Economy

For over 20 years, Britain effectively gave up on building new nuclear power stations. But that’s changed now Hinkley Point C in Somerset is under construction. When completed it will provide around 7 per cent of the UK’s electricity. Hinkley Point C is set to be the most expensive nuclear power station ever built. In fact, it is more than four times more expensive on a pound-for-megawatt basis than the average nuclear power plant built in South Korea. Even Flamanville 3, a French plant that uses the same reactor (EPR-1750) and built by the same company (EDF), is set to cost at least 25 per cent less. Why has Hinkley Point C

Imagine that for the past 30 years all food entering Britain from EU countries had been subject to stringent sanitary checks and that today, for the first time, the government had decided to abolish those checks. It isn’t hard to guess how the Labour party would react. The government, it would be claiming, was throwing our farming and horticultural industries to the wall in the name of an ideological commitment to deregulation. Britain was being opened up to infection from devastating diseases like swine fever and foot and mouth disease – all so that the government’s friends in the food import industry could trim a few percent off their costs

Labour’s plan to renationalise the railways is not much of a plan at all. Rather, it is a list of goals: to eliminate ‘fragmentation, waste, bureaucracy’, to ‘bring down costs for taxpayers’ and to ‘drive-up standards for passengers’. All lofty ambitions, all lacking a strategy. What little detail we do have points to significantly more bureaucracy. The party plans to set up two more quangos – Great British Railways and the Passenger Standards Authority – which are unlikely to do much to create the more ‘efficient’ system Labour is promising passengers. Still, the announcement has been popular. And it is likely to stay popular until commuters are forced to reckon

How bad would it be if Royal Mail’s parent company, International Distributions Services (IDS), were to be taken over by the Czech billionaire Daniel Kretinsky? Our historic postal service is heavily lossmaking, struggling to maintain its universal delivery obligation and at war with its unions: a foreign owner would surely take an axe to it. Kretinsky, who owns almost 28 per cent of stockmarket-listed IDS, has gone back on an assurance that he would not try to take the company private and has tabled a £3.1 billion offer – above the group’s current market value but well below what other shareholders think it is worth. He won’t win with this

Rishi Sunak’s announcement that the government will increase defence spending to 2.5 per cent of GDP has been warmly welcomed, but how much is it really going to transform the UK’s military? Former armed services minister James Heappey was quick to scotch expectations this morning when he said it wouldn’t necessarily be enough to reverse falls in the size of the Army, Navy or Royal Air Force – the money could quite easily disappear simply in upgrading equipment. Nor is there anything particularly novel about the Prime Minister’s announcement: Boris Johnson made the same promise – to raise defence spending to 2.5 per cent of GDP by by 2030 – at the

Britain is putting its defence industry on a ‘war-footing’, the Prime Minister has said, as he vowed to boost spending to 2.5 per cent of GDP by 2030. It was only a matter of time that Rishi Sunak made such an announcement. After all, Russia’s invasion of Ukraine illustrated a simple truth: that the world is more dangerous now than for a generation, and nations will need to increase their defence spending if they want to protect themselves and their interests. Grant Shapps, Penny Mordaunt and Tom Tugendhat had all expounded this view from within government, and now it seems the PM has given his seal of approval. The money

Alongside the Prime Minister’s speech on welfare today, the Department for Work and Pensions quietly released updated forecasts. The numbers are stark: DWP expects there to be 3.96 million working-age claimants by 2028-29, a rise from 2.8 million in 2023-24. Meanwhile the number of working-age people receiving disability benefits is forecast to rise to 1.16 million – that’s 160,000 more claimants than was expected just six months ago. These are the numbers Rishi Sunak must grapple with as he sets out his welfare reform agenda.  Back in 2020, then chancellor Rishi Sunak had days to design the furlough scheme. Once lockdown became mandatory in spring 2020, it was a race

Labour, according to Rachel Reeves, is now the party of low taxes. She has said she won’t raise income tax, National Insurance, capital gains tax and corporation tax, as well as ruling out a wealth tax. But that still leaves a few options for jacking up taxes, as one of Reeves’ advisers, Sir Edward Troup has hinted. Last week, Troup, a former head of HMRC, was appointed by Reeves to look at efforts to reduce tax avoidance. This is a slightly ill-timed initiative given that Labour is simultaneously trying to play down the case of a particular taxpayer who stands accused of failing to pay capital gains tax on a

Interest rate cuts are beginning to look like a mirage: the closer we seem to get to them the more they seem to recede into the distance. Bank of England governor Andrew Bailey may have hinted this week that UK rates could soon be cut regardless of what happens in the United States, where strong jobs data is putting off the Federal Reserve from cutting rates, but this morning’s inflation data will not encourage an early cut. While the Consumer Prices Index (CPI) did fall in March, from 3.4 per cent to 3.2 per cent, this was less than the fall which was expected. The rise in road fuel prices

Britain already has the worst post-pandemic workforce recovery in Europe. New figures out today show the problem is getting even worse. The number of those ‘economically inactive’ (not in work or looking for it) rose by a remarkable 150,000 in the last three months to 9.4 million – equivalent to the adult population of Portsmouth and some 850,000 since the first lockdown. Taken as a share of the working-age population, it’s now at an eight-year high – and significantly worse than it was during Covid or its aftermath. What’s driving the worklessness? The biggest single factor is long-term sickness, also at an all-time high. Is this just economic long-Covid, the

The economy grew by 0.1 per cent in February: not much to celebrate on its own but the small uptick in GDP all but confirms that the UK is leaving its recession in 2023. February wasn’t a booming month: services output only grew by 0.1 per cent, with transportation and storage services contributing the most to the sector’s growth (the former seeing its biggest boost since June 2020). The construction sector decreased by 1.9 per cent in volume terms, as the ‘fourth wettest February on record in England’ delayed projects. But a bounceback in production – the ‘largest contributor to the growth in GDP’ that month – provided some balance:

Can flexible working get the best out of what a ministerial press release calls ‘hardworking Brits’ – or is it a couch potato’s charter? As of 6 April, employees have had the right to ask for flexibility – including remote working and hours to suit – from their first day in a job; employers can reject unworkable requests, but are obliged to consider and consult. If you’re an optimist, you’ll think workers whose family lives are accommodated by enlightened employers will be happier, more loyal and more productive: ‘5 a.m. will be the new 9 a.m.,’ declares the HR Director, for parents who choose to ‘tackle work before attending to