UK unemployment rises and wage growth slows as jobs market ‘weakens’

ONS data shows jobless rate climbing to highest rate since June 2021 with growth in average earnings slowing to 5%.

Unemployment climbed and wage growth slowed in the three months to May, according to official figures that will pressure the Bank of England to cut interest rates next month.

Data from the Office for National Statistics, released on Thursday, showed that Britain’s official unemployment rate rose to 4.7% in the three months to May, up 0.1% from April to reach the highest level since June 2021.

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Treasury minister says ‘headline’ rate of income tax won’t go up, in hint thresholds might be frozen in budget – UK politics live

Darren Jones also declines to rule out wealth tax when questioned about government plans

In an interview with the Times, Andrew Bailey, governor of the Bank of England, says firms are “adjusting employment and hours” in the light of last year’s rise in employer NICs. That sounds like a euphemism for cutting jobs. But he says, if the labour market slow down, the Bank may respond by cutting interest rates more aggressively.

Asked about this comment in an interview on the Today programme, Darren Jones, chief secretary to the Treasury, played down the impact of the budget. He said:

There’ve also been hundreds of thousands of new jobs created across the economy, and in the first quarter of the year [we had] the fastest growing economy in the G7, so we’re doing everything we can to create conditions for businesses to be profitable and to be able to grow.

Of course, we had that particular tax decision in the budget last year, because our commitment was to protect working people in their pay slips. And I recognise the independence of the bank governor.

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Government inheriting poor value assets due to bad handling of PFI contracts, watchdog says

Public accounts committee warns UK infrastructure risked becoming ‘stony ground’ for investors without major overhaul

Bad management of private finance contracts is leading to poor quality assets being handed back to the government, including schools and hospitals, according to parliament’s spending watchdog.

Its report into the use of private finance initiatives (PFI) for infrastructure comes at a time when the government has identified private investment in projects such as power plants and transport outside London as a key part of its growth agenda.

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Trump praises English of the leader of Liberia – where English is the official language

Trump inquired where Liberian president Joseph Boakai got his language skills during meeting with African leaders

Donald Trump was basking in the praise of a group of African leaders on Wednesday, when the Liberian president took the microphone.

“Liberia is a longtime friend of the United States and we believe in your policy of making America great again,” President Joseph Boakai said in English at a White House meeting before advocating for US investment in his country. “We just want to thank you so much for this opportunity.”

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UK borrowing rises to £17.7bn, adding to pressure on Rachel Reeves

May figure second highest for month on record amid fears chancellor is struggling to keep within spending rules

Higher tax receipts were unable to prevent a rise in public sector borrowing in May to £17.7bn, up from £17bn a year earlier and the second highest for the month on record.

A poll of City economists had forecast public sector net borrowing – the difference between public spending and income – would be £17.1bn.

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Sizewell C power station to be built as part of UK’s £14bn nuclear investment

Ed Miliband promises to ‘get Britain off the fossil fuel rollercoaster’ with new plant expected to create 10,000 jobs

The biggest nuclear programme in a generation will “get Britain off the fossil fuel rollercoaster”, the energy secretary, Ed Miliband, has said, announcing £14.2bn to build a new nuclear power station and a drive to build small modular reactors.

The multibillion-pound investment at Sizewell C on the Suffolk coast, which has been long expected, will create 10,000 jobs and power the equivalent of 6m homes.

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Rachel Reeves in standoff over policing and council budgets days before spending review

Chancellor still at negotiating table on Sunday as Home Office demands more cas

Rachel Reeves has been locked in a standoff over the policing and council budgets just days before this week’s spending review, which is set to give billions to the NHS, defence and technology.

Yvette Cooper’s Home Office and Angela Rayner’s housing and local government ministry were the two departments still at the negotiating table on Sunday fighting for more cash, after weeks of trying to reach a settlement.

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Government sells final shares in NatWest 17 years after £45bn bailout

Sale ends state ownership of the banking group, then known as Royal Bank of Scotland, after 2008 rescue

The UK has sold its final shares in NatWest Group, ending 17 years of state ownership since the £45bn taxpayer bailout that saved the bank from collapse at the height of the 2008 financial crisis.

The full privatisation of NatWest is a symbolic moment for the banking group – formerly known as Royal Bank of Scotland (RBS) – and draws a line under the most tumultuous chapter in its near 300-year history.

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No 10 delays child poverty strategy with tens of thousands more facing hardship

Exclusive: Flagship policy put back until at least autumn amid fears cost of removing two-child benefit cap will outweigh political benefit

Labour’s flagship child poverty strategy has been delayed until at least the autumn, the Guardian has learned, even though tens of thousands more children will fall into poverty as a result.

The decision to push back the strategy comes amid Treasury concerns about the cost implications of ending the two-child limit on universal credit and questions inside No 10 over the political benefits of scrapping it.

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UK asking other countries to host ‘return hubs’ for refused asylum seekers, Starmer confirms – UK politics live

PM on trip to announce increased cooperation against people smugglers alongside Albania’s prime minister, Edi Rama

All Commons Speakers, at least for the past 30 years, have complained about the government making major announcements to the media first, and not to parliament first. But rarely have any of them sounded quite as furious about this as Lindsay Hoyle, who this morning delivered an extended reprimand to the government about this at the start of an urgent question.

The UQ was about plans to limit the use of prison recall – something announced by the justice secretary, Shabana Mahmood, at a press conference yesterday, while the Commons was still sitting. After pointing this out, and reminding MPs that details of the immigration white paper were given to the media extensively, long before the ministerial statement about it was delivered in the Commons on Monday, Hoyle went on to imply that, as well as regularly breaking the ministerial code, ministers were also guilty of hypocrisy. He said:

I note that those who now occupy senior ministerial roles were not slow to complain when the previous government made major policy announcements outside this house.

I will continue to uphold and defend the rights of this house, the rights of backbenchers, to be here, and hear it first, the most important announcements of government policy, and the right of honourable members to question ministers on those announcements in person.

When Parliament is in session, the most important announcements of government policy should be made in the first instance in Parliament.

If the government is not going to take the ministerial code seriously, who will?

I’ve got to say, I don’t like this. I believe I am here to represent all backbenchers and backbenchers have the right to ask questions. I’m not interested in Sky News or the BBC or political programmes. I’m here to defend all of you. I will continue to defend. Please do not take MPs for granted. It is not acceptable.

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London dominates England’s social mobility league with top 20 places

Sutton Trust ‘opportunity index’ measured factors such as children on free school meals passing key GCSEs

The top 20 constituencies with the best social mobility in England are all in London, according to research from a leading education charity that underscores the stark regional divide in children’s life chances.

In a report published on Thursday, the Sutton Trust has put together an “opportunity index” by analysing six measures of mobility. These include the share of children on free school meals who achieve passes in GCSE maths and English; who complete a degree by age 22; and who make it into the top 20% of earners by age 28.

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UK interest rates fall to 4.25% as Bank of England announces a quarter-point cut

Move follows run of downbeat economic data and looks to cushion UK from Trump’s trade war fallout

Bank of England policymakers have cut interest rates by a quarter point to 4.25% to cushion the UK economy against the impact of Donald Trump’s trade war.

The widely expected move from the Bank’s monetary policy committee (MPC), its fourth cut since last August, should lead to cheaper mortgages for homeowners.

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Treasury threatens Defra with £4bn bill if Thames Water nationalised

Exclusive: Treasury threat an example of ‘scare tactics’ to help force through private sector deal, sources suggest

Whitehall officials have been at loggerheads over the fate of Thames Water since the Treasury told the environment department that it would have to meet the cost of a multibillion pound temporary nationalisation.

Britain’s biggest water company recently came within days of running out of money. Thames is in a desperate race to find a buyer willing to inject cash, with the US private equity firm KKR in pole position.

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Trump tariffs cause fastest slump in British factory export orders in five years

Decline in output and new orders in April allied with rising uncertainty is prompting layoffs, survey finds

Britain’s factories suffered a slump in export orders last month as Donald Trump’s globally unsettling tariff regime sent overseas demand for UK goods tumbling at the fastest pace in five years.

Manufacturers reported rising economic and trade uncertainties in April as some tariffs took effect and other threatened border taxes loomed, forcing them to lay off workers for a sixth consecutive month.

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African diplomats urge UK government to back bill to speed up debt restructurings

Exclusive: Countries are struggling to manage expensive loans, with much of debt transacted through London

Diplomats from eight southern and east African countries have signed a letter calling on the UK government to support a private member’s bill that aims to speed up debt restructurings, after economic crises meant countries were unable to pay back loans.

Poor countries’ economies have been hit by a series of global events in recent years, including the coronavirus pandemic, which reduced growth; the Russian invasion of Ukraine, which sent inflation soaring; and raised US interest rates, which have pushed up the cost of international loans to often unaffordable levels.

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US consumer sentiment sees largest drop since 1990 after Trump tariff chaos

Experts warn of slowing economy after score based on Americans’ financial outlooks fell by 32% since January

US consumer sentiment plummeted in April after Donald Trump’s trade war threw the global economy into chaos, according to a new report.

The index of consumer sentiment, a score based on a monthly survey asking Americans about their financial outlooks, fell by 32% since January – the largest drop since the 1990 recession, according to the University of Michigan’s Institute for Social Research.

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Reeves says inflation fall shows ‘plan for change is working’ – UK politics live

Chancellor says wages are growing faster than prices but acknowledges many are still struggling with the cost of living

A government minister has reiterated the call for the Unite union to accept a deal and end the bin strike in Birmingham.

Speaking on GB News this morning, Lillian Greenwood, parliamentary under-secretary of state for the future of roads, said residents were facing “a completely unacceptable situation”

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Did Trump’s tariffs kill economic populism?

Lasting damage has been done not only to Trump’s political credibility but to globalisation as a system

At the beginning of this helter-skelter week, Downing Street was declaring globalisation not only dead but a failure. Now, only five trading days later, the autopsy is still under way but the victim may instead be economic populism, strangled by Wall Street, the citadel of globalisation. Donald Trump’s so-called liberation day may in fact have been the anti-globalist’s entombment day.

In an effort to deny even a tactical retreat, Trump’s aides insist the White House goal all along was not to weaken globalism, or even to protect the US economy with tariffs, but instead to get into a negotiation to lower tariffs around the world and to punish China. As cover stories go, it is hardly credible, partly because the tariffs were repeatedly lauded by Trump as a macroeconomic revenue-raising measure, or a means to bolster US manufacturing.

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Government scrambles to save British Steel as firm faces crisis within crisis

Union leaders have welcomed moves towards public ownership but it is not an auspicious environment for nationalisation

Blast furnaces have been making steel in Britain for 300 years, ever since they helped start the Industrial Revolution. This weekend, parliament will sit for the first Saturday in decades as it tries to keep the last two furnaces running for a bit longer.

Keir Starmer has recalled MPs to discuss emergency powers to direct steel companies, including British Steel’s Scunthorpe steelworks, to “preserve capability and ensure public safety”. The move would be short of nationalisation, but it would give the government more influence on the steel industry than at any point since Margaret Thatcher.

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Labour MPs urge ministers to focus on rebuilding trading relationship with EU

Call to prioritise reset with Europe comes after top adviser to Trump downplays prospect of US tariffs being reduced

Ministers should focus on rebuilding bridges with the EU, Labour politicians have said, after a senior adviser to Donald Trump downplayed the prospect of a breakthrough with the US.

MPs said the government should “prioritise our trading relationship with the EU” and “get a sugar rush of growth” instead of banking on the prospect of preferential treatment from Washington.

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