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Tim Montgomerie

Is Britain losing its sense of fairness?

Has Britain become a freeloader’s paradise, asks the Spectator’s economics editor Michael Simmons in our cover piece this week. Michael analyses ‘the benefits of benefits’, at a time when Britain’s welfare bill is burgeoning and most households are struggling with cost of living. For example, while a family of four can expect to pay £111 to visit the Tower of London, that is just £4 total on Universal Credit (UC), and for London Zoo it is £108 compared to £26. Michael is not arguing against the idea of helping those in need, but pointing out that – as the benefits bill continues to increase – this is another case of

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Ryan Shorthouse

Cutting Britain’s giant welfare bill would be an act of kindness

Does having money really matter that much? There are those, usually with quite a bit of it, who want us to care less about materialism. But, unequivocally, money really does matter – not because of any status it supposedly brings, but for the freedom it buys: freedom to choose how we live and how we look after others. Considering this, it seems that the deep disillusionment with mainstream politicians in recent years stems from a protracted and ongoing period of stagnant living standards over which they have presided. But the truth is that the average person has not got poorer since the global financial crisis. They have got a little

Wednesday

Matthew Lynn

Why Rachel Reeves’ growth plan is doomed

The wait is over. After six months in government, Chancellor Rachel Reeves has decided that today is the day to step forward and pull the big lever marked ‘growth’. In a widely-trailed speech, she has outlined all the different ways her government is going to get the economy moving again. There is just one snag. The lever isn’t attached to anything. In reality, Reeves doesn’t have a clue where growth comes from – and that means her big speech this morning won’t change anything.  Reeves has, at least, finally got round to detailing how she plans to make the UK the fastest-growing economy in the G7. Cynics might wonder why

Tuesday

Rupert Lowe

Rachel Reeves can’t ‘regulate for growth’

The Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) are under pressure to reduce red tape in the financial sector. “We’ve told our regulators they need to regulate for growth, not just for risk,” the Chancellor Rachel Reeves has said. But the idea that tweaking regulations will somehow unlock growth is a fallacy. The idea that tweaking regulations will somehow unlock growth is a fallacy The problem is that these ungoverned and rogue regulators are manned by second-rate lawyers and special interest groups who present their ideas as mainstream. They have never facilitated growth and have created a labyrinth of rules that suffocate the UK’s financial services industry, serving

Katy Balls

Will Labour MPs back Rachel Reeves’s growth plan?

It’s ‘growth week’ in government, as the Chancellor Rachel Reeves attempts to convince sceptical business leaders, bankers and voters that she has a plan to get the economy going. After a dismal start to the year in which bond market jitters saw the cost of government borrowing soar, Reeves is hoping to turn things around with a speech on Wednesday setting out the measures and choices the government is willing to make to drive economic growth. Much of the content is already out there with talk of the government supporting a third runway at Heathrow airport amongst other things. Since the reports first emerged, there have been some grumblings among

Michael Simmons

Is the UK prepared to welcome one million migrants a year?

One million people will migrate to the UK every year this decade. The result: the UK population will grow by nearly five million. Population projections, released by the Office for National Statistics (ONS) this morning, show Britain’s population rising from an estimated 67.6 million now to 72.5 million in the middle of 2032 – driven almost entirely by migration.  Whilst the number of births and deaths will be roughly the same (6.8 million) in the next seven years, ONS statisticians estimate 10 million people will migrate to the UK with only five million due to leave. That will put net migration at 340,000 every year from the middle of 2028. 

Sam Olsen

How DeepSeek can help Britain

Sometimes a new technology comes along that immediately shakes the world. The release this week of the new Chinese artificial intelligence (AI) tool, DeepSeek-R1, is one such moment. Despite Washington’s efforts to restrict Beijing’s development of AI, including an export ban on advanced microchips, researchers in China have created an AI tool that not only exceeds the performance of American AI models like OpenAI’s ChatGPT, but does so at a fraction of the cost. If we are to believe the hype, it took just $6 million (£5 million) to build DeekSeep-R1, compared to more than $100 million (£80 million) for ChatGPT. This is the equivalent of building the fastest Formula

Kate Andrews

Will Rachel Reeves walk the walk on going for growth?

On the face of it, the Chancellor’s big growth speech tomorrow could be one of this government’s most significant interventions yet. If Rachel Reeves is serious about starting the building process for a third runway at Heathrow – she is expected to endorse the idea formally tomorrow – she will be single-handedly overturning more than a decade of Nimby consensus under the Tories that such projects simply were politically impossible to carry out. The same goes for her pledge to finally get some homes built, and to ‘take on regulators, planning processes and opposition’ to the growth consensus. These also seemed like an impossible task for the governments that came

Elliot Leavy

DeepSeek has brought China’s ‘Sputnik moment’

In the years since ChatGPT’s debut, the world of artificial intelligence development has been defined by a single obsession: scale. Companies have raced to build ever-larger models, train on datasets of unimaginable size, and spend billions on the infrastructure required to sustain this rapid growth. The logic has been simple: bigger is better. The pursuit of scale has inflated the industry, driving massive valuations. Nvidia – the shovel and picks provider of this new age – rose to a trillion-dollar valuation fuelled by its GPUs being indispensable for AI development. Over the weekend, Meta announced plans for a data centre spanning half the size of Manhattan, further reinforcing the industry’s commitment

Monday

Louis-Vincent Gave

Has DeepSeek popped the AI bubble?

The arrest of Huawei’s chief financial officer Meng Wanzhou in Canada in 2018, and the ensuing United States ban on high-end semiconductor exports to China, transformed Donald Trump’s “trade war” into a “tech war”. At the time, the US clearly felt it had a comparative advantage in technology, and that if it had to fight a battle against China, then picking tech as the battlefield made good sense. In September 2021, US commerce secretary Gina Raimondo, declared that: “If we really want to slow down China’s rate of innovation, we need to work with Europe”. As a result, Europe was roped into a cold war most European businesses – not

Michael Simmons

Will Chinese AI get the Treasury off the hook?

The launch of the Chinese chatbot DeepSeek has caused turmoil in the markets. The release of China’s newest AI – which appears to work as effectively as programmes developed in the West – saw tech stocks plummet when the market opened today. It hasn’t helped that DeepSeek was made for $6 million: pennies compared to its competition. All assumptions about this technology – the required parts, the assumed costs – have fallen apart and investors are panicking over what was already a muddled future for the development of AI. But in the midst of market turmoil, there is always a degree of stability. As markets lose confidence in emerging tech

Stephen Pollard

Tory Nimbys are walking into Starmer’s trap

The government has yet to formally announce its widely trailed decision to expand Gatwick, Heathrow, and Luton airports. But that hasn’t stopped six MPs from writing to Transport Secretary Heidi Alexander with a pre-emptive attack. The four Green MPs, perhaps, plus a couple of anti-capitalist hard left Labourites? Nope. Four Lib Dems and two Conservatives – one of whom is, astonishingly, Andrew Griffith, the Shadow Business Secretary. The idea of the Shadow Business Secretary campaigning against a core component of economic growth would be funny if it wasn’t so utterly damning Griffith tells Alexander that local residents’ “life is blighted every single day by the noise of take-offs and landings

Cindy Yu

Is Donald Trump warming to Keir Starmer?

16 min listen

Starmer and Trump have finally spoken, with a 45 minute phone call taking place between the two leaders. The pair reportedly discussed the ceasefire in Gaza, and trade and the economy, with Starmer attempting to find common ground by talking up his plans for deregulation. Cindy Yu speaks to Katy Balls and Kate Andrews about their relationship. Do these early signs suggest it will be wholly positive, or are there thornier issues to come?  Also on the podcast, Rachel Reeves is set to deliver a speech this week outlining her plans for growth – just how important is this week for her? Produced by Patrick Gibbons and Cindy Yu.

Matthew Lynn

Britain is on track for a ‘Reeves recession’

Business confidence is falling. Companies are warning that profits will be lower than expected, and they are already planning to cut their output. The Chancellor Rachel Reeves might have hoped that this week would open with better news on the economy, especially as she is planning a major speech to relaunch her plan for growth on Wednesday. Instead, it has started with yet more bad news. In reality, a ‘Reeves recession’ is now a certainty – and the Chancellor won’t be able to escape the blame for that. The CBI reported today that British businesses are braced for a ‘significant fall’ in trading over the next few months. There is

Friday

Matthew Lynn

Two big problems with the Sainsbury’s job cuts

You won’t be able to get a cup of coffee. Nor will you be able to pick up something from the patisserie or the pizza oven. A trip to Sainsbury’s was hardly the most exciting thing in the world, but it is about to get a little bit duller, with the grocery chain set to get rid of its last remaining cafes, as well as speciality counters. And the Labour government is to blame for that. Sainsbury’s had already closed its fresh meat, fish and deli counters, and announced this week that it was closing down the cafes and counters that used to be a regular feature of its stores

Ross Clark

Why are so many MPs still clueless about the cost of net zero?

Donald Trump has withdrawn the United States from the Paris Climate Change Agreement for the second time and reiterated his desire that America should ‘drill, baby drill’. The US president’s decision exposes the naivety of MPs in Britain who, in 2019, nodded through a legal commitment to reaching net zero by 2050, with the hope that it would inspire other countries to follow our example. The Climate and Nature Bill risks taking Britain back to the dark ages In fact, Britain is pretty well alone in voluntarily choosing to ‘leave it in the ground’, as anti-fossil fuel activists like to put it. The US has been following an unashamed policy

Hamish McRae

Why Starmer needs Trump

Do we have to choose between prioritising European or American trade? Let’s hope we don’t, because we need both. But the question has sharpened this week for two reasons. The less important one is that Maros Sefcovic, the EU’s new trade commissioner, has suggested that the UK might join the Pan-Euro-Mediterranean Convention, a group of 23 countries with economic ties to the EU, including Norway and Switzerland, but also Ukraine, Turkey, Israel, Algeria, Morocco, Jordan, Lebanon and so on. It’s not a free trade area or anything like that, merely an agreement to foster trade by streamlining things like rules of origin. Our relationship with the EU will toddle along, but that is

Thursday

Matthew Lynn

Rachel Reeves is getting an expensive lesson in economics

It may prove to be just the first of many screeching U-turns. Whilst hobnobbing among the plutocrats in Davos this week, the Chancellor Rachel Reeves has admitted that she may have to tweak her clamp-down on non doms, to make it less punitive for anyone who isn’t British, and happens to have a bit of money, to live in the UK. Sure, it is good that Reeves is learning from her mistakes. The only trouble is it is going to prove a very expensive education for the rest of us.  It is only a couple of months since Reeves’s Budget introduced tough new rules for non doms, but it already

Dalibor Rohac

The EU’s decarbonisation plan can’t survive Donald Trump

As in a more delirious version of Bill Murray’s Groundhog Day, Donald Trump withdrew from the Paris Climate Accord on his first day in office, again. In a thinly-veiled attempt to mend Beijing’s relations with Europe, Chinese foreign ministry spokesman commented: “Climate change is a common challenge facing all of humanity. No country can stay out of it, and no country can be immune to it.” Whatever their views on climate change, Europeans and British would do well to realise that decades-long effort to reduce emissions through multilateral deals is over. Continuing on one’s own – after America’s explicit repudiation of the COP framework, and in light of the track record

Martin Vander Weyer

Would it be worth Trump buying Greenland?

London’s capital market needs a kick in the pants, as I write every week, and ‘activist investors’ are no bad thing if they provoke sharper corporate performance. The assault by the New York hedge funder Boaz Weinstein on seven UK investment trusts – demanding shareholder votes to replace directors with his own people and take the management of the trusts into his own firm, Saba Capital – looks like the kind of intervention that might bring positive change to the UK’s historic investment trust sector, which accounts for a third of FTSE 250 companies but according to critics offers lacklustre returns, with share prices too often stuck at discounts to

Matthew Lynn

Unmade in Britain: we’re becoming a zero-industrial society

The French sociologist Alain Touraine coined the term ‘post-industrial society’ in 1969. By the 1980s it had become shorthand for the kind of services-based, individualistic economies most major developed nations had created. Today, the UK is moving its economy beyond that. We are creating what might be called a ‘zero-industrial society’. Climate change targets, soaring energy prices and rising taxes on employment are killing off Britain’s small and vibrant industrial base. Last week, Ineos closed its ethanol plant in Grangemouth, Scotland, with its chairman Sir Jim Ratcliffe warning of ‘the extinction of our major industries’. The previous month, Airbus announced it was cutting 500 jobs. In October, JCB cut 230

Wednesday

Ross Clark

Rachel Reeves’ tinkering won’t rescue Britain’s economy

The news just seems to get worse for Rachel Reeves. After the slight relief of last week’s inflation and GDP figures, this morning brings headlines that are even grimmer than economists expected. The government was forced to borrow £17.8 billion in December, more than twice the £6.7 billion which Rishi Sunak’s government borrowed in December 2023. In just one month, taxpayers had to spend £8.3 billion to service the government’s debt. Interest payments are now consuming over 8 per cent of government expenditure – more than is spent on education or defence – and very nearly as much as the welfare bill, which is itself ballooning. The Chancellor’s immediate problem is that