Published: 18 April 2023
By Suzanne Evans, Director, Political Insight
Chancellor Jeremy Hunt has this morning hailed figures released by the Office for National Statistics (ONS) showing the jobs market defying any economic slowdown, as employment rose from 75.7% to 75.8% in the three months to February, and the number of employees on payroll rose by 31,000 in March 2023, to reach 986,000 above its pre-covid lockdown level. Hunt also noted that unemployment is “close to historic lows” despite the official figures showing the rate nudging up from 3.7% to 3.8% in the three months to February, and despite the statistics showing real-terms wages are still tumbling - after taking inflation into account, average pay including bonuses fell by 3% in the year to December 2022 to February 2023, or 2.3% excluding bonuses. Long-term sickness has also hit a new record high - up around 422,000 since before Covid lockdowns. Other ONS stats released this morning include:
· Economic inactivity being 21.1% in the period
· Around 220,000 more people were seeking work than in the previous period
· Total actual weekly hours worked 1.051bn in December 2022 to February 2023, up 15.8m on the previous 3 months and just 1.7m below pre-Covid levels.
· 1.105 million job vacancies on average across January to March 2023, down 47,000 on the previous quarter, as employers continue to cite economic pressures.
Employment minister Guy Opperman said: “Helping more people into work will deliver on our priority to halve inflation and grow the economy, while tackling labour shortages…Today’s figures are encouraging, and I remain focused on supporting those on the lowest incomes to progress in work and build a steady and sustainable future”.
Prime minister Rishi Sunak is under investigation by The House of Commons Standards Commissioner over his possible failure to declare a relevant interest in relation to the shares his wife Akshata Murty holds in a childcare agency that will be boosted by the Spring Budget. Sunak has faced questions over not mentioning his wife’s links to the firm, Koru Kids, when questioned by MPs on his childcare policies during an appearance at the liaison committee last month. The PM has reportedly written to the chairman of the liaison committee, Sir Bernard Jenkins, in light of the “media coverage” and said: “This interest has rightly been declared to the Cabinet Office.” A No 10 spokeswoman responded: “We are happy to assist the commissioner to clarify how this has been transparently declared as a ministerial interest.”
Tech and industry bodies have praised Prime Minister Rishi Sunak’s plans to transform the UK’s approach to maths education. “Founders regularly tell us sourcing people with the right tech skills is a critical challenge to growth,” Camilla de Coverly Veale, from the Coalition for a Digital Economy (Coadec), said. “We have to tackle this challenge from different angles and at different stages in the talent pipeline – so this new focus is very welcome”. James Watkins of the London Chamber of Commerce and Industry (LCCI) also told City A.M. he is “pleased” the PM’s commitment on maths to age 18 for all English pupils was still on the agenda. “London desperately needs a skills system that works for businesses and learners alike and for this we need to develop flexible and agile training programmes,” he said. However, Matthew Lesh, from the Institute of Economic Affairs (IEA), warned against “forcing disinterested students” into balancing quadratic equations. “Extending compulsory maths education is no silver bullet for economic growth,” he said. “The UK has some of the top universities in the world yet has experienced stagnant growth for the last decade…Prosperity requires creating the right institutional environment for entrepreneurship, not dictating curriculums from the top.” The National Education Union’s joint general secretary Mary Bousted said there were not enough teachers to deliver Sunak’s “laudable aim”.
Encrypted messaging services have called jointly for changes to the Online Safety Bill (OSB). The bosses of WhatsApp, Session, Signal, Element, Threema, Viber, the Oxen Privacy Tech Foundation and Wire have all signed a letter asking the government to "urgently rethink" the proposed law, which they believe could undermine end-to-end encryption, in which only the sender and intended recipient can read the message information. "Weakening encryption, undermining privacy and introducing the mass surveillance of people's private communications is not the way forward," their open letter warns, adding that in its current form, the OSB "opens the door to routine, general and indiscriminate surveillance of personal messages". It states that the Bill "poses an unprecedented threat to the privacy, safety and security of every UK citizen and the people with whom they communicate around the world, while emboldening hostile governments who may seek to draft copycat laws". Ministers want to force the platforms to monitor users, to root out child abuse images, with a spokesperson saying: "We support strong encryption, but this cannot come at the cost of public safety”. "The Online Safety Bill in no way represents a ban on end-to-end encryption, nor will it require services to weaken encryption," they added. However, in the open letter, the tech bosses suggests that the truth “is that this is not possible".
Conservative Party MPs have warned that powerful regulators are operating “largely unchecked” and holding back the UK’s economy, “directly hindering” the country’s growth prospects. The backbench Regulatory Reform Group (RRG) has called for increased parliamentary oversight of the UK’s regulators – from water and energy watchdogs Ofwat and Ofgem to banking supervisor the Financial Conduct Authority (FCA). Hitchin and Harpenden MP Bim Afolami, who founded the group in November 2022, said: “Unaccountable regulators are directly hindering the UK’s growth prospects. Regulators have the potential to be key drivers of the government’s long-term ambitions for the UK, not to mention enablers of economic growth, but without adequate oversight from parliament, this potential has been lost.”
The BBC reports that the Government’s plans to regulate artificial intelligence (AI) with new guidelines on "responsible use" have been criticised by the Trades Union Congress (TUC), which says it will "dilute" existing worker protections, threaten jobs, and potentially be discriminatory. AI-powered technologies are now making "high-risk, life changing" decisions about workers' lives including line-managing, hiring and firing staff", the TUC said, adding that it is already being used to analyse facial expressions, tone of voice and accents to assess candidates' suitability for roles, which may disadvantage candidates or employees with certain disabilities. AI could "set unrealistic targets that then result in workers being put in dangerous situations that impact negatively on their both physical health and mental wellbeing," the TUC warns. The government white paper on AI offers only "vague" and "flimsy" guidance to regulators on how to ensure AI is used ethically at work, "and no additional capacity or resource to cope with rising demand," the TUC says.
Ofgem has announced fresh safeguards relating to the forced instillation of pre-payment meters, saying energy suppliers must give struggling customers more chance to clear their debts before forcibly switching them. New rules outlined by the regulator will also see forced instalment banned in the homes of customers aged over 85, and those with severe illnesses will also be exempt from forced switching when behind on payments. Fitting was halted after agents for British Gas were exposed breaking into the homes of vulnerable customers in an undercover investigation by The Times which sparked a public outcry.
The strike by junior doctors last week led to more than 196,000 hospital appointments being cancelled, NHS figures show. The total included more than 20,000 operations and treatments. The rest were appointments, tests and check-ups. The number of cancellations is the greatest so far in the ongoing NHS pay dispute.
The British Insurance Brokers’ Association, which represents 1,800 insurance brokers and intermediaries, confirmed last night it had ripped up its Confederation of British Industry (CBI) membership card after rape and sexual abuse allegations involving senior staff emerged earlier this month. Former director general Tony Danker was sacked last week after he apologised for his conduct, which included sending a barrage of unwanted messages to a female colleague; and City of London police are investigating various claims, include those who have seen three members of CBI staff suspended.
The owners of the AA are reportedly exploring the sale of a large stake in the breakdown recovery service two years after taking it private. According to Sky News, Towerbrook Capital Partners and Warburg Pincus have hired investment bank Goldman Sachs to advise them on a potential deal.It was understood that a transaction could involve them offloading a stake to a third-party investor, resulting in the three shareholders owning the company equally. The AA has nearly 13 million roadside customers and 2m insurance customers, making it one of the biggest financial services businesses in Britain. It struggled for years under an enormous debt pile, and eventually agreed to be bought by Towerbrook and Warburg Pincus in a deal which valued its equity at less than £250m. Although it has not been confirmed what valuation they intend to seek, one analyst said it could now be more than £2.5bn including debt. The AA’s closest rival, the RAC, did a similar deal in 2021, when its then owners CVC Capital Partners and the Singaporean state fund GIC, brought in private equity firm Silver Lake. Sky also said an eventual separation of the breakdown recovery and insurance arms is also considered a long-term possibility. However, formal talks are yet to begin.
The one-millionth 3-door MINI has rolled off the production line at BMW’s Oxford plant.
Barclays is reportedly cutting another 100 roles in its investment banking group amid a continued slowdown in dealmaking and capital-markets businesses. Barclays cut around 200 roles from the same division in November.
Online consumer brands retailer THG has confirmed it has received a takeover proposal from private equity firm Apollo Global Management. Responding to press speculation, THG said in a brief statement that there can be no certainty that any firm offer will be made. Under takeover rules, Apollo has until 15th May to either announce a firm intention to make an offer or walk away. THG shares surged nearly 45% yesterday on the news.
Scottish oil and gas engineering giant John Wood Group, meanwhile, has said it will now consider a £1.7bn bid from Apollo, having previously rejected four bids. Takeover rules mean Apollo must make a formal offer or walk away by the close of play on Wednesday.
Apollo itself is also set to open a new office in London, combining its teams in a 88,000 square foot office at 1 Soho Place. The office – which includes a coffee bar, employee dining area and fitness centre – will house more than 400 employees and serve as a regional hub for Apollo’s European team to help to anchor its “global growth strategy”. Apollo CEO Marc Rowan said: “London is a global financial hub where we have assembled a growing, diverse and highly talented team”.
Asda is rolling out a delivery trial using self-driving cars for customers in London. Britain’s third largest grocery store is launching the scheme in partnership with Wayve, a developer of artificial intelligence for self-driving cars, using Jaguar I-Pace electric cars for the trial. Asda said 72,000 households in London would be selected randomly to have their order delivered in this way. Although the vehicles will be driven autonomously during the 12-month trial, an Asda colleague and supervising Wayve safety driver will be present in the vehicle when making deliveries.
Air France and Airbus have been cleared of involuntary manslaughter in a plane crash that led to the deaths of 228 people. French judges laid the blame solely at the feet of the aircraft's three pilots, as investigations into the crash revealed two of them had fallen asleep. Flight AF447 plunged into the Atlantic in 2009 after the pilots failed to manage malfunctioning equipment on the Airbus 330 during a storm. Corporate guilt was "impossible to demonstrate", according to the judgment, principally due to the fact that investigators were unable to establish a "culpable breach" by Airbus or Air France in connection with the piloting faults, the Judges said.
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