Prime Minister Boris Johnson opened the UK's Global Investment Summit yesterday

By Suzanne Evans, Director, Political Insight

Price rises dipped slightly in September, according to official figures. The increase in the cost of living, as measured by the Consumer Prices Index, fell to 3.1% in the year to September, down from 3.2% in August. The Office for National Statistics said however that the inflation rate fell back slightly last month because prices in restaurants rose less this August than last when the Eat Out to Help Out Scheme was running. Under the scheme, diners got a state-backed 50% discount on meals of up to £10 each on Mondays, Tuesdays and Wednesdays. Higher prices for transport were the biggest contributor to September’s price rises.
 
Prime Minister Boris Johnson opened the UK's Global Investment Summit yesterday, welcoming business leaders including Microsoft co-founder Bill Gates to the event at the Science Museum in London. The government is partnering with Gates on new investment in new tech to reduce emissions, with a combined cash injection of £400m in net-zero projects. Opening the summit, Johnson hailed free market capitalism for the creation of the COVID-19 vaccine. "Innovation, capitalism, and a strong government lead," Johnson said, are therefore needed to combat climate change in the future. He also noted that lessons from the pandemic had shown that the combination of science and investment had produced results. The UK is the "Saudi Arabia of wind power," said Johnson, and needs to be the "Qatar of hydrogen" to drive a net zero future. He also announced £9.7bn worth of overseas investment in the UK — a move he says will create 30,000 new jobs – in 18 investment deals to support growth in sectors such as wind and hydrogen energy, sustainable homes, and carbon capture technology.
 
The government is planning to offer homeowners in England and Wales a £5,000 grant to swap their old gas boilers for low-carbon heat pumps. The move is part of more than £3.9bn in new funding to decarbonise heat in buildings, which accounts for 21% of total UK carbon emissions. The new grants will be available through a new £450m three-year Boiler Upgrade Scheme from April next year, however ministers also confirmed that households will not be forced to remove their existing fossil fuel boilers. The government has set a target of installing 600,000 heat pumps each year by 2028, and while the number installed is increasing, just 60,000 were installed last year in UK homes. PM Boris Johnson has pledged to reducing greenhouse gas emissions in the UK to net zero by 2050.
 
The policy head of the Road Haulage Association warned yesterday that "things are not visibly getting better" for the UK's supply chains in the run-up to Christmas. Speaking at a Business, Energy and Industrial Strategy Committee evidence session, Duncan Buchanan said that the industry is in a "very uncertain place" as companies that can pay more are poaching drivers from some essential suppliers. Buchanan also said that government support offered to the HGV industry such as apprenticeships are not having an immediate effect and likely won't be felt for a year. He said that the average drivers' wage has increased by between 10% and 20% in the last six months and that businesses are renegotiating contracts to pass on costs to retailers.  Speaking on Brexit, Buchanan said that the industry is learning to navigate it. “Brexit is like a mountain, we have to deal with it — you have to either go over it, round it or through it,” he said. Ian Wright, CEO of the Food and Drink Federation also told the committee that a combination of structural factors such as changing immigration patterns, increased demand in online shopping and foreign students no longer working their way through college are to blame for part of the labour and HGV crisis. He also warned on the "terrifying" issue of inflation which "discriminates against the poor".
 
The Civil Aviation Authority (CAA) has provisionally allowed Heathrow airport to increase passenger charges from a maximum of £22 per passenger to between £24.50 and £34.40 for the next five years, starting in the summer of 2022. However, the CAA rejected the airport's request to almost double the fees to help it recover from the pandemic; Heathrow had wanted to charge up to £43 per passenger to help recover £2.9bn in losses made since the first lockdown in March 2020. The increase is likely to be passed straight on to travellers. The increase was condemned by both airlines and trade bodies such as Airlines UK, which accused the CAA of giving in to a "monopoly-abusing" airport. Heathrow is owned by infrastructure investors such as Ferrovial of Spain and the Qatar Investment Authority, which took billions of pounds in dividends out of the business in the years before the pandemic. Tim Alderslade, Airlines UK's chief executive, said: "Monopolies will always try it on and that's why we need a strong regulator to clamp down on what is blatant gouging. How on earth can it be in the interests of consumers to ramp up charges by as much as 50%? It's Heathrow's shareholders and not our customers who should be asked to foot the bill. We will oppose this in the strongest terms." Willie Walsh, who ran British Airways owner IAG for 15 years and is now director general of airlines body Iata, said: “It is vital the CAA demonstrates it has not been gaslighted by Heathrow into accepting their outrageous demands.” Shai Weiss, chief executive of Virgin Atlantic, said the proposals “failed to protect” consumers and paved the way for Heathrow to introduce “unacceptable charges”. Luis Gallego, chief executive of IAG said: “Heathrow is already the world's most expensive hub airport. The disproportionate increase compared to other European hubs will undermine its competitiveness even further and UK consumers will be losing out.”
 
FTSE 250 British aerospace manufacturer Meggitt says it is confident its £6.3bn takeover by a US rival will go ahead. On Monday, business secretary Kwasi Kwarteng intervened in the deal, referring the proposed acquisition Parker-Hannifin to the Competition and Markets Authority amid national security concerns. “The UK is open for business. However, we will take steps to protect our national security when necessary,” he said. Yesterday Meggitt issued a brief statement saying it looked forward to “engaging constructively” with the competition regulator on its review.
 
The Competition and Markets Authority has announced it plans to clear S&P's £32bn merger with IHS Markit if the companies can address competition concerns in the supply of price assessments of biofuels, coal, oil, and petrochemicals in the UK. S&P, which provides ratings, benchmarks, analytics and data to the capital and commodity markets, and HIS, which issues information and analytics for major industries, financial markets and governments, now have five working days to submit proposals to address the concerns or their deal will be referred for an in-depth investigation.
 
The Competition and Markets Authority (CMA) is to launch a merger enquiry into the takeover of GCP Student Living by rival Scape Living. The FTSE 250real estate investment trust agreed to be taken over in July and the deal was expected to complete by the fourth quarter.  Interested parties have until 1 November to comment on the merger, with a final decision by the CMA due by 13 December. Scape is backed by Dutch pension fund APG Asset Management and private equity firm Blackstone, which bought rival student housing provider iQ Student Accommodation last year in a £4.7bn deal. GCP has 11 properties in and around London with a total of around 4,100 beds. iQ has around 29,000 beds across the country.
 
Accountancy giant PwC has struck a deal to sell its mobility services division to US private equity firm Clayton, Dubilier & Rice (CD&R) for $2.2bn (£1.6bn). The sale of the unit, which advises more than 3000 organisations on tax and immigration issues when they move staff abroad, is the firm’s largest sale in almost 20 years. Peter Clarke, global managing partner for global employee mobility at PwC, will take the helm as chief executive of the newly-formed rebranded company, the Financial Times reported. Russ Fradin, former chief executive and chair of Aon Hewitt and a partner at the buyouts group, will be chairman. The unit has suffered over the last year due to the coronavirus pandemic, and the enforcement of lockdown and travel restrictions, but its new owners will be looking to turn this around.
 
Ladbrokes owner Entain said yesterday that the UK Takeover Panel has extended the deadline for US-based DraftKings to announce a firm intention to make an offer for the company or walk away to 16 November. Entain is currently considering a 2,800p a share takeover offer from the group, having rejected a bid from its joint venture partners MGM Resorts in January. Entain shares opened this morning at 2,196.
 
JCB has announced it is investing £100 million in zero-emission hydrogen engines to power machinery. The British manufacturer already has a 100-strong team working on the hydrogen project and is recruiting for up to fifty more engineers to deliver on its bid to make the first machines available to customers by the end of next year. The firm will showcase its hydrogen technology in the Green Zone at COP26 in Glasgow.
 
69% of Brits believe the Financial Conduct Authority (FCA) is in charge of regulating cryptocurrencies, a study by the organisation has shown. The FCA surveyed 1,000 people aged between 18 and 40 who invest in high-risk investment products. It also found that 58% of those investing in high-risk financial products say hype on social media and in the news lies behinds their investment decisions. The FCA concluded from their research that new investors were unlikely to understand the lack of protection and the risk to their money when investing. The FCA is launching an £11m InvestSmart campaign, designed to help consumers identify the risks cryptocurrencies may pose. However, it also found that few of the high-risk investors it surveyed were investing for the long haul. Just one in five respondents (21%) were considering holding their most recent investment for more than a year, and less than one in 10 (8%) for more than five years, despite 60% saying they prefer more stable returns than investments that rise and fall dramatically.
 
Facebook Inc has agreed to pay up to $14.25 million in damages to settle civil claims by the US government that the company discriminated against American workers and violated federal recruitment rules. The social media giant gave hiring preferences to temporary workers, including those with H-1B visas that let companies temporarily employ foreign workers in certain specialty occupations, and which are widely used by tech companies.
 
The first US bitcoin futures-based exchange-traded fund began trading yesterday, sending bitcoin to a six-month high and just off its all-time peak, as traders bet the fund could boost investment flows into cryptocurrencies. The ProShares Bitcoin Strategy ETF closed up 2.59% at $41.94 in its first day of trading, with around $1 billion worth of shares trading hands on Intercontinental Exchange Inc's NYSE Arca exchange under the ticker BITO. Bitcoin, the world's largest cryptocurrency, is notoriously volatile, says Reuters.It has risen around 45% this month on hopes that the advent of US bitcoin ETFs - several of which are in the works - will spur billions of dollars managed by pension funds and other large investors to flow into the sector.

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