Money

During the election campaign, Chancellor Rachel Reeves made bold promises – no increases to Income Tax, National Insurance, or VAT. She also sought to echo the ‘prudence’ mantra of her predecessor as chancellor Gordon Brown, though his tenure was marked by significant spending increases rather than prudent restraint. True to form, over the weekend Reeves indicated the government could accept recommendations for above-inflation pay increases, of about 5.5 per cent, for NHS workers and teachers. The Institute for Fiscal Studies (IFS) estimates that a similar pay hike across public sector professions would cost about £10 billion, requiring more taxation or borrowing. This comes amid other ambitious plans for restructuring and

In dodging calls from his party to remove the two-child cap, Sir Keir Starmer is making one of his first noteworthy mistakes as Prime Minister. Both John McDonnell, the far-left former shadow chancellor, and Anas Sarwar, the soft-left Scottish Labour leader, have called for the Coalition-era policy to go. The cap limits the payment of Universal Credit to a family’s first two children, with subsequent offspring meriting no additional payment. According to the Institute for Fiscal Studies, keeping the cap will mean an extra 670,000 children worse off by the end of this Parliament while scrapping it would reduce relative child poverty by half a million. The annual cost of

‘We cannot let the challenges of the recent past define our relationships of the future,’ declared the Prime Minister ahead of today’s meeting of the European Political Union at Blenheim Palace. The meeting, he added, ‘will fire the starting gun on this government’s new approach to Europe’. The subtext to this is: the grown-ups are back in charge, and from now on we are going to have a far more constructive relationship with the EU. Keir Starmer has even promised a renegotiation of Britain’s trading relationship with the EU, which is supposedly going to make life easier for our exporters. Keir Starmer has even promised a renegotiation of Britain’s trading relationship

When Rishi Sunak called a summer election, the Tobacco and Vapes Bill didn’t make the pile of ‘wash up’ legislation to be rushed through Parliament. His plans for a generational smoking ban, and a crackdown on vapes, were paused. But this was never going to be more than a brief delay. Labour has used the King’s Speech today to confirm that it will see Sunak’s smoking ban through. Or rather, the party might argue that it’s reclaiming the idea. It was Labour, after all, that floated the policy before the Tories adopted it at their party conference last year.  One day, a 63-year-old will be able to purchase a tobacco

As opposition leader, Sir Keir Starmer long struggled to define what ‘Starmerism’ is, other than ‘not Corbynism’ and ‘not Toryism’. Last Autumn, he belatedly stumbled across a policy theme which he has since tried to make his own: ‘Yimbyism’, a positive ‘Yes In My Back Yard’ attitude to development: the antidote to Nimbyism.  Labour’s rhetoric on housing has been confrontational In her first major speech on economic policy, Chancellor Rachel Reeves picked up this ‘Yimby’ theme in order to bolster her pro-growth credentials. Policy announcements include bringing back mandatory housebuilding targets, removing green belt protection from bits that are clearly not green (the ‘grey belt’), and overturning the ban on onshore wind. 

Just Stop Oil continued its campaign by spreading orange paint over road junctions in Westminster this week, but why bother when the organisation seems now to be in power? Energy and Climate Change Secretary Ed Miliband is said to be weighing up blocking new licenses for oil drilling in the North Sea. Labour has previously said that it wouldn’t allow exploration of entirely new fields but wouldn’t stand in the way of the continued exploitation of existing fields. Yet even this limited exploration now looks in doubt. How is the government going to generate that income if oil and gas companies are not going to be allowed to drill? The Department for

What country ever went wrong with a sovereign wealth fund? It is easy to envy Singapore and Norway – the latter of which now has £1.3 trillion squirrelled away, equivalent to £240,000 for every citizen. Britain would be in a much better situation now had it, like Norway, invested its windfall from the North Sea, rather than chucking it into the pot of general day-to-day expenditure. Paying state and public sector pensions liabilities out of tax revenue rather than from a long-term investment fund is going to become an ever more serious burden on the state. We shouldn’t, then, sniff at Rachel Reeves’ idea for a ‘national wealth fund’. It is just that what

A major new factory from one of the American tech giants perhaps? Or a new lab from one of the pharmaceutical giants? Or, best of all, a huge new green energy fund. The newly appointed Chancellor Rachel Reeves was probably hoping for some positive investment news for her first week in office, especially as she has decided, in an unprecedented move, to make ‘growth’ a ‘national mission’. Instead, one of the UK’s best businesses has cut almost a third of its UK workforce – and that will just be the start of the corporate exodus from Labour’s Britain. Dyson will argue that its decision to axe 1,000 jobs in the

Jonathan Reynolds on Reform: ‘Now…they will get the scrutiny they deserve’ On Sky News this morning, Trevor Phillips pointed out that Labour had the smallest vote share of any election-winning party – and asked the business and trade secretary Jonathan Reynolds if it was sustainable that votes for smaller parties like Reform and the Greens did not translate into seats. Reynolds argued that Labour’s successful campaign under this electoral system gave them a legitimate mandate to govern, and claimed that smaller parties were given ‘far less scrutiny’ because they’re not seen as ‘parties of government’. Reynolds also implied that many people who voted for Reform don’t really know their policies.

Rishi Sunak’s bags are probably packed. The plane tickets are booked. And no doubt he has found somewhere for the family to stay while they look for a permanent home. It is widely assumed that, having lost the election, Sunak will soon disappear to Silicon Valley as quickly as possible to restart his career. But hold on. Sure, it is easy to understand why Sunak would want to get as far away as possible from the car crash he has presided over. Yet after running one of the most spectacularly inept election campaigns in history, will the tech giants still want him?  Sunak has just fought what will surely go

I recant. On a number of occasions I have asserted that the European Union is run by lobbyists acting on behalf of French farmers and the German car industry. It seems I was wrong – or perhaps that I have become wrong as the politics of global trade has shifted. A more accurate way of putting it would be to say that the EU is run by people who think they are acting in the interests of French farmers and the German car industry, but who are not quite plugged in to what those industries really want. It is a typical case of EU protectionism. However, this time, there is a twist At

The 2024 general election ‘should be the immigration election’, Nigel Farage has said. The Reform leader’s wish has been granted: the topic of immigration is a major focus of debate. It’s also a big issue in the United States’ presidential election. Much of the debate in both countries depicts immigrants as a burden that receiving countries should accept (if at all) only out of altruism or a sense of obligation. But this is misleading, and ignores the many benefits of migration to Britain and other receiving countries. Open migration is not just charity for migrants Accepting migrants is the right thing to do, in part because it saves many thousands of

Big business will be brought onside. The bond markets will be mollified. And there will be plenty of reassuring words about dealing with the budget deficit. With the first round of voting in France’s parliamentary elections set for this week, Marine Le Pen’s Rassemblement National is preparing for government. This week it has set out a programme designed to keep investors, if not exactly happy, at least under control. There is just one catch. It is also a programme for stagnation – and that means France’s out-of-control debts are going to grow and grow.  Nothing that Bardella is proposing will do anything to lift France out of its rut With