New Chancellor Rachel Reeves will focus on planning reform in her first speech today
Daily Business News
New Chancellor Rachel Reeves will set out her plans for the economy later today. The former Bank of England economist who has become Britain's first female Chancellor will pledge to build more houses and speed up planning approval for infrastructure projects. "Last week, the British people voted for change. And over the past 72 hours I have begun the work necessary to deliver on that mandate," she will say in a speech to business leaders, from which excerpts have been released by The Treasury. “Where governments have been unwilling to take the difficult decisions to deliver growth – or have waited too long to act – I will deliver. It is now a national mission. There is no time to waste."
Housebuilders are anticipating a boost from the new Labour Government’s plans to overhaul planning rules. Shares in Barratt, Britain’s biggest house builder by volume, Persimmon and Taylor Wimpey have all risen in response to Chancellor Rachel Reeves’ anticipated speech today. Labour’s manifesto pledges also promised to build 1.5m homes in England and Wales over the next parliament – equivalent to about 300,000 homes a year – including on what Reeves and Prime Minister Keir Starmer have described as low-quality “grey belt” land from the green belt. Labour also set out plans to build new towns, expand major cities where there are housing shortages, give local councils the power to ensure local first-time buyers are prioritised for new homes, and extend the current first-time buyer mortgage guarantee scheme. Darren Jones, the new Chief Secretary to The Treasury, also told the BBC Radio 4 Today programme this morning that Reeves could reintroduce mandatory housebuilding targets for local councils which were scrapped by the previous Conservative government after a rebellion from its MPs. Planning will be the focus of her first speech as Chancellor because it would boost growth which was "the sustainable way to get public finances back in order for the long run,” he said.
Fewer British firms plan to raise their prices in the coming months, according to a survey by the British Chambers of Commerce. 39% of its member companies it surveyed expected to raise prices over the next three months, down from 46% in its previous survey published in April. The BBC survey also showed business confidence improved slightly during the second quarter of 2024; a total of 58% expect a jump in turnover over the next year, up up from 56% in the first quarter. Only 13% expected turnover to fall.
Pontins has been rated the worst UK holiday park brand in a survey by consumer organisation Which? Which? surveyed more than 1,700 people about their experiences at UK holiday parks in the past two years, asking them to rate their stays on 11 criteria, including quality of accommodation, cleanliness, facilities and activities, and value for money. Founded by Fred Pontin in 1946, Pontins was taken over in 2011 by the Britannia Hotels chain and has only two parks still open - Pakefield in Suffolk and Sand Bay in Somerset. Potters Resorts, which has a base in the Essex countryside and another on the Norfolk coast, was voted the best brand.
Burberry is set on cutting potentially hundreds of jobs as part of a radical cost-cutting programme, The Telegraph reports, saying that employees were told in a Zoom meeting last month that they are facing redundancy and will have to reapply for their roles. The company has begun a 45-day consultation with union officials, who are also coordinating redundancy settlements with a select group of employees. The company refused to say how many workers will be affected, but employees fear up to 400 jobs could be at risk. One employee described the process as “brutal”. Burberry employs 9,169 people globally, but the cuts are expected to mainly affect the company’s UK offices in Leeds and London. The fashion house has lost more than a third of its stock market value since the turn of the year and is one of the worst performers on the FTSE 100. Profits at Burberry fell 36% last year to £418m, while sales revenue fell 4% to £2.97bn.
Britvic has accepted a £3.3bn takeover offer from Danish drinks giant Carlsberg. Directors at Britvic say the offer of 1,315p per Britvic share, a premium of around 36% to the FTSE 250 soft drinks maker’s closing price on 19th June, is “fair and reasonable,” and they are recommending unanimously that shareholders vote in favour of the scheme.
Superdrug’s profit has surged past £100m, to £111.6m, after sales in 2023 broke the £1.5bn barrier. The chain also created more than 400 jobs in the year, according to results newly-filed with Companies House. The pharmacy and beauty chain is owned by AS Watson Holdings which is incorporated in the Cayman Islands and based in Hong Kong. It is the second largest health and beauty retailer of its kind in the UK, behind Boots.
The UK arm of energy giant Eon has returned to profit for the first time since 2020, posting a pre-tax profit of £49m for 2023, up from a loss of £659m in the year prior. Eon’s turnover rose from £2.862bn to £3.385bn over the same period.
Crest Nicholson, the London-listed housebuilder, has rejected a takeover proposal from Avant Homes, the rival housebuilder owned by Elliott Advisors. Crest previously rejected an offer from Bellway homes.
Asda has ditched plans for a four-day week after staff on a trial of the proposal claimed it left them feeling exhausted. The supermarket introduced flexible working arrangements “in a bid to stamp out a revolt among disgruntled store managers”, the Telegraph says, introducing the right for staff in 20 Asda stores to work a 44-hour week over four days instead of five, for the same pay. However, staff complained the longer shifts were “physically demanding” and left them exhausted on their day off. Others argued it was hard to meet the earlier start and later finish times, and parents said it created “difficulties with childcare and school drop offs and pick-ups”. A pilot which involves doing 39 hours in five days for the same pay has proved more popular and will run until the end of the year, Asda said.
Lord (Maurice) Saatchi, one half of advertising duo Saatchi and Saatchi, is said by Sky News to be considering putting in a bid for The Daily Telegraph ahead of a deadline for initial offers set by RedBird IMI later this month, linking up with Lady Lynn Forester de Rothschild, a former director of The Economist Group, to do so.
Boeing has agreed to plead guilty to a criminal fraud conspiracy charge and pay a criminal fine of $243.6m (£190m) the BBC reports, having violated a deal for reform agreed after two fatal crashes involving its 737 Max planes, which killed 346 passengers and crew. The settlement, which must be approved by a US judge, has been slammed by the families of those who died on the flights five years ago. They have called it a "sweetheart deal" that allows Boeing to avoid full responsibility for the deaths. “It is not immediately clear how the criminal record will affect the firm's contracting business,” the BBC notes. Read the full story at https://www.bbc.co.uk/news/articles/cjjjj85z0lno
The euro has fallen in response to a win in the French legislative elections by The New Popular Front (NPF), but without enough seats to make a majority, meaning there is likely to be a hung parliament. The currency fell as much as 0.4% against the US dollar and is currently worth $1.08, or 85p. [1] French bonds were also sold off, thereby pushing government borrowing costs higher, and the Cac 40 stock exchange in Paris opened lower, although has since gained some ground. The NPF, an alliance formed by socialist, green and communist parties (in order to keep the hard-right National Rally, led by Marine Le Pen, out of power), won 182 seats in France’s National Assembly, the 577-seat lower house. The NPF has promised to scrap pension and immigration reforms passed by the current government, to set up a rescue agency for undocumented migrants and to facilitate visa applications. It also wants to put caps on basic goods to combat the cost of living crisis and raise the minimum wage. President Emmanuel Macron is now under pressure to name his Prime Minister from within the ranks of the NPF.
[1] The Pound has benefited from the threat of political gridlock in the Eurozone’s second large economy – standing at a three-week high against the euro.