Christine Lagarde says governments must address corporation taxation concernsThe managing director of the International Monetary Fund has joined the growing clamour to further tax tech firms Google, Facebook and Amazon as part of a wider review of “outdated†global corporation tax rules.In a speech in Washington, Christine Lagarde said governments must react to growing concerns that digital companies pay little tax in most countries where they operate, which denyies exchequers vital funds for public services and welfare. Continue reading...
Australian treasury yields hit a record low in a grim portent for the economy, while the Nikkei falls 3% in wider share selloffShares in Asia Pacific have slumped after a key market indicator flashed an “amber warning†that the United States could be heading for a recession.Bond yields also continued to fall across the world with Australian 10-year treasury yields falling to a record low on Monday of 1.756% in what analysts see as a strong indicator of a downturn hitting the resource-rich country.Related: The European Union has bigger problems to deal with than BrexitJapan 10Y yields collapse further into negative territory pic.twitter.com/UViHgcb3dSRelated: Donald Trump and Xi Jinping miss a trick over trade | Jeffrey FrankelBond futures: A closely watched measure of the yield curve briefly inverted Friday — with the yield on the 10-year Treasury note falling below... https://t.co/uJKcXpyxN0Aussie yields collapsing - 10 year bond opened below 1.8% for the first time on record, hit record low 1.762%
The next recession will expose the eurozone as a half-baked project in need of leadershipAs the clock has ticked down towards Brexit, the state of the UK has attracted even more attention than normal. Every scrap of official data and every survey of business opinion has been pored over by leavers and remainers alike.Much less attention, understandably enough, has been paid to what is happening in the rest of the European Union, where the recent news has been poor. The frustration of the leaders of the other 27 EU countries towards Theresa May is that Europe has plenty of issues that need addressing, with Brexit not even the most serious of them.Related: As recession looms, could MMT be the unorthodox solution? | Larry ElliottA real solution to Europe’s growth problems means fixing the design flaws in monetary union Continue reading...
Headteachers tell of the damage caused by years of cuts to their capital and maintenance budgetsIn one of the classrooms of Gillotts secondary school in Henley-on-Thames, there is a mysterious, acrid smell. It is a school day but the room is empty because this “awful†scent, a mix of damp and chemicals, clogs children’s throats and clings to the teachers’ hair and clothes long after they go home.“That classroom is shut and unusable because of the smell – and I could really do with that classroom,†said headteacher Catharine Darnton. Her state school has 900 pupils and, like many other heads across the country, she has struggled to maintain her dilapidated building in the face of the government’s austerity cuts. As well as the stink, heating failures and electricity blow-outs have led to partial temporary closures of the school and blocked drains have threatened to leak raw sewage onto the playground. Darnton has been forced to take money intended for the education of students and allocate it to repairs and even capital expenditure. The low point came when, in winter, the building was so cold and dark she had to consider closing the school. “It was insane,†she said.By not maintaining our schools, we are storing up problems and the cost is higher when we have to do it in an emergency. Continue reading...
Avoiding the B word, (no, not Barcelona) will be tricky at the British Chambers of Commerce conference this weekAs aficionados of 1970s situation comedy know well, Basil Fawlty did not support the UK’s entering the “continentâ€, but graciously pledged to make as good a stab at it as he could.“I didn’t vote for it myself, quite honestly, but now that we’re in I’m determined to make it work,†he told a family of unfortunate German visitors staying at his terrible Torquay hotel. That was just after a bump on the head was to have disastrous consequences, causing Fawlty to ignore his own advice and repeatedly mention the war to his guests. Continue reading...
Her attempt to frighten everyone by talking up no-deal amounts to almost criminal negligence with the economy‘People,†a civil servant friend of mine once observed, “are divided into two distinct groups: those who blame others, and those who blame themselves.â€After her preposterous address to the nation last Wednesday evening, it is abundantly clear to which group Theresa May belongs. She blames others, not least those of her fellow elected representatives who are trying to prevent her sacrificing the interests of this country to what the good Lord Adonis calls Jacob Rees-Mogg’s “Economic Ruin Groupâ€. (For readers who may have missed this, Rees-Mogg runs an outfit that purports to be the “European Research Groupâ€, but it does not seem to do much research, or even notice the economic and social damage in front of its very eyes associated with the mere prospect of Brexit.)She has been playing havoc trying to keep the party together while they have been plotting to tear her apart Continue reading...
Economists say a low joblessness rate is not necessarily a sign of a healthy economyBritain’s unemployment rate fell to 3.9% in January, the lowest level in more than 44 years. Is the return to levels of employment last seen in the 1970s a sign that the economy is more robust as Brexit approaches than many feared? We asked three eminent labour market economists. Continue reading...
Xi Jinping visits Rome as Italy becomes first G7 country to back Belt and Road initiativeItaly has become the first G7 country to endorse a contentious plan by China to build a Silk Road-style global trade network, irking its EU and US allies.The prime minister, Giuseppe Conte, and the Chinese president, Xi Jinping, have signed a non-binding memorandum of understanding (MoU) that could lead to Italy’s participation in China’s Belt and Road initiative (BRI), an ambitious project that envisages Chinese investment in a network of infrastructure projects connecting Asia, the Middle East, Africa and Europe.Related: Italy pulls out red carpet for Xi Jinping in trade charm offensive Continue reading...
US-Japan agreement on structural reforms in 1990 could be model for current China talksPresident Donald Trump has postponed until at least April the supposed deadline for concluding the United States’ trade negotiations with China. A good outcome for both sides would be reached if China agreed to protect property rights better and reduce the state’s role in its economy; the US agreed to strengthen national saving and public investment; and both sides agreed to reverse their recent tariff increases. Unfortunately, this is not the deal that is likely to materialise.For starters, Trump fixates on the bilateral US merchandise trade deficit. The Chinese could probably deliver on the verifiable – but worthless – step of committing to buy more US soybeans, natural gas and other commodities. But this would have little or no effect on the overall US trade balance because the US would export less soybeans and natural gas to other countries. Congressional Democrats would rightly point out that the gain was illusory, again highlighting the irrelevance of bilateral trade balances. The more meaningful measure – the overall US trade deficit – widened last year, the predictable result of Trump’s budget-busting fiscal policy.Related: Economists must think broader – or risk becoming irrelevant | Mohamed El-Erian Continue reading...
by Richard Partington Economics correspondent on (#4BKQW)
Dow Jones and FTSE 100 slump as eurozone output falls at fastest rate in almost six yearsFinancial markets around the world have dropped sharply amid mounting fears of a slowdown in the global economy, after eurozone factory output fell at the fastest rate in almost six years.Friday’s losses on stock exchanges across Europe and on Wall Street came after figures suggested economic growth across the European single currency bloc remained weak in the first quarter of 2019, dashing hopes of a rebound from a weak end to last year.Related: The global economy is slowing down. What can governments do about it? Continue reading...
A series of freedom of information requests shows the UK capital has lost 104 youth centres as austerity continues to grip councilsLondon has lost at least 100 youth centres since the 2011 riots, according to new figures.The research, compiled from freedom of information (FOI) requests and shared exclusively with Guardian Cities ahead of publication later on Friday, shows the continued decline in youth service provision across the UK capital as austerity continues to grip local councils.Related: Do youth clubs really deter violence? I’ve seen for myself that they do | Robert BoothRelated: 'Security has deteriorated': young Londoners pay price as city expands Continue reading...
by Libby Brooks Scotland correspondent on (#4BK7G)
UK-wide austerity blamed as predictions put figure at 29% – rather than 18% – in 2023The Scottish government is at risk of missing its own child poverty targets by more than 100,000 children, according to projections from the Resolution Foundation.Westminster austerity measures will put child poverty across the country on course to hit a 20-year peak of about 29% of children living in relative poverty by 2023, its report forecasts. The figure is considerably higher than the Scottish government’s target of 18%. Continue reading...
Wall Street economists claim low unemployment rate and rising GDP point to Trump victory, despite his poor personal pollsForget Robert Mueller and Stormy Daniels. Ignore Russia. If the election were held today, Donald Trump would win – and if America’s economy remains robust he may well win again in 2020, according to Wall Street.Related: The race for 2020 is on. The time to prioritize the Hispanic vote is now | Claudia Romo Edelman Continue reading...
by Larry Elliott and Richard Partington on (#4BJ25)
Shoppers ‘ignore Brexit’, while record employment levels contribute to £1bn deficit cutPhilip Hammond has received a twin boost after the latest official figures showed consumers ignoring the threat of a no-deal Brexit to carry on spending, and higher tax receipts leading to a fresh fall in the government’s budget deficit.Data from the Office for National Statistics showed retail sales – goods bought in shops or online – were up 0.4% in February, confounding City fears of a similar-sized decline.Related: Shoppers increase spending despite Brexit uncertainty Continue reading...
by Richard Partington Economics correspondent on (#4BH87)
Bank warns of increasing risks for economy because of impasse over UK’s exit from EUThe Bank of England has warned that continuing Brexit uncertainty and the prospect of further delay until the summer is serving as a brake on the economy, as it left interest rates on hold.Amid signs that the political turmoil is increasingly taking its toll on business investment decisions, paving the way for weaker economic growth in future, the Bank’s nine-member monetary policy committee (MPC) voted unanimously to leave interest rates at 0.75%.Related: Bank of England leaves interest rates on hold as UK braces for no-deal Brexit - business live Continue reading...
‘We have to make sure that if we do the deal, China lives by it,’ says president ahead of resumption of trade talksDonald Trump has warned that the United States may leave tariffs on Chinese goods for a “substantial period†to ensure that Beijing complies with any trade agreement, while later emphasizing he wanted them to reach a “great†trade deal.Trade talks are set to resume next week and Chinese officials have been pressing for a full lifting of US tariffs as part of any deal.Related: How a US-China trade war would hurt us all | Linda Yueh Continue reading...
The high-speed rail network may never be built any further north than Birmingham. It is utterly nonsensicalYesterday, on the day a report from the New Economics Foundation comprehensively exposed the HS2 project as a London-boosting white elephant, I found myself writing this sitting in a station Wetherspoons because my train from Liverpool to Huddersfield had been cancelled. Last Saturday, I missed a talk for which I had tickets because my train to Manchester, again from Liverpool, was cancelled. On Monday, I was an hour late dropping my daughter at her grandma’s because our train – a Northern Pacer due for the knacker’s yard – broke down at the terminus.NEF’s report, which can be read as much as an utter indictment of a directionless, actively neglectful government as a cool-headed analysis of a single bad idea, exposes the fact that high-speed rail is unnecessary for everyone except London-based frequent travellers who dislike leaving the capital unless they can be there and back in half a day. The report demands a better service for northern commuters, the electrification of rail lines stuck in the mid-20th century, and the reopening of old branch lines to places lost to the car.Related: HS2 would widen UK north-south divide and should be axed, says reportRelated: Economic benefits of local buses eclipse unrealistic HS2 target | Larry Elliott Continue reading...
Total orders fall back in March as firms put off investment and stockpile goodsBritain’s manufacturers are in despair at the failure of politicians to end the Brexit impasse, according to the CBI, which reported a drop in output in March as businesses cut back production.Export order books increased among the 358 manufacturers in the survey, supported by the low level of sterling, but this was cancelled out by a decline in domestic demand to leave the industry in a weakened position ahead of a decision in parliament on Brexit. Continue reading...
UK is predicted to suffer first fall in prices since 2011 towards the end of this yearHouse prices grew at the slowest rate since 2013 in January, according to official figures that signalled the UK was heading later this year for the first fall in property values since the financial crash.Average house prices in the UK increased by 1.7% in the year to January 2019, down from 2.2% in December 2018 and 5.1% in October 2017, the Office for National Statistics said.Related: Manufacturers 'in despair' over Brexit; UK inflation rises - business live Continue reading...
‘Deeply troubling’ survey of 21 countries finds 60% believe they are not getting ‘fair share’A majority of people living in developed countries want their government to increase taxes on the rich in order to help the poorest in society, according to a major global study.In all 21 countries included in the OECD study, more than half of those polled said they were in favour when asked: “Should the government tax the rich more than they currently do in order to support the poor?â€Related: MPs to launch inquiry into ‘survival sex’ by benefit claimants Continue reading...
Thinktank says London would benefit most and money should go to less wealthy areas insteadThe government’s planned HS2 high-speed rail project will make the UK even more divided and should be scrapped in favour of boosting services in the less well-off parts of the country, a left-leaning thinktank has said.A report from the New Economics Foundation found that 40% of the benefits of the controversial project would go to London and that the £56bn budget would be better spent on upgrading the existing network and smaller-scale local projects.Full electrification of much of the northern rail network.The reopening of the trans-Pennine Woodhead line between Manchester and Sheffield to provide a fourth east-west link in the north.A Bradford Crossrail to link the two lines that terminate in the city and put it at the centre of northern rail.The full electrification of the Midland and Great Western lines.The creation of more four-track sections on the three core, north-south mainlines and the building of bridges to take slower, regional lines over intercity tracks to speed up long distance journeys. Continue reading...
Funding cuts are forcing impossible choices on our local authorities, say Dr Ellen McAdam and Dr Frank ComptonYour coverage of the staff restructuring by Leicester museums in response to funding cuts (‘Engagement team’ replaces curators at Leicester museums, 14 March) is hardly fair. A decade of austerity has forced even local authorities that, like Leicester, value their cultural institutions highly to make impossible choices. Social care or arts? Children’s services or museums?For over 30 years most regional museum funding has targeted audience engagement. This has unfortunately been at the expense of curatorial and other care for the public asset represented by the collection, even in museums with collections designated by government as being of national importance, albeit not so funded. When shops, pubs and restaurants are closing, museums and their collections are among the few attractions left to draw people into our town and city centres. No other country would have allowed its family silver to tarnish so badly.
Supermarkets ‘happy to be held to account’ on reducing prices by £1bnSainsbury’s has promised to publish an annual breakdown of the £1bn-worth of price cuts it has promised shoppers if it merges with Asda, as it scrambles to reverse the competition watchdog’s opposition to the £7bn deal.Many analysts think the tie-up between Sainsbury’s and Asda, the UK’s second and third largest supermarket chains respectively, is doomed after the Competition and Markets Authority (CMA) warned last month that the tie-up threatened to push up prices and reduce the choice and quality of products on sale. Continue reading...
Employers’ hiring reduces jobless rate to 3.9%, the lowest since the start of 1975UK unemployment has dropped to the lowest level in more than 44 years despite mounting fears over Brexit, as employers across the country ramped up hiring at the fastest rate in more than three years.The Office for National Statistics said Britain’s jobless rate fell to a fresh low of 3.9% in the three months to January, down from 4% a month earlier, the lowest point since the start of 1975.Related: UK jobless rate hits 44-year low of 3.9% despite Brexit uncertainty - business live Continue reading...
Former Staples chain with 90 stores hit by falling stationery sales and high street woesThe stationery chain Office Outlet has collapsed into administration, putting 1,200 UK jobs at risk.The struggling retailer, formerly known as Staples, has 90 stores, predominantly in out-of-town retail parks. Its collapse comes less than a year after its management team resorted to a company voluntary arrangement (CVA) to jettison unwanted stores and slash its rent bill.Related: 'It could be terrible for us': how one British high street is preparing for Brexit Continue reading...
As the proportion of SEN children in alternative schools continues to rise, it’s time to stand up for inclusionA showdown between parents of children with special needs and the government is coming. Three families from different parts of England have won the right to a judicial review of the funding allocated to local authorities to fulfil their obligation to educate the 253,680 young people in England with an Education, Health and Care plan (EHC) – or “statement†– and the 1,022,535 other children also entitled to some form of SEN support. Such budgets have been stretched beyond breaking point, while the number of children assessed as having special needs has increased for two years in a row until these groups now form 14.6% of the school population – with autistic spectrum disorders the most common type of need for pupils with a statement.In December the Local Government Association predicted a funding shortfall of £1.6bn by 2020/21. Paul Whiteman of the National Association of Headteachers believes the code governing special needs education has been reduced to an “empty promiseâ€. Yet so far the response from ministers has served to underline the problem rather than solve it. This is because, while additional resources are urgently needed, there is another aspect to the special needs crisis in England. Namely, that decades of progress towards an inclusive model in which, as far as possible, all children are educated together, are being rolled back. Continue reading...
Merger plan comes amid problems that find many European banks in a zombie-like stateThe proposed merger between Deutsche Bank and Commerzbank is far from a done deal. Politicians in Berlin might be supporting the tie-up, but there are plenty of critics – from unions fearful of tens of thousands of job losses to shareholders worried about the impact on already depressed share prices.Clearly, this is not an ideal moment for Deutsche to be considering swallowing up its smaller rival. It will take up valuable management time and involve booking a hefty loss on the Italian and Spanish bonds sitting on Commerzbank’s books.Related: Deutsche Bank and Commerzbank confirm merger talks Continue reading...
After a Franglais Swan Lake, the comic explains economics with sex dolls in ChiffChaff. She talks about loving horror, how guinea pigs helped her through illness and standing up for comediansElf Lyons loves economics. Or rather, as she warbles to The Lion King’s They Live in You, “eco-eco-no-nomicsâ€. In her show ChiffChaff, which is equal parts John Maynard Keynes and Lorelei Lee, Lyons breathily considers fiscal policy by asking the audience to blow up sex dolls, play plinky-plonk instruments and imagine inflation as spinach. “I’m what the Times called ‘an ordeal’,†she informs us during a vigorous bout of hula-hooping. That review was for her 2017 rendition of Swan Lake, delivered in Franglais while dressed as a parrot. It earned her an Edinburgh comedy award nomination but left some looking for le exit.When we meet for coffee in Soho, Lyons says she wants audiences to share her passion and think of finance as fun rather than “George Osborne holding a briefcaseâ€. Unusually, it was the economy – rather than comedy – that really excited her as a child. “I don’t have a good comedy knowledge,†she says. “I’ve never seen Blackadder. Never watched Fawlty Towers or The Young Ones.†Growing up, she travelled a lot with her father, City economist Gerard Lyons. In China, he would explain the financial booms that built the skyscrapers. They watched films like Blade Runner and The Man in the White Suit together then discussed how they depicted expansion and the free market. “It’s about loving something,†she says of the irresistibly silly ChiffChaff. “Economics is beautiful.â€I want to play a really nice IagoOn Fridays we’d all go to the bar. Everybody would swap partners and drink bottles of crap wineRelated: A new way to love: in praise of polyamoryElf Lyons: ChiffChaff is at Omnibus theatre, London, 25-30 March. Continue reading...
Stalling inflation and a need to show independence have pushed it to a dovish stanceThe US Federal Reserve surprised markets recently with a large and unexpected policy change. When the Federal Open Market Committee (FOMC) met in December 2018, it increased the Fed’s policy rate to 2.25%-2.5%, and signalled that it would raise the benchmark rate another three times, to 3%%-3.25%, before stopping. It also signalled that it would continue to unwind its balance sheet of Treasury bonds and mortgage-backed securities indefinitely, by up to $50bn (£38bn)per month.But just six weeks later, at the FOMC meeting in late January, the Fed indicated that it would pause its rate rises for the foreseeable future and suspend its balance-sheet unwinding sometime this year.Related: Global stock markets gain as investors predict cautious Federal Reserve – business live Continue reading...
The artist scoured asset-stripping websites for the things British companies toss out as they close. He relives his six-month journey into a country in declineMike Nelson is feeling his age. He’s halfway through installing his new work, in the soaring Duveen galleries of Tate Britain, and as we sit down to chat, I notice the support strapped to his arm. The artist gives me a quick run-through of all the dislocations, injuries and strains that decades of vigorous construction work, all in the name of art, have exacted on his arms and shoulders. “I’m starting to feel long in the tooth,†he mutters apologetically.It all feels apt, given the work he’s installing. Redundancy, decrepitude and physical labour are central themes of The Asset Strippers. In preparation, over the last six months, he has amassed an array of industrial equipment from British manufacturers downsizing, closing or moving out of the country. Shelved, archived, stacked, clustered and sitting on reinforced flooring, this collection of machines large and small recasts the London gallery as a storage facility for the detritus of British industry.Related: A modern masterpiece: Mike Nelson's The Coral Reef | Jonathan JonesIn the 20th century, sculptures started to look like machines – and machines started to look like sculptures Continue reading...
The former education secretary has watched as class sizes have gone up, schools have fallen into disrepair and teachers have covered for cleaners. What’s next, she asksEstelle Morris is someone who tries to see the positive side. She’s polite about political foes; she hopes that something better will come out of the nightmare that is Brexit. But she is finding it hard to sound upbeat about the financial crisis facing schools.The former teacher and education secretary is plainly worried about mounting evidence of school cuts. A recent Guardian investigation found there’s not enough money for the basics such as textbooks, stationery and science equipment; support staff are being cut; teachers are covering for lunchtime staff and cleaners; buildings are falling into disrepair, and headteachers are relying on parents’ donations to make ends meet. One school is holding extra, non-uniform days to raise funds; another is delaying turning the heating on until November; and a teacher in Rotherham told the Guardian she buys sanitary pads and deodorant for her students as well as pens. Class sizes have gone up, school trips are off, subjects have been scrapped and pastoral care has been axed. The list goes on.Related: Schools have become 'fourth emergency service' for poorest families Continue reading...
The modern monetary theory debate is welcome in a world laying bare the constraints of conventional policyThe last few months of 2018 saw a real bout of jitters in the financial markets. Growth was slowing everywhere and share prices were in full retreat. There were fears that this was the start of Global Financial Crisis 2.0.In the end, central banks managed to calm things down. The US Federal Reserve abandoned plans for increases in interest rates, the European Central Bank put back the date at which it expects to start raising the cost of borrowing, the Bank of Japan left rates negative and the People’s Bank of China eased lending constraints on commercial banks. Continue reading...
Of course Brexit creates uncertainties. But the chancellor has funds available now to fulfil the pledge to end austerityLow-income families will be hit hard in April by government spending cuts and tax rises. Philip Hammond might have considered the double whammy that awaits them when he stood up last week to deliver his spring statement. There was an expectation, especially among some anti-poverty charities, that the chancellor would open his wallet to ease their financial pain following his promise last year to end austerity.Families in the bottom fifth of earners will lose, on average, £400 a year from a freeze on benefits. Universal credit will be cut for all but the lowest-income households, and council tax bills, which affect the poorest much more than those in higher income brackets, are set to rise by an average of 4.5%. Continue reading...
And even staying in the EU would only lessen the effects of this shortfall, not solve itAs we enter the dog days of article 50 negotiations, with the political heat rising to boiling point, MPs should stop a moment and consider what kind of Brexit catastrophe awaits the country.Brexit supporters argue that MPs’ information could be a little out of date. And it’s not just them. Listen to the governor of the Bank of England, Mark Carney, who says a no-deal Brexit is not the catastrophe many believed it would be when forecasts were made last year. Continue reading...
The Guardian columnist Frances Ryan explains why she was so determined to cover the volunteer-run Biscuit Fund ‘gifting service’ for people going through hard timesA few weeks ago, I decided to have a clear-out. There were several years’ worth of clutter best assigned to the rubbish, but among the old birthday cards and assorted keyrings, one box stood out: it was full of letters and cards from readers.
Ownership falls to lenders but company will continue trading and operating public servicesThe government contractor Interserve has gone into administration after its largest shareholder, the US hedge fund Coltrane, led a rebellion against financial rescue plans drawn up by the company’s lenders.About 16,000 small shareholders have lost their investment, with the business sold to hedge funds and banks via a “pre-pack†administration which means Interserve, which employs 45,000 people in the UK, can continue trading.Related: Interserve: a calamity created in the boardroom | Nils PratleyFirst Carillion and now Interserve. The gov't model of outsourcing services to cut costs has failed. It is time to bring these contracts back in-house. https://t.co/yjfvTqBmpo Continue reading...
Another outsourcing company that was making huge profits has gone into administration“I voted for Donald Trump,†said the representative for Coltrane, flippantly, when asked after Interserve’s shareholder meeting how he cast the New York hedge fund’s critical 27% stake in the outsourcing firm. Maybe he did, but in this case he voted against a board-backed rescue deal and helped to send into administration a company employing 45,000 people in the UK.Related: Interserve to go into administration after rescue deal rejected Continue reading...
Ministers rush to do deals with countries UK trades with under EU free trade arrangementsBritain has signed a post-Brexit trade deal with the Pacific islands of Fiji and Papua New Guinea, as the government rushes to sign as many agreements as possible before 29 March.The Department for International Trade said the agreement would maintain access to goods including sugar and fish imported from the islands 10,000 miles away. Total trade between Britain and the region is worth about £369m a year. Continue reading...
by Richard Partington and Phillip Inman on (#4B1VB)
Wage hikes of nearly 6% could signal return of pre-2008 rewards, thinktank saysBig pay rises for people already earning at least £1m a year could be the result of a return to levels of reward for bankers and top company bosses not seen since before the financial crisis, according to the head the UK’s leading economic thinktank.New data collected by HMRC and released alongside the chancellor’s spring statement showed pay for the highest earners rose nearly 6% between April and September last year, compared with 3.7% for the rest of the workforce. The Institute for Fiscal Studies (IFS) said the pay disparity would exacerbate inequality.Related: Benefits freeze means 'no reprieve' for 10 million poor families – business live Continue reading...
Forecaster’s mid-term outlook buoyed by £50bn in tax increases, despite low growth and falling house prices in 2019Britain’s economy will struggle to grow by more than 1.2% this year as Brexit uncertainty hits business investment and sends house prices into reverse for the first time since the 2008 financial crash, the Office for Budget Responsibility has warned.The Treasury’s independent forecaster has cut its estimate of economic growth for 2019 from 1.6%, made only last October. It is also predicting a slide in house prices later this year, which will cut stamp duty tax receipts by £3bn. Brexit uncertainty and changes to the way corporation tax is paid, it said, will also knock a £2bn hole in tax payments made by companies. Continue reading...