Published: 05 October 2022
Location: London, UK
By Suzanne Evans, Director, Political Insight
Prime Minister Liz Truss will deliver her speech to Conservative Party Conference this morning, at just after 11am.
In her speech to Conservative Party Conference yesterday, Home Secretary Suella Braverman said that opposition by some senior Conservative MPs to the decision to abolish the top rate of income tax amounted to a "coup". Braverman said she was disappointed in Conservative colleagues who opposed it, adding that critics like former minister Michael Gove should raise any problems he has with government policy in private.
Treasury sources have confirmed to journalists that the government will publish its fiscal plans earlier than the originally scheduled date of 23rd November, and probably this month. The date will be announced in parliament.
Transport secretary Anne-Marie Trevelyan has told BBC News that train companies must be prepared to make compromises to bring an end to the strikes that have crippled the network, saying all sides have "voice in this dispute". After just days in her new job, she has met with union bosses, something her predecessor Grant Shapps refused to do. Mick Lynch, head of the RMT union, said his meeting with Ms Trevelyan had been a "good start" but "concrete change" was needed. Trevelyan said it was ultimately up to the rail companies and the unions to settle their differences but as transport secretary she had an "important" role to play, adding: "I'm here to make sure our trains work." However, in a BBC Newscast podcast on Monday, Shapps dismissed her approach, saying there was "no point" in talking to union leaders "unless there is a different package on the table and I have no evidence of that". "You can have chateroo if you like," he added, but it "would not change the outcome". He said he would be watching "very carefully" for any sign of "capitulation" to the unions, arguing that the offer made to them by employers was "pretty fair".
The pound rose for the sixth consecutive session yesterday, as currency traders appeared to welcome the government's U-turn on some tax cuts and the US dollar slipped. This morning, Sterling is down 0.6% to stand at $1.1405, after touching a session high yesterday of $1.1428. Sterling dropped to a record low of $1.0327 on 26th September after Chancellor Kwasi Kwarteng unveiled plans to slash taxes and ramp up borrowing.
It has been revealed that UK-based investors pulled a record £2.4 bn out of equity funds in September. Funds network Calastone said the net outflows make September the worst month in what is already the worst year on record for equity funds. Funds focused on UK equities were the worst hit, Calastone added, with £694m worth of selling making for the sixteenth consecutive month of outflows. US equity funds also saw their biggest outflows on record. The FTSE 350 rose over 2% yesterday but is down 0.68% this morning at the time of writing.
Britain recorded about 225,000 new car registrations in September, according to preliminary industry data released by the Society of Motor Manufacturers and Traders (SMMT) this morning. The industry body said the year-to-date registrations were down a third on pre-pandemic 2019 levels.
The outgoing CEO of Shell, Ben van Beurden, has said at an oil industry conference that energy markets cannot behave in a way that "damage a significant part of society" and that taxes on firms within the oil and gas industry are "inevitable". “One way or another" there will be government intervention that "results in protecting the poorest" people, he said, adding that governments should not however intervene to cap gas prices. Last week, the EU agreed emergency measures to charge energy firms on record profits, and the UK government launched a windfall tax on oil and gas firms - the Energy Profits Levy – in May, via which it expects to raise an extra £7bn in its first year. This will help pay for the £400 energy bills discount for all households to help with energy bills from this month. The new government has pushed back against extending this tax to raise more money, leading Susannah Streeter, senior investment and market analyst at Hargreaves Lansdown, to tell the BBC that van Beurden's comments had "flung open a door on a windfall tax which the UK government had been trying to close". "This will reignite the debate over how profits of energy giants should be taxed, just as a row rages about whether welfare spending will be hit to pay for the Truss administration's slash and spend policies," she said.
Shares in Drax Group have been trading up to 10% lower since the FTSE 250-listed UK firm was accused by the BBC’s Panorama programme yesterday of chopping down ecologically important Canadian forests to make the pellets for its biomass plant in Yorkshire. The converted coal plant and Britain's biggest power station, burns millions of tonnes of imported wood pellets, a process classed as renewable energy. Drax has received £6bn in subsidiaries for producing green electricity, according to the BBC. Drax responded by saying that 80% of the material used in its pellets was sawmill residue - the sawdust, wood chips and bark left over once timber has been processed - and the rest was waste material collected from forests. "Canada has some of the most highly-regulated forests in the world, which ensures the forests in British Columbia are managed properly. People living in and around these forests are best placed to determine how they should be looked after, not the BBC." Drax added that its lawyers had written to the broadcaster and that it was "considering further action". It also accused the BBC of focusing "primarily on the views of a vocal minority who oppose biomass".
Greggs has increased its prices again despite increasing sales, putting the price of its famous sausage roll up 10p to £1.15 this week. The bakery says its total sales have grown by 14.6% in the last 13 weeks, but that it is battling rising costs. This was also below the 27.1% growth reported in the first half of the year. CEO Roisin Currie told Reuters she hoped this would be the final round of price increases this year but could not guarantee it. Sales slowed during August as people ditched the staycations that had been fuelled by the pandemic, she said, but that momentum returned in September. Greggs also noted that its sales growth dipped by about 1% as a result of closing its shops for the Queen’s funeral on September 19.
German-owned discount supermarket Lidl GB said yesterday that it plans to hire 1,000 more hourly paid staff in Britain over the next five months for its new stores and warehouses.
FTSE 250 engineering services company Hill & Smith has acquired the business and assets of California-based National Signal, a portable solar construction equipment manufacturer, as part of a deal valued at almost $30m, funded from Hill & Smith’s existing banking facilities.
AIM-listed legal and professional services provider Gateley has bought Symbiosis IP for some £2.5m in cash and new shares. Symbiosis is a chartered patent attorney firm specialising in intellectual property (IP) services for the life sciences industry. It is the second such business Gateley has acquired onto its business services platform, after the acquisition of Adamson Jones in January, Sharecast News reports.
Asset and energy support services group Sureserve has won a £5.4m contract with the Defence Infrastructure Organisation to supply the Ministry of Defence with solar photovoltaic technology.
British manufacturer Paneltex is set to create 240 jobs and open a new factory in East Yorkshire after securing the largest contract in its history: cargo boxes made by the Hull-based firm for Volta's new electric truck will be exported to Austria.
The Seaquarium at Clacton Pier in Essex is to close permanently to visitors after some 40 years. It is home to about 900 individual fish and other examples of sea life. Nigel Brown, communications manager for the pier, blamed energy costs which are already running at £1,500 per month, and being unable to meet stricter regulatory standards if it were to renew its licence with Tendring District Council. "We are now in a very different world with emphasis on protecting the environment quite rightly gaining greater priority,” he said. "If it was to remain, we would have also wanted to look to come up with more conservation activities and that was simply not viable," he added. The owners said they were in discussions with other aquariums, including Sealife Adventure in Southend, to rehome all the sea life. Brown said he hoped The Seaquarium would be replaced with another attraction.
HSBC has confirmed to Sky News that it is exploring a multibillion-pound sale of its operations in Canada, and has instructed investment bankers at JP Morgan to sound out prospective buyers. Sky says one analyst suggested that the value of the Canadian subsidiary could be in the region of $7bn (£6bn). The news comes as HSBC is confronted by a campaign orchestrated by the Chinese insurance group Ping An for it to embark on a wholesale break-up. Ping An, which owns more than 8% of HSBC, is thought to have told HSBC - led by chairman Mark Tucker and CEO Noel Quinn - to split its lucrative Hong Kong business from the rest of its global empire, Sky said. HSBC has already announced that is to sell or wind down its mass-market retail operations in the US and sold its business in Brazil in 2016 for more than $5bn. HSBC told Sky in a statement: "HSBC regularly reviews its businesses in all its markets. We are currently reviewing our strategic options with respect to our wholly owned subsidiary in Canada. Amongst the options being explored is a potential sale of HSBC Group's 100% equity stake in HSBC Bank Canada. HSBC Bank Canada is a very strong business and Canada's leading international bank. The review is at an early stage and no decisions have been made."
Elon Musk is going to buy Twitter Inc. for £44bn after all. According to a filing with the US Securities and Exchange Commission, he wrote to the social media giant on Monday seeking to revive his bid for the company at the original offer price, provided that the Delaware Chancery Court “enter an immediate stay” of Twitter’s lawsuit against him and adjourn the trial scheduled to begin in two weeks. Then in a statement yesterday, Twitter confirmed receipt of the letter, adding: “The intention of the Company is to close the transaction at $54.20 per share”. Musk’s change of heart comes after the Tesla boss asked his 107 million followers to vote on his suggestions for ending the Ukraine war yesterday, suggestions which included global recognition that Crimea was part of Russia. His poll appeared to spark numerous bot (fake account) attacks. Film director Robby Starbuck suggested that perhaps Musk had concluded that “it was worth it to own Twitter, end the censorship and destroy bots at any price”.
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