Published: 26 May 2023
By Suzanne Evans, Director, Political Insight
In an interview with Sky News this morning, Chancellor Jeremy Hunt said he is comfortable with Britain being plunged into recession if that's what it takes to bring down inflation. In response to a question from Ed Conway, he argued “inflation is a source of instability” which needed to be tackled to reduce the risk of recession. He added that there “is nothing automatic about bringing down inflation” which is why the Bank of England had his full backing if it hiked interest rates to around 5.5%.
British retail sales rose by more than expected last month, with volumes over the three months to April growing by the most since mid-2021, according to data released by the Office for National Statistics this morning. Sales volumes in April rose by 0.5% from March, when they fell by 1.2% as unusually heavy rain kept shoppers at home, the official statistics body said, showing resilience in consumer spending despite the surge in inflation. Jewellers, sports retailers and department stores had an especially good month, while fuel sales dropped despite lower prices, the ONS added. Food sales were also down again, by an annual 2.7%, as food inflation reached a record high, and retail sales volumes are currently 3% lower than a year earlier.
Train passengers have faced record levels of disruption over the last twelve months, with more than train journeys cancelled than ever before, the Office for Road and Rail (ORR) says. For April 2022 to March 2023 the “cancellations score for the latest year was 3.8%, the highest since the time series began,” it said. There have been months of strikes across the rail network, and more than 40,000 rail services were cancelled across Britain in the latest quarter alone.
The Gambling Commission has fined Paddy Power and Betfair £490,000 for sending promotional push notifications to customers who had signed up to exclude themselves either via the online self-exclusion service Gamstop, or with the companies directly. Gambling operators are supposed to remove anyone who signs up to Gamstop from their marketing databases within two days, under the conditions of British gambling licences. Ian Brown, CEO of Flutter in the UK and Ireland, which owns both Paddy Powerr and Betfair, said: “Flutter’s ambition is to lead the industry in safer gambling, and we apologise for this mistake. The push notification in question was sent in error and, once discovered by our team, we took immediate steps to rectify the issue and proactively notified the Gambling Commission”.
Eli Lilly has paused plans to build a new base in London, saying that while ‘it believes in “the UK’s biotech talent,” and that it shares Britain’s “ambition to be a life sciences superpower,” “the stifling commercial environment does not invite inward investment at this time”. “The UK needs to do more to reward scientific discovery through access to innovative medicines to speed up clinical research and regulatory processes,” the US drugs giant added. Eli Lilly already has a UK headquarters in Basingstoke in Hampshire and a research centre in Bracknell, Berkshire. The Daily Mail notes the criticism comes after statements in February by Pascal Soriot, CEO of AstraZeneca, who said a “discouraging” tax system was behind that big pharma decision to build a £330million factory in Ireland rather than the UK. Sir Jim Ratcliffe, founder of chemicals group Ineos, has also warned the UK windfall tax on energy producers, which imposes an effective tax rate of 75% on profits made from the North Sea, risked squeezing the sector ‘to death’.
Asda owners the Issa brothers and petrol giant EG are said to be close to finalising their £10bn merger, with Sky News saying there will be an announcement at some point today. The deal will create a cluster of 170,000 employees and revenues of £30bn, and see the group operate nearly 1,400 outlets split between a range of supermarkets, petrol stations and convenience stores.
Capita has been selected as the preferred bidder to deliver a new service designed to assess how much people should be paid in benefits. The contracts are worth a combined £565m between 2024 and 2029, with an option to extend for a further two years, and involve delivery of the ‘functional assessment service’ (FAS) in the Midlands and Wales for the Department for Work and Pensions (DWP), and in Northern Ireland for the Department for Communities (DfC). Existing assessment services for disabled people and people with health conditions will now be grouped under a single provider in each geographical region. Capita will assess Personal Independence Payments (PIP), Employment and Support Allowance (ESA) and Universal Credit (UC), as well as a number of specialist benefits. In the Midlands and Wales, Capita will partner with Maximus, the assessment provider responsible for Health and Disability Assessment Services (HDAS) since 2015.
Pets At Home has reported record full year revenue of £1.4bn, a 6.6% rise, mostly thanks to increased food sales and a stronger performance from within its veterinary services division.
The founder of Starling Bank, Anne Boden, will step down as CEO at the end of June, going out on a high as the bank has just reported record annual profits of £195m for the year to the end of March 2023, a sixfold increase on the previous year’s figure of £32m. She will remain on the board as a non-executive director. In a statement, Starling said the hunt for a replacement CEO had begun, and that Starling COO John Mountain will take over temporarily.
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