Published: 05 January 2023
By Suzanne Evans, Director, Political Insight
Prime Minister Rishi Sunak set out his five priorities to the next general election in his first speech of the New Year yesterday: to halve inflation; grow the economy; reduce debt; cut NHS waiting lists; and stop small boats full of illegal migrants crossing the channel. His plans will build a stronger country, he said, adding: "Those are the people's priorities. They are your government's priorities. And we will either have achieved them or not ... So, I ask you to judge us on the effort we put in and the results we achieve".
Labour leader Sir Keir Starmer is set to deliver his New Year speech today, and is expected to say that his party “won't be able to spend our way out" of the "mess" left by the Conservatives, while recognising the need for investment. He will promise a "decade of national renewal" if he wins the next general election, but also say that the party won't be "getting its big government chequebook out again," the BBC reports.
The Times said yesterday that Prime Minister Rishi Sunak is poised to announce legislation to curb strikes today. The plan is apparently to enforce "minimum service levels" in six sectors, including the health service, rail, education, fire and border security services, the report said, adding that the laws will require a proportion of union members to continue working to retain a "minimum level" of service. Strikes would be deemed illegal if unions refused to provide the minimum level of service, the newspaper quoted a government source involved in the discussions as saying, and will give employers the right to sue unions and sack staff.
Following his meeting with business leaders yesterday, Chancellor Jeremy Hunt is to set out next week how he intends to scale back subsidies for businesses' soaring energy costs, having described the current programme as "unsustainably expensive". He is said to have warned yesterday that any future subsidies would be smaller. "No government can permanently shield businesses from this energy price shock," the Treasury said in a statement. The current six-month programme, which runs until the end of March, was predicted to cost £18.4bn when the Office for Budget Responsibility published forecasts in November. Although oil and gas prices have fallen back to around the same level as a year ago, they are still several times higher than in early 2021.
Meanwhile, a fall in wholesale gas prices is likely to lower the average household energy bill by £500 a year in the second half of 2023, according to wealth management firm Investec, which predicts the energy price cap will fall to £2,640 in July.
Media Secretary Michelle Donelan has scrapped plans to sell Channel 4 in favour of giving the broadcaster more commercial flexibility to help underpin its long-term future, according to a leaked letter published by The News Agents podcast. "After reviewing the business case, I have concluded that pursuing a sale at this point is not the right decision and there are better ways to secure C4C's sustainability and that of the independent production sector," she said in the letter addressed to Prime Minister Rishi Sunak. A spokesperson for the Department of Culture, Media and Sport (DCMS) said they would not comment on the leaked letter. Channel 4 is government owned, but funded by advertising. Former prime minister Boris Johnson announced the potential sale in April 2022.
Mortgage approvals fell to their lowest level since June 2020 in November, decreasing to 46,075 from 58,997 in October, according to the latest money and credit statistics from the Bank of England (BoE). Meanwhile, approvals for remortgaging with a different lender fell to 32,500 in November from 51,300 in October, and were below the previous six-month average of 48,100. Gross mortgage lending fell from £27.7bn in October to £25.7bn in November, while gross repayments dropped from £25.8bn to £21.6bn. Separate figures from the BoE revealed consumers borrowed an additional £1.5bn in consumer credit, on net, above the £700m borrowed in October — driven by an additional £1.2bn of credit card borrowing.
The Society of Motor Manufacturers and Traders (SMMT) said its preliminary figures indicate that British new car registrations fell 2% to 1.61 million units last year, about 700,000 units below the pre-pandemic total hit in 2019. However, SMMT CEO Mike Hawes said despite rising inflation and a cost-of-living crisis hitting British consumers, the group was "reasonably confident" in its 2023 growth forecast of 15%, given pent-up demand and easing of global supply chain difficulties which include the end of punitive Covid restrictions in China. The trade body also said fully electric, or battery electric, vehicles (BEVs) made up 16.6% of sales in 2022, up from 11.6% in 2021. However, charging infrastructure is not being built quickly enough to cope with growing demand, the SMMT warned. The top selling cars of 2022 were 1) Nissan Qashqai, 2) Vauxhall Corsa, and 3) Tesla Model Y.
Shopper numbers in December rose 5.8% from November and were up 9.9% compared to 2021 despite the impact of the cost-of-living crisis and national rail strikes, research company Springboard says. The gap to pre-pandemic levels also narrowed, with December footfall being 10.9% below 2019 levels, compared to 11.4% gap in November. Springboard noted that footfall was 10.3% higher in shopping centres and 3.6% higher in retail parks, and suggested this was because of a shift away from the high street in response to the rail strikes, as they are more accessible by car.
Increasing numbers of retailers are now charging shoppers to return items bought online a report in the Telegraph says. The newspaper cites as examples Mountain Warehouse – which charges £2 per order; THG, which charges £2.99, and Moss Bros, which offers the choice of a free Royal Mailservice or payment of £2.99 for a courier to pick up the item. Zara and Boohoo introduced charges to send back items last year. According to return management specialist ReBound, one in three fashion items bought online are sent back, around double the rate of shop-bought goods.
Retailer Wilko has secured a £40m funding lifeline from Hilco UK, one of the high street's most prolific investors, Sky News reports, citing a loan deal filed at Companies House late last month. Last year Wilco warned it could run out of cash. Wilko employs roughly 15,000 people and trades across the UK from about 400 stores. Founded as a hardware store in 1930, it specialises in homewares and garden-related products and is one of Britain's biggest family-owned businesses. Hilco UK owns Homebase and Cath Kidston.
300 workers at Amazon’s Coventry warehouse who are members of the GMB trade union are to strike on 25th January. The US tech giant said it was offering "competitive pay," and that operations will continue as normal at the warehouse, with no impact on customers.
Meanwhile, Amazon says it is to cut 18,000 jobs worldwide, the biggest round of layoffs in the company's history. In a note to employees, CEO Andy Jassy confirmed that the e-commerce giant's brick-and-mortar stores – including Amazon Fresh and Amazon Go – will be especially impacted by the cuts, and that those working in human resources may also be vulnerable as the workforce is reduced. The layoff decisions will be detailed from 18th January. The cuts amount to 6% of the company's roughly 300,000-person corporate workforce. Amazon had already stopped hiring new staff and stopped some of its warehouse expansions, warning it had over-hired during the pandemic. It has also shut some parts of its business, and cancelled projects such as a personal delivery robot.
Sainsbury's has put up pay again for 127,000 hourly paid workers, to at least £11 an hour from February, including for its staff working at Argos. Pay will increase from £10.25 to £11 per hour outside of London, and from £11.30 to £11.95 per hour in the capital. Sainsbury's said the latest rise takes the increase for frontline, hourly paid staff to 10% in the last year and 38% over six years, adding that the move will cost it £185m, which will be financed by cost savings in other areas of the business.
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