Published: 11 January 2023
By Suzanne Evans, Director, Political Insight
Ambulance workers, including paramedics and dedicated call handlers, are on strike again today, however, the advice is still to call 999 if you are seriously ill or your condition is life-threatening. The NHS 111 service is not affected and open for non-emergency calls. Almost all secondary schools in Scotland are also closed today because of a teachers’ strike.
Conservative MP Andrew Griffith, the economic secretary to the Treasury, yesterday told the Treasury Committee that the Government is still committed to making the UK a global cryptocurrency hub – as outlined by PM Rishi Sunak in April last year - despite recent extensive turmoil in and reputational damage to the crypto sector. Griffith said the aim was to embrace the disruptive technology behind crypto assets. "The UK government's objective is to continue to seek for the UK to be the home of well-regulated technologically advanced financial systems, and that there is absolutely room for this new technology within that," he said, adding: "We want to ensure consumers have the right information by legislating for financial promotions for crypto assets (which) will give consumers additional protection over and above what is already out there,” he added. He also announced production of a consultation document about the regulation of the crypto asset sector in general and in conjunction with the Bank of England about a sovereign UK central bank digital currency (CBDC). However, he said the introduction of a UK CBDC was not a given. "The consultation is going to say this is an if and not a when. We are not fully into the inevitability of doing this," he said, given that a digital pound raised many public policy issues. At the same committee hearing, Andrew Griffith also said that a review of banking rulesintroduced after the 2008 financial crisis to hold bankers accountable for risky decisions, would be at the top of his “to do” list this year. Bankers say the rules are burdensome, causing delays in regulatory approval for the appointment of senior executives, and that they are holding back the City of London, but Griffith downplayed the likelihood of radical changes in proposed reforms. "Our approach to this is to be cautious, to take a prudent approach. Let's be very clear, there is no race to the bottom, no bonfire of controls here," he said. The reforms do not "dismantle or dismember the core objectives of the ring-fencing regime", Griffith added.
The number of companies listing on the London Stock Exchange (LSE) more than halved last year as capital raised plunged 90 per cent, the Daily Mail reports. Economic uncertainty, high inflation and rising interest ratesdiscouraged some companies from going public, according to analysts at EY. The accounting giant said just 45 companies listed on the LSE’s main and junior markets in 2022, a 62% decline from the 119 recorded in a bumper 2021. The report also found that just £1.6bn was raised in total from initial public offerings (IPOs) in 2022, down from a record £16.3bn in 2021. The number of companies going public globally also dropped by 45% to 1,333 and the total value declined by 61% to $180bn (£148bn) compared to 2021, EY said.
The London Metal Exchange (LME) said yesterday it will set out by the end of March how it will implement recommendations to prevent market distortions and improve risk monitoring after a review into the nickel crisis last year. “Months after turbulence highlighted shortcomings in LME oversight, the nickel contract remains broken, and volumes and liquidity are sliding, leaving the nickel industry without a global reference price,” Reuters says. Disorderly trade in nickel as a consequence of Russia’s invasion of Ukraine culminated on 8th March 2022, when prices doubled to above $100,000 a tonne in a matter of hours. The LME – the world’s largest and oldest metals forum – responded by annulling all nickel trades that day, and suspended the market for the first time since 1988, moves for which it is now facing legal action.
The Financial Conduct Authority (FCA) has fined the UK subsidiary of Nigeria's Guaranty Trust Bank £7.6m for “further failures in its anti-money laundering systems and controls”. The financial watchdog said it found "serious weaknesses" in systems aimed at preventing money laundering between October 2014 and July 2019. The FCA had already fined the bank £525,000 in August 2013 for anti-money laundering failings. As GT did not dispute the FCA’s findings and agreed to settle, it qualified for a 30% discount on the fine, which would otherwise have amounted to £11m. The FCA found no instances of suspected money laundering at the bank.
Wizz Air is ending all flights in and out of Cardiff Airport from 25th January. The budget airline suspended its winter flights in August over running costs and has now cited the economic climate as the reason for this decision. All Cardiff-based employees will be offered redeployment opportunities at Wizz Air's two other UK bases, London Gatwick and London Luton, MD Marion Geoffroy said. The Welsh government, which owns the airport, described the move as "surprising". Welsh Conservative Leader Andrew RT Daviessaid this was "yet another blow to the taxpayer-owned Cardiff Airport." He told the BBC that the money spent on the airport since the Welsh government bought it "could have gone towards sorting out the A&E crisis in the Welsh NHS". Welsh Liberal Democrat leader Jane Dodds said serious questions now needed to be answered about Labour's strategy for the future of the airport. "With a bill of £210m since the Welsh government purchased the airport and no sign of things improving, taxpayers will rightly be asking what value for money they are getting."
Insurance company Direct Line said this morning it was cancelling its final dividend for 2022 after taking a hit from claims related to severe cold weather and increases in motor inflation. The announcement has sent shares tumbling 28% at the time of writing. Direct Line expects claims associated with the cold snap to be around £90m across Home and Commercial, which, together with subsidence related claims over the summer means that it currently expects total weather claims of around £140m for 2022, versus its previous expectations of £73m.
German discount store Aldi has been named the UK's cheapest supermarket in 2022, according to a new ranking by consumer group Which? German rival Lidl came a close second, as measured against the cost of an average basket of groceries over the year. Waitrose was the most expensive supermarket, Which? said.
Smiths News - which distributes newspapers and magazines to retailers - has secured a new contract with Telegraph Media Group, one of its largest clients. London-listed Smiths said yesterday that the contract represented 11% of its newspaper and magazine revenues; runs until 2029; and covers all of Smiths News' current distribution territories in the UK. CEO Jon Buntingsaid the deal marked "a further step in securing our newspaper and magazine revenues for the long term".
British fund manager Terry Smith, whose Fundsmith investment vehicle is Unilever's 15th biggest shareholder, has accused the consumer goods giant of "virtue signalling" with its ethically-focused marketing while continuing to ignore his fund's advice on the need to improve performance. The company had "clearly lost the plot" in feeling like it "has to define the purpose of Hellmann's mayonnaise," he wrote in a letter to the Unilever board. He also noted that it had recently added activist investor Nelson Peltz, known for reshaping corporate C-suites, to its board. "Based on our experience, we tend to get ignored, whereas an activist who has held shares for fewer months than we have held in years gets invited to board meetings," Smith wrote. "I don’t know how long Trian held its stake before Mr Peltz was invited to join the board or how big that stake was, but I would guess that they held it for far fewer months than we have held it in terms of years." However Smith also said he had "no objection to Mr Peltz’s involvement" and did not want a board seat.
In a speech in Sweden on Tuesday, US Federal Reserve Chair Jerome Powell cautioned that institutions such as the central bank must 'resist the temptation' to try and tackle social issues such as climate change. “Taking on new goals, however worthy, such as climate or social policy, without a clear statutory mandate would undermine the case for our independence,” he said, adding that while the Fed's regulatory powers give it a 'narrow' role to ensure financial institutions 'appropriately manage' the risks they face from climate change, 'we are not, and will not be, a 'climate policymaker.'' 'Without explicit congressional legislation, it would be inappropriate for us to use our monetary policy or supervisory tools to promote a greener economy or to achieve other climate-based goals,' Powell concluded. Although his commends are not new, The Daily Mail notes they have been restated just as the Republican Party has installed one of its members as Speaker of the House of Representatives, and begins selecting new chairs for the committees that oversee federal government operations, including the Federal Reserve. Republicans led by Florida Representative Byron Donalds are launching an attack on the growing use of environmental, social and governance (ESG) principles by federal agencies, and attempting to prevent them promoting green energy or 'woke causes' in the same way that investment firms such as BlackRock are basing investment decisions on ESG principles. Ten states have withdrawn billions of dollars in funds from the asset management giant, including Florida. The state's Chief Financial Officer Jimmy Patronis said: “Using our cash... to fund BlackRock's social-engineering project isn't something Florida ever signed up for. It's got nothing to do with maximizing returns, and is the opposite of what an asset manager is paid to do.”
Ukraine has exported almost 23.6 million tonnes of wheat, corn, and barleyso far in the 2022/23 season, down from the 33.5 million tonnes exported at the same stage of the previous season, the country’s agriculture ministry data shows. After an almost six-month blockade caused by the Russian invasion, three Ukrainian Black Sea ports were unblocked at the end of July under a deal between Moscow and Kyiv brokered by the United Nations and Turkey, Reuters reports. The government has said that Ukraine could harvest only some 51 million tonnes of grain this year, down from a record 86 million tonnes in 2021, because of the loss of land to Russian forces and lower yields.
LVMH Chairman and CEO Bernard Arnault has extended his family's involvement in his luxury goods empire by putting his daughter Delphine in charge of Christian Dior in a management revamp. LVMH has also replaced long-time Louis Vuitton CEO Michael Burke with Pietro Beccari, head of Dior since 2018. Arnault recently took the title of the world’s richest man from Elon Musk.
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