Published: 01 June 2023
By Suzanne Evans, Director, Political Insight
Trade deals with Australia and New Zealand came into force at midnight, meaning tariffs on all UK goods exports to the two nations will be removed; access to these markets for services unlocked; and red tape slashed for digital trade and work visas. Business and Trade Secretary Kemi Badenoch said: “Today is a historic moment as our first trade deals to be negotiated post-Brexit come into effect. Businesses up and down the country will now be able to reap the rewards of our status as an independent trading nation and seize new opportunities, driving economic growth, innovation, and higher wages.” To mark the occasion, international trade minister Nigel Huddleston is visiting DHL’s Southern Distribution Centre near Heathrow to see off two handpicked consignments of UK goods. These include Beano comics signed by the comic’s editor John Anderson, Penderyn single malt Welsh whisky, Brighton Gin, The Cambridge Satchel Co. bags and Fever-Tree mixers, which are being sent from the Government to the Australian and New Zealand trade ministers. Holiday and visa requirements have also been relaxed as a result of the deal. From 1st July 2024, Brits will be able to stay in Australia for up to three years without having to meet specified work requirements, and the shared Youth Mobility and Working Holiday Maker visa schemes is being expanded from 1st July this year so the age limit for UK applicants going to Australia is going up from 30 to 35 years old.
The number of houses sold in the UK has fallen by almost a third, HMRC figures show. UK residential transactions fell 32% in April with 67,220 homes sold, 32% lower than April 2022 and 29 per cent lower than the previous month. The tax collector said the drop in sales could be linked to fewer working days due to Easter bank holidays and also the end of the government’s Help To Buy Equity Loan Scheme at the end of March – which offered equity loans to first time buyers. However, Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, put the slump down to concerns surrounding rising interest rates and a fall in the number of home mortgages available. She told City A.M.: “Over the past few days, we have seen a few lenders withdraw selected fixed products, with some pulling out of the market, at least temporarily. Product choice has started to fall, and as may be expected, average fixed mortgage rates are on the rise.” A Reuters poll of economists published yesterday suggested most believe the Bank of England will raise the base rate to 5%. Meanwhile, Nationwide says its figures show UK house prices fell by 3.4% in the year to May, the fastest annual pace for nearly 14 years. The building society is also warning that more rises in mortgage interest rates could hit the housing market. House prices edged down by 0.1% in May itself, the Nationwide said, with the average property price now stands at £260,736. Average prices are still 4% below their August 2022 peak, it added.
Almost two in five Londoners (38%) are commuting more frequently than they were at the start of the year, according to new data from Virgin Media’s O2 Business Mover Index, covering January to March. Wednesday was the capital’s most popular day to commute with 73 per cent of workers traveling into work, followed by Tuesday and Thursday, which saw levels of 66 per cent.
National Express has already seen a 30% jump in travel bookings as a result of this week’s rail strikes, the firm has told City A.M. The long distance bus and coach group, which operates around 1,500 journeys per day in the UK, said: “we are very busy across our UK-wide network” and warned tickets are selling out rapidly.
National Grid is looking to hire two design and consenting service partners and four to six construction partners to help build new overhead lines and substations as part of its £16bn Great Grid Upgrade which aims to ramp up clean energy infrastructure for the growing number of renewable projects across England and Wales. For the supply partnerships, National Grid is initially looking to focus on nine onshore projects – representing around £4.5bn worth of network infrastructure by the end of the decade.
Ofgem has launched an investigation into Drax Group to ascertain whether its biomass-fuelled power station near Selby in North Yorkshire was in breach of annual profiling reporting requirements relating to the Renewables Obligations scheme, and other related matters. Ofgem noted it had not made any findings about possible non-compliance. Drax said: "Like all energy generators, Drax receives regular requests from Ofgem and continues to cooperate fully throughout this process”. It added: “Last year, Drax appointed a third party to independently verify the accuracy of its biomass sustainability and profiling data as part of an ongoing process. Drax is confident in the compliance of its biomass with the renewables obligation criteria." The Renewables Obligation scheme, which is administrated by Ofgem, was introduced in 2002 to encourage generation of electricity from eligible renewable sources in the UK. Electricity suppliers have an annual obligation to present to Ofgem with a specified number of Renewable Obligation Certificates per megawatt hour of electricity supplied to customers during each obligation period.
British water company Pennon has reported an 88% slump in annual profit this morning, saying the dip is the result of extreme weather patterns and increased costs, at a time when customers were grappling with high power bills. Underlying profit before tax for the year ended 31st March came in a £16.8m, compared with £143.5m in the previous year. However, revenue for the period was up 4.1% to £825m.
Entain said it could face a “substantial financial penalty” following investigations into its business practices in Turkey by the Crown Prosecution Service (CPS). The Ladbrokers owner said the offences under investigation at its Turkish facing business, which it held between 2011 and 2017, include breaching the bribery act. The FTSE 100 sports betting and gaming company admitted that “historical misconduct involving former third party suppliers and former employees of the group may have occurred.”
The scandal-hit Confederation of British Industry (CBI) is to appoint a new president, it confirmed in a prospectus, published yesterday. Current incumbent Brian McBride said he would "immediately" start the search for his successor. The process is expected to take the best part of the year, with the transition set to begin "no earlier than January 2024". The CBI also told members it would focus on three core commitments: to "build a leadership team reflecting the organisation's co-created values;" embedded numerous recommendations for change made by legal firm Fox Williams and the Principia Advisory consultancy; and to establish an external culture advisory committee to "steer and challenge" culture renewal. However, the CBI is facing a confidence vote by members, with results due to be published shortly after an extraordinary general meeting on 6th June. Two Government sources, speaking to City A.M., also suggested the distance ministers were now putting between themselves and the organisation was unlikely to change in the immediate term. One said “I don’t think our position will be changing for now” whilst another said the CBI had no “God-given right to be the UK’s premier business organisation.”
Prudential has announced that CFO James Turner has resigned due to an investigation into his conduct relating to "a recent recruitment situation," saying he had fallen short of the "high standards" the group sets itself "on this occasion". The FTSE 100 insurer gave no details of the incident but said it has no implications on the group's financial performance, reporting or operations.
Bodycote CEO Stephen Harris said he had decided to retire from the FTSE 250 heat treatment specialist for the automotive and defence sectors next year, after 15 years in the role.
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