Published: 27 October 2021
Location: London, UK
In yet another deliberate ‘leak’ of information to be detailed in today’s Budget - just one of several such pre-announcements roundly condemned by the Speaker of the House of Commons this week - Chancellor Rishi Sunak will announce £30m of funding to back the UK's bids to host the Women's Rugby World Cup and the Tour de France Grand Depart. He will also provide a further £11m to support the UK-Ireland bid for the 2030 Football World Cup.
The price of a pint of beer will have to rise by as much as 30p to help pay for wage rises and soaring energy costs, according to City Pub Group. A hike in the National Living Wage to £9.50 per hour in April for the over 23’s, set to be announced today, means prices rises are "the only way forward,” Clive Watson, the chain's boss said, as this alone would cost the chain about £1m a year. Emma McClarkin, chief executive of the British Beer & Pub Association, also called for help for the sector saying that while increases to the minimum wage and the minimum living rate would be "welcomed" by many staff in pubs, it was a further cost increase for pubs who were "still struggling to recover and face an uncertain future". "It makes beer duty, business ratesand VAT cuts in the Budget all the more important for the viability of our sector," she told the BBC.
The UK's spy agencies have signed a deal with Amazon to host classified material to boost the use of data analytics and artificial intelligence in espionage, according to a report by the Financial Times. AWS, Amazon's cloud computing arm, will host the high-security system in a deal estimated to be worth between £500m and £1bn over the next decade. The deal, which covers GCHQ, MI5 and MI6, was signed in 2021 but not made public, the newspaper says. The agencies' data will be held in the UK and Amazon will not have access to any of the information on the platform, but the service will let British spies share data more easily from overseas locations and spot particular voices from hours of intercepted recordings. The contract may raise concerns about sovereignty because a single US tech company will host reams of the UK's most secret data. The FT says agencies looked for a UK provider, but none had the scale or capabilities needed. Jeremy Fleming, the director of GCHQ, has said AI will be crucial in keeping the UK safe. Britain lags the CIA,which signed their first deal with AWS in 2013, in using commercial cloud services.
The government’s response to covid caused a 'blip' in the narrowing of the UK's gender pay gap, with stats showing it had worsened by 0.9 percentage points in the year to April 2021. According to new figures by the Office for National Statistics, among full-time employees the gender pay gap in April 2021 was 7.9%. It was 7.0% in April 2020 and 9.0% in April 2019. That means that in April 2021 full-time working men earned 7.9% more than women.
A bankrupt Labour council has been taken over by ministers after blowing a £100m black hole in its finances following a string of major property investments, the Telegraph reports. Slough council has been forced to implement a three-year rescue plan overseen by Government-appointed commissioners. The town's leaders have admitted that it needs more than £100m of additional financial support in 2021-22, far higher than initial estimates of £15m. The borough spent £96m betting on commercial property before Covid hit, with investments including a cinema in Basingstoke and superstores in Gosport and Wolverhampton. Slough is now trying to sell off half of its £1.2bn of assets, and ministers have criticised the council's leadership for “deeply concerning” mismanagement of its finances.
Farming bosses have warned acute shortages in the UK labour market due to both Brexit and COVID-19 mean there may not be enough turkeys and produce to go around at Christmas. Speaking at an Environment, Food and Rural Affairs Committee session on Tuesday, British Poultry Council chair Graeme Dear said the industry is doing its utmost to provide produce, but that the UK government had not moved fast enough on addressing labour issues and supporting the industry. He called for a two-year visa scheme in recognition of the fact that this is an issue that will persist past Christmas for the poultry industry. Charlie Dewhirst, policy adviser at the National Pig Association, said it is a "deeply distressing time for the industry", noting how the shortage of butchers was weighing on the pig farming sector. He said it takes 18 months to train a butcher from scratch and that they are well-paid and skilled jobs that the industry is finding impossible to fill. A butcher in the UK is typically paid between £26,500 and £40,000.
The cost of food is likely to go up as we head towards Christmas, according to the monthly British Retail Consortium (BRC)-NielsenIQ shop price index. According to the monitor, food inflation accelerated to 0.5% in October, up from 0.1% in September. This is above the 12- and six-month average price growth rates of 0.1% and -0.1%, respectively and is the highest inflation rate since November 2020. The BRC said three in five retailers expect prices to increase in the run up to Christmas, and the ongoing labour shortages are making the situation worse.
UK retail stocks supply fell to the lowest levels since 1985 in October, according to the latest monthly Confederation of British Industry (CBI) Distributive Trades Survey. Stocks in relation to expected sales reached a survey record low for the seventh consecutive month, falling to -31% from -23% month-on-month, Yahoo Finance UK reports. Many retailers are suffering from ongoing supply chain issues due in part to a shortage of delivery drivers in the UK. Supply chains have been hit by a "double whammy" of drivers going back to their home countries either due to uncertainty over new Brexit rules or COVID-related restrictions which has led to a major shortage. Trade bodies have estimated the UK currently has a shortage of about 100,000 heavy goods vehicle (HGV) drivers.
Almost 8 million Brits who have used 'buy now pay later' (BNPL) services to shop have outstanding balances that average £538 each — totalling £4.14bn across the UK. Research by Credit Karma found that almost half (48%) of BNPL purchases are made on nonessential items, such as electronics, cosmetics or holidays, and that 31% of Brits intend to increase their use of the service as Christmas approaches.
Monzo, one of Britain's most prominent standalone digital banks, is in detailed talks to raise hundreds of millions of pounds in new investment despite a string of setbacks including curtailing expansion in the US. The company is in discussions with several investors about raising at least £300m in new funding, Sky News revealed last night. Approximately £200m is expected to be provided by new shareholders, with the remainder coming from existing company backers. Monzo is backing its investment call with a fresh valuation of £3bn, which would reflect substantial growth in Monzo's revenues, according to one source close to the process, and would be almost three times the £1.1bn valuation achieved in its last capital-raising earlier this year. In recent months, Monzo has launched a BNPL service enabling customers to make card payments in instalments. The company is chaired by Gary Hoffman, whose other principal job is chairing the English Premier League.
Ikea has signed a conditional purchase agreement for Topshop’s former flagship store on Oxford Street in London for £378m. The Swedish company will take the long leasehold on the building, which houses 239,000 square feet of retail and office space over seven floors and is home to current long-term tenants Nike and Vans. The deal is expected to complete in January with the new Ikea store set to open in autumn 2023.
BT shares surged yesterday following a report the telecoms group has moved to strengthen its defences against a possible takeover bid by French billionaire Patrick Drahi, by hiring advisory firm Robey Warshaw. According to Sky News, the advisory firm was formally appointed by BT in recent weeks to work alongside Goldman Sachs. The move comes shortly before a 10 December threshold that will release Altice, the telecoms investor controlled by Patrick Drahi, from a binding commitment not to launch a takeover bid for BT. Altice bought a 12% stake in BT in June for £2.2bn. Sky cited city sources as saying that BT's board is engaged in a range of scenario planning exercises including Altice lodging a formal takeover offer or demanding that it spins off either its consumer division, which includes mobile network EE, or its Openreachbroadband infrastructure arm.
BP's trading team made at least $500 million in the third quarter of 2021, benefitting from a gas crisis that has left consumers and industries reeling, Reuters reports. The news agency says two anonymous sources with knowledge of the company's trading results, ascertained at an internal call with staff earlier this month, have passed the knowledge on. BP declined to comment.
Royal Dutch Shell plc has begun natural gas production from the Arran gas and condensate field in the UK’s North Sea. The Arran field is part of the Shearwater gas hub, which remains among the biggest producing fields in the North Sea. Arran, which is developed and operated by the company, is a 60-kilometer subsea tie-back to the Shearwater platform.
Britishvolt is on the verge of securing circa £200m of government funding to support the construction of its new gigafactory in Northumberland. The £2.6 billion plant - one of the UK's largest ever industrial investments - is expected to create 3,000 direct jobs.
The Pound hit a new 2021 high against the euro yesterday morning in London to trade at its highest level since the pandemic-induced market turmoil in March 2020. For the month-to-date, the pound is outperforming the euro by about 2%, on track for its second biggest monthly gain in two years.
Washington has revoked the US licence of one of China's biggest telecoms companies citing "national security" concerns. China Telecom must stop providing services in America within 60 days. Officials said the Chinese government's control of the company gave it the opportunity "to access, store, disrupt, and/or misroute US communications". This in turn could allow it "to engage in espionage and other harmful activities against the US", they said. China Telecom, which has provided telecoms services in the US for nearly 20 years, called the decision "disappointing".
Google's parent company Alphabet recorded record profits for a third consecutive quarter, powered by a rise in advertising spending as more consumers shopped online during the pandemic. Alphabet, the world's largest provider of search and video ads, saw its revenue rise to $65.1bn (£47.29bn), while Google's sales jumped 41% to $53.1bn (£38.58bn). Meanwhile, Alphabet's quarterly profit hit $18.93bn (£13.75bn), delivering a third-straight quarter of record profit for the company. Alphabet's shares have risen 24% in six months and 62% in the year to date, strongly outperforming the market, as consumers have spent more of their lives online during the pandemic.
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