Economy

The weekend’s torrential Yorkshire rain amid a hosepipe ban offered a handy metaphor for the chaos that has befallen the privatised UK water industry. Sir Jon Cunliffe’s Independent Water Commission report – aiming for a ‘fundamental reset’ to restore public confidence, clean our waterways and ensure future supply – is welcome for the clarity of its central conclusion: that unfit-for-purpose Ofwat and a jumble of other regulators should be replaced by a single body with more teeth and comprehensive oversight of the sector. So far, so good. Cunliffe – a veteran of the Treasury, the Bank of England and Brussels – can also be applauded for his bureaucratic cunning in

In February 2020, a few weeks before Britain was thrown into lockdown, Sajid Javid resigned as chancellor of the exchequer over a bust-up with the prime minister’s chief adviser, Dominic Cummings. The fight was thought to be over Cummings’s attempts to dictate who could and could not work in No. 11. In fact, it was just one skirmish in a long-running and bitter power struggle between the two men. Two months before his resignation, Javid had claimed victory in a different battle against Cummings – one over who would occupy the governor’s office at the Bank of England. Cummings wanted Andy Haldane, then the Bank’s chief economist, who he believed

Well, would you look at Mark Carney. Just three months ago I described the incoming prime minister of Canada and former governor of the Bank of England as ‘a fish-out-of-water technocrat’ who made little public impact over here and was swiftly forgotten after he left in 2020. When I once came across him hunched and dark-suited in the Pret queue at King’s Cross, midway through his Bank tenure, I actually felt sorry for him. But here he is, beer-swigging in an Ottawa bar with Sir Keir Starmer; cutting Donald Trump short in a press call before the G7 meeting; shedding his eco-credentials to champion Canadian oil and gas; and generally

The Chancellor’s promise of £14 billion for the Sizewell C nuclear power station in Suffolk is hardly news. The project has been talked about for 15 years while the existing UK nuclear estate has gradually been shut down and the only other new station, Hinkley Point in Somerset, has stumbled to a decade-long delay and £28 billion of budget overruns. Quite some optimism – verging on Milibandian delusion – is required to embrace the idea that Sizewell will come quicker and cheaper because it will replicate Hinkley Point while avoiding its mistakes. And since Chinese money has been ruled out, it’s still a mystery as to who else will pay

Donald Trump’s Soprano-like threat that the ‘termination’ of Federal Reserve chairman Jerome Powell ‘cannot come fast enough’ has been headlined as one of his wildest thrusts to date, but is actually one of his most conventional. Prickly politicians always resent unelected central bankers, though they also see them as useful scapegoats for economic trouble. Liz Truss longed to fire Andrew Bailey from the Bank of England; Gordon Brown gave Eddie George’s Bank its ‘independence’ but took away so much of its power that George nearly resigned; Margaret Thatcher never accepted the most potent modern governor, Gordon Richardson, as ‘one of us’. Trump’s predecessors took fewer potshots at the Fed because

London’s capital market needs a kick in the pants, as I write every week, and ‘activist investors’ are no bad thing if they provoke sharper corporate performance. The assault by the New York hedge funder Boaz Weinstein on seven UK investment trusts – demanding shareholder votes to replace directors with his own people and take the management of the trusts into his own firm, Saba Capital – looks like the kind of intervention that might bring positive change to the UK’s historic investment trust sector, which accounts for a third of FTSE 250 companies but according to critics offers lacklustre returns, with share prices too often stuck at discounts to