Economy

Another day, another tax hike. This is presumably not how Boris Johnson saw his first term in office going; he’s reneged on manifesto promises left and right, including one that defines modern Conservatism: a healthy scepticism of tax rises. The new health and social care levy of 1.25 per cent for employers and employees (so, really, a 2.5 per cent levy) is now part of an emerging trend. This is not a one-off tax, but the follow-on from a March Budget that included £25 billion worth of tax hikes. In fact, it’s record-breaking. The levy is estimated to raise an additional £12 billion a year extra for the Treasury’s coffers.

It is a curious thing to exclude a vast group of generally quite well-heeled voters from funding a policy innovation that they will benefit from more than any other group. One might almost call it blatant favouritism. But Boris Johnson’s plan to pay for a big increase in resources going into social care long-term and the NHS short-term amounts to just that. By opting for a National Insurance increase to fund his proposals, the PM is ensuring that nobody over the state pension age of 66 will have to put their hands in their pockets. Neither will the extra financial burden fall on so-called ‘unearned’ income such as dividends on

A shock poll commissioned by the IPPR Scotland thinktank has revealed this week that more than 80 per cent of Scots would like to work fewer hours for the same pay. This may well prompt further revelations about the religious leanings of the Pope, or the toilet habits of bears, but in the meantime, the IPPR has called on the Scottish government to extend its financial support for companies who want to trial a four-day working week. This is still quite a modest proposal. The SNP manifesto for the May elections promised to establish a £10 million fund for companies trialling the shorter week, with the results used to consider

As Covid-19 swept through care homes in the spring of last year, the public watched on with horror and helplessness. About a third of all Covid deaths in England took place among residents of these homes. It was worse overseas. In Spain, care home residents accounted for 40 per cent of Covid deaths last year. In the Netherlands and Sweden, it was around 50 per cent. In Canada, almost 60 per cent. But this doesn’t provide much comfort. Britain may belong to a large club of countries that got their pandemic policy wrong — but the results, regardless, were deadly. The huge holes in Britain’s social care system have been

Andy Haldane’s departure from the Bank of England opened up one of the most influential roles in guiding UK monetary policy — and that role has now been filled. Huw Pill has been announced as the BoE’s new chief economist, taking up the post from next Monday. Some of the snap reaction is focusing on Pill’s similarities to those who came before him. Despite resources being poured into diversity teams to recruit a mix of applicants, it was Pill who was selected, a former Goldman Sachs economist and most recently a senior lecturer at Harvard Business School. Pill won’t take kindly to ideas about reneging the Bank of England’s independence

Car workers in Sunderland are doing just fine. Construction workers still have jobs. And the food is still getting to the supermarkets, even if there are some occasional disruptions to supply.  Not many of the dire warnings about the consequences of leaving the European Union have actually come to pass. There is, however, one group that looks likely to be hit, even if no one quite predicted it. The pensioners. It looks certain to cost them the ‘triple lock’ on their pensions: although since many of them voted for Brexit, they can hardly complain. The government is tying itself up in knots on how to wriggle out of the ‘triple lock’

Liberals have always set great store by laws and declarations. It was joked about Lord Loreburn, the liberal Lord Chancellor in the years before the First World War, that if told the Germans had landed he would immediately have taken steps to obtain an interim injunction from the Chancery Division requiring an immediate withdrawal. These days something similar seems to be happening as regards the Liberal Democrats’ approach to climate change. Last Thursday Ed Davey took aim at the City, which he has decided to add to the party’s growing list of climate change villains. In a curious interview with the Guardian he put forward a modest proposal to deal

The Hundred — some sort of pimped-up cricket tournament, I gather — passed me by entirely, but I’ve been admiring the spin bowling of the Clayton, Dubilier & Rice team in another big contest, namely the bid battle for Morrisons. When CD&R made its initial 230p per share offer in June, there was much talk of the ruthless financial wizardry this New York private equity firm might apply to the supermarket group to extract maximum profit within a short timescale. But there was no more than a passing mention of the role as CD&R’s adviser of the former Tesco chief executive Sir Terry Leahy. Now the offer has been raised

The City has resigned itself to being locked out of the EU. The hauliers are adjusting to all the extra paperwork. Now it looks as if the lawyers will have to get used to no deal as well — and while that won’t do any serious long term damage to the profession’s booming global status, it now looks as if a lot of divorcing families will be collateral damage. Over the last month, it has become clear the EU plans to block the UK from joining the Lugano Convention, which helps settle in which jurisdiction disputes should be resolved. The reason is no great mystery to anyone. Brussels wants to make

Upheavals in welfare policy have historically followed major crises such as wars, civil unrest, recessions and pandemics – the Ministry of Health itself was established in 1919. The experience of the second world war led to the creation of the contemporary welfare state. If a course of action (a furlough scheme, say) is pursued in an emergency, we know it is possible. Keep the measure in place too long and it can swiftly become an accepted norm — and politically awkward to unwind. But those expecting a post-Covid reboot of the welfare system might be disappointed. Shadow work and pensions secretary Jonathan Reynolds talked a good talk on overhauling universal

Job vacancies at a record high, a shortage of 90,000 lorry drivers, farmers complaining about a lack of seasonal workers, care homes complaining about difficulties in recruiting staff — and 1.9 million people still on furlough at the end of June. It shouldn’t be difficult to put these figures together and work out what is going on — even if Lord Adonis, with his usual tunnel vision, has been busily tweeting blaming everything on Brexit. When the furlough scheme was introduced it was intended as a short-term measure to tide over businesses that had been forced to close as a result of Covid restrictions. So why is it still in place when