Suella Braverman was knocked out of the Conservative leadership contest yesterday

By Suzanne Evans, Director, Political Insight

Suella Braverman was knocked out of the Conservative leadership contest yesterday. The five remaining candidates are Tom Tugendhat (32 votes), Kemi Badenoch (49), Liz Truss (64), Penny Mordaunt (83) and Rishi Sunak (101).
 
The Office for National Statistics says one in every four businesses in the UK are planning to raise prices further in in August. This is, however, a drop from the 31% who said they had to pass on their increased costs to customers back in April.
 
The Treasury committee has written to Visa and Mastercard demanding to know why their debit and credit card fees have increased nearly sixfold when Britons buy from European businesses. They have gone up from 0.2% to 1.15% for debit cards, and from 0.3% to 1.5% when a credit card is used to purchase goods or services from Europe. The companies have so far failed to explain the reason for the hike. “Recent rises in the fees paid by firms for cross-border debit and credit card transactions add additional costs to businesses, many of whom are already grappling with rising inflation and other cost pressures,” said committee chairman Mel Stride MP. The two companies are already facing a probe into the hiked fees by the Payment Systems Regulator.
 
Sharon Graham, general secretary of Unite, Britain’s largest private sector trade union has warned of a 'summer of discontent' over pay in an interview with the BBC. She said there could be hundreds of disputes involving tens of thousands of people if workers are made to "pay the price for inflation". Graham said ordinary workers have already "had a spring, summer autumn and winter of discontent for years". “Any employer who can pay, who has made profit out of workers, has to pay a proper fair wage to those workers," she said, adding that calls from the government and the Bank of England that workers should not ask for high wage rises were "totally wrong" and "abhorrent". She highlighted double digit pay rises already won, for bus drivers, bin collectors, and factory workers, including in one case a rise of 23%. Inflation is currently 9.1%, but Graham denied there was a risk of a "Seventies-style" spiral of wages and prices which would prolong the period of very high inflation, instead blaming a rise in profits at big companies. Business’ group the Confederation of British Industry (CBI) responded by saying that firms were helping employees and consumers where they could. A spokesperson said: "With living costs at the highest level in decades, workers are understandably concerned about how they're going to cope with rising prices. Businesses too are being hit by soaring input costs. Wherever they can, firms are stepping-up to help by absorbing costs to keep prices down for consumers, as well as supporting their employees to cope with the cost-of-living spike."
 
Ben van Beurden, CEO of oil giant Shell has warned that Europe faces a "really tough" winter as energy costs soar, and that energy rationing in Europe can’t be ruled out in a worst case scenario, given Russian president Vladimir Putin’s threats to limit supplies. "It will be a really tough winter in Europe. We will all face very significant escalation in energy prices," he told an energy conference in Oxford. Last month, van Beurden warned the world faces an "ever-tighter market" and a "turbulent period" because OPEC has less spare capacity than assumed. Several European countries, including Germany and Italy, are already reporting shortages in supply as Russian-owned Gazprom limits fuel sent to European countries.
 
Emirates airline has refused point blank to comply with an order from Heathrow Airport to limit flights and passenger numbers, saying the edict shows “blatant disregard for consumers". On Tuesday, Heathrow asked carriers to stop selling tickets for the next two months and imposed a cap on passenger numbers until September 11 to prevent delays during the peak summer holiday season. Emirates said in a statement: “LHR (London Heathrow) last evening gave us 36 hours to comply with capacity cuts, of a figure that appears to be plucked from thin air. Their communications not only dictated the specific flights on which we should throw out paying passengers, but also threatened legal action for non-compliance. This is entirely unreasonable and unacceptable, and we reject these demands.” The Dubai-based carrier stressed that its ground handlers at Heathrow are “fully ready and capable of handling our flights” and that it would be “impossible” to re-book the number of passengers that would be affected by Heathrow’s cancellation demands. In a stinging rebuke to Heathrow, emirates said: “All the signals of a strong travel rebound were there, and for months, Emirates has been publicly vocal about the matter. We planned ahead to get to a state of readiness to serve customers and travel demand, including rehiring and training 1,000 A380 pilots in the past year. LHR chose not to act, not to plan, not invest. Now faced with an ‘airmageddon’ situation due to their incompetence and non-action, they are pushing entire burden – of costs and the scramble to sort the mess – to airlines and travellers. The shareholders of London Heathrow should scrutinise the decisions of the LHR management team.” The statement added: “Until further notice, Emirates plans to operate as scheduled to and from LHR.”
 
Amazon says it will create over 4,000 new jobs in Britain this year, mostly based at its new warehouses in Wakefield and Knowsley - two of the four it opened in 2021 – but also at its corporate offices in London and Manchester, and in Edinburgh and Cambridge, where Amazon bases most of its tech staff. The jobs, which will be permanent, will take the online retail giant’s total UK staff count to 75,000, putting it in the top ten of the country’s private sector employers. Amazon had already created 2,500 UK jobs in 2021 as lockdowns pushed consumers towards online shopping. "We're continuing to invest in talent right across the UK, from apprentices in Swansea to data scientists in Edinburgh," said John Boumphrey, Amazon UK country manager.
 
Luxury car maker Aston Martin has announced a £653m equity capital raise to repay existing debt, strengthen financial resilience and improve cash flow generation by reducing its interest costs, in a move that will result in the Saudi Public Investment Fund (PIF), Saudi Arabia's sovereign wealth fund, becoming its second-biggest shareholder after Chairman Lawrence Stroll. The company will place 23.3m shares at 33p each with PIF to raise £78m in exchange for a 16.7% stake.
 
The Financial Reporting Council (FRC) has fined UHY Hacker Young £300,000 and audit engagement partner Martin Jones £45,000 for audit failings in connection with collapsed retailer Laura Ashley Holdings. Sharecast News reports that both companies were severely reprimanded, and have agreed not to undertake any new audits of public companies until at least May 2024. Laura Ashley, which had 155 stores and 2,700 staff, filed for administration in March 2020. Between 2016 and 2019, revenues and profits had both "consistently declined", the FRC noted, with the loss after tax increasing tenfold in 2019, to £14m from £1.4m a year previously. Yet the audit reports for 2018 and 2019 were "unmodified and noted no material uncertainty related to the use of the going concern assumption", the FRC found. The regulator acknowledged that while Laura Ashley's administration was not caused by the breaches, both the 2018 and 2019 audits "failed in the principal objective", it ruled.
 
The Chinese economy contracted sharply in the second quarter of this year because of widespread coronavirus lockdowns, notably in Shanghai, the financial and manufacturing centre of the country. Gross domestic product(GDP) fell by 2.6% in the three months to the end of June from the previous quarter. China continues to pursue a "zero-Covid" policy. Luxury fashion house Burberry this morning said that first-quarter same-store sales increased just 1% year-on-year as sales were impacted by lockdowns across mainland China.
 
Sri Lanka's President Gotabaya Rajapaksa has formally resigned. The crisis-hit nation declared a state of emergency earlier this week, after protestors who had been demanding Rajapaksa’s resignation stormed the capital, forcing him to flee the country to Singapore, escaping via the Maldives on a military jet. His close political ally Ranil Wickremesinghe was sworn in as Acting President earlier today (a role he is only allowed to hold for 30 days under the Sri Lankan constitution) ahead of the election of a new President by the country’s Parliament. Sri Lanka’s economy has collapsed; it is suffering runaway inflation of around 54%; there are severe shortages of basic goods such as fuel and food; and electricity blackouts; all of which has resulted in mass civil unrest. While global forces have been influential, the country’s infrastructure began to unravel when the government banned agricultural chemical fertilisers in a bid to go organic, which led to a huge surge in food prices. Food price inflation in the country is believed to be in the region of 80%.
 
Billionaire Bill Gates has again pledged again to give his wealth away. He has just announced that he will make a $20bn (£17bn) donation to his philanthropic fund, the Bill & Melinda Gates Foundation, saying he has an "obligation" to return his resources to society. Gates first pledged to give away his wealth in 2010 but his net worth has more than doubled since then. He is currently worth $118bn, according to Forbes magazine.
 
Social media site Twitter suffered its longest global outage yesterday, going down for around an hour at lunchtime in the UK. According to the Guardian, the service has not experienced such a long outage since 2016, when it went down for more than two hours.

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