Chancellor says ‘austerity finally coming to an end’, announcing £400m for ‘little extras’ for schools and £1.7bn for universal credit work allowances

Financial stocks also boosted by HSBC results as FTSE 100 enjoys best day for weeksShares in carmakers were boosted on Monday by a report that China is considering cutting vehicle sales tax to boost demand, helping European stock markets rebound after last week’s mauling.Financial stocks also contributed to the rally, thanks to strong results from Europe’s biggest bank, HSBC, as well as the decision by Standard & Poor’s not to downgrade the Italian government’s credit rating. Continue reading...

Short-term spending aims to placate a public the PM thinks is sick of austerityWatching Philip Hammond deliver his third budget, it was hard to avoid thinking that an election must be in the offing. Chancellors normally show their mean streak when parliaments are young and squirrel away any available cash so that they can give money away as polling day approaches.Not this time, though. The chancellor was in the position of knowing that public borrowing this year is on course to be £12bn lower than was predicted in the spring – an extremely happy outcome given the economy’s mediocre performance.Related: Hammond says end of austerity is in sight as he boosts spendingRelated: Key points from budget 2018 – at a glance Continue reading...

The economic blowback from Brexit is unknowable, but even so, Philip Hammond is fixing none of the country’s woesHere was a pothole budget, a light spray of makeshift asphalt over the riskiest craters in the public sector. The end of austerity? No, just minor repairs to a little of the damage they have done; things sounding good but signifying little.This was a traditional Tory budget, with benefits still frozen for the poorest while three-quarters of the winnings from raising personal tax allowances flow to the top half of earners. As John Major warned, universal credit would have collapsed, and taken the government with it, without a bung. Enough? Its structural defects may sink it yet. Welcome gestures, like taxing the Amazons and Googles, turn out to be a slap on the wrist. A one-off £10,000 gift per primary school is almost insulting, as was the small sop for social care, while police and local councils are left high and dry.Welcome gestures, like taxing the Amazons and Googles, turn out to be a slap on the wristRelated: Budget 2018: Jeremy Corbyn lambasts 'broken promise budget' – Politics live Continue reading...

Austerity has been a self-defeating policy. It is not enough to abandon it in rhetoric, it must be dispensed with in substanceIt was Hyman Minsky, one of the 20th century’s most formidable economic thinkers, who claimed “the game of policy making is rigged. The Prince is constrained by the theory of his intellectuals”. Minsky argued politicians – the Princes in his Hamlet allusion – who believed themselves above influence were, in fact, limited by the beliefs used to determine the options that are presented to them. Since 2010, the Conservative chancellor’s austerity has shown that the game of policymaking is rigged, and has become increasingly so. Austerity to a very large extent excluded policies that would have contributed to sustainable prosperity. Instead, it promoted a self-defeating idea that this country could retain its economic vigour by a form of economic bloodletting. This failed because throttling back on aggregate demand when the country needed it most left the patient gasping. On the ground, the result has been to extend privatisation and diminish the public realm. Voters are fed up with this approach. Philip Hammond is canny enough a politician to recognise that – in rhetoric.That is why Mr Hammond claimed “austerity is coming to an end” during his Budget speech and has chosen to spend government money on politically sensitive parts of the welfare state. More money for the National Health Service, for schools and social security is to be welcomed. Properly taxing global tech companies who have got away with paying negligible amounts of tax despite profiting from advertising in this country is a good thing. In some ways, as several have pointed out, this felt like a pre-election budget, with tax cuts and fuel duty freezes warming the hearts of traditional Tories, while turning on the spending taps defuses Labour’s attack. In doing so Mr Hammond has spent his better than expected tax receipts to present a crowd-pleasing budget. And he still has the room to borrow further. This hedging is understandable given the fractious politics of the Conservative party. The chancellor knows that the Tory party remains deeply divided over the prime minister’s Chequers blueprint for a future relationship with the European Union once this country leaves the EU. A “no deal” Brexit remains a distinct possibility. So he has retained the financial room to restore demand should a serious crisis befall this nation, which a hard Brexit surely would mean that it will. Continue reading...

Increases for universal credit, defence and schools in budget alongside digital services taxPhilip Hammond claimed that “austerity is coming to an end” as he took advantage of better-than-expected tax revenues to promise a £30bn boost in public spending by 2024.The chancellor used a 71-minute budget speech to announce immediate short-term increases in spending on universal credit, defence and equipment for schools.Related: Key points from budget 2018 – at a glance Continue reading...

Our writers react to the chancellor’s final budget before the UK leaves the EURelated: Budget 2018 'biggest giveaway since 2010', says OBR – Politics liveRelated: Toilet jokes, missing rabbits and Nick Clegg calling: Hammond's budget humour Continue reading...

All the day’s economic and financial news, as shares rally across Europe.

Philip Hammond has delivered his budget – here are the main points, with political analysis

British consumers rein in borrowing money for cars amid falling vehicle salesBritish consumers have reined in their borrowing on car finance deals amid falling vehicle sales triggered by new emissions tests.Figures from the Bank of England showed annual growth in consumer credit – on personal loans, credit cards and car finance deals – dropped to 7.7% in September to the lowest level since June 2015.Related: Car production in UK falls year-on-year for fourth month in a row Continue reading...

What to expect from Philip Hammond’s speech tomorrowHow will the budget affect core sectors of the economy and public finances? Here is our checklist of what to expectBrexit costs Continue reading...

This is supposed to be the last budget before Brexit. Without a radical shift in policy Theresa May’s rhetoric of ‘ending austerity’ is fundamentally disingenuousWhen Theresa May addressed the Conservative party conference earlier this month, her audience were primed for what she had to say about Brexit. But the most interesting part of the speech was when she pledged to “end austerity”. The British public are fed up with the idea that after the financial crash the country could cut itself to growth. But the state has been deliberately rolled back, reducing aggregate demand when the economy would have benefited from it. The result has been an immiseration of ordinary people and the forced decay of the public realm. Austerity failed as it turned a nascent recovery into stagnation.The problem for Mrs May’s Treasury is that it has to square two conflicting aims: that of ending austerity and that of meeting self-imposed fiscal targets. By borrowing more, and with stronger than expected tax receipts, there’s a possibility that the chancellor, Philip Hammond, could in Monday’s budget ensure that no government department need face any drop in its real-terms spending per person after 2020. That might be construed as ending austerity. Getting to that point depends largely on whether Mrs May is capable of successfully navigating the intellectual and political minefield that is Brexit. Continue reading...

One of Hammond’s challenges is to show that eight years of cuts have not caused economic harmPhilip Hammond is a fiscal conservative. He wants taxes to be as low as possible, would like to see the government balancing its books and is unhappy with national debt at its current levels.The chancellor’s problem, as he prepares for the budget, is that he is one of a dying breed. There are no longer many fiscal conservatives around, even in his own party. Continue reading...

Theresa May’s pledge to end austerity has put Philip Hammond on the spot. But even with billions in extra tax receipts, caution will be his watchwordIt may not have been hugely noticeable, but Philip Hammond was making an effort to be more upbeat at this year’s Tory conference. Attacks on him as the “Eeyore chancellor” for his gloomy Brexit outlook had convinced his team that he needed a note of positivity – so he began talking up the “Brexit deal dividend” that would come when a good agreement was reached with the EU.Yet even during chats with MPs at the febrile event in Birmingham, colleagues were left in no doubt about his priorities. He was clear that whatever the potential gains in the future, now was not the time for a spending splurge. Brexit made everything far too unpredictable. Continue reading...

Rising political instability and trade disputes are symptoms of the rampant disease of inequality, and rich men giving away their billions is not the answerThere are two worrying things to consider about the world economy in 2018 – beyond the obvious risks of Brexit, Donald Trump’s trade war with China and steep losses on the financial markets.First, there is the news that the world’s billionaires made more money last year than at any time in recorded history. The richest people on Earth increased their wealth by a fifth to $8.9tn in 2017, according to Swiss bank UBS. Continue reading...

The Economist’s rosy profile of Australia is in some ways an oddly timed piece given the insecurities many in this country are feelingThis week The Economist magazine featured Australia on its front page, stating “Aussie Rules: What the world can learn from Australia”. In some ways it is an oddly timed piece given the insecurities many in this country are feeling – coming as it did in a week when about 150,000 people rallied in Melbourne for better wages, and in which the stock market slid five days in a row. Is it a case that Australians have become the grumpy ones who can’t see how good we have it, or is it time to end stories about the “Australian economic miracle”?It’s not all that surprising really to have a magazine based in London as it experiences the absurd hit on its economy from the Brexit idiocy look wistfully to Australia. And given this week Tony Abbott advised the Brits to just give the EU a take it or leave it offer, many in Britain could well be forgiven for wondering just how did Australia manage to not be in an economic mire given the competency bar for leadership in this country appears to be so low.Related: ACTU rallies: estimated 150,000 workers march for 'better deal' on payRelated: Enterprise bargaining is out of reach for most workers. We need a better system | Josh Bornstein Continue reading...

A job that provides rising living standards is a thing of the past. Now the route to wealth is through property and pensionsIt is often said that people are defined by their work. Whether the job is in mining, teaching or engineering, it provides an income, status, friends and a sense of community.Yet for a long time now work has become secondary to being a savvy consumer, a homeowner (or, better still, a multiple homeowner) and a pension saver. It’s not a trend the Jeremy Corbyn’s Labour party recognises. But it’s a sad fact that a job is no longer the primary route to a better life, unless promotions – which often only add to the stress and long hours that employers already demand – are part of the plan.Young people have very little influence at work: the baby-boomer generation runs things Continue reading...

We ask residents and local politicians in Lancashire whether Theresa May’s proclamation offers much hope for better timesThe shoppers are out in force at the start of half-term in Wigan. The autumn sun is low in the sky and the drizzle that can drench south Lancashire – the kind that made the air here perfect for spinning cotton a century ago – has stopped.For a town that is among the hardest-hit by council budget cuts, according to a recent Cambridge University study, there is little evidence of austerity on a day like today. The town appears to be doing well, despite some derelict buildings among the bars and nightclubs on King Street, the complaints over the three-weekly bin collections, and the decrepit state of the often-delayed trains to Manchester.Working poor is an amazing thing to say in this day and age. If you work you shouldn't have to be poor, but people are Continue reading...

Philip Hammond will have to come up with extra funds for Theresa May’s £20bn pledgeBritish taxpayers will soon learn how the government plans to finance Theresa May’s pledge to increase spending on the NHS by £20bn by 2023.After months of intense speculation, Philip Hammond, the chancellor, will on Monday announce the tax and spending changes required to accommodate the extra funds in his budget.Related: Omnishambles: five big budget bust-ups of recent years Continue reading...

Falls in Europe follow nervous US trading as investors question tech giants’ valuationsGlobal markets chalked up their longest weekly losing streak in five years on Friday, as Wall Street reacted to worse-than-expected results from US tech giants.The MSCI all-country world index, which tracks shares across stock markets in 47 developed and emerging countries, closed down 3.7% on Friday. Continue reading...

Trump’s regulatory and tax policies have aided growth but he will bear blame for any downturnThe US president, Donald Trump, claims credit for “the greatest ever” economy and constantly contrasts economic conditions today with the historically weak recovery under President Barack Obama. With growth this year more than 3%, unemployment at 3.7% and more job openings than unemployed people, the economy has greatly improved on Trump’s watch. The macroeconomic indicators are the best in decades.Meanwhile, Obama, too, claims credit for the strong economy, arguing that his policies prevented a far worse downturn following the 2008 financial crisis. Neither Trump’s hyperbole nor Obama’s selective memory comes as a surprise.Related: EU members should be wary of stealing London's super-sized financial sector | Howard DaviesAmerican presidents get too much credit and too much blame from voters and historians for what happens on their watch Continue reading...

NIESR warns if no agreement reached, chancellor’s spending power will be much reducedThe impact of Brexit on next week’s budget has been spelled out by one of Britain’s leading economic forecasters, with the difference between a soft and no-deal outcome worth around £15bn over the next five years for Philip Hammond.According to the National Institute of Economic and Social Research (NIESR), the chancellor could increase spending on public services above and beyond the £20bn promised for the NHS - but only if Britain retains the closest possible relationship with the EU following its departure.Related: Philip Hammond can't announce an end to austerity. Brexit won't allow itRelated: Britain's last budget before Brexit needs to be bold: experts debate dataRelated: Frictionless Brexit trade deal would bolster budget – Hammond Continue reading...

US and European markets bounce back after Asia falls into a bear market

Shadow chancellor estimates cost at £108.2bn and pledges to take ‘large-scale action’The shadow chancellor, John McDonnell, has said Labour would reverse cuts made by the government since 2010 as Labour highlighted more than £108bn needed to “end austerity”.Labour’s pre-budget review said it would take £42bn to reverse departmental spending cuts. The Institute for Fiscal Studies (IFS) had already highlighted another £19bn needed to stop further cuts to government. Continue reading...

Markets fall from Sydney to Shanghai as analyst warns that broad selloff could turn into a ‘capitulation’Shares in Asia Pacific have plunged into bear market territory and wiped billions off the values of companies as one analyst warned that the losses could be a harbinger of a wholesale “capitulation”.After the worst day for tech stocks on Wall Street for seven years, markets were in retreat from Sydney to Shanghai as concerns about the global economy and rising borrowing costs were compounded by local factors.Related: Dow Jones falls 600 points as market volatility continues –as it happenedThere are many symptoms but no one can diagnose the illness.Geopolitics, rising bond U.S. bond yields, a more hawkish looking U.S. Federal Reserve (the Fed), slowing Chinese growth, a strong U.S. dollar and the already well known problems in some emerging economies have all contributed to the market unease....and the VIX spiked to over 26, a level last seen in February.This similarity obfuscates two (related) differences. First, less enthusiasm on the part of #investors to buy the dip. Second, accumulated evidence that the #Fed no longer has the #markets back covered as in the past pic.twitter.com/23W7EhdOfeBad day for Aussie stocks with #ASX200 down to lowest in a year. Now on longest losing streak since Sept. 10. Financials have entered a bear market. #ausbiz #auspoll @BloombergAU @markets pic.twitter.com/5XwTuUiPE5Chart: South Korea's stocks in bear-market territory - pic.twitter.com/1mkOs2whpfIf the month ended today, it would be the worst monthly decline for the S&P 500 Total Return Index since February 2009: -8.8%. $SPX pic.twitter.com/9rWxn1k8qDRelated: Stock market investors are finally facing up to global turmoil Continue reading...

The gap between rich and poor has been widening for decades, driving a climate of mistrust that harms us allFrom Adam Smith onwards, economists have recognised that trust is the glue that binds societies together. Nations in which people trust each other have stronger institutions, are more open, have less corruption, grow faster and are nicer places to live. Trust is notable by its absence in police states.So it is a matter of concern that trust has become an increasingly rare commodity. In the US, there has been a precipitous drop in faith in the government. Almost four out of five Americans trusted Washington to do the right thing when Eisenhower and John F Kennedy were in the White House. Under Donald Trump, that has fallen to one in five. In Britain, Theresa May is trying to finesse a Brexit deal at a time when parliament is even less trusted than the banks. By a distance, the most trusted institution in the UK is the military. We don’t trust big business, we don’t trust the City, we don’t trust the newspapers – and we certainly don’t trust politicians. Continue reading...

Brexit and future of diesel vehicles blamed for 16.8% fall compared with last SeptemberThe number of cars built in the UK slumped again year-on-year last month, as global trade tensions and concerns over the shape of Brexit and the future of diesel vehicles took their toll.Car manufacturing fell 16.8% in September from a year ago to 127,051 vehicles, according to the Society of Motor Manufacturers and Traders (SMMT). It is the fourth month in a row that output has fallen sharply compared to the same month in 2017, with June recording the steepest drop, of 47%.Related: Brexit could kill off entire industries, says Jaguar Land Rover chiefRelated: How has Brexit vote affected UK economy? October verdict Continue reading...

Fresh losses in New York sees the Dow lose its 2018 gains, and the Nasdaq enter a correction

Guardian readers respond to our report on the rise in families desperate for educational support for their childrenAn increasingly effective framework of support for some of the nation’s most vulnerable children and their families, young people with special educational needs and disabilities, that has shown steady progress since the groundbreaking 1978 Warnock report, has been destroyed by the policies of Michael Gove and George Osborne (Crisis looms for special needs education, 23 October).As a former local education authority (LEA) senior adviser and higher education lecturer for special educational needs (SEN), I can’t express how angry I feel over the destruction of these services. It is not “looming”; it is a crisis. Fifteen out of every 100 children have these needs, which include a variety of disabilities from the partially sighted and hearing impaired to children with mild and complex learning difficulties. Educational psychology services, speech therapy, home tuition for sick children, teams of highly qualified specialist support teachers and advisers have been reduced to a rump. Specialist integrated units in mainstream schools are closing. Vandalism is too kind a term. For Nadhim Zahawi to parrot cash spending figures in defence adds insult to injury when the evidence of wrecked services is all around. The worry and stress caused to the families of these deserving children denied their right to life-enhancing education is incalculable.

John McDonnell says he will address leavers’ grievances if failure to do deal with EU leads to snap general electionThe shadow chancellor, John McDonnell, is preparing an anti-austerity budget to deal with the grievances of voters who support Brexit if failure to strike a deal with the EU leads to a snap general election.McDonnell said he understood why people living in the poorer parts of Britain had voted to leave the EU in the 2016 referendum, but added that the chaotic negotiations had led to “instability, insecurity and uncertainty”.Related: My constituents backed Brexit. But I didn’t enter politics to make them poorer | Phil WilsonRelated: Labour has caught the mood of the times. Now it needs new ideas to remake capitalism | Will Hutton Continue reading...

Each month we look at key indicators to see what effect the Brexit process has on growth, prosperity and trade

With optimism low and investment very weak, Philip Hammond faces a difficult task

Ahead of probably the UK’s last budget as a member of the EU, storm clouds are gathering

Shares in heavy-duty equipment maker fall despite better-than-expected profitsCaterpillar left investors concerned on Tuesday after the heavy-duty equipment maker warned that the US’s trade war with China was driving up the cost of its raw materials and dampening the outlook.Shares in the US firm, considered a bellwether for the manufacturing sector, fell more than 7% after it failed to raise its 2018 earnings forecast, prompting fears that a slowdown may be ahead. Continue reading...

Deadlocked talks have led to waning business confidence and sharp fall in order booksBritain’s leading employers’ organisation has urged the government to end Brexit uncertainty after warning that the deadlocked talks have already led to plunging investment, waning business confidence and the sharpest fall in order books in three years.In its latest quarterly health check, the CBI said the impasse in the talks between London and Brussels would bring growth in manufacturing output to a standstill over the coming month.Related: Brexit is like a Premier League side wanting to be relegated | William KeeganRelated: Brexit could kill off entire industries, says Jaguar Land Rover chief Continue reading...

US/China trade dispute, US interest rates, Brexit and Italy’s budget spook investorsWall Street and European stock markets followed Asian shares lower on Tuesday, as investors around the world took fright at the increasingly fractious global geopolitical outlook.Investors are growing increasingly worried about a cocktail of risks that could act as a significant drag on the world economy. Potential headwinds include the trade dispute between the US and China, rising US interest rates, the fallout from the death of the Saudi journalist Jamal Khashoggi and the budget dispute between the EU and Italy. Continue reading...

Worries about trade wars, Brexit, Italy’s budget, China’s economy and Saudi Arabia all blamed as shares decline

Early declines signalled acknowledgment of US-China trade war and other eventsStock market investors’ ability to ignore big geopolitical events is legendary. Give them a whiff of lower interest rates and most big-picture troubles can be relegated to the status of passing worries. In the absence of cheaper money, however, the story can be different. Tuesday’s early declines, which were really a continuation of a losing run that has lasted for most of October, marked a moment when investors were obliged to acknowledge that, yes, some global forces look genuinely alarming.First, the trade war between China and the US is having an impact that US companies can count. Caterpillar, the manufacturer of earth-moving equipment, said the full-year whack from higher steel and aluminium prices will be about $100m (£77m). Continue reading...

Reactions to Aditya Chakrabortty’s exploration of the damage caused by decades of neoliberal policiesI have always admired Aditya Chakrabortty’s analytical writings and his latest offering (Britain fell for a neoliberal con trick. Even the IMF says so, 17 October) is no exception, apart from one thing, which isn’t really his fault. I wish one could say that in the pubs and bars where I live they speak of little else but “neoliberalism”, but I can’t. I have never heard the word used by anyone in ordinary conversation. Never. And that’s a problem for the left if opposing it encapsulates what we stand for. The word is too academic and remote, and too unclear in meaning, to set the pulse of opposition racing.In order to shift the mass of public opinion in favour of the state and public sector, we need a word or phrase that sums up why, and for whom. Franklin D Roosevelt’s New Deal did it in 1930s America, and we need something like that here and now. “For the many, not the few” is fine in its way, but already feels somewhat tired and empty. The Tories won the economic argument with their use of the word “austerity”, so it’s vital to oppose that, but that is not enough. We need something optimistic and positive in language that captures the public mood.

Despite Theresa May’s eye-catching pledge, the chancellor’s budget will have to factor in Britain’s precarious post-EU futurePhilip Hammond’s budget next week is likely to be filled with initiatives and spending plans that, the NHS aside, add up to very little. Brexit, for so long an undetonated bomb, makes all predictions of economic growth and tax receipts more of a fiction than usual – and the chancellor knows it. The inescapable conclusion from a lack of clear visibility is that the Treasury can spend only what it must, he will say. In other respects, it must keep its powder dry. How could he not be cautious, when the most bloodcurdling predictions attached to Britain crashing out of the European Union could prove optimistic.There may be a £16bn war chest, stored up since April from a combination of unexpectedly high tax receipts and low Whitehall spending, but spending pledges at this stage, with only months to go before the divorce deadline, would be reckless.Related: Philip Hammond urged to make moves to end austerity Continue reading...

An innovative Rust Belt school district prepares students for industrial jobs – but also competition from robotsThe high school students clustered around a 4ft-tall red robot with long arms and cartoonish eyes. A so-called collaborative robot, programmed to work with humans at the Prent Corporation, a packaging company, it looked cute, not intimidating.But on this “Manufacturing Day”, which in the last few years has given local high schoolers the chance to don safety goggles and step inside factory walls, the robot delivered a not-so-subtle reminder that their teachers have tried to drill into them: the unskilled jobs that paid earlier generations so well are dwindling, gone offshore and to robots like this one. Continue reading...

The author and journalist Nicholas Shaxson gives a chilling account of the financial sector’s stranglehold on the UKIn its final decades, the Soviet Union was hooked on alcohol. It needed the revenue from selling vodka, and it needed the booze to keep its citizens happy. But there was a problem: the more Soviet citizens drank, the less they worked, and the more the economy withered. It was a vicious circle, with no clear exit, that helped doom the whole communist project.I was reminded of this parlous trap while reading Nicholas Shaxson’s excoriating analysis of the City of London’s effect on our economy in The Finance Curse. Coming seven years after his groundbreaking Treasure Islands, which told the story of Britain’s tax havens, this new book broadens his assault on the foundations of the modern globalised financial system.Related: Britain can’t prosper as a tax haven. It has to stop these hollow threats | Nicholas Shaxson Continue reading...

No case for keeping to surplus plan and focus should be on investment – Fabian SocietyDitching the government’s budget plans and adopting Labour’s tax and spending proposals would allow Philip Hammond to ditch austerity and pencil in an extra £100bn of spending by the middle of the next decade, according to a leftwing thinktank.In a report to be published later this week, the Fabian Society said there was no clear case for the chancellor to stick to his plan of running a surplus and that the emphasis should be on investment that would improve the economy’s growth rate. Continue reading...

Theresa May’s foolish promise offers an open goal for Labour if the chancellor fails to abolish tax relief for wealthy votersHow do Theresa May and Philip Hammond converse in private? I doubt he roared at her like Gordon Brown did at Tony Blair – “You’ve stolen my fucking budget” – even though she has. Prime ministers in a corner often do it. Blair did it from a TV sofa in 2000, panicking when a cash-starved NHS tipped into crisis: he pledged health spending would reach the EU average (an unknowable moving target). Familiar? May, facing a far worse NHS crisis, promised £20bn – and then went further. Confronting a fractious Tory conference she declared “an end to austerity” (meaning and price tag: equally unknowable).Her Brexit conundrum of impossibilities is of her own making, drawing red lines round herself with no escape. Now she’s red-lined her chancellor: he must abolish the deficit, keep debt falling, cut tax thresholds and “end austerity”, just like that. Impossible, says the Institute for Fiscal Studies, the great arbiter. It will cost £19bn extra just to stand still, while still cutting another £7bn from benefits: in next Monday’s budget, the public won’t think that ends austerity. May’s foolish promise offers never-ending open goals for Labour.Related: Philip Hammond urged to make moves to end austerityRelated: Hammond 'would need £19bn a year to meet May's end of cuts vow' Continue reading...

Charities, teaching unions and medical colleges accuse UK government of ignoring young peopleChildren’s services from Sure Start to schools and NHS mental health are at breaking point, according to a coalition of 120 organisations that have called on the chancellor to invest in young people in the budget next week.An open letter to Philip Hammond and Theresa May from a group of charities, teaching unions and medical colleges accuses the government of ignoring children and young people in its spending plans. Continue reading...

Alarm clocks and trouser presses are also out as John Lewis report reveals shopping trendsSome 20 years after the first DVD players went on sale, they’re history. John Lewis won’t be restocking when the current players have sold out, the retailer said, after a 40% dive in sales this year.The DVD player’s demise is revealed in the annual snapshot of buying trends compiled by the department store group. A number of other devices and electricals are also in steep decline: sales of alarm clocks are down 16%, prompting the retailer to reduce its range by nearly a third, while desktop computers are down 15%. Sales of trouser presses are down by 36%. Continue reading...

Rolling coverage of the latest economic and financial news, as investors brace for Europe to reject Italy’s budget this week

Unprecedented move likely after government insists it needs to increase deficitThe European commission is expected to ask Italy’s indebted government to revise its 2019 draft budget, the first time such a request will have been made of an EU member state.Italy refused to compromise on its economic targets, sending a letter to Brussels on Monday explaining why it will raise its deficit – the gap between government spending and income – to 2.4% of GDP. The prime minister, Giuseppe Conte, told reporters in Rome that the government was not being led by “a bunch of hotheads” and that the increased borrowing was needed to ensure that Italy’s economy grows. Continue reading...

Thinktank promotes measures to help chancellor increase NHS spending and reverse planned cuts to servicesPhilip Hammond could make progress towards ending austerity in his budget on 29 October despite opposition from backbench Tory MPs to tax rises and extra borrowing, according to a leading tax and benefits thinktank.The Resolution Foundation said a freeze on income tax and inheritance tax thresholds before the end of the parliament would raise billions of pounds for public services. Cutting a string of tax reliefs for employers would also improve the chancellor’s war chest as he seeks to pay for increased NHS spending and reverse planned cuts to services.Related: Hammond 'would need £19bn a year to meet May's end of cuts vow'Related: CBI demands £2bn boost for business in Philip Hammond's budget Continue reading...

The man who used to run the WTO says the EU single market, set up by Margaret Thatcher, is ‘the top league’. How right he isThis country is obsessed by football. Many of the people who voted to “leave Europe” follow closely the ups and downs of the teams in the Premier League, teams whose stars and managers are often from, well, “Europe”.It is unimaginable that any football fan would want his or her team to descend from the Premier League to the lowest, just like that. Yet that is not unlike what this country would be doing if the wishes of the Brexit extremists were to be realised.The idea of trying to set up new trade agreements in a world that is going protectionist fast is for the birds Continue reading...