), produced last month, concluded that “unmet financial needs” meant people in poorer areas were less likely to be able to self-isolate because they could not afford to lose income.

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Brexit cost will be four times greater for UK than EU, Brussels forecasts

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Departure to cost EU 0.5% of GDP but UK 2.25% by end 2022, according to first official estimate since deal was agreed

The economic blow dealt by Brexit will be four times greater in the UK than the EU, according to the latest forecasts by Brussels.

A month into the new relationship, the European commission said the UK’s exit on the terms agreed by Boris Johnson’s government would generate a loss in gross domestic product (GDP) by the end of 2022 of about 2.25% in the UK compared with continued membership. In contrast, the hit for the EU is estimated to be about 0.5% over the same period.

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UK importers brace for ‘disaster’ as new Brexit customs checks loom

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Exporters badly hit already but KPMG says ‘biggest headaches’ have yet to come’ for importers

British firms are warning of further Brexit red tape as the government prepares to introduce a long list of new controls on imports from the European Union in April and July.

In the coming months further checks are due to be phased in at the UK border, controlling everything from the import of sausages and live mussels to horses and trees, as well as the locations these checks can take place.

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Is the leftwing vision of Brexit Britain just fantasy? | Letters

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Readers respond to an article by Larry Elliott calling for those on the left to see the UK’s departure from the EU as an opportunity to rebalance the economy

Larry Elliott is consistent in his criticism of the EU (The left must stop mourning Brexit – and start seeing its huge potential, 31 December). He points out the neoliberalism inherent in the core EU policies of free movement of goods, services, capital and people. He then extols the advantages for the UK of being freed from EU shackles to pursue its own destiny in the world.

But aren’t we committed to chasing the same neoliberalism on a broader canvas? He says nothing of the EU’s social and political projects – health and safety, employment protection, social welfare, retirement rights and other programmes. He ignores the ambitions of a gradual rapprochement between nations that engaged in monstrous wars in the recent past. Brexit UK is moving backwards, self-condemned to continued national decline, as other countries find ways of developing at least some elements of a progressive agenda in a harsh and divided world.
Peter Taylor-Gooby
Professor of social policy, University of Kent

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Brexit deal: Boris Johnson poised to announce UK and EU have reached trade agreement – live

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Negotiations continued overnight between UK and EU at European commission’s headquarters in Brussels

Boris Johnson is confident he can sell the trade deal to Brexiters, according to the FT (paywall).

Sebastian Payne and George Parker report that Downing Street has been preparing the ground for weeks with the ERG, ensuring that senior backbenchers were aware of the shape of things to come and compromises being made.

Senior members of the group have already welcomed Johnson’s imminent deal as the “Christmas Eve Agreement”, a reference to the 1998 Belfast Good Friday Agreement that secured peace in Northern Ireland.

Indications from senior figures within the ERG suggest that many of its members will accept the compromises negotiated by Johnson and Lord Frost.

If they want help from the party to stay in parliament, then they’ll back the deal.

In case you’re just joining us, the final stage of the negotiations for a post-Brexit trade deal has been delayed after it emerged that the European commission was using out-of-date figures to calculate the reduction in the amount of fish that member states can catch in British waters after 1 January.

A deal was due to be announced early this morning but the announcement had to be postponed when officials noticed a discrepancy between two sets of fishing figures and realised that the numbers used in the negotiation appeared to be out of date.

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For seasoned EU watchers, Brexit trade talks look uncannily like Grexit

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Analysis: While there are similarities with the 2015 clash between Athens and Brussels, there are also key differences

It was a marathon even by the European Union’s standards. For hours, leaders of countries in the eurozone argued, haggled and shouted at each other. After breaks for refreshment, they argued, haggled and shouted some more. Rumours swirled around the packed media room. Eventually, as Brussels was waking to a new morning, the 17-hour overnight summit staggered to an end.

All participants were in agreement that victory had been snatched from the jaws of defeat. Despite the brinkmanship, a deal was eventually done – as seasoned EU watchers had always said it would be, even when all hope seemed lost.

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