Published: 08 February 2024
By Suzanne Evans, Director, Political Insight
Labour Leader Sir Keir Starmer is expected to announce today that he is scrapping his Green Prosperity Plan, which had pledged spending of £28bn a year on investments in green technology. The policy was announced in 2021, and the cash was intended to turbo-charge Britain’s transition to ‘clean energy’ by 2030, if the party wins the next General Election, which is expected to be towards the end of this year. However, Starmer’s party has watered down the pledge of late, saying the spending target would be met only in the second half of a first Labour parliament, rather than immediately. Shadow business secretary Jonathan Reynolds has also expressed doubt about whether “we can get there” on the numbers, and Shadow chief Treasury secretary Darren Jones has said the figure is dependent upon “the state of the economy”. Last week, Shadow Chancellor Rachel Reeves refused to commit to the sum ten times in an interview with Sky News. Green campaigners, trade unions, and even Labour’s own MPs are now lining up to attack the U-turn. Barry Gardiner MP, a former shadow environment secretary, told the BBC Radio 4 Today programme: "It's economically illiterate, it's environmentally irresponsible and it's politically jejune," while on the same programme, Shaun Spiers from the Green Alliance, said: “The certainty the private sector’s been looking for… has been damaged”. Meanwhile, Labour's biggest union backer, Unite, said: "This latest Starmer U-turn represents yet another capitulation to right-wing interests.” Carla Denyer, co-leader of the Green Party, said: "This is a massive backward step - for the climate, for the economy and for good quality jobs”. Chief Secretary to the Treasury Laura Trott said: "This is a serious moment which confirms Labour have no plan for the UK, creating uncertainty for business and our economy”. It is understood that while Labour will ditch the main spending target, it will commit to other policies in the Green Prosperity Plan, including creating a publicly-owned green power company.
A £200m Government proposal to shake-up NHS dental health services has been dismissed by industry bodies who say it will not tackle the fundamental problems with the service. An estimated 12m Britons are unable to access affordable NHS treatment, and the new proposal came just two days after TV news reports showed hundreds of people queueing for three consecutive days to register as NHS patients at a dental practice in Bristol. The Government's "Dental Recovery Plan" proposes paying NHS dentists £15-50 per patient to treat 1m people who’ve not seen a dentist in two or more years. 240 dentists will also be offered one-time payments of £20,000 for working in underserved areas, or "dental deserts," for up to three years. However, The British Dental Association (BDA) said the plan as "unworthy of its title", as the higher fees would benefit only around a tenth of NHS dentists and that the money allocated was simply being recycled from existing funding. The BDA said the main problem was the "dental contract" that dentists have with the NHS, which fails to distinguish between the complexity of treatments, leading to many practices running at a loss, and dentists leaving the NHS. This plan “won't halt the exodus from the workforce or offer hope to millions struggling to access care," Shawn Charlwood, chair of the BDA General Dental Practice Committee, said.
The Bank of England (BoE) says the Financial Conduct Authority’s (FCA) probe into potentially unfair commission charged on customers for car finance is not expected to undermine banks’ financial stability, but “clearly does have the potential to become a quite significant conduct issue with potentially quite significant financial ramifications," Reuters reports. Analysts have said that banks caught up in the FCA’s investigation could face a redress bill totalling billions of pounds.
Britain’s first privately financed nuclear power station is to be built in Teesside on the site of a former chemical works, using four small modular reactors (SMRs), the Telegraph says. The scheme is intended to produce 1.5 gigawatts of power, enough for up to 2m homes, and come on stream by 2030. For the first time ever, the State is not contributing to the cost. Community Nuclear Power, the company behind the project, said it has reached an agreement with US manufacturer Westinghouse to supply the reactors. The so-called ‘mini reactors’, which are also being built by British engineer Rolls-Royce, were championed by Boris Johnson during his time as Prime Minister, he saw them as a way of generating cheap, clean power at scale. SMRs are much smaller than conventional nuclear reactors and be built in factories rather than being assembled on site, thereby lowering costs and manufacturing time.
The Competition and Markets Authority (CMA) has launched an investigation into Aviva's acquisition of AIG's life insurance business to assess whether the deal could result in "a substantial lessening of competition". The antitrust regulator has also provisionally cleared Turkish domestic appliances maker Arcelik's proposed purchase of Whirlpool's appliances business in Europe, saying the deal was unlikely to reduce competition for domestic appliances.
British American Tobacco (BAT) has reported a £15.7bn loss for its 2023 financial year, having made a profit of £10.52bn the year before. However, the firm said its ‘new categories’ division, mostly vaping products, has become profitable two years ahead of schedule. BAT is aiming to generate half of its revenue from non-combustibles by 2035.
Sky News says that parcel delivery firm Yodel is lining up administrators from Teneo as hopes of a rescue deal fade. Yodel makes deliveries for some of retails’ biggest names, including Very, John Lewis, Argos, Zara and AO World. The heavily-indebted firm is owned by the Barclay family and needs a cash injection within the next two weeks to survive. Yodel has only ever made a profit during Covid lockdowns, which boosted online shopping.
Sainsbury’s announced £1bn cost-cutting and growth plan yesterday that will see the supermarket chain adopt a “food first” focus that will reduce other goods it sells, such as homewares and clothing, and move more standalone Argos outlets into its stores. Only 15% of Sainsbury’s sells its full range of currently, the FTSE 100 company said. It also plans to invest £70m into its electric vehicle charging network, and open around 75 new Sainsbury’s local convenience stores nationwide. Sainsbury’s refused to rule out job cuts when asked by journalists.
ABI Electronics has been awarded a second record-breaking contract in the space of one month by the Royal Bahrain Air Force. The contract involves exclusive electronic repair and reverse engineering technologies to extend the service life of critical systems including avionics, ground equipment, radar and communication, and special weapon systems.
Three Oxford graduates who started a software business while studying at university are in line for a payday of up to $100m (£79m) each after it was snapped up by a US competitor, the Telegraph reports. The founders of Onfido, a UK start-up that develops ID-checking tools for companies such as Revolut, will receive the payout following a $650m sale of the business to American rival Entrust. Entrust, which is valued at more than $17.5bn, confirmed yesterday that it was in advanced talks to acquire the British business. The deal values Onfido, whose investors also include Microsoft, Salesforce, US fund TPG and UK-listed investor Augmentum, at around $650m. Husayn Kassai, Eamon Jubbawy and Ruhul Amin – who are all in their 30s – own around 15% of the company between them. Dozens of staff members will also be handed millions of pounds, and Oxford University is in line for a payout because it became an early shareholder.
The former Chancellor, Home Secretary and Health Secretary Sir Sajid Javid is being sounded out for the job of Chairman at Standard Chartered bank, according to the Financial Times. Sir Charles Roxburgh, who served as second permanent secretary in charge of financial services from 2016 to 2022 is also said to be in the running.
US ride-hailing app behemoth Uber has posted its first ever full-year profit. The San Francisco-based company reported a profit of £870m for 2023, having made a loss of £1.4bn the year before. Total revenue for the group, including its food delivery service Uber Eats, was up 17% year-on-year to £37bn.
Germany has “reinforced its status as ‘the sick man of Europe’ as the once-mighty industrial sector clocked up its longest downturn since the aftermath of reunification three decades ago,” the Daily Mail says. Official data shows output fell a further 1.6% in December, the seventh monthly slump in a row, marking the longest downturn for German industry since the early 1990s. Production is now 10% below pre-Covid levels, a state of affairs driven largely by Germany’s heavy reliance on Russian gas. When Russian President Vladimir Putin turned off the taps in retaliation to sanctions introduced after Russia’s invasion of Ukraine in February 2022, German energy costs soared. The Germany economy shrank 0.3% last year – the worst performance in the G7.
China has seen prices fall at their steepest rate since 2009, mostly because of plummeting food prices, which fell 5.9% year-on-year. Susannah Streeter, head of money and markets at Hargreaves Lansdown, says: “While inflation is still an unruly force central banks are attempting to tame in many nations, China is grappling with its evil twin. Deflation”. China’s consumer price index has also fallen by 0.8% compared to a year earlier, and Beijing’s policies also mean the country is mired in a property slump, “affecting wealth perceptions and making consumers more cautious about spending big,” Streeter added.
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