Economy

Another Sunday, another banking takeover swiftly arranged before markets open on Monday morning. This time Credit Suisse has agreed to be bought by fellow Swiss bank UBS for 0.5 Swiss Francs a share – less than a third of its closing price on Friday and less than a tenth of what the bank was worth a year ago. A banking collapse which was beginning to look inevitable in spite of a 50 billion Swiss Franc bailout by the Swiss central bank on Friday has been averted, market turmoil has been avoided, or postponed, jobs have been saved (although many are expected to be lost in London as Credit Suisse’s investment banking

No victory is ever final in politics – and the wrecking-ball of lockdowns now seems to have destroyed almost every success of the 2012-20 welfare reforms. The workless numbers are again as bad as they they were under Labour. People who stopped working during lockdowns never quite got back into it and the UK has done a worse job than almost any other country at rebuilding its post-pandemic workforce. In 2009 I was filling Coffee House with attacks on the Labour government for keeping so many on benefits. And the story now? See below. Remember, this joblessness is not induced by recession and layoffs but incubated by welfare to produce

First the good news. Unlike the IMF, which predicted in January that the UK economy would have a worse 2023 than even Russia, the OECD’s latest forecast has Britain outperforming Russia. Now the bad news: the OECD still predicts the UK to perform worse than any European country other than Russia.  Forecasts aside, the actual data for the UK economy is a slightly improving story Its latest bulletin, published this morning, sees Britain shrinking by 0.2 per cent in 2023, compared with growth of 0.3 per cent for Germany, 0.7 per cent for France and 0.8 per cent for the Euro area as a whole. The Russian economy, by the way,

Jeremy Hunt has announced plans to extend the 30 hours a week of ‘free’ childcare for three and four year olds to include babies as young as nine-months old. This expansion of childcare provision has been hailed by the Chancellor as a measure to allow mothers to return to employment if they want to; it will also, according to Hunt, help boost the economy. But has anyone paused to think about the impact on the children themselves – and families? The truth is that Hunt’s proposed changes aren’t a win for mothers, children, and families as a whole. Why? Because the childcare plans suggest that a mother’s worth comes from

Jeremy Hunt has just delivered his second Budget as Chancellor. The top message the Chancellor wants to push is that Britain will avoid recession. But the Office for Budget Responsibility’s report suggests immigration may be the real story. Among the policy announcements were an extension to the energy price guarantee, currently at £2,500, to July (effectively scrapping the price hike), committing £5 billion to fund free childcare for one and two year-olds and abolishing the pension Lifetime Allowance. But what else did we learn from today’s Budget? You can follow these metrics every day on the budget page of The Spectator’s data hub.

Is the UK’s labour market cooling down? While unemployment remains unchanged at 3.7 per cent, according to today’s update from the Office for National Statistics, the number of job vacancies ‘fell on the quarter for the eighth consecutive period’, down 51,000. The overall number of vacancies, however, still remains above a million. But the biggest indicator things are changing is wage growth: the rise in average total pay fell to 5.7 per cent between November last year and January this year, down from 5.9 per cent in the previous three months. Adjusting for inflation, this means real wages fall by 3.2 per cent – the biggest fall since the pandemic hit, not

On the face of it, the takeover of the UK arm of Silicon Valley Bank by HSBC is a triumph for the government. Today, we could have been seeing the collapse of dozens of UK tech start-ups. We could have seen staff going unpaid and shares in tech companies plunging to greater depths than they have yet explored during the correction of the past year.  Instead, things are fairly calm in the tech sector. Well before markets opened this morning, the government had brokered a deal which will allow the Silicon Valley Bank’s facilities to continue without a hitch, thanks to a wholesale takeover by one of the largest banking institutions in

Tech start-ups tend to involve taking big risks on ideas which are untested both in terms of technology and the market place. Yet it isn’t blind faith in new ideas that is threatening to bring down scores of British tech start-ups over the next few days: it is boring old bonds. Many start-ups have relied for financing on Silicon Valley Bank UK, an offshoot of its larger US parent. Over the last few years, the institution has in turn relied on taking bets on government bonds whose value had been inflated by near-zero interest rates. As interest rates have risen, those bets have gone sour. On Friday, the Bank of