Economy

Rachel Reeves is having to borrow more money than even the worst estimates expected. Figures on the public finances, published this morning by the Office for National Statistics (ONS), show that in the financial year to January we borrowed over £118 billion. This is £11.6 billion more than at the same point in the last financial year and is the fourth highest borrowing period since comparable records began in 1993. The Office for Budget Responsibility (OBR) had expected borrowing to be some £13 billion lower by this point in the year. This news puts even more pressure on the Chancellor who, reports now suggest, has blown her fiscal headroom and

Several weeks ago, just in advance of Donald Trump’s second presidency, there was a mass withdrawal of US financial institutions from Mark Carney’s Net Zero Banking Alliance – which committed members to adopt policies of reducing lending to fossil fuel companies and to take other measures aimed at reducing carbon emissions. Are UK banks now preparing the ground to do the same? The senior executives of Barclays and NatWest have decided that they would rather that their annual bonuses were not based on climate targets. Both have removed sustainability metrics from the formulas used to determine the size of their bonuses. Although both banks will still use climate targets in

Kemi Badenoch made a speech today which mentioned the terms ‘liberal’ or ‘liberalism’ seven times before the word ‘conservative’ got a look in. The liberalism she was extolling in her address at the ARC conference in London was not of the leftist kind, but the ‘classic liberalism of free markets, free speech, free enterprise, freedom of religion, the presumption of innocence, the rule of law, and equality under it’. And there is not much to cavil over in that little list. Although when one person’s desired ‘freedom of religion’ impinges on other people’s basic freedom of expression then clearly there are priorities to be ranked. Since the Brexit vote, the

The government says it wants to stop the ‘blockers’ which are holding back Britain’s economy. It also says it wants to boost the nation’s energy security. How convenient, then, that along comes a project which could achieve both at the same time. The only trouble is that it is something which will drive Ed Miliband nuts. Over the next few weeks, it is reported, a little-known oil and gas company, Egdon Resources, will announce that it has discovered 480 billion cubic metres worth of shale gas reserves in a large trough extending westwards of the Lincolnshire town of Gainsborough. Onshore oil and gas is Egdon’s business – it already operates

The Labour government was pinning everything on an ambitious industrial strategy to boost growth. It was meant to make the UK the fastest-growing economy in the G7, reboot the economy, raise real wages and generate all the extra tax revenues that were going to pay for improved public services. The trouble is, there is not much sign of it. First we were told that it would be published in the spring, and now it has emerged that we will have to wait until June to finally see it. It is increasingly hard to avoid the conclusion that it may not actually exist.  Today’s GDP figures will have come as a

Has Rachel Reeves broken her fiscal rules? It’s been speculated for some time now that the Chancellor lost her headroom when borrowing costs surged last month. Capital Economics forecast at the start of the year that Reeves’s limited headroom (about £10 billion) had been wiped out by rising gilt yields. This left the Chancellor in the uncomfortable spot of having to weigh up more tax hikes or serious spending cuts just months after unveiling her first Budget – the kind of tax-hiking Budget she insisted would not be needed again. Today, the news gets worse. The Office for Budget Responsibility has reportedly downgraded its growth forecast for the UK –