How net zero will divide Labour and the Tories

This morning, Ofgem announced another reduction in the energy price cap from July. The new cap on the unit price of energy should see costs fall by another 7 per cent, taking £122 off the average household bill. And it didn’t take long for both the Tories and Labour to try to swing the news in their electoral favour. Only two days into an election campaign, the government will want to claim credit for today’s news: an opportunity to remind voters what successive Conservative prime ministers did to protect people from higher energy costs (of course, the Energy Price Guarantee was a large part of the reason markets rebelled against

The need for greed

I suspect I’ve had a lot more fun writing about the annual Sunday Times Rich List over the years than many of its denizens have had clambering into it and staying there behind their high-tech security gates and their phalanx of tax advisers. The 2024 roll call includes some great British wealth-creation stories – led by the industrialist Sir Jim Ratcliffe, the inventor Sir James Dyson and the Far Eastern trading Swire dynasty. But if the completed jigsaw of 300 names makes any sort of picture, it is of a vast treasure hoard from elsewhere, and in some cases from nowhere, that has found a relatively safe vault in the

Labour and Unite go to war over oil

There is nothing new about battles between the unions and a Labour government. But could a Starmer government be upset by a growing union rebellion from an unexpected quarter? In a move which has been remarkably underreported in England, the union Unite has launched a campaign against Labour’s policy of refusing licences for new oil and gas extraction in the North Sea. The campaign, called ‘No ban without a plan’, demands that Labour suspends the policy. If successful, it means a future Labour government would continue, like the Conservatives, to grant new licences, until it has come up with a plan to create at least 35,000 new ‘energy transition jobs’

How Pret ate itself

How bad would it be if Royal Mail’s parent company, International Distributions Services (IDS), were to be taken over by the Czech billionaire Daniel Kretinsky? Our historic postal service is heavily lossmaking, struggling to maintain its universal delivery obligation and at war with its unions: a foreign owner would surely take an axe to it. Kretinsky, who owns almost 28 per cent of stockmarket-listed IDS, has gone back on an assurance that he would not try to take the company private and has tabled a £3.1 billion offer – above the group’s current market value but well below what other shareholders think it is worth. He won’t win with this

Mike Lynch has little chance of escaping US jail

As I’ve said before, I hold no brief for Dr Mike Lynch, the founder of the Cambridge-based software firm Autonomy, who faces US fraud charges over the $11 billion takeover of his company by Hewlett-Packard (HP) in 2011. But I watched with foreboding as US marshals bagged Lynch under the lopsided 2003 US-UK extradition treaty and flew him to California – after the then home secretary Priti Patel declined to halt the process – and a judge there changed his pre-agreed bail conditions to place him under armed house arrest. Now, having comprehensively lost the argument that as a UK citizen running a UK company he should have been tried in

The farce of Drax’s wood pellets

When is the government going to stop pretending that chopping down trees in North American forests and shipping them across the Atlantic to burn them in UK power stations is a zero-carbon form of energy? The environmental-friendliness of Drax power station in North Yorkshire has been called into question yet again this week after BBC Panaroma investigation reported that some of the woodchips being burned there have allegedly been sourced from established ‘old growth’ forests in Canada rather than recent plantations. Drax has not commented on those specific allegations, but the investigation has thrown the issue back into the spotlight. How and where the wood is sourced has a dramatic

Bombed-out bank shares are a failure of modern capitalism

When I read news of a fresh strategic plan for Barclays, I seem to hear a ghostly rustling from the corner cupboard in the living room. Could it be a forlorn protest from the dusty bundle of share certificates that are the last vestiges of my late father’s lifelong service to Barclays from junior clerk to deputy chairman? They were a modest farewell reward – 40 years ago, in the era before mega-bonuses for senior executives – that might once have been swapped for a country cottage but today would barely yield enough to pay for his upcoming centenary dinner. Even the Qatari sheikhs have sold down their Barclays holdings

Will Rachel Reeves scrap the private equity tax break?

I’ve been reading – so you don’t have to – speeches recently addressed to a hot-ticket gathering of business leaders at the Oval cricket ground by Sir Keir Starmer and shadow chancellor Rachel Reeves. The nub is a promise to hold corporation tax at the current rate of 25 per cent for the duration of the next parliament, combined with a warning that ‘levelling up of workers’ rights’ will cause companies’ labour costs to rise. Then there’s all the usual guff you’d expect from a government-in-waiting about infrastructure and skills; plus an unusually warm tone towards the financial services sector, including a pledge not to reinstate the EU-inspired cap on

Can anyone save the Post Office? 

Angry farmers offer a theme for the week – starting with the French at close quarters. Leaving the Eurotunnel at Calais en route to a wedding in the Alps, my car party encounters agricultural rage in the form of convoys of stationary trucks at all the port’s major exit points, as tractors blockade the autoroutes and police do nothing to shift them. Echoing recent protests in Germany, Poland and Romania, French farmers want better price protection, cheaper diesel, more import barriers, more aid from Brussels and less green regulation. We’re lucky not to be sprayed with manure, as was happening elsewhere. The protests have support from the powerful CGT union

Where are the smart investments under a Starmer government?

I worry that my Burlington Bertie life in London’s West End offers a misleading picture of the real economy. Yes, boutiques and brasseries are busy, but what’s it like in outer boroughs and distant provinces? To take a single morning’s headlines, on the plus side there’s upbeat trading news from ABF, the grocery and Primark discount clothing retailer, which reaches consumers everywhere; and a prediction that energy prices will fall 16 per cent by April. On the negative, warnings that ‘more than 47,000 companies are on the brink of collapse’ (from insolvency specialists Begbies Traynor); and that world trade faces a second wave of Red Sea disruption even if Houthi

Fujitsu should pay for the Post Office scandal

Let’s talk about Fujitsu. In particular, let’s ask why the Japanese multinational IT supplier has not been taken to court, or heavily fined, or barred from bidding for new public-sector contracts, for the faults of its Horizon sub-post-office system and the mishandling of pleas for help from hundreds of innocent sub-postmasters who were wrongfully convicted. Public reaction to the ITV drama Mr Bates vs the Post Office has provoked the former Post Office chief Paula Vennells to hand back her CBE, but whatever she did wrong, she wasn’t the root cause of the scandal. So let’s take a closer look at the maker of the kit that failed. Fujitsu built

How many criminal convictions are overturned? 

Power play The former energy minister Chris Skidmore resigned in protest at a bill to issue more licences for oil and gas extraction in the North Sea. What are other countries doing? – US oil production hit a record 13.3m barrels a day last month, up from 10.8m five years ago. – Qatar is investing $150 billion toincrease oil production by 50% to 5m barrels per day by 2027. – Brazil plans to increase oil production from 3.1m barrels per day in 2022 to5.4m barrels per day by 2029. – Canada increased oil production by 375,000 barrels per day between 2021 and last year. Judgment call The Criminal Cases Review

Was COP28 any more than hot air?

What position should the distant observer take on the COP28 conference in Dubai? That the sight of 70,000 delegates flying into a desert oil state from around the world to discuss human impacts on climate change is beyond satire and that its proceedings are never likely to rise above Greta Thunberg’s encapsulation of all such jamborees as ‘blah blah blah’? Or that the climate problem is now so obvious and urgent that all efforts towards global action, however small, should be uncynically applauded? I leave that choice on the table. But I’m finding it hard to take a positive view of Sultan Al-Jaber, president of the Dubai gathering, who also

What’s the point of a degree?

‘Place nose on dot.’ That’s what my screen is telling me to do as the first step in a ‘liveness’ test I must complete to be accepted as a signatory on a club bank account. But if I align the image of my face with the dot, nothing happens. If I press my nose to the screen, I go cross-eyed. And if the test’s purpose is to make sure I’m not dead, it would be simpler to ask me to shout at it. After the sixth failed attempt, that’s what I do – cursing the modern world in which identity fraud is so prevalent that all new connections between customers

WeWork and FTX tell us visionary hype is always dangerous

In the New York trial of Sam Bankman-Fried, founder of the collapsed FTX crypto exchange, there was never a moment when he looked like talking his way to freedom: he was found guilty on seven charges of fraud and conspiracy and now awaits what’s likely to be a very long sentence. Justice has been swift and sure, barring an extraordinary reversal on appeal. But what should worry thoughtful observers is the fact that during the period of the trial, from 3 October to 2 November, the price of bitcoin rose from £22,700 to £28,700. Perhaps investors saw the crypto currency as a safe haven after Hamas’s attack on Israel. Perhaps they

The attack on Israel must lead to an uptick in inflation

A 10 per cent increase in oil prices translates to a 0.15 per cent loss of global GDP and a rise of 0.4 per cent in global inflation, says Gita Gopinath, deputy managing director of the IMF. Before Hamas launched its assault on Israel on 7 October, the Brent Crude barrel price had already moved 20 per cent above its summer level of $75 and pundits were predicting $100, based on prospects of tighter supply from Saudi Arabia and Russia. Natural gas prices have also risen sharply with winter approaching – and no one knows how escalation of the latest Middle East conflict might affect other energy flows and supply chains.

Metro’s story tells us markets are still fearful of a banking crash

Market sentiment around the possibility of failures in the banking world remains as febrile as ever. Or so we might judge from coverage of Metro Bank – which reports suggested might have been edging towards collapse before finding a new owner over the weekend. Metro was the brashest of the ‘challenger banks’ that sprouted after the 2008 financial crisis and the only one that aimed to build an all-new network of 200 branches. Its American founder, Vernon Hill – whose other interests included a chain of Burger King outlets – declared an urge to ‘make banking fun’ when the first Metro opened in Holborn in 2010, offering free lollipops and

The forecast Andrew Bailey actually got right

When inflation was at 5.5 per cent and rising in January 2022, the BBC’s Faisal Islam adopted a look of amazement when he asked the governor of the Bank of England, Andrew Bailey: ‘So you’re trying to get inside people’s heads and ask them not to ask for too high pay rises?’ ‘Broadly, yes,’ Bailey stepped into the trap, ‘It’s painful, but we need to see that in order to get through this problem more quickly.’ The governor was slated for insensitivity, critics making much of his own half-million package. That 38-second clip did more to make his out-of-touch reputation than any of his other stumbles. But he wasn’t wrong.

Solar panels in, swimming pools out: 2023’s property trends

Inflation has finally dipped a little but is still riding high, and mortgage rates may still rise further: Britain’s households are suffering a pay squeeze. But what are home-owners still spending their money on – and what has fallen out of favour? Here is Spectator Life‘s guide to the winners and losers in the property market this year so far… The winners… Solar panels High energy bills have kickstarted British householders into going green. During the first half of this year, sales of solar panels were up 82 per cent on the same period last year, according to MCS, the standards body. The hot spots of solar installations? Cornwall, Wiltshire

Should crypto be regulated like shares – or more like a casino?

‘Crypto assets are commodities,’ said my neighbour at dinner. No they’re not, I replied, commodities are natural raw materials that have ultimate real-world uses. Crypto is merely a collection of blips in cyberspace to which adherents choose to attribute value. ‘Just like fiat currencies,’ my neighbour shot back. ‘What’s real about them? Aren’t they just an idea in the mind of central bankers?’ And off we went on a ding-dong debate. A pity the US Securities and Exchange Commission chairman Gary Gensler wasn’t there to offer his theory that bitcoin, crypto’s market leader, is big enough to be a commodity but that lesser imitators are ‘securities’ (that is, investments bought