Published: 06 March 2023
By Suzanne Evans, Director, Political Insight
The ambulance strikes that were due to take place in England on Monday and Wednesday this week have been called off. The Unite union has suspended the industrial action to enter pay talks with the government, it said.
Jeremy Hunt is expected to extend support for household energy bills by an extra three months beyond April, until the end of June, confirming a story reported by the Times on Friday. The announcement is expected to be made in the Spring Budget on 15th March. Wholesale prices are expected to fall over the three months from April to June, meaning the government’s guarantee will no longer be necessary beyond after that period, the newspaper said, citing a Whitehall source. At the moment, subsidies are scheduled to be scaled back from next month, meaning average annual bills would rise from £2,500 to £3,000.
MPs have slammed proposals to reimburse fraud victims, describing the Payment Systems Regulator’s (PSR), current plans, which involve banks and building societies having to fully reimburse victims of authorised push payment fraud where the loss is over £100, as “half-baked”. Last month the House of Commons’ Sub-Committee on Financial Services Regulations questioned why fraud under £100 would not be refunded too, and queried the regulators definition of consumers who show ‘gross negligence,’ who will not be reimbursed in most cases. In a response published on Saturday, the PSR said 24% of all authorised push payment scams were for transactions less than £100, and that it was aligning the figure with the minimum reimbursement level for credit card fraud, last updated in 1983. As far as ‘gross negligence’ was concerned, the PSR said the meaning will be clarified as complaints to be arbitrated by the Financial Ombudsman Service. Commenting on the correspondence, chair of the Committee Harriet Baldwin said:“fraud is on the rise and our constituents are being robbed.”
City A.M. reports that The Financial Conduct Authority (FCA) has announced plans to begin an “enforcement” investigation into what “conduct and systems and controls” were in place at the London Metal Exchange (LME) during last year’s nickel crisis. Between the start of last year and 8th March, when the exchange suspended nickel trading for a week and cancelled £3.3bn worth of trades following a a price surge which saw the metal trading above $100,000 per tonne – an all-time high – and one the LME argued no longer reflected the metal’s underlying market value. The spike was fuelled by a failed short bet from Tsingshan – the world’s largest stainless steel producer – which was overpowered by fears of sanctions on mega producer Russia following the invasion of Ukraine. Separately, the Bank of England has confirmed plans to name an independent monitor for the LME – following its own review of LME Clear, the exchange’s clearing house. The review revealed “several shortcomings across LME Clear’s governance, management and risk management capabilities”. It said: “LME Clear will need to strengthen its governance arrangements, increase independence in management and governance at the CCP, and improve on its wider risk management.”
City A.M. has an exclusive claiming that tech and fintech industry chiefs have met with some of the City’s top pension funds as part of plans to create a UK “sovereign wealth fund” that could help unleash a wave of funding into the UK’s tech startups. The meeting, convened by the Lord Mayor of London Nicholas Lyons at the end of January, included top pension firms Phoenix, Aviva and L&G together with fintech industry body Innovate Finance and big four accountancy firm EY to discuss pooling institutional capital in a £50bn private-sector led fund.
The UK’s service sector bounced back to growth in February as business optimism improved and activity expanded at the fastest pace since June. The S&P Global/CIPS UK services PMI survey showed a reading of 53.5 in February, up from 48.7 in January and slightly ahead of market expectations. Any score above 50 is considered growth while a reading below indicates the economy is shrinking. It marks the first time since August that business activity and incoming new work both expanded.
UK food and drink exports reached record highs in 2022 according to the Food and Drink Federation. Exports were worth £24.8bn, with exports to Europe up 22% to £13.7bn. For the first time, exports to non-EU countries broke through the £10bn barrier, now worth £11.1bn.
The government's food tsar has blamed Britain's "weird supermarket culture" for shortages of salad vegetables, the BBC reports. Henry Dimbleby – who founded the Leon chain - said "fixed-price contracts" between supermarkets and suppliers meant that when food is scarce, some producers sell less to the UK and more elsewhere in Europe. As an example of "market failure", Dimbleby said lettuce prices in supermarkets were kept stable, regardless of whether there was a shortage or over supply. He said this meant farmers could not sell all their produce when they had too much - or be incentivised to grow more. "If there's bad weather across Europe, because there's a scarcity, supermarkets put their prices up - but not in the UK. And therefore at the margin, the suppliers will supply to France, Germany, Ukraine," he told the Guardian newspaper. However, Andrew Opie, director of food and sustainability at the British Retail Consortium (BRC), which represents UK supermarkets, said retailers were "pragmatists and recognise they need to pay more when costs are high and product is short". "They're working with growers every day," he added, saying regulation for supermarkets in many European countries meant retailers there were "able to, and actually required" to pass on extra costs to customers.
Beleaguered social housing investor Home REIT revealed that two of its tenants had gone into administration this morning, meaning another 18% of its annual rent roll has gone. In an update on the London Stock Exchange, Home REIT said that Lotus Sanctuary – its biggest single tenant – and Gen Liv had both entered into a creditors’ voluntary liquidation in the past week. Lotus made up 12.5 per cent of the company’s annual rent roll, while Gen Liv 5.7 per cent of the firm’s annual rental income. The former FTSE 250 investment trust revealed that it had collected just 23% of its rent roll in an update last month, and that its property portfolio requires between £15-£20m to refurbish. Home REIT said in a statement: “The company is in discussions with prospective tenants to take on new leases of Gen Liv UK CIC’s and Lotus Sanctuary CIC’s portfolios and it should be noted that whilst discussions with prospective tenants are ongoing, arrangements have been made for existing care and support services to continue, to ensure that there is no impact on underlying residents.” “No resident will lose their accommodation as a result of the above creditors’ voluntary liquidations,” it added.
Lloyds Pharmacy has launched a “strategic review of its entire UK store base,” fuelling worries for 1,300 sites supporting 17,000 jobs. According to reports in The Sun on Friday, Aurelius Group, the private equity owner of the chemist, is considering selling or closing all of its pharmacies, having already announced it will close all 237 of its sites within Sainsbury’s branches. The chain closed over 76 stores in 2022.
Bloomberg says housebuilder Vistry has told hundreds of employees they may lose their jobs, citing people with knowledge of the plans. Reductions are expected to be in the region of 200 out of a 5000-strong workforce, with up to 19 job cuts in each of its business units. It is understood the firm has begun redundancy consultations, but no final decisions have been made. Vistry announced in September 2022 that it had agreed to buy Countryside Partnerships for £1.25bn. Although Bloomberg put the 200 job cuts down to cost-cutting amid a slowdown in the housing market, Vistry did say at the time that the merger would involve a restructuring and that "the total number of roles" would be reduced by "approximately 4%".
Outsourcing giant Capita has agreed the sale of its resourcing wing for £21m, as it continues to cut debt. The company has offloaded Capita Resourcing, HR Solutions and ThirtyThree to Inspirit Capital, and will take in £17m for the agreement.
Cambridge-based technology firm Arm said on Friday it will pursue a US-only stock market listing this year, dealing a blow to the UK markets. The plans from the company, owned by Japanese investment giant SoftBank, come despite heavy lobbying by successive prime ministers and cabinet members, City A.M. says. Arm did however indicate it could still look at an additional UK listing in the future but provided no further details. Arm, which designs chips used in almost every smartphone, stressed that it will continue to expand and invest in the UK.
Scottish bakery Morton's Rolls is understood to have ceased trading after missing a deadline to file accounts. In a letter to staff on Friday, the firm wrote that employees would be "laid off with immediate effect,” the BBC reports. The Glasgow-based bakery, which employs around 250 people, said that "no final decision" had been taken on redundancies, but all jobs were at risk. "The directors have taken steps to ensure that the business can continue in some form.,” the letter, said, adding that “it is likely that this will be with a reduced workforce across the business."
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