Liz Truss’s bid to ‘go for growth’ by slashing big business taxes will fail, study warns

Liz Truss’s bid to “go for growth” by slashing taxes on big business profits has failed in the past and will fail again, a leading think tank is warning.

Rob Merrick www.independent.co.uk

The plan to scrap a hike in corporation tax ignores the harsh lessons of recent history – when investment stagnated despite ultra-low rates – and is not even favoured by business leaders, the Institute for Public Policy Research (IPPR) is arguing.

Instead, it calls for a strategy stretching beyond tax to boost investment and productivity by tackling chronic problems in housing, energy, transport, skills and childcare.

“Slashing corporation tax is just a continuation of a failed race to the bottom that hasn’t delivered for the UK economy,” said George Dibb, head of the Centre for Economic Justice at the IPPR.

“Tax cuts are not a magic bullet to increase investment and growth – in fact, despite having some of the lowest levels of corporate taxation, business investment in the UK is the lowest in the G7.

“If the government were serious about boosting investment, it would be listening to businesses who want a serious economic strategy to support growth, boost innovation, and increase our low productivity.”

Friday’s mini-budget is expected to fulfil Ms Truss’s campaign pledge to axe the corporation tax hike, as one of a clutch of policies that will benefit the better off.

The levy is due to rise from 19p to 25p next April, after former chancellor Rishi Sunak reversed years of Tory economic faith by accepting the low rate was failing to fire up business investment.

The analysis by the IPPR has found that – even with the 19p rate, by far the lowest of the G7 leading economies – the UK fell behind its rivals in the investment race.

In 2019, it slipped behind Italy and Canada to have the lowest private sector investment in the G7 as a proportion of gross domestic product (GDP), the left-leaning think tank said.

The following year, the UK ranked a miserable 28th out of a 31-strong group of developed countries which are members of the Organisation for Economic Co-operation and Development.

Mr Dibb added: “We’re not just falling behind the largest economies either, the UK is consistently in the worst performers in the OECD club of 38 developed economies.”

He criticised a belief that a government “can cut tax and deregulate its way to growth, which has failed before” – contrasting it with Joe Biden’s “whole-government” approach.

A “chop-and-change” approach – which had seen government adopt five strategies in just eight years – was also confusing businesses and undermining UK economic credibility, Mr Dibb said.

The mini-budget is also expected to see taxes cut in a string of “investment zones”, where businesses may also be able to ignore some environmental regulations.

But a near-identical policy pursued by George Osborne after 2010 – when they were called “enterprise zones” – also failed to spur growth in economically left behind areas.

Jacob Rees-Mogg’s imperial measurements consultation ‘biased’ after no option given to say no

“This isn’t a Brexit freedom. It’s a nonsense.” Conservative MP

It was meant to be one of the sure-fire wins for Brexit, but plans to bring back imperial measurements face criticism over claims of a biased government review.

Jon Ungoed-Thomas www.theguardian.com

Ministers were keen to launch a review to revive imperial measurements – such as pounds and ounces – and the Department for Business, Energy and Industrial Strategy (BEIS), now overseen by Jacob Rees-Mogg, conducted a government consultation over the summer. However, the questions appeared to have something missing.

The survey asked consumers: “If you had a choice, would you want to purchase items: i) in imperial units ii) in imperial units alongside a metric equivalent.”

No other option was given.

Officials said respondents who wanted to keep the current metric system could send in an email to the department or give their views in one of the text boxes in the survey.

The BBC Radio 4 programme More or Less last week highlighted concerns about the survey and criticism of it on social media.

One Twitter user commented: “This survey is being punted out by BEIS. It is so slanted that the words nearly slide off the page.”

Dr Pamela Campanelli, a consultant on survey methods who has advised local government, told More or Less: “This is missing the category that you would prefer metric only. We’re going to get a biased answer, because people have to choose something that doesn’t apply to them.

“It seems like they’re actually trying to sculpt or lead the responses towards what they want, because they want people to go back to imperial.”

France adopted a metric system in the late 18th century, and a Decimalisation Assocation was founded in Britain in 1841 to lobby for a new system for currency and measurements. A report by a standards commission in the 1860s recommended metrication for Britain, but it was another 100 years before a government board was set up in 1969 to promote and coordinate metrication.

Once Britain joined the European Economic Community in 1973, the government committed to adopting the metric system. Regulations introduced in 1995 required goods to be sold in metric units in the UK.

In a high profile case in 2002, five market traders – know as the “metric martyrs” – lost their court battle for a right to trade in pounds and ounces. The battle was supported by celebrities including the comedian John Cleese and politicians including Boris Johnson.

Rees-Mogg, who had a cabinet role to identify Brexit opportunities, has been a long-term supporter of using imperial measurements. The proposed change is however unlikely to be hailed as a significant Brexit dividend.

“Not one constituent, ever, has asked for this,” Conservative MP Alicia Kearns tweeted earlier this year. “This isn’t a Brexit freedom. It’s a nonsense.”

BEIS officials say the purpose of the consultation was to examine how greater choice could be given to businesses and consumers. The government has not yet said when the response to the consultation will be published.

Landowners to urge environment secretary to stick with rewilding pledges

As Jayawardena (the new Secretary of State for Environment, Food and Rural Affairs) announced his new role by visiting an intensive chicken farm and made little mention of nature, instead focusing on food security.

Says it all! – Owl

Helena Horton www.theguardian.com

The head of Natural England and the chair of England’s largest landowners’ organisation are to meet the new environment secretary to urge him not to scrap or water down rewilding schemes.

Tony Juniper, who will meet Ranil Jayawardena along with the CLA chair Mark Tufnell on Tuesday, pointed out that swathes of prime land were being used for golf courses, housing and other infrastructure but political focus was on the small amount that would be rewilded.

There has been concern that the new government might roll back nature recovery schemes put in place by the previous administration, in which landowners and farmers are paid for improving nature.

The business secretary, Jacob Rees-Mogg, is said to have pushed back against the schemes, while Jayawardena announced his new role by visiting an intensive chicken farm and made little mention of nature, instead focusing on food security.

Speaking at the Gathering nature festival at Wild Ken Hill in north Norfolk, Juniper said: “Some of [this prime land] is under golf courses, so it is not only nature and other things.”

He said alongside food security “we also need to catch carbon, we also need to avoid flood risk. We also need to have places for healthy outdoor enjoyment and recreation, we need land for biodiversity and nature recovery, you need land for water infrastructure, and housing.

“There’s probably more housing going on land with high agricultural value than there is rewilding projects. And all of this stuff needs to be on the table at once.”

Tufnell, whose organisation represents 33,000 landowners, added that he hoped the new administration would listen to them, and that they realised nature recovery was the future.

He said: “We are meeting the secretary of state on Tuesday, and I will be asking the same questions that we have debated this morning. We do need to accelerate environment land management and we need to see a recovery in nature. It’s a totally false narrative that you can have food or you can have nature. You have to have both, and it’s perfectly possible.”

Some at the event were concerned that the government would try to cut the schemes. Lee Schofield, a senior site manager at RSPB Haweswater, said: “I am very concerned, so I’m not sure what else to say. It’s terrifying. And we just have to hope that what they may try to enact does not get through the checks and balances that are in place to stop us going backwards.”

Some conservationists are more optimistic about the prospect of nature recovery as they believe Liz Truss’s government may not be around for long – so might not be able to cause much damage to the schemes even if it wanted to.

Jake Fiennes, the head of conservation at the Holkham national nature reserve and author of Land Healer, said: “We have a government that potentially is only going to be around for 18 months. We have set this ball rolling. There’s environmental restoration already in place that is happening. I think that actually we are on a trajectory, and I think this momentum is not going to stop.”

Others agree; Benedict Macdonald, who works with landowners to rewild with the Real Wild Estates Company, said his clients disagreed with anti-nature comments from government figures.

He said: “The backlash against this government, especially from the landowners and farmers, will be from them saying: ‘Why are you standing in the way of me doing better things and handing down sustainable land to my children?’ And that’s a very powerful thing that I don’t think 18 months of government is going to sink.”

Juniper said: “I don’t see any reason why we need to be making any departures from those policies at the moment. I look forward to working with ministers on finding the very best ways forward during the months and years ahead.”

Poorest will be just 63p a month better off under Liz Truss national insurance cut

Britain’s poorest three million households will be as little as 63p a month better off under Liz Truss’s plans to cut national insurance contributions, while the richest will benefit by £150, according to economic analysis.

What a way to blow £30bn. – Owl

Matt Dathan www.thetimes.co.uk 

Kwasi Kwarteng, the chancellor, is expected to make good on the prime minister’s pledge to scrap the increase in national insurance contributions in a mini budget on Friday.

Reversing the 1.25 per cent rise, which was only implemented in April, will be among a range of measures intended to stimulate economic growth and is expected to take effect as early as November.

Tom Waters, a senior research economist at the IFS, said people earning more than £100,000 would benefit the most, adding that there were more progressive ways to cut taxes, such as raising the threshold at which workers pay the basic rate of income tax. Kwarteng is said to be more persuaded towards cutting income tax by 1p rather than raising the threshold, which would still benefit the middle classes more than those on the minimum wage.

The move would bring forward plans announced by the government earlier this year to cut 1p off income tax from 2024, while Goldman Sachs, the US investment bank, said it is expecting Kwarteng to go further by cutting 2p from basic rate income tax.

A final decision has not been taken, it is understood, while a reduction in the basic rate could be deferred until a formal budget, expected in November.

The chancellor is also expected to create 12 special investment zones across the UK that could offer workers a significant discount in employer national insurance contributions for staff employed within the zones. He will use Friday’s “fiscal event” to freeze corporation tax, with the total package of tax cuts expected to cost between £30 billion and £50 billion.

The Times revealed on Saturday that Kwarteng is reviewing fiscal rules that require debt to fall as a proportion of national income in 2024-25 in order to make way for the massive tax cuts.

There is also expected to be a package of deregulation to stimulate a “big bang 2.0”, which could include removing the cap on bankers’ bonuses, slashing environmental protections that have historically made it hard to build on certain types of land, and scrapping plans to prevent supermarkets advertising buy one get one free-type multibuy deals on junk food as part of the government’s obesity strategy.

However, analysis of Truss’s existing plans to cut NICs by the Institute for Fiscal Studies has revealed the extent to which the move will disproportionately benefit richer households compared to the poorest.

The richest tenth of households, who earn an average of £108,000, will save £1,800 on their annual tax bill, equivalent to £150 per month. In contrast, the poorest ten per cent of households, who on average earn £12,000, will save just £7.66 on their annual tax bill, which works out at just 63p per month or 14p per week.

Those in households with the average UK household income of £31,400 will save about £250 per year, or £20 per month. Households with an income of £55,000 will save about £700 per year, which is £58 per month, while households on £23,000 will benefit by about £73 per month, according to the IFS analysis.

Tom Waters, senior research economist at the IFS, said that while tax cuts would always benefit richer households over the poorest, there were fairer ways in which Truss could cut taxes.

He said: “Reversing the recent NICs rise would tend to benefit richer households more than poorer ones, even as a share of their income; the richest 10th, for example, would gain about £1,800 per year, or 1.7 per cent of their income, and the poorest tenth about £7 per year, less than 0.1 per cent of their income.

“That’s partly just a natural consequence of the existing tax system: those towards the bottom of the income distribution don’t pay much in direct taxes, and so it’s hard to cut taxes in a way that makes a big difference to them.

“That said, there are more progressive ways to cut tax — raising the income tax personal allowance, for example, which is currently due to be frozen in cash terms until March 2025. Tax cuts along these lines, including a NICs cut, would of course strengthen incentives for people to move into work.”

Tony Wilson, director of the Institute for Employment Studies, said the plans were a “tax giveaway to relatively high earners” and warned that they risked higher inflation. He said: “The worry that the Bank of England and Treasury officials will be that the move is more inflationary than a more targeted subsidy or tax cut at those on lower incomes. “Another £600 in the pocket of higher earners is likely to lead to more discretionary spending.

Wilson urged the Treasury to spend billions of pounds that was set aside but unused during the pandemic to stave off long-term unemployment, which never transpired, in order to attract tens of thousands of over-50s back into employment. Many over-50s left the labour market during or after the pandemic but are not counted as unemployed because they are not actively seeking work.

The Treasury only spent about £1.3 billion of the £2 billion set aside for the Kickstart programme, and the £1.3 billion it saved from the projected £2.7 billion it committed to the Restart programme – both designed to get people back into work.

He said: “There are other things we can do on policy to make our labour market work better and if we don’t get more people in the labour market, other decisions, such as tax cuts, will be counter-productive.

“One thing the government could do is reinvest the £10 billion set aside during the pandemic to stave off long-term unemployment that never transpired.”

No10 and the Treasury have said Friday’s “fiscal event” will be focussed on how to create economic growth. Kwarteng is “prepared to be bold” and “prepared to have the argument,” sources said, adding that the UK can “no longer carry on fighting over what’s left of the pie, which hasn’t been growing at all over the last few years”.

Their ambition is to “grow the pie for the prosperity of the country”. The mini budget is designed to deliver Truss’s pledges during the Conservative leadership election over the summer, with a full, formal budget planned for November, which will be accompanied by the usual forecasts by the Office for Budget Responsibility, the spending watchdog.

More on the South West Water “just add lemon” fine

Total Costs tot up to £300,000

From the Western Morning News

South West Water has been ordered to pay almost £300,000 in fines and costs for supplying unfit drinking water in Devon.

The Exeter-based company admitted one in charge in a prosecution brought by the Drinking Water Inspectorate.

South West Water apologised for what it described as an “isolated incident” in 2018 and said it was caused by a naturally occurring algal bloom on Exmoor’s Wistlandpound reservoir, in part due to a hot and dry summer.

The regulator told the court that between June 19 and August 21, 2018, South West Water supplied water that was “unfit for human consumption” at Bratton Fleming and Horedown, near Barnstaple.

Customers at the time reported that the water was discoloured and had an “earthy” or “mouldy” taste. South West Water said it was not harmful to health and told people to chill the water in the fridge or add a slice of lemon to improve the taste.

The company admitted the offence and was fined £233,333 at Plymouth Magistrate’s Court last Tuesday. It was also ordered to pay a victim services surcharge of £170, and costs of £60,320.73, bringing the total penalty to £293,823.73.

A spokesperson for South West Water said after the hearing: “We deeply apologise to our customers affected by this incident in 2018, which was caused by an algal bloom on the reservoir. We accept that unpalatable water, even when safe to drink, is absolutely unacceptable, and this was reflected in our guilty plea at the earliest opportunity. Since then, we have made a number of major investments of up to £1 million to the site to reduce the risks of such events occurring again.”

The company said the problem had not happened again due to the action it took afterwards. The issue was caused by what it called “naturally occurring scientific compounds [algal bloom]” at “unprecedented levels”, caused in part by “an unusually dry and hot summer”.

The water from the reservoir made it through to the local water treatment works and eventually to drinking water supplies. South West Water says it did not impact the safety of the water, but affected the taste and smell which led to customer complaints and an investigation by the Drinking Waters Inspectorate.

The company says that, since 2018, it has made “major interventions and investments in the site”, costing up to £1 million. The measures include installing a large reservoir mixing system in 2019, which it says helps to maintain water quality by keeping the water fully mixed and easier to treat.

The company says it continues to review its drinking water safety plans continuously to assess new risks and to prioritise investment.

The Wistlandpound reservoir has a capacity of 1,550 megalitres and water is taken for treatment to supply customers in Devon, including Ilfracombe and Barnstaple.

The Environment Agency downgraded the company to the lowest rating of one star for its environmental performance in July. Water companies have come under fire from campaigners over water quality in the rivers and seas, including the level of storm overflows of untreated sewage which are legally allowed to prevent flooding after exceptionally heavy downpours.

Another new COVID variant is spreading – here’s what we know about omicron BA.4.6

BA.4.6, a subvariant of the omicron COVID variant which has been quickly gaining traction in the US, is now confirmed to be spreading in the UK.

Manal Mohammed theconversation.com 

The latest briefing document on COVID variants from the UK Health Security Agency (UKHSA) noted that during the week beginning August 14, BA.4.6 accounted for 3.3% of samples in the UK. It has since grown to make up around 9% of sequenced cases.

Similarly, according to the Centers for Disease Control and Prevention, BA.4.6 now accounts for more than 9% of recent cases across the US. The variant has also been identified in several other countries around the world.

So what do we know about BA.4.6, and should we be worried? Let’s take a look at the information we have so far.

BA.4.6 is a descendant of the BA.4 variant of omicron. BA.4 was first detected in January 2022 in South Africa and has since spread around the world alongside the BA.5 variant.

It is not entirely clear how BA.4.6 has emerged, but it’s possible it could be a recombinant variant. Recombination happens when two different variants of SARS-CoV-2 (the virus that causes COVID-19) infect the same person, at the same time.

While BA.4.6 will be similar to BA.4 in many ways, it carries a mutation to the spike protein, a protein on the surface of the virus which allows it to enter our cells. This mutation, R346T, has been seen in other variants and is associated with immune evasion, meaning it helps the virus to escape antibodies acquired from vaccination and prior infection.

Severity, infectiousness and immune evasion

Fortunately, omicron infections generally cause less serious illness, and we’ve seen fewer deaths with omicron than with earlier variants. We would expect this to apply to BA.4.6 too. Indeed, there have been no reports yet that this variant is causing more severe symptoms.

But we also know that omicron subvariants tend to be more transmissible than previous variants. BA.4.6 appears to be even better at evading the immune system than BA.5, the currently dominant variant. Although this information is based on a preprint (a study that is yet to be peer-reviewed), other emerging data supports this.

According to the UKHSA’s briefing, early estimates suggest BA.4.6 has a 6.55% relative fitness advantage over BA.5 in England. This indicates that BA.4.6 replicates more quickly in the early stages of infection and has a higher growth rate than BA.5.

The relative fitness advantage of BA.4.6 is considerably smaller than that of BA.5 over BA.2, which was 45% to 55%.

The University of Oxford has reported that people who had received three doses of Pfizer’s original COVID vaccine produce fewer antibodies in response to BA.4.6 than to BA.4 or BA.5. This is worrying because it suggests that COVID vaccines might be less effective against BA.4.6.

The capacity of BA.4.6 to evade immunity may however be addressed to a degree by the new bivalent boosters, which target omicron specifically, alongside the original strain of SARS-CoV-2. Time will tell.

Meanwhile, one preprint study shows that BA.4.6 evades protection from Evusheld, an antibody therapy designed to protect people who are immunocompromised and don’t respond as well to COVID vaccines.

Vaccination is key

The emergence of BA.4.6 and other new variants is concerning. It shows the virus is still very much with us, and is mutating to find new ways to overcome our immune response from vaccination and previous infections.

We know people who have had COVID previously can contract the virus again, and this has been particularly true of omicron. In some cases, subsequent episodes can be worse.

But vaccination continues to offer good protection against severe disease, and is still the best weapon we have to fight COVID. The recent approval of bivalent boosters is good news. Beyond this, developing multivalent coronavirus vaccines that target multiple variants could provide even more durable protection.

A recent study showed that a multivalent coronavirus vaccine administered through the nose elicited a strong immune response against the original strain of SARS-CoV-2, as well as two variants of concern, in mouse models.

Close monitoring of new variants including BA.4.6 is pressing, as they could lead to the next wave of COVID pandemic. For the public, it will pay to stay cautious, and comply with any public health measures in place to prevent the spread of what remains a very contagious virus.

Individuals taxed according to postcode – Truss plans low regulation “investment zones”

Liz Truss is planning to levy lower tax rates and strip out regulations in certain parts of the country picked by the government.

Readers, you need to get your heads around the implications of this extension to the “freeports” that Boris Johnson announced.

As with freeports these low tax, low regulation investment zones will probably end up relocating, rather than creating, economic activity and jobs. They are unlikely to lead to the sort of growth transformation the Truss Government needs by the election due in January 2025. It’s a beggar my neighbour strategy.

The rules surrounding these zones will be open to “gaming”. They are likely, therefore, to be accompanied by some significant unintended consequences. The ability of the affluent in society to “relocate” by outbidding local people on a whim, is an example. The rise in second homes we see locally is driven by a desire to have a holiday home in more scenic parts of the country. Seeking residency in an area to reduce personal tax liability might provide a similarly strong motive for a second/alternative residence.

If these zones are a natural extension of freeports, consider this.

Dartmoor and the South Hams are already included in the Plymouth freeport area, so obviously would be included in any “Plymouth Investment Zone”.

Is Liz Truss going to replicate the Northern Ireland border issue all over the country as we move in and out of each “investment zone”, between the “low tax regimes” and “high tax regimes”? Sounds divisive to Owl.

Liz Truss to cut taxes in certain parts of the country picked by the government

Jon Stone www.independent.co.uk

Liz Truss is planning to levy lower tax rates and strip out regulations in certain parts of the country picked by the government.

The prime minister is reportedly planning to badge the areas “investment zones” – and will claim that the approach could boost economic growth.

Businesses based in the handpicked regions will be able to ignore some environmental regulations and pay lower rates of tax.

And workers living there could pay personal income taxes and national insurance at reduced rates, the government-supporting Sun On Sunday newspaper reports.

Details of the plans are still said to be being worked out, but an announcement could come as early as chancellor Kwasi Kwarteng‘s emergency budget on Friday.

The plans to apply the tax cuts to particular areas of the country only may raise eyebrows because the government has previously come under fire for playing political favourites.

A previous policy, the Towns Fund, selected areas to benefit from a £1 billion pot of investment – but this was mostly funnelled into Tory areas.

An inquiry by parliament’s spending watchdog, the Public Accounts Committee, concluded last year that the selection process to benefit from the fund was “not impartial” and decisions were “politically motivated”.

39 of the 45 places to receive the first round of funding were represented by Tory MPs.

It is not clear which areas will benefit from the “investment zone” tax cuts or how they will be picked.

Mr Kwarteng, who was appointed by Ms Truss earlier this month, is set to use Friday’s emergency budget to reverse Rishi Sunak’s rises in corporation tax and national insurance contributions.

Other policies are expected to include lifting the cap on bankers bonuses, which limits payouts to twice a banker’s annual salary. The policy was intended to reduce the risk-taking associated with bonuses incentives, and so reduce the risk of another financial crisis.

12 places earmarked for this status

Andrew Sparrow www.theguardian.com carries a bit more detail:

Planning regulations will be relaxed in up to 12 places earmarked for this status, and taxes will be cut to incentivise investment.

The West Midlands, the Thames estuary, the Tees Valley, West Yorkshire and Norfolk are among the places where the new zones might be sited. According to the plans set out by Truss in the summer, in each area there will be a central region, where regulations and planning rules will be eased to encourage industrial, commercial and residential development, and a periphery where the planning rules will be streamlined for housing.

‘It beggars belief’: Liz Truss energy plan ‘shows government doesn’t understand climate crisis’

Liz Truss’s energy plans show the UK has effectively abandoned net-zero targets just three years after its world-leading commitment to cutting emissions, the government’s former chief scientific adviser has said.

Another example of the Tories demonstrating that they don’t see themselves in power for much longer. – Owl

Harry Cockburn www.independent.co.uk 

A major new fossil fuels campaign, including lifting the ban on fracking and expanding drilling for oil and gas in the North Sea, has already been announced by the new prime minister’s administration.

But the drive for more oil and gas production was “completely at odds” with the UK’s legally binding net-zero target, said Sir David King, head of the Climate Crisis Advisory Group, who was chief scientific adviser to the government between 2000 and 2007.

Furthermore, it would bring large quantities of greenhouse gas-emitting fossil fuels to the market directly ahead of the 2050 deadline for reaching zero, he told The Independent.

He said the plans, announced last week by the prime minister’s new energy secretary, Jacob-Rees Mogg, were “extremely alarming”.

“We’re looking at a situation where the crisis is with us here today,” he said. “But we don’t recognise that when we say ‘let’s go ahead and start new fracking operations in this country’.

“It beggars belief. What it seems to show is that the leadership in the government does not understand the nature of the climate crisis.”

Mr Rees-Mogg, who has previously dismissed climate science as “alarmism”, said in a video on his second day in office that “we are lifting the moratorium on fracking. We will extract every ounce of oil and gas from the North Sea.”

During Ms Truss’s leadership campaign, she derided the role that renewable energy increasingly plays in the energy system, in particular solar power, which has become the “cheapest electricity in history”, according to the International Energy Agency (IEA).

But Sir David, who is the founder and chair of the Centre for Climate Repair at Cambridge, warned that the government’s revival of fossil fuels could backfire rapidly.

He said: “I fully agree with what the IEA is saying, which is ‘do not invest in new oil and gas recovery’.

“If we do invest in new oil and gas recovery, it will take a minimum of five years to get to the marketplace and more like 10-15 years, which is the average.

“In which case, they’re not dealing with the current crisis at all, and instead are investing in an operation that is likely to become a stranded asset.

“Quite frankly, it’s a policy that hasn’t been thought through in terms of climate change or in terms of the current climate crisis. It doesn’t attack either [issue].”

His assessment of the government’s position has been echoed by leading campaigning groups.

Doug Parr, Greenpeace UK’s policy director, told The Independent: “Sir David King speaks the truth. Most sensible countries realise that the economically rational course is to drive rapidly for zero emissions, because it boosts the whole economy and tackles the climate crisis and the cost of living crisis in one fell swoop.

“Truss’s current energy plans will do nothing for the economy any time soon, and will in fact create substantial stranded asset risks.

“Further, they accelerate climate breakdown, contributing to the deadly heatwaves and floods we see around the world, and do nothing to impact the soaring costs of energy that will leave households and the national overdraft in trouble for years to come.

“If Truss and Rees-Mogg continue on this course, it begs the question – whose interests are they serving?”

Sir David suggested the leadership of the country was using Russia’s war in Ukraine as an opportunity to expand the use of fossil fuels – even though doing so failed to address either the climate crisis or the energy crisis.

He said: “The immediate consequence of the Russia-Ukraine war is that energy prices have gone shooting up. The response to that [should be] to build more renewable energy – we can use an extension of an already successful operation.

“The opposite is to say ‘let’s use this as an opportunity to develop our oil and gas reserves’ – using the war as an opportunity to do this, knowing it has nothing to do with managing the short-term problems of the war.

“All of that indicates massive cynicism at the top of government. What they’re saying is ‘we’re not going to be in government in 2050, but we don’t believe in the net-zero target’.”

Friends of the Earth’s head of policy, Mike Childs, told The Independent that Sir David was “right to raise the alarm about the government’s enthusiasm for fracking and drilling more gas and oil”.

He said: “At best, it’s difficult to see how this enthusiasm for new fossil fuels is compatible with the prime minister’s commitment to deliver on the UK’s climate targets.

“At worst, it’s a sign that the new government is more interested in placating wealthy fossil fuel lobbyists than it is in tackling the mounting climate emergency and addressing the energy crisis for good.”

Energy experts have repeatedly called on the government to expand support for renewable energy technology and storage, implement a national insulation programme, invest in rolling out more heat pumps and halt investment in fossil fuel programmes.

The Department for Business, Energy and Industrial Strategy did not respond to The Independent’s request for comment.

Climbing the greasy pole – advice for Simon Jupp

According to Vince Cable in his new book “How to be a politician” there are two ways for an ambitious MP to get on:

Make some brilliant eye-catching intervention that gets everyone talking about you.

The other more common route is obsequiousness. 

Looks like you have already chosen your route – Owl

Just seven days in twelve weeks, that’s all Truss thinks we’re worth

Seven days is all the parliamentary time this Tory Government thinks is worth devoting to debating the problems this country is facing. Three of these will be next week to enable Liz Truss to conduct her “special fiscal operation”.

Could it be she wants to avoid scrutiny?

If the planned parliamentary schedule is followed, from 5:30 pm on Thursday July 21 to 2:30 pm on Monday 17 October, the House of Commons will have sat for nine days. These include the two days of special sittings to pay tribute to the late Queen. 

(That’s seven days devoted to running the country in what the rest of us would consider to be twelve working weeks in round numbers)

Meanwhile all the effort seems to be devoted to abstruse debates on subjects only of interest to her right wing such as:

Should she prioritise effort on: cutting taxes, oxford commas, and bankers bonuses.

Or following the deputy Prime Ministers, Thérèse Coffey, edict:

Should she prioritise effort on: cutting taxes, oxford commas and bankers bonuses.

Thumbs up from Thérèse

(Do they know what they are doing? – Owl)

Residents’ parking going up

First rise since 2015

The cost of residents’ parking permits is set to rise under plans revealed by Devon County Council.

Ollie Heptinstall, local democracy reporter www.radioexe.co.uk

If approved, the price of permits will increase to £35 for a property’s first vehicle, a rise of £5. Second permits will then be priced higher depending on the vehicles’ carbon emissions, while extra permits on top of that will cost £65.

All residential permits currently cost £30; a price the council says hasn’t increased since 2015. The price for a business permit for one vehicle is also going up to £35.

Explaining the move, which does not apply to Plymouth and Torbay, the county council said the consumer price index has increased approximately 19.5 per cent since the last rise – more than the planned base permit increase of approximately 17 per cent.

Under the proposed new scheme, which follows a public consultation, the only residential permits that will be priced according to a vehicles’ carbon emissions will be the second one in a household.

They will be £45 for electric and low-emitting vehicles in Band A (less than 100g/km), £55 for Bands B – K (101-225g/km) and £65 for the worst emitting vehicles in Bands L – M (226+ g/km)

A property’s first permit will be £35 irrespective of carbon emissions, as will the £65 price for a third vehicle or any additional ones.

Permits will also be required for motorcycles (first permit £35, second permit £45, extra permits £65).

Once the new scheme has been adopted all future permits will be issued virtually, which the council says will benefit the environment and see a reduction in waste.

It claims the new pricing structure will “positively affect a reduction in consumption of fossil fuels in private vehicles by encouraging the uptake of fuel efficient/low emission vehicles and discouraging multiple car ownership.

“It is hoped more [people] will consider changing the mode of travel or adopt other sustainable modes of travel.”

Other changes to the permit scheme include:

  • Refunds will be issued for part-used virtual permits.
  • Introduction of virtual visitor permits which will be available as an alternative to physical ones.
  • £30 per batch of 350 hours (allocated in 1 hour sessions) for schemes operating at all times (24hr/7days).
  • £30 per batch of 200 hours (allocated in 1 hour sessions) for schemes not operating at all times.
  • Virtual visitor permits will be required for motorcycles.
  • Refunds will be issued for part-used batches of virtual visitor permits.
  • New £10 administrative charge for essential visitor permits.
  • Price for Exmouth (Langerwehe Way) business occupier permits and charity business permits increased to £35 for each permit.
  • Supported living and school business permits introduced at charity business permit rate.
  • Proof will be required for all applications.
  • Exemption for car club vehicles from residents parking restrictions (including limited waiting and pay & display with exemptions for residents permit holders).

A report, due to be presented to a meeting of the cabinet later this month – rescheduled because of the queen’s death – also provides information on how Devon’s system compares to neighbouring local authorities.

Plymouth and Torbay currently charge £30 each for residents permits, with a maximum of two per household, while the prices differ completely in Cornwall and Somerset.

A first Cornish household permit costs £50 and £75 for the second. Only two are allowed per household.

Somerset’s scheme is based on the carbon emissions of vehicles for the first permit. They cost £60 as standard, but are discounted by either 100 or 50 per cent if a vehicle emits less than 100g or 110g/km. Second permits cost a flat fee of £100.

Devon’s ruling cabinet will consider and vote on the changes at a meeting on Monday 26 September.

Bank expected to unveil big rate hike on Thursday

Markets think the Bank of England will unveil the biggest hike in interest rates for over three decades when its decision makers gather for a delayed meeting.

www.newschainonline.com 

The Monetary Policy Committee (MPC) is expected to increase rates by 0.75 percentage points to 2.5%.

It would be the highest interest rate that the UK has had since the financial crisis. In December 2008 the base rate was slashed from 3% to 2%.

It would also be the highest single increase to interest rates since 1989.

Next week’s Bank of England meeting is crucial

“Investors think the most likely outcome is that the MPC will increase the Bank rate by 75bp (0.75 percentage points) on Thursday,” said Samuel Tombs, chief UK economist at Pantheon Macroeconomics.

But he said that economists are expecting a smaller rise, to 2.25% – the same 0.5 percentage point change as the Bank’s last hike.

“For a start, hawkish surprises from the MPC have been far less common than dovish ones over the last year,” he said.

“In addition, Governor Bailey openly referred to a 50bp hike ahead of the August meeting, but has not given markets a nudge to price-in a 75bp hike.

“We think that the MPC still will deem a 50bp increase to be consistent with its pledge to act ‘forcefully’, if it sees signs of more persistent inflationary pressures.”

ING economist James Smith said that the Bank of England will have to react to recent falls in the price of the pound. Sterling hit a new 37-year low against the dollar on Friday.

“Next week’s Bank of England meeting is crucial,” he said.

“It will tell us not only how worried policymakers are about the slide in sterling and other UK markets, but also how the Government’s decision to cap household/business energy prices will translate into monetary policy.”

“We narrowly favour a 50bp hike on Thursday, taking the Bank Rate to 2.25%, although 75bp is clearly on the table and we would expect at least a couple of policymakers to vote for it.”

He said that rates will likely rise again in November and December, hitting 3% by the end of the year.

The decision to hike interest rates is a bid to keep inflation under control. It is the best tool that the Bank of England has to steer inflation – currently at 9.9% – back to its 2% target.

But the decisions will also have major impacts on people’s finances, not least those with mortgages who will need to start paying more for their home loans.

The MPC was originally set to announce its decision on Thursday September 15, but delayed this for a week due to the Queen’s death.

NHS to increase beds to head-off winter hospital crisis

This is reported as costing £24m within the county.

Stand up all those, mostly Conservatives, who backed the closure of the community hospitals. – Owl

Edward Oldfield www.devonlive.com

Plans are being put in place to open more beds at Devon hospitals to head-off a winter healthcare crisis after one of the busiest ever summers for the NHS. An extra £5million is being spent in Plymouth which alongside Cornwall is among the worst in England for ambulance handover delays.

Some of the money will go on 41 extra beds at Derriford Hospital and community hospitals to ease the pressure on the emergency department. In the rest of Devon, £19million is being spent on creating extra capacity in the NHS for the winter. That includes £6million on creating 37 extra beds and spaces at Torbay Hospital, 18 at the Royal Devon & Exeter Hospital, and 11 at North Devon District Hospital in Barnstaple.

The extra £24million has been secured from national funding to tackle the pressure across the NHS in Devon. More patients will be treated at home in so-called ‘virtual wards’, where support from clinical teams is provided remotely through the use of apps, platforms and devices which can monitor pulse, heart rate and breathing.

The £5million project will create three virtual wards covering Plymouth, Torbay and South Devon, and East and North Devon, creating the equivalent of around 75 hospital beds. The first of the schemes will go live in December 2022, and will be scaled up through to March 2024.

Patients will be given a choice of being an inpatient or receiving treatment at home, and their home circumstances and available support will be taken into account.

Devon will see £9.8million invested in the hospital discharge process, including for care hotels, agency support, rehabilitation care and support, and for patients with complex dementia. It includes extra capacity for mental health, on top of £219,000 already allocated for winter pressures.

An extra £900,000 is being invested in the handover of integrated community urgent care services to a new provider, Practice Plus Group, in October.

A communications strategy will focus on persuading people to contact the 111 service before going to an emergency department, take up the flu and Covid vaccines, use pharmacies, and use online services.

A report outlining the measures to Devon County Council said: “Devon’s system remains under sustained pressure due to a range of complex and multi-faceted issues – including the pandemic, increased demand, staff shortages, and vacancy rates in health and adult social care providers.

“The cost-of-living crisis is also impacting on health and social care services, not only for our population and our staff, but also in the care market. Staff nationwide have faced one of their busiest summers ever with record numbers of Emergency Department attendances and ambulance services facing extreme pressures, high demand for social care and mental health services, and the impact of another wave of COVID-19.

“As a result, bed occupancy levels in hospitals are high, people are staying in hospital for longer than they need to, and ambulance handover delays are increasing. Ultimately, it means many patients aren’t getting the care they need in a timely way. The past two years has seen significant pressure upon our urgent and emergency care (UEC) services. The workforce is stretched and exhausted, yet it continues to deal with high levels of demand against a backdrop of constraints which affect our ability to treat people.”

The rise in ambulance handover delays at hospitals has been blamed on shortage of beds and delayed discharges to social care. Figures at the start of September showed that in Plymouth, Exeter and Torbay, around one in 10 beds was occupied by a patient who was fit to leave, but was waiting for care to be arranged. In North Devon the proportion was 27 per cent – more than a quarter. GPs are seeing more patients and more complex needs, with appointments up by 8 per cent in the past year. Meanwhile the vacancy rate in the NHS has increased in line with the national picture. In July, there were more than 4,500 vacancies in health and social care in Devon.

National ambulance data for July showed record calls to the most serious incident, and the highest level of patient handover delays.

Last week a senior doctor warned that the NHS is facing a winter crisis as figures show 1,200 emergency patients in Devon waited more than 12 hours for a bed in August. Dr James Gagg said the latest data from the region’s emergency departments was “shocking”, with large numbers of patients “facing extremely long waiting times”. He called on MPs and councils to acknowledge a “looming crisis” facing the health service in the winter and to “act now before it is too late”.

The NHS in Devon says it is facing a “challenging” budget for this financial year, with a need to find savings of £142million. The county council, which funds social care, was forecast in July to face an overspend of £40million, including £6million on adult social care.

The proposals in the winter winter plan after learning from last year, when the health and care sector faced “severe and sustained pressure” due to an increase in demand and the impact of the pandemic.

HMRC data confirms: Brexit has decimated UK exports

Brexit is hitting the UK export market, according to data from HMRC.

This comes just as Kwasi Kwarteng has told Treasury officials to adapt to a new approach focused on boosting annual economic growth to 2.5 per cent.

One might ask what contribution overall government policies are supposed to play in this dash for growth – Owl

Joe Mellor www.thelondoneconomic.com 

The number of UK businesses exporting goods to the EU fell 33 per cent to 18,357 in 2021, from 27,321 in 2020.

Michelle Dale, a senior manager at accountancy firm UHY Hacker Young, pointed out the fall is due to the extra red tape UK businesses must now comply with when exporting to the EU.

“Businesses are not getting enough support from the Government to navigate the post-Brexit trading minefield,” she said, reports City A.M.

“A lot of SMEs can’t afford professional advice to cope with Brexit-related red tape. Many are likely to have decided trading with the EU is not worth the cost,” Dale added.

“Fewer UK companies exporting to the EU will result in lost opportunities for growth and expansion in Europe.”

EU receives UK’s response to legal threats

Meanwhile, the European Union is considering its next steps after receiving the UK’s response to legal threats over the failure to comply with the post-Brexit Northern Ireland Protocol.

Despite politics as normal being paused while the nation mourns the Queen’s death, the Government responded to the action ahead of Thursday’s deadline.

The bloc had requested a response to its raft of infringement proceedings over the UK’s failure to comply with the rules before the end of the day.

European Commission spokesman Daniel Ferrie said: “I can confirm we have received a reply from the UK. We will now analyse the reply before deciding on the next steps.”

What the UK’s response contained was unclear, but the Government was expected to set out how it believes that no operational changes on how the protocol works are required.

European Commission president Ursula von der Leyen will be in Westminster for the Queen’s funeral on Monday.

It is unclear if she will be meeting Prime Minister Liz Truss while in London, although Ms Truss is expected to hold some talks with political leaders during their visits.

There have been unconfirmed suggestions that Ms Truss will speak to Irish Taoiseach Micheal Martin on the margins of the funeral amid tensions over the protocol.

Redrow revenue hits new record as housebuilder continues London exit

Housebuilder Redrow’s revenue has climbed above pre-Covid-19 levels, as it continues its withdrawal from the London market.

(To concentrate on the regions – Owl)

By: Millie Turner www.cityam.com

Revenue grew 10 per cent to a record £2.14bn in the year to 3 July. While profit before tax hit £246m, down from the £314m, it reported a year prior due to one-time fire safety costs of £164m.

The group is expected to have completely exited the capital’s property market, except the Colindale development in north west London, by the end of the year.

“In addition to the record revenue achieved, the group still ended the year with an order book of £1.44bn,” non-executive chairman Richard Akers said in a statement.

“Excellent progress has been made during the year executing our strategy to grow in the regions. The new Southern business, based in Crawley, officially opened at the end of June but the team has been active in the land market for some time. This division is expected to make a positive contribution to profits in the current financial year.”

The London-listed company, like most housebuilders in the UK, has been boosted by rising house prices and demand.

Charlie Huggins, head of equities at investment firm Wealth Club, cautioned: “Make no mistake – the biggest reason for Redrow’s success is high house prices, and the general strength of the housing market.

“That is something over which it has no control, and the big bad wolf of recession could be about to blow away the good times.”

East Devon: Pervy pub landlord is stripped of his licence after being jailed for sex assaults

A former pub landlord who has been jailed for sexually assaulting women at his bar has been stripped of his licence by East Devon officials.

Local Democracy Reporter eastdevonnews.co.uk 

Peter Hayball had his personal licence revoked and will be unable to reapply until long after his release from prison, writes local democracy reporter Philip Churm.

The decision made by East Devon District Council’s licensing and enforcement sub-committee on Wednesday, August 24 was only disclosed this week (Wednesday, September 7).

Members agreed to revoke Peter Hayball, 56, of his licence after he was jailed in May for 18 months and placed on the sex offenders’ register for 10 years for offences committed between 2016 and 2018.

During the trial, the court heard how Hayball, who was running a pub in Devon at the time, would pull open women tops and push money into their cleavage.

He touched the breasts of at least one woman and was stopped from doing so by another.

Hayball claimed he was just using ‘Carry-On humour”, saying it had been misunderstood as sexual advances and never went beyond a joke.

He was prosecuted on 13 charges relating to four women and was found guilty of three sexual offences.

Independent Councillor for Cranbrook and chair of the licensing sub-committee Kim Bloxham said: “The licensing authority takes matters such as this very seriously.

“All licence holders are required to promote the ‘licensing objectives’ – including maintaining public safety and preventing crime and disorder.

“The committee considered whether the holder of the licence remains a ‘fit and proper’ person to continue to hold a personal licence with these two objectives in mind.

“The committee considers that the revocation of the personal licence on this occasion is a necessary and proportionate decision to ensure that the public remain safe where alcohol is being served, either in East Devon or wherever the holder might be operating in the future.”

All sales of alcohol must be made by, or under the authority of a personal licence holder.

The council’s legal advisor Giles Slater explained the long-term impact of Hayball’s conviction.

“Obviously if he applies for personal licence again, that will come up on his application that he’s debarred for the next 10 years and he will be unable to apply until 2032,” he said.

Mr Slater also said, under the Rehabilitation of Offenders Act, Hayball’s conviction would affect other areas of employment.

“A custodial sentence of 18-months imprisonment means that the rehabilitation for most other jobs is four years from the date on which the sentence is completed. So, he won’t be rehabilitated until 2026.”

New tourism strategy launches for East Devon

A new tourism strategy has been approved by Cabinet.

eastdevon.gov.uk 

people walk on a sandy beach

Beach walking. Image credit: Jay Cross

Building on East Devon District Council’s support for the tourism industry with the EastDevonly campaign, a new tourism strategy has been approved by Cabinet.

The new 5-year strategy aligns with the new East Devon Cultural Strategy and will help the tourism sector to grow sustainably and bring prosperity to the area. The vision is for “East Devon to be the leading, year-round tourism destination in Devon, whose diverse ecosystem of outstanding natural environments, distinctive, high-quality businesses, towns and villages, all thrive and grow through a commitment to Net Zero, accessibility and collaboration”.

Councillor Nick Hookway, East Devon District Council’s Portfolio Holder for Tourism, Leisure, Sport and Culture, said:

I am delighted that this new strategy has been approved by Cabinet as it aligns perfectly with the Council’s vision for a clean and greener future, improved accessibility, good quality employment and higher wages across the area.  Tourism plays an important part of this work and brings many economic and social benefits, helping support our local cultural activities within our vibrant towns, villages and hamlets. 

The tourism strategy builds on the quality of the existing tourism offer and encourages growth through an increased focus on sustainability and inclusivity.

The strategy is based on strong evidence including existing strategies, stakeholder engagement, national analysis and trends. The strategy is achievable but ambitious, identifying a direction, actions and the role for East Devon District Council as an Enabler that will create lasting impact for the area’s tourism sector.

The strategy has already helped shape EDDC’s UK Shared Prosperity Fund Investment Plan.  Next steps include securing tourism data for 2021 to act as a baseline for future measurement and procuring a partner to run an East Devon Tourism Network to facilitate collaboration and sharing of best practice. In addition, the tourism strategy will inform relevant policy within the district’s new Local Plan, due later this year.

Read the full tourism strategy.

Planning applications validated by EDDC for week beginning 29 August

[Apologies for the delay in posting these – Owl]

EU To Bring In Windfall Tax On Energy Firms’ ‘Extraordinary Profits’

We are still waiting for Liz Truss’ and Kwasi Kwarteng’s “special fiscal operation” which will bypass much of the analysis and scrutiny a formal budget gets. – Owl

Alexandra Rogers www.huffingtonpost.co.uk 

The EU is planning to bring in a windfall tax on energy firms so their huge profits can be “shared and channelled to those who need it most”.

Ursula Von der Leyen, the European Commission president, said it was “wrong” for companies to make “extraordinary” profits on the back of consumers and the war in Ukraine.

The move is in stark contrast to the approach taken by Liz Truss, who last week ruled out bringing in a fresh levy on the companies’ excess profits.

The EU is also proposing to cap the revenues of electricity-producing companies that are making extraordinary profits thanks to the war in Ukraine and climate change.

Von der Leyen told the European Parliament in Strasbourg that the proposal could raise 140 billion euro (£121 billion) to help people hit by spiralling energy prices.

During her state of the European Union address, Von der Leyen said: “These companies are making revenues they never accounted for, they never even dreamt of.

“In our social market economy, profits are OK, they are good.

“But in these times it is wrong to receive extraordinary record revenues and profits benefiting from war and on the back of consumers.

“In these times, profits must be shared and channelled to those who need it the most.”

She added: “And because we are in a fossil fuel crisis, the fossil fuel industry has a special duty, too.

“Major oil, gas and coal companies are also making huge profits. So they have to pay a fair share – they have to give a crisis contribution.”

The EU’s intervention is likely to lead to increased calls for a further windfall tax on UK firms.

A windfall tax on the UK’s oil and gas sector introduced on May 26 remains in place but there have been calls from Labour for it to be extended due to the worsening economic situation.

In her first week as prime minister, Truss unveiled a £150 billion package to cap energy bills at £2,500 for the next two years, saving the typical household £1,000 a year.

The policy has been welcomed as a much-needed intervention but the funding of it — through government borrowing — has been criticised by those who do not believe the taxpayer should shoulder the burden.

During prime minister’s questions last week, Truss ssaid she was against a further windfall tax when challenged by Keir Starmer.

“I believe it is the wrong thing to be putting companies off investing in the United Kingdom, just when we need to be growing the economy,” she told the Labour leader.

The 27 member states that make up the EU are also struggling with the cost of living crisis that has taken hold in the UK.

Since the outbreak of Russia’s invasion of Ukraine, EU member states have sought to wean themselves off Moscow’s exports, which in turn has pushed prices up as demand for other supplies intensifies.

Russia has already cut gas supplies partially or entirely to 13 member countries in response to the EU’s decision to impose sanctions of Moscow for its continuing aggression against Ukraine.

In her speech, Von der Leyen said there needed to be a “deep and comprehensive reform of the electricity market” to reduce the influence of natural gas on the way that prices are set.