Tuesday 22 November

LONDON’S BUSINESS NEWSPAPER

NEW WAR OF WORDS OVER HEATHROW

ILARIA GRASSO MACOLA

HEATHROW’s boss John Holland Kaye was yesterday warned the pressure is on if this summer’s travel delays and disruption take place again.

Aviation veteran Willie Walsh said “heads should roll” if there is more chaos at the west London hub.

“People ask me ‘are we going to face the same problems next year?’ If we do, heads should roll,” Walsh –a former British Airways and IAG chief exec and now head of airlines trade body IATA –told a London conference.

“Let’s be clear: there is no excuse.”

Heathrow made the headlines throughout the summer as travel delays and cancellations disrupted holidays and business travel, with demand increasing faster

than staffing levels could manage.

Heathrow went as far as to introduce a passenger cap. The airport had been considering reintroducing the cap, which it binned after the summer, but any plans to do so have since been shelved.

According to Walsh, both the UK government and the aviation regulator, the Civil Aviation Authority (CAA), should have been “more vocal” in criticising the airport’s performance.

The director general’s words were echoed by Shai Weiss, chief executive of Virgin Atlantic, who said a repeat of this summer is “completely avoidable” if “honest and accurate forecasts are used now for resource planning and building resilience”.

Carriers have repeatedly accused Heathrow of downplaying its post-pandemic recovery in a bid to increase the passenger fee it can charge its air-

line customers.

An interim £30.19 fee was set in December last year by the UK’s aviation regulator to help the airport recover from the impact of Covid-19.

Airlines have warned the passenger fee would inevitably be passed onto passengers in the form of higher ticket prices.

Since the initial CAA decision, the airport has regained its status as Europe’s busiest hub but is still seeing passenger numbers below pre-pandemic figures.

“If we want a globally competitive aviation sector, [Heathrow’s fee] should simply not be allowed to happen,” Weiss said.

A Heathrow spokesperson said the airport was focused on boosting cooperation amongst stakeholders.

“Our efforts are firmly directed towards the constructive engagement and collaboration with the regulator and with the airlines to deliver great service for passengers this Christmas and into next year,” they said.

OIL MAJOR Shell has warned it could ditch its pledge to invest £25bn in the UK’s energy sector, after Chancellor Jeremy Hunt toughened the windfall tax last week.

David Bunch, chairman of Shell’s UK operations, confirmed the energy giant will “evaluate” its spending pledges –which includes 75 per cent in low carbon and renewable projects – and push for changes to the expanded Energy Profits Levy.

“We’re going to have to evaluate each project on a case-by-case basis. When you tax more you’re going to

have less disposable income in your pocket, less to invest,” he told the CBI conference in Birmingham yesterday. His comments are the latest blow to the UK’s ambitions to ramp up investment in the North Sea to boost the country’s energy security and stave off blackouts this winter.

Harbour Energy told City A.M. last week it was also “reviewing” the impact of the tax on its UK operations and would pursue talks with ministers.

A Shell spokesperson said they recognised the burden “increased prices have across society” but argued taxes needed to boost investment as well as support people.

EXCLUSIVE

LONDON is the most technologically advanced city in Europe, beating Paris, Frankfurt and Madrid, according to exclusive research shared with City A.M.

The capital’s capacity for world class innovation drove it to the top

of the continental rankings in Z/Yen’s sixth smart cities index.

New York topped the list.

The Square Mile’s banks, brokers and insurers’ ability to create new financial products also helped it retain second place in the world, while Z/Yen praised London’s infrastructure for enabling smooth trade.

London’s welcoming legal and tax regime has made it seamless for firms to interact with each other, the index noted.

UK cities dominated the top 10. Oxford and Cambridge also placed ninth and tenth, ahead of any other European city.

The closest place in Europe rivalling London is Zurich, followed

by Lugano and Malta.

London has topped most of Z/Yen’s other indexes on a European basis. The organisation recently ranked the capital as the top finance hub and the greenest place for banks, brokers and insurers.

European capitals have been vying for London’s crown as the top finance centre since Brexit.

NICHOLAS EARL

JACK BARNETT

STANDING UP FOR THE CITY

Business gets concerns over immigration –but shortages are real

Britain’s business groups have had a tumultuous recent past. In particular the CBI, the largest of the lot, was outmanoeuvred on the EU referendum and spent years seemingly scared of its own shadow. Attacked as the voice of corporatism not capitalism –not always an unfair criticism, it might be said –it seemingly abandoned the field of political debate and focused instead on ever-more-earnest congratulatory

THE CITY VIEW

press releases over whatever the latest green finance wheeze was.

It is to the director general Tony Danker’s credit that he has shaken off those self-imposed shackles.

Yesterday he said the quiet bit out loud: Britain’s economic growth

isn’t up to much. Significant parts of that are due to staff shortages. A significant part of that is due to, yes, Brexit. Nobody wants to fight the same old battles again. Sequels are invariably less enjoyable than the original, and the first battle over Britain’s post-Brexit relationship with the European Union wasn’t overly fun in the first place. But immigration, now controlled (in theory), remains one of the most economically beneficial things

that can happen to a country, and that’s nowhere truer than in London and the south east.

Rishi Sunak’s implicit deal yesterday was thus: let us control the boats on the channel, and you’ll get your worker shortage visas. Clearly, No.10 feel the optics do not allow them to expand current routes into the UK when people traffickers are still plying their trade, apparently with previous little resistance, on the Kent and Sussex coast. He’s

probably right.

But it’s beholden on business to continue making the argument that immigration is a net positive, and it’s not a choice between foreign labour or training up. Business owners are investing in training –but it takes time. And the shortages, as business leaders at the very top of the economy to the pub and bar owners of the City both know, are very real right now. The status quo will not do.

THE FINANCIAL TIMES

MORGAN STANLEY’S TOP INTERNATIONAL EXECUTIVE TO STEP DOWN

THE GUARDIAN UKRAINE TO START EVACUATIONS IN KHERSON AND MYKOLAIV REGIONS

Ukraine is to evacuate civilians from recently liberated areas of the Kherson and Mykolaiv regions, amid fears that the damage to infrastructure caused by is too severe for people to endure the winter.

THE TELEGRAPH INDONESIA EARTHQUAKE LEAVES AT LEAST 162 DEAD

At least 162 people were killed in a 5.6 magnitude earthquake that struck Indonesia’s main island of Java yesterday, causing office workers and residents of the capital Jakarta to flee onto the streets.

Flip flopping over tax hikes and spending cuts

vince investors he is serious about shoring up the UK’s public finances.

FLIP flopping on UK economic policy has been “a bruising episode” for the country over the past few months, a top City economist said yesterday.

The huge swing in tax and spending decisions by former Chancellor Kwasi Kwarteng and the current No.11 incumbent Jeremy Hunt has damaged the country’s financial credibility, according to Neil Shearing, chief economist at consultancy Capital Economics.

Last week Hunt launched £55bn of spending cuts and tax hikes to con-

Tax rises and spending cuts were designed to undo the damage to investor sentiment toward UK economic policy caused by former Prime Minister Liz Truss and Kwarteng approving £45bn of unfunded tax cuts.

“The UK’s current predicament was caused by a perception in markets that the Truss administration had weakened budget discipline and jettisoned the usual constraints on fiscal policy,” Shearing said.

“Not only did it announce large unfunded tax cuts, it also ignored fiscal

rules and eschewed [Office for Budget Responsibility] oversight.”

The fiscal swing between Truss and Kwarteng’s package and Hunt’s measures is around £100bn.

“The UK’s experience holds two lessons for other countries. First, there is much less room for fiscal error in a world of rising interest rates. And second, perceptions of fiscal discipline matter and can shift quickly,” Shearing added.

Weaker GDP growth and a swelling debt interest bill has burnt a massive hole into the UK’s finances, forcing Hunt into the corrective measures.

Soaring energy bills knock £142 off household finances

JACK BARNETT

SOARING energy bills have knocked £142 off Brits’ budgets over the last year, a new survey published yesterday revealed.

Research carried out by supermarket Asda and the Centre for Economics and Business Research (CEBR) found families are struggling to maintain spending amid rising prices.

Inflation has scaled to a 41-year high of 11.1 per cent, prompting the UK’s budget watchdog, the Office for Budget Responsibility, last week

alongside the autumn statement to warn of a combined real wage hit of 7.1 per cent over the next two years. That would be the biggest drop in living standards on records.

Economists reckon the coming recession, likely to last between one and two years, will be driven by consumers cutting spending in response to their pay failing to keep pace with prices.

Asda and the CEBR’s research supported this view. Some 54 per cent of families plan to cut spending on Christmas decorations to shield their budgets.

JACK BARNETT

has been a ‘bruising episode’ for UK

KEEPING IT CLEAN Soldiers at Hyde Park Barracks yesterday started preparations ahead of ceremonial events for this week’s state visit by the president of South Africa

Morgan Stanley’s top international executive, Franck Petitgas, is retiring from the Wall Street bank after a 30year career in capital markets and investment banking.

Regulator warns trading apps of ‘gamification’

CHARLIE CONCHIE

THE UK’s financial watchdog fired a warning shot at trading apps yesterday over the so-called gamification of betting on the financial markets, amid fears retail investors are being lured in to trades against their own interest.

In a statement, the Financial Conduct Authority (FCA) warned trading app operators to review design features including sending “frequent notifications with the latest market news” and providing investors with “in-app points, badges and celebratory messages”.

The warnings come amid fears on both sides of the Atlantic that retail investors are being prompted into speculative bets without understanding the ramifications.

US trading platform Robinhood, which used prompts like confetti sprinkling on screen when trades were placed, was among the most high-profile firms to be hit by allegations after it emerged a 20year old US-based customer committed suicide after mistakenly believing a leveraged bet had put him $730,165 in

the negative. The case prompted the firm to tighten its guardrails for customers.

The FCA said it had found gamification “being used in ways that may mislead consumers or lead to poor outcomes and problem behaviours”.

“Some product design features could be contributing to problematic, even gambling-like, investor behaviour,” said Sarah Pritchard, executive director of markets at the FCA.

“We expect all firms that offer stock trading to consumers to review and, where appropriate, make improvements to their products based on these findings.”

She added that firms should ensure they are supporting customers, particularly “those in vulnerable circumstances or those showing signs of problem gambling behaviour”.

The FCA said it now intends to do further research into trading app use and design features, in order to understand “wider financial vulnerabilities for users of these apps, such as whether they borrow to invest and the scale of any losses”.

Unions and engineering work to halt trains

RAIL unions threatened further strike action yesterday –with train companies also readying to stop services over Christmas for engineering work.

The RMT said they were “highly likely” to agree on further industrial action even though the Rail Delivery Group, negotiating for the operators, said “for the first time in months we can see the outline of a credible deal”.

Strikes since June have resulted in lost revenue of £250m-£300m, the group said.

The RMT claimed “the hand of the Tory government” was behind the failure to strike a deal –a claim the Department for Transport denied.

Five energy suppliers have ‘severe weaknesses’ in treating customers

NICHOLAS EARL

FIVE UK energy suppliers have severe weaknesses in how they handle vulnerable customers, according to the latest industry report from Ofgem.

It named Good Energy, Outfox, So Energy, Truenergy and Utilita as the five suppliers with the most issues.

Ofgem assessed how 17 suppliers across the energy sector treated customers in a vulnerable situation.

This included how energy firms

identified customers, and if they are adding them to the ‘Priority Services Register’, which offers additional support to customers in need.

Utilita pushed back at Ofgem’s findings, with a spokesperson telling City A.M. it “does not reflect where we are as a business today”.

Meanwhile, So Energy argued Ofgem’s findings were based on “incomplete information”.

The three other suppliers were approached for comment.

Oil markets whipsaw as Saudi Arabia rules out production hike

NICHOLAS EARL

OIL PRICES whipsawed in yesterday’s trading, before settling near the morning’s initial prices on both major benchmarks.

Prices dipped to their lowest since early January, before rebounding as reports varied over whether Saudi Arabia and other OPEC oil producers were

considering a half-million barrel daily output increase.

Brent Crude and WTI Crude prices both plummeted more than $5 per barrel amid media reports OPEC and its allies were considering a production boost of up to 500,000 barrels per day.

This saw Brent Crude fall from $87.09 per barrel to $82.41 per barrel in a couple of hours yesterday

lunchtime, before prices returned to near previous levels when Saudi Arabia ruled out a production hike.

WTI Crude slipped from $79.50 per barrel to $75.13, before also rebounding in afternoon trading.

Saudi Arabian energy minister Prince Abdulaziz bin Salman confirmed it was not discussing a potential oil output increases with other OPEC oil producers.

HERE WE GO AGAIN

Bitcoin tumbles below £13,500 as investors flee cryptocurrencies

CHARLIE CONCHIE

BITCOIN plunged below £13,500 again yesterday as investors flee to steadier ground amid turmoil sparked by the collapse of crypto exchange FTX.

The most valuable crypto currency fell as low as £13,456 early yesterday morning after tumbling to two-year lows earlier this month.

Bitcoin is down nearly 25 per cent since revelations began to emerge over the state of the balance sheet at Alameda Research – FTX’s sister firm – and has tumbled nearly 70 per cent from its all-time peak in November last year.

It comes as the industry is rocked by the fallout of the bankruptcy of Sam Bankman-Fried’s crypto exchange –previously regarded as

one of the most stable firms in the sector –which has sparked fears of contagion across the sector.

Crypto broker Genesis has been among the most high-profile firms caught up in the crisis as it froze withdrawals at the end of last week, warning it had been hit by “abnormal withdrawal requests which have exceeded our current liquidity”.

FTX shows urgent need for crypto rules, says Bank

CHARLIE CONCHIE

THE IMPLOSION of FTX has underlined the need to rapidly bring crypto within the remit of financial watchdogs before it threatens the stability of the wider financial system, the deputy governor of the Bank of England warned yesterday.

The collapse of FTX, founded by disgraced former billionaire Sam Bankman-Fried, has sent shockwaves through the crypto world and revealed major corporate failings at the top of the firm.

Speaking at a policy event, the deputy governor of the Bank Jon Cunliffe said there was a need to tighten oversight of firms before they grow large enough to threaten wider financial stability.

“While the crypto world, as was demonstrated during last year’s crypto winter and last week’s FTX implosion is not at present large enough or interconnected enough with mainstream finance to threaten the stability of the financial system, its links with mainstream finance have been developing rapidly,” Cunliffe said.

“We should not wait until it is large and connected to develop the regulatory

frameworks necessary to prevent a crypto shock that could have a much greater destabilising impact.”

The failed crypto bourse is now being wound up under the leadership of insolvency veteran John Ray III, who last week described the corporate failings at FTX as worse than Enron.

Britain’s financial regulators have been edging into the crypto space but currently only have oversight of crypto firms on anti-money laundering grounds.

Lawmakers have been pushing for more of the industry to be brought under the remit of the Financial Conduct Authority and Prudential Regulation Authority. However, City minister Andrew Griffith tabled an amendment to the Financial Services and Markets Bill currently progressing through parliament that will allow regulators to roll out a full framework for crypto currencies, in addition to original plans to regulate stablecoins.

Cunliffe said the Treasury intends to consult in the near future on “extending the investor protection, market integrity and other regulatory frameworks” to cover the crypto sector.

ON THE VIRGIN MONEY High street lender hands out 10 per cent pay rise to 7,500 staff

VIRGIN Money shares jumped yesterday after the company handed a 10 per cent pay rise to most of its 7,500 staff. The wage boost comes on top of a £1,000 one-off payment in August designed to help staff get through the UK’s cost of living crisis. Shares rose nearly 14 per cent yesterday. Profits also surged over 40 per cent to £595m in the year to September.

GAP BOLSTERS NEXT JOINT VENTURE WITH TWO BRANDS

Gap has added a pair of apparel brands to its joint venture with Next, after the fashion firm left the high street amid the pandemic. The e-commerce retailer yesterday said it will re-introduce Banana Republic and Athleta products to the UK via Next’s Total platform. It comes after the US retailer shut its 81 stores in the UK and Ireland in a phased exit last year, culling more than 1,000 jobs. It made a physical return to the country in March this year, with the opening of a Gap-branded shop within Next’s Oxford Street flagship site. Managing director of the joint venture Jon Jeffrey said the two brands were “aspirational” names to add to its offering which would help the venture expand its UK and Ireland portfolio.

SURVEY SETS OUT BLEAK CONSUMER CONFIDENCE

Seven in ten consumers do not expect their wages to keep up with rising prices, according to another damning consumer confidence survey. However, research from Jefferies revealed that only one in three businesses had seen evidence or expected job cuts. In worrying signs for the high street, the survey of European punters revealed 70 per cent would slash back spending on restaurants while more than half would pare back clothing purchases Some 57 per cent of shoppers said they would tame holiday spending. Fuel, energy and groceries are the categories with the sharpest price increases, with these items weighing the heaviest on shoppers’ budgets, the survey outlined.

IN BRIEF

Simon & Schuster and Penguin tieup on the rocks after merger block

LEAH MONTEBELLO

SIMON& Schuster’s owner is set to let its $2.2bn (£1.9bn) sale to Penguin

Random House collapse after the deal was blocked by US regulators.

German media group Bertelsmann, which owns Penguin, was unable to convince Paramount Global, Simon & Schuster’s owner, to launch an appeal of the decision, as

first reported by Reuters.

The move means that another suitor can now swoop in for the publisher. Bertelsmann will owe Paramount a $200m breakup fee.

It comes after a federal judge last month said the combination would “substantially” lessen competition.

The largest five publishers

currently control 90 per cent of the market and it was claimed the proposed merger would make up around 49 per cent of the blockbuster book space.

Competition concerns focused on authors’ earnings, with it argued that advances for writers across the board would be lower if the publishing giants came together.

Compass profits almost triple due to catering uptick

HENRY SAKER-CLARK

CATERING giant Compass yesterday revealed that profits had almost tripled over the past year after its recovery surpassed expectations.

The world’s largest food services provider said it reported record new business growth as demand for business and sports catering rebounded following the impact of the pandemic.

Revenues surged by 42.5 per cent to £25.5bn for the year to September 30, compared with the same period last year.

As a result, statutory pre-tax profits leapt to £1.5bn from £545m a year earlier.

Compass said it also benefitted from lower exceptional costs after the firm was affected by £157m of Covid-19-related “resizing costs” in the previous year.

Meanwhile, underlying operating profits were 87.5 per cent higher at £1.59bn for the year.

Compass told investors that underlying operating profits are expected to lift by around 20 per cent in 2023 as the new outsourcing market “remains buoyant”.

The group said underlying revenues have bounced to 105 per cent of pre-pandemic levels from 2019 after a rise in new

BIG SQUEEZE

customers. Compass said it also benefitted from the return of office workers over the final quarter of the year, boosting its business and industry sales above 2019 levels for the first time.

Dominic Blakemore, group chief executive of Compass, said: “The group’s performance surpassed our expectations both in terms of net new business growth and base volume recovery, with business and industry now operating above its prepandemic revenues.

“The strong growth trends seen in the first half have continued, with net new business accelerating through the year in all our regions.

“Our clients are continuing to face operational complexities and inflationary pressures, which are driving increased outsourcing, and we are successfully capitalising on the resulting growth opportunities. While the macroeconomic environment is uncertain, we are working in partnership with our clients to mitigate inflationary pressures.”

Compass said it will hand out a final dividend of 22.1p per share as a result of the performance. Despite the upbeat results, shares in the company closed down 1.43 per cent yesterday.

Sir Martin Sorrell’s venture fund backs US digital asset firm round

LEAH MONTEBELLO

A VENTURE capital fund backed by Sir Martin Sorrell revealed its first public investment in a US digital asset management platform yesterday.

S4S Ventures alongside Bertelsmann’s BDMI co-led a $10m (£8.48m) Series B investment in Tenovos, a New Yorkbased software-as-a-service provider, which helps clients streamline and automate the creation and activation of global content.

Tenovos counts the likes of Amazon, Mattel and Marvel as clients, and has continued to grow thanks to the wider push for more personalised online content for brands.

The funding will be used for product development, as well as supporting the business to expand globally.

Discussing the round, Sorrell, who is both the brainchild behind WPP and S4 Capital, said the combination of data and content was “foundational to modern marketing success”.

NEW data from ISBA and Ebiquity has revealed that companies are planning to cut back on TV spend next year as recession feeds into last-minute promotion and digital spend. Some 40 per cent of advertisers surveyed said they would cut spend on “offline” like radio and TV.

Two-thirds of advertisers plan to cut on traditional TV in favour of digital

Reform stamp duty to improve housing stock

NICHOLAS EARL

THE GOVERNMENT should reform stamp duty to encourage Brits to boost the energy efficiency of their new homes, argued Kingfisher, the owner of household brands such as Screwfix and B&Q.

Nick Lakin, group director of corporate affairs at Kingfisher, told City A.M. that Downing Street should consider “long-term macro nudges” such as financial incentives for people to insulate their new homes.

Commenting on potential options, he highlighted the possibility of a reimbursement scheme within a twoyear window of stamp duty for people boosting the efficiency of their homes with cavity wall, loft insulation and, double glazing

“It requires redesigning the stamp duty system, but you could redesign it and still make it cost neutral,” Lakin

added yesterday.

The Kingfisher director hoped this would be appealing to the government, which would be able to drive down energy bills and ease the cost of future support.

He said: “The difference now is there is a fiscal burden on the Treasury from subsidising all of the population’s energy bills. This means that they’re going to want to take this stuff even more seriously, perhaps more than they might have done before.”

This follows a report from trade association UK Finance on net zero homes, where it called for similar reforms to stamp duty.

Currently just one third of UK homes have an energy performance certificate rating of C or above – the minimum standards the government has set for domestic households by 2035.

This means that approximately 19m homes need retrofitting.

RAC calls on supermarkets to cut petrol prices to ease living costs

NICHOLAS EARL

THE RAC has urged supermarkets to cut petrol and diesel prices by 5p per litre to ease the pressure on cashstrapped Brits ahead of Christmas.

The motoring group’s ‘Fuel Watch Data’ revealed supermarkets are currently enjoying margins of around 15p per litre on both petrol and

diesel, while drivers are facing historically high average prices of 160.96p and 184.41p respectively.

RAC fuel spokesman Simon Williams said: “With many people struggling to put fuel in their cars it’s very sad to see the biggest fuel retailers taking advantage of their customers by charging far higher prices than they should be.”

Free market wonks support solar on farms

NICHOLAS EARL

TWO of the UK’s leading free market think tanks have lent their support to solar projects on farmland, and have raised concerns over the government’s potential tightening of planning rules on agricultural sites.

Andy Mayer, energy analyst at the Institute of Economic Affairs, told City A.M. it was “disappointing” the government was cracking down on solar projects in the middle of an energy and a growth crisis.

He said: “They claim it’s about food security, but the UK depends on trade for half our food, and modern tastes are geared towards many things we will never grow. It’s really about nimbyism. The government, whatever they say at climate summits, are more worried by angry resident associations than warmer summers.”

Emily Fielder, from the Adam Smith Institute, said: “Drastically curbing the amount of land available for solar farms during an energy crisis is nonsensical. This de facto ban on solar will keep energy prices high, weaken our energy security and risk investment in renewables.”

Supermarkets are enjoying margins of around 15p per litre on both petrol and diesel

Disney backs its boomerang boss Bob Iger

EX-DISNEY boss Bob Iger has made a dramatic comeback as the media giant continues to grapple with inflation and growing competition.

The businessman will take back the reins from Bob Chapek, who took over as chief executive in February 2020, to lead the iconic brand to a digital future.

“We thank Bob Chapek for his service to Disney over his long career, including navigating the company through the unprecedented challenges of the pandemic,” Susan Arnold, chair of the Disney board, said.

Iger, who spent more than four decades at Disney, including 15 years as CEO, has agreed to serve as top dog for two more years, less than a year after retiring.

The Disney chair said that Iger was “uniquely situated” to help the media titan navigate the “increasingly complex

having told the New York Times in January that it would be “ridiculous” for him to return to the company.

Iger was notably the man behind Disney’s acquisition of the Marvel film franchise and the Star Wars films.

Iger’s return comes at a difficult time for Disney, with shares having fallen some 40 per cent in the past year. The company’s fourth quarter profit and key revenue segments fell short of expectations earlier this month, with heavy investment in Disney+ having cut into margins.

Tech analyst at PP Foresight Paolo Pescatore said the change of heart underlined the state of the streaming landscape, as well as the “challenges faced by all traditional media companies pivoting towards this new world”.

Shares jumped over 10 per cent following the news.

Meta sued over data collection for advertising

LEAH MONTEBELLO

FACEBOOK owner Meta is facing a UK high court lawsuit after claims that it disregarded the right to object against the collection of personal data to sell to advertisers.

Human rights advocate Tanya O’Carroll alleges that the Silicon Valley giant breached UK data laws by failing to respect her right to demand that it stop collecting and processing her data.

Internet users have had the “right to object” to data collection since the GDPR was adopted in the UK in 2018.

O’Carroll’s claim includes an extensive list of “ad interests” that Meta had assigned to O’Carroll between 2021 and 2022, including sexuality and politics.

“This case is really about us all being able to connect with social media on our own terms,” O’Carroll told BBC Radio 4 yesterday.

If O’Carroll is successful, it could set a precedent for millions of UK users across all social media platforms.

A Meta spokesperson said: “We know that privacy is important to our users and we take this seriously.”

Return of tougher Covid-19 rules in China dampens investor sentiment

weighed down by the re-emergence of tougher restrictions in China.

FEARS of tougher Covid-19 restrictions across China were reignited yesterday, after the country recorded its first death from the virus in six months and curbs were tightened in cities such as Shijiazhuang and Guangzhou.

Local markets fell in response, led by Hong Kong’s Hang Seng Index which fell more than 1.87 per cent.

However, the jitters yesterday reached the Square Mile.

London’s FTSE 100 was also

Sunak dismisses Swiss-style trade deal with Europe

RISHI SUNAK will not pursue a postBrexit “Swiss-style” deal to bring the UK closer to the EU, the Prime Minister said yesterday.

“Under my leadership, the United Kingdom will not pursue any relationship with Europe that relies on alignment with EU laws,” Sunak said.

A report in The Sunday Times that the government might be looking at a new Swiss-style Brexit deal with the EU has sparked fury among Tory Brexiteers.

Switzerland, while not a member of the EU, has frictionless trade with the bloc, is in its single market and has freedom of movement with EU countries for people, goods, capital and services.

Speaking at the Confederation of British Industry conference in Birmingham yesterday, Sunak said: “I voted for Brexit, I believe in Brexit and I know

that Brexit can deliver, and is already delivering, enormous benefits and opportunities for the country.”

“We need regulatory regimes that are fit for the future... and having those regulatory freedoms to do that is an important opportunity of Brexit,” Sunak said.

Immigration minister Robert Jenrick also rejected the idea that the government was eyeing such a deal, saying it “couldn’t be further from the truth”.

“We have a settled position on our relationship with the European Union, that’s the deal that was struck in 2019 and 2020 – and that’s the one that we intend to stick to,” Jenrick told TalkTV.

“That sets out the fundamental position that we don’t want to see a return to free movement, we don’t want to have the jurisdiction of European judges in the UK, and we don’t want to be paying any money to the European Union.”

Only the most committed Brexit supporters could argue that leaving the EU hasn’t caused a set of serious economic problems.

The Office for Budgetary Responsibility has said the UK’s GDP will be four per cent smaller in the long term due to Brexit, thanks largely to the crippling effect on trade flows. These realities are coming into focus now the UK is entering into a recession and experiencing slower growth post-Covid than other G7 countries.

This has led to questions at the heart of government around whether the UK

Housebuilders’ shares to remain sturdy despite UK real estate woes

MILLIE TURNER

HOUSEBUILDERS are expected to avoid any significant share price tumbles amid an anticipated house price plunge in the UK, according to analysts at brokerage Jefferies.

In a research note yesterday, Jefferies analysts doubled down on UK housebuilders continuing to bring value for shareholders, despite the forecast dip in house prices and sales as mortgage rates rise.

Last week, the Office for Budget Responsibility forecast that house prices in the UK would tumble nine

per cent over the next two years.

However, Jefferies has cautioned that the hit to the market could be worse – with property costs potentially slipping between nine and 20 per cent in the coming years.

Spiralling inflation has also hit housebuilder’s margins as the cost of labour, materials and fuel spike.

A number of FTSE housebuilders have appeared sheepish on their outlook for the coming months, as the country dives into a recession.

Taylor Wimpey and Persimmon have warned of lower net reservation

rates and higher cancellations in recent weeks.

Barratt Developments and Bellway have also noted a slowdown in reservation rates as the housing market’s pandemic era glow begins to dim.

“Despite the recent bounce in the stock prices, and while still nervous around news flow near term, we see strong value available,” analysts at Jefferies wrote.

“Current share prices we calculate reflect not just 20 per cent decline in volumes but also 9-20 per cent house price decline compared to OBR view of -9 per cent.”

Analysts at the firm have kept most of the country’s biggest housebuilders, listed in London, firmly within its buy rating.

The capital’s premier index edged 0.12 per cent lower to 7,376.85 points, while the domestically-focused midcap FTSE 250 index, which is more aligned with the health of the UK economy, climbed 0.68 per cent to 19,413.35 points.

“Renewed outbreaks of Covid have seen some restrictions return and helped dampen sentiment,” Russ Mould, investment director at broker AJ Bell, said.

Investors had been hopeful of a gradual reopening after Beijing started to ease a number of Covid-19 measures restrictions early last week.

Chinese officials announced that they were relaxing some “zero-Covid” policies, such as suspending flights from airlines that had brought a certain number of passengers who tested positive.

However, Beijing has since returned to confining some residents to their homes and ordered others to quarantine centres.

THE BOTTOM LINE

should change tack and seek a closer relationship with the EU. The proposal of a Swiss-style deal with the EU, however, is clearly untenable.

Sunak, despite being a genuine Leaver, already isn’t trusted by the right of his party to stay the true Brexiteer course. Any attempt to converge with Brussels and become a regulatory rule taker would likely lead to another leadership coup within the Tory party. However, it has become increasingly

clear that the current post-Brexit relationship is not working.

Sunak needs to secure some deregulatory wins quickly to make the most of the UK’s Brexit freedoms, while also improving relations with Brussels, which includes the difficult task of finding a bilateral solution to the Northern Ireland Protocol.

Sunak’s only political option is to walk this tight rope and hope the right of the party, who are already seething after last week’s tax hikes, allow him the time to make it work.

STEFAN BOSCIA

ANNOUNCEMENTS

STEFAN BOSCIA

MILLIE TURNER AND JACK BARNETT

China yesterday recorded its first Covid-19 death for six months

UK ‘could and should’ be AI global power

more needs to be done to improve data capabilities across government.

THE UK could be the next big global artificial intelligence superpower as the government leads the way with public sector investment.

According to a new independent report carried out by WPI Economics, on behalf of software firm Splunk, the UK is forging ahead of its European rivals in its use of new technologies across departments and government agencies. This was compared to the other three leading AI countries, including France, Germany and the Netherlands.

WPI Economics revealed that the government has invested more than £2.3bn since 2014 into AI to improve data management, allowing it to play a key role during the pandemic for the government.

For instance, the NHS was seen as a pioneer with AI for medical imaging, using it to better detect the severity of a patient’s condition and provide direct patient care.

Despite this, the report warned that

ANNOUNCEMENTS

It argued that several departments still do not have a data strategy and there are still too few civil servants with the requisite knowledge to improve data usage and share data.

Secretary of State for Digital, Culture, Media and Sport Michelle Donelan welcomed the study this morning, stating that the UK “could and should be a global superpower in this space in the coming years”.

This ambition has also been a key talking point for Prime Minister Rishi Sunak, who said during his speech at the CBI this week that innovation would be a “defining focus in my government”.

Part of these plans include enticing more high-skilled migrants in areas like AI into the UK. “We cannot allow the world’s top AI talent to be drawn to America or China,” said Sunak.

The UK is currently negotiating a free trade agreement with India to ensure top talent is attracted into this space.

LEGAL AND PUBLIC NOTICES

CITY of LONDON

The PLANNING ACTS and the Orders and Regulations made thereunder

This notice gives details of applications registered by the Department of The Built Environment

Code: FULL/FULMAJ/FULEIA/FULLR3 – Planning Permission; LBC – Listed Building Consent; TPO – Tree Preservation Order; OUTL – Outline Planning Permission 78 - 80 Old Broad Street, London, EC2M 1QP 22/00651/LBC

Internal alterations involving the removal of internal partitions and installation of new internal partitions and installation and display of a nonilluminated fascia sign and non-illuminated projecting sign. (REVISED DESCRIPTION)

37 Ludgate Hill, London, EC4M 7JN 22/01006/FULL

Proposed change of use from retail (Use class E) to takeaway (Sui Generis).

100 Cannon Street, London, EC4N 6EU 22/01016/FULL

Extend the existing roof terrace to utilise additional useable space.

36 St Andrew’s Hill, London, EC4V 5DE 22/01043/LBC

Demolition and reconstruction of the existing

Stonecutter Court, 1 Stonecutter Street, London, EC4A 4TR 22/01050/NMA

Non-material amendment pursuant to Section 96A of the Town and Country Planning Act 1990 (as amended) to amend Condition 37 (Approved Documents) of planning permission 18/00878/ FULMAJ (dated 28/03/2019) to allow for the relocation of photovoltaic panels to main L14 roof and plant screen, addition of green roof on roof level, additional pass door to main entrance on Stonecutter St, repositioning of terrace doors on L8, L10 and L12, removal of door at ground level on Farringdon St, addition of riser inlet cupboard and lighting control box on facade at Harp Alley,

St Bride St, reduction in louvred area, additional UKPN door, repositioning of pedestrian access door to loading bay on St Bride St.

Retail Unit 3, 2A Eastcheap, London, EC3M 1AA 22/01074/LBC

Another low-cost flyer tries to make transatlantic travel work

REBECCA BLACK

A NEW low-cost airline is set to offer transatlantic flights from Northern Ireland.

The announcement by Fly Atlantic has been described as a “game changer”, filling the gap in the market of no direct flights currently operating between Belfast to North America.

Fly Atlantic is planning to start operating flights to Europe as well as North America.

Once fully operational, the airline said it intends to operate to 35 destinations from Belfast, and will create 21,000 new jobs by 2030. That figure is to include 1,000 jobs created within the airline and up to 21,000 in tourism and support sectors. Flights will begin in 2024.

Molten slumps to loss as tech downturn hits

CHARLIE CONCHIE

LISTED venture capital investor

Molten Ventures has slumped to a loss in the first half of the year after its tech investments were battered by a downturn on the markets.

The FTSE-250 firm, previously known as Draper Esprit, said its portfolio value had tumbled to £1.45bn in the six months to the end of September, down from £1.53bn in March.

Molten also reined back its investments in the period and pumped £112m into firms, alongside £17m from the enterprise investment scheme and venture capital trust funds, compared to £164m and £4m in the same period last year respectively.

The fall led Molten to a post-tax loss of £155m after posting profits of £218m in the six months to the 30th September. Martin Davis, CEO at Molten Ventures, said the firm had “not been immune” from the challenging market conditions for technology firms in the first six months of its year.

“Wider macroeconomic factors –rising inflation and global interest rates – have impacted public markets and particularly the valuation of technology stocks,” Davis said, adding that this has also fed into the “private arena” where investment has slowed.

PA

associated external and internal works.

Retention of one internally illuminated digital menu board measuring 1.23m high by 0.7m wide by 0.01m deep.

You may inspect copies of the application, the plans and any other documents submitted with it on-line

or telephone 020 7332 1710.

Anyone who wishes to make representations about this application should do so online:

Any observations must be received within a period of 21 days beginning with the date of this notice (unless otherwise stated) and will be taken into account in the consideration of this application.

In the event that an appeal against a decision of the Council proceeds by way of the expedited procedure, any representations made about the application will be passed to the Secretary of State and there will be no opportunity to make further representations.

Hedin given extension for Pendragon bid

HENRY SAKER-CLARK

UK CAR dealership Pendragon has revealed its Swedish suitor has been handed an extension over its potential £400m takeover move.

In September, Swedish motor company Hedin Group approached Pendragon over a possible deal to buy out the entirety of its share capital at 29 pence per share.

The group, owned by Anders Hedin, has a 27.5 per cent stake in the car dealership and is its biggest shareholder.

Hedin Group is a major retailer

of vehicles in several European countries including Sweden, Germany, and the Netherlands and it operates 240 dealerships

Pendragon said it would consider the preliminary proposal as Hedin was handed a deadline of 24 October to submit a formal offer or walk away.

The “put up or shut up” deadline was later extended to 21 November to allow Hedin to finalise necessary due diligence.

However, yesterday Pendragon said Hedin has still not confirmed if it will table the offer but has

been granted a further extension by the UK takeover panel.

Hedin said due diligence is “now substantially complete”, as the firm was set a fresh deadline of 5pm on 9 December.

The extensions are the latest part of a lengthy period of takeover interest, coming after Pendragon was forced to reject a bid from an international company in August after being unable to get hold of one of its biggest shareholders.

Shares in Pendragon closed up 5.93 per cent at 28.6p yesterday as a result

LEAH MONTEBELLO

Fly Atlantic will launch from Belfast in 2024, creating direct flights from the country

Shares in Pendragon rose almost six per cent yesterday following news of the extension

CATEGORY

PAVIA

Pavia is a singles instance world, made up of 100,000 plots of NFT land and a thriving community that will shape this utopian virtual world together. Pavia has not only awarded each land owner with 8333 $PAVIA tokens for each land parcel they own, but they have also given them Pavia merchandise such as hats, hoodies and tshirts, plus opportunities to own Pavs.

Pavia has a lively community and has constantly found ways to give a little back to those that have invested in their project. Pavia has 17,400 wallet holders, considerably higher than any other metaverses on Cardano. Pavia was also the first metaverse to be minted on the Cardano Network. Unlike many other projects, Pavia believes Interoperability is a high priority.

VOMA LABS

We created VOMA as the world’s first completely virtual art museum. Accessible from anywhere with an internet connection, it was launched in November 2020.

It has held museum-level exhibitions of world-renowned artists, along with a programme of talks and curators tours. It has fast become a destination for art-lovers globally, going viral in a way that was previously unthinkable for a museum.

We’ve proved that in a post-pandemic world, people demand more and higher access to the arts. The work we’ve done with VOMA forms the basis of our plans for the future.

With the expansion of the VOMA landscape and capability to include metaverse solutions for museums and corporates.

THE SANDBOX

The Sandbox is a virtual world where players can build, own, and monetize their gaming experiences and assets inside an immense virtual world. The Sandbox offers a suite of tools, tailor-made to empower players to come together and create engaging experiences across the metaverse.

COINBASE

This year, Coinbase announced the single largest deal between a crypto platform and an asset management provider. We finalised a deal to begin offering institutional crypto access to BlackRock’s Aladdin platform. BlackRock is the world’s largest asset manager. The creation of the new access point saw the providers connecting the dots between Aladdin – an end-to-end investment management platform – and Coinbase Prime, which offers crypto trading, custody, prime brokerage, and reporting capabilities.

SWARM

Swarm provides compliant DeFi infrastructure for token issuance, liquidity and trading. Our permissioned infrastructure combines the architecture and innovation of DeFi with the reassurance of regulation.

Regulated by BaFin in Germany, we connect TradiFi with DeFi. We can onboard new participants and assets into the blockchain ecosystem to create novel products and services so that people can do more with DeFi.

AAVE

Aave is a decentralised non-custodial liquidity market protocol where users can participate as depositors or borrowers. Depositors provide liquidity to the market to earn a passive income, while borrowers are able to borrow in an overcollateralised (perpetually) or undercollateralised (one-block liquidity) fashion.

Issa brothers’ Leon continues coffee roll-out

EMILY HAWKINS

LEON IS set to more than double its self-serve coffee kiosks in the UK over the next couple of months, as the Issa brothers expand the on-the-go food operator.

The chain, which sells healthier alternatives of fast food and is owned by the billionaire brothers behind supermarket Asda and petrol forecourt operator EG group, aims to expand its presence by the end of January.

Its number of self-serve coffee stands in the UK will top 200 before the end of January, with over one hundred to be launched in Asda stores.

The brand, which was poached by the

Mohsin and Zuber Issa

duo’s EG Group in 2021, currently has coffee kiosks in 65 EG convenience stores and 33 Asda supermarkets.

The expansion programme will also see four kiosks introduced at EG service stations before the end of the year.

The rollout marks another “milestone” in Leon’s expansion programme, according to the chain’s managing director Glenn Edwards.

“We continue to invest and innovate, with the intention to make Leon more accessible to more customers. Whether in our drive-thrus, restaurants, selfserve or through our grocery offer, we continue to make it easier for everybody to eat well, live well and be kind to the planet,” he said.

EG has pledged to create some 22,700 jobs in the UK in the next four years, thanks to investment in its food service arm.

Elizabeth Line celebrated as a boon for business after six months in action and near 70m journeys

ILARIA GRASSO MACOLA

LONDON businesses have gathered to celebrate the Elizabeth line’s impact on the capital almost six months after its opening.

Data published by Transport for London (TfL) showed that almost 70m trips have been made on the line since 24 May.

“This incredible project, which

the government invested over £9bn into, has already created over 55,000 jobs and is expected to generate £42bn for the entire UK economy, is a shining example of what we can do when working together,” transport secretary Mark Harper said.

London mayor Sadiq Khan and TfL’s interim commissioner Andy Lord also praised the line for

boosting the capital’s profile, while West End businesses credited the line for supporting them in their post-pandemic recovery.

According to Dee Corsi, chief executive of the New West End Company, people capitalising on the line’s quick connection in the run up to Christmas will lead to £1.55bn spent across West End businesses.

The dollar has strengthened markedly over the last several months. According to the Federal Reserve’s US Dollar Index, which tracks the currency against six others including the euro, the greenback was up around 17% at October 2022.

Reflecting the troubled economic conditions in Europe, which have been enflamed by the crisis in Ukraine, the euro fell below parity with the dollar in July –breaking through a notorious psychological barrier for the foreign exchange market – for the first time since 2002. The British pound has also been put through the wringer.

For international organizations with dollar-denominated debts, this means conditions have become considerably more expensive over the course of this year. Conversely, for US consumers, a stronger dollar will lead to lower prices on imported goods. And for US organizations with an eye on overseas expansion, the exorbitant privilege afforded them by their stronger currency has put them in a rather enviable position for M&A.

BARGAIN HUNTING

Thanks to this increase in purchasing power, which seems unlikely to dissipate for as long as the Federal Reserve maintains its inflation-fighting monetary policy stance and keeps its policy rate high, cross-border M&A into Europe involving US bidders could swell.

Even in the context of broader macroeconomic disquiet and a less lively M&A market – certainly in comparison to dealmaking volumes in 2021 – now may be

Will the Strong Dollar Make European Targets Appealing?

carry less heady valuations than their US equivalents, and the strong dollar should make these opportunities all the more appetizing.

BOOSTING BIDDING

These currency swings won’t translate into swollen cross-border deal volumes

equations – not least the war in Ukraine and political volatility in the UK. But the forecast is rather bright.

Through the first six months of this year, 612 companies in Western Europe were targeted by US bidders, not very far behind the 658 such deals announced in H1 of 2021, per Mergermarket data. The last couple of

Datasite is a leading SaaS provider for the M&A industry, empowering M&A professionals around the world with the tools they need to succeed across the entire deal lifecycle. For more information, visit www.datasite.com. To learn more about how M&A is faring around the world, scan the QR code.

Datasite discusses the strong dollar and how it may affect purchasing power in Europe

JEREMY HUNT’s £55bn tax grab last week marked the death knell for Liz Truss’ ill-fated minibudget, but many of the energy policies and goals promoted by her predecessor Boris Johnson remain intact.

Not only did the Chancellor reinforce Johnson’s funding pledge for Sizewell C, but the Energy Security Strategy from April has stayed in place, alongside its highly ambitious targets for renewable generation.

This includes vast plans for offshore wind and solar power, with the government aiming for 50GW and 70GW of both power sources by 2030 and 2035 respectively to boost the country’s energy independence and meet its environmental goals.

However, without reform, National Grid faces zombie projects stuck in development limbo –unable to progress through the planning system, huge bills to turn off operating turbines to prevent the UK’s creaking network from breaking down and a lack of power distributed to key population hubs hundreds of miles from future energy sources like offshore wind and solar farms.

This raises the question of whether National Grid, the UK’s motorway network for the UK’s power supplies, is prepared for such a mammoth task.

Ben Wilson, chief strategy officer for National Grid, told City A.M. that to meet Downing Street’s targets it would need to connect the grid to a further 40GW of renewable power over the next eight years – a sixty per cent boost on current capacity.

In his view, there were three things National Grid needed to push for: anticipatory investment, planning reform and updating the connections process.

But such a scale-up will be highly dependent on National Grid building the necessary power lines, storage facilities and interconnectors to distribute power across the country, including shifting historic amounts of offshore wind power from the North Sea to the south of England.

Wilson called for developers of energy projects and the National Grid to work in concert to ensure new sites were connected to the grid more quickly, and improve how and where it spends money to make improvements.

“When we see these developments coming, such as offshore wind leases, we need to be able to start planning to reinforce the grid – and construct that reinforcement in parallel with developers working on their projects and before the connection request,” Wilson said.

He was also in favour of financial support for communities facing inconvenience from new projects to reduce opposition to vital infrastructure.

Wilson said: “If you are impacted by local infrastructure, it is only right that there should be community investment to come hand in hand with that.”

His comments echoed National Grid chief executive John Pettigrew, who earlier this month told City A.M. he thought the government should consider how it can provide “benefits to local communities that are hosting infrastructure”.

Wilson expected the government to be consulting on the prospect of financial compensation in the new year.

Barnaby Wharton, director of future electricity systems at industry body Renewable UK, argued National Grid had to be ready for the shift from fewer generators set up close to demand at fossil fuel plants to lots of renewable generators being built hundreds of miles from British households.

This means there will be an increasing need to build more transmission infrastructure, such as power pylons or underground copper cables, quickly.

“The regulatory structures we have in place don’t allow for that pace of deployment,” Wharton warned, adding that the regulatory regime is too focused on “minimising cost today rather than seeing the long-term value in the network”.

Speeding up the planning process for rolling out transmission infrastructure seems like a no-brainer for Downing Street, which is aiming to shave three years off the planning cycle for renewable projects, with offshore wind turbines, for example, taking up to seven years to complete under the current planning system.

NATIONAL POLICY STATEMENT

National Grid also noted one of the key influences on planning for the country’s green future were National Policy Statements (NPS) – which are used to shape energy developments. While the government has a new strategy in place, the latest NPS was established under the former energy and climate department back in

2010-11.

“It’s very important that NPS is updated and reflects the amount of renewable generation that is required, but also references the network required to connect it – and the current ones don't do that,” Wilson said.

“They focus on generation; they do not focus on networks.”

National Grid has also made some of its own adjustments to steps to make the development pipeline for energy projects more efficient.

As things stand, proposed new renewable energy projects enter the Transmissions Entry Capacity queue, which are approved on a first come first serve basis, rather than whether they are fully funded and ready to go.

But if projects want to exit the queue, due to issues with funding or planning, they face financial penalties. This system has led to viable renewable energy projects being delayed – with nervous project managers in the queue fearing losses if they step aside.

To address this, National Grid has set up a temporary amnesty – providing companies with the ability for people to exit the queue if they feel the project is not going to go ahead without having to suffer financial penalties.

Wilson conceded, however, that the queue process might need some further tweaking in order to get more renewable projects up and running, and connected, quicker.

GRID’S MONOPOLY POWER

Despite National Grid’s recent reforming zeal, the group is not without its critics.

Octopus Energy’s boss Greg Jackson argued last month National Grid was “not fit for purpose” and was the biggest challenge to building more renewable energy sources.

He argued there should be more options for developers looking to connect their projects to the UK’s energy grid – questioning its monopoly status.

At the Times Earth Business Summit last month, he called on the UK to follow the example of other countries such as India and Brazil with “contestable grids” where connections can be fielded by competing contractors.

Rachel Fletcher, director of regulations and economics at the energy firm, argued that it was simply taking too long for new renewable energy projects to get grid connections.

She said: “If you know the best place for your wind farm and the place that people want it – that is good for birds and good for catching wind – if it is on a bit of the network that is already at capacity, then you have to wait a very, very long time to get to get a connection to get to get an upgrade.”

The energy expert also questioned whether National Grid should maintain its monopoly status – with the organisation showing too much reliance on settled ideas at the risk of lacking innovation.

Fletcher said: “For example, putting storage next to a wind farm might be a more effective and cheaper way of dealing with the impact of that wind farm on the grid than putting more copper in the ground. But the network companies –clues in the name –are hardwired to think about particular solutions.”

She warned there was a risk in defaulting “to the same old same old solutions”, which might not be the most cost effective.

These remarks reflect the daunting challenge ahead for National Grid –which will have to meet such criticisms with actions rather than words, as the UK seeks to transform its entire energy sector.

CITY of LONDON Notice is hereby given that the Common Council of the City of several Orders on 17 November 2022 under Section 14(1) of

Cornhill (Entire Length) ---- Scheme Works

Ian Hughes Director,

CITY DASHBOARD

YOUR ONE-STOP SHOP FOR BROKER VIEWS AND MARKET REPORTS

LONDON REPORT BEST OF THE BROKERS

Return of Covid cases in China dispels hopes for global rebound

LONDON’s FTSE 100 was yesterday weighed down by the reemergence of tough restrictions to tame Covid-19 in China over the weekend. The capital’s premier index edged 0.12 per cent lower to 7,376.85 points, while the domestically-focus mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, climbed 0.68 per cent to 19,413.35 points.

Virus cases have been rising in China, causing the first Covid-19 related death in Beijing in months, sparking a tough response from lawmakers.

Investors had been hoping for global economic activity to be lifted by Beijing easing its tough response to the pandemic. “However, renewed outbreaks of Covid have seen some restrictions return and helped dampen

sentiment,” Russ Mould, investment director at broker AJ Bell, said.

Middle-class favourite and online supermarket Ocado continued its long term slide today, falling nearly five per cent and to the bottom of the FTSE 100. Its shares are down nearly 60 per cent since the beginning of the year. Investors have soured on the firm after the boost it received during the pandemic from consumers turning to online supermarkets during lockdowns has whispered out.

High street retailers also dragged the premier index lower.

Primark owner Associated British Foods fell 1.89 per cent, while Next shed 1.15 per cent.

Markets are worried British consumers will respond to elevated inflation by slashing spending.

Virgin Money rose nearly 15 per cent.

CITY MOVES WHO’S SWITCHING JOBS

NEWTON

Newton Investment Management, part of BNY Mellon Investment Management, has bolstered its board with a fresh chair.

Ex-Fidelity Investments Japan CEO Judy Marlinski, currently an independent nonexecutive board member, stepped into the new role earlier this month, having sat on the board since July of this year.

Peel Hunt maintained its ‘buy’ rating for Diploma, praising the company’s model as “quality”. It said the British-based technical products and services supplier’s outlook was confident, especially considering the fact full year revenues were up 29 per cent to £1bn. “We expect there is plenty more to come,” the broker said, giving the FTSE 250 firm a target price of 3,000p.

Hunt downgraded its target price by 30p to 470p yesterday for Gleeson, after the firm’s AGM confirmed a softer trading environment and a higher cancellation rate. Brokers still backed the housebuilder, which specialises in first-time buyer properties, as a stock worth buying, stating that it still offers a “clear value proposition to its customer base”.

Marlinski succeeds Susan Noble, as Noble steps down after eight years as a board member and five years as chair.

“She brings a tremendous amount of global experience and pedigree to this role which will be invaluable,” said CEO Euan Munro. “A big thank you to Susan for her eight years of service as a board member. Her counsel and leadership have made a significant contribution in shaping Newton’s growth.”

H.I.G. CAPITAL

Alternative investment firm H.I.G. Capital has built out its London office with three new hires within its capital

formation group.

Incoming managing director Daniel Rosenthal Ayash will be responsible for managing European client partnerships for the firm’s global private equity platform. Meanwhile Bernice Berschader joins as a principal to oversee European client relationships for the firm’s global credit platform. Micael Hagelin joins the same platform as a managing director.

“We are thrilled to welcome Daniel, Bernice and Micael to H.I.G. Their expertise and knowledge of alternative assets, across the European markets, will play a meaningful role in our continued efforts of providing compelling and differentiated offerings,” executive

managing director Jordan Peer Griffin said.

GOODWIN

Law firm Goodwin has strengthened its London-based employment practice with a new partner.

Alex Fisher brings experience on transactions, restructuring and redundancy processes, employee complaints and whistleblowing allegations, executive exits and other employee dismissals.

“Alex’s experience and capabilities span transactional, advisory and contentious work, which will further enhance our UK client offering,” said Rob Hale, chair of the employment practice.

THE GREAT WALL

“Once again, the FTSE 100 is finding the 7,400 mark a difficult wall to climb over as nagging worries over the economic outlook help to drag it lower, with its heavy weighting to commodities stocks not helping given this sector is particularly sensitive to Chinese growth fluctuations.”

RUSS MOULD, AJ BELL

The Hot Tickets

Musk’s Twitter takeover and the FTX collapse should end the founder cult

Max von Thun

FEW would disagree that entrepreneurs and the companies they create are an essential part of any successful economy. Nevertheless, today’s excessive levels of founder adulation – call it the cult of the founder – are proving damaging in ways that are plain to see, from Elon Musk’s takeover of Twitter and the spectacular collapse of FTX, to Mark Zuckerberg’s eye-watering investments in the metaverse.

Start with Twitter. Musk may not have founded the social media platform himself. But his dictatorial way of running it, and belief that he alone holds all the solutions to Twitter’s problems, is typical of the extreme self-confidence and “lone genius” mentality that characterises the cult of the entrepreneur. Musk’s delusions of grandeur, and our collective indulgence of them, are seriously threatening the future of an important communications platform, with Twitter rapidly haemorrhaging staff, advertising revenues, and credibility.

The other case study dominating the headlines is the sudden demise of crypto exchange FTX, founded by Sam Bankman-Fried. Thanks to his perceived charisma and “vision”, Bankman-Fried was able to overcome both his inexperience and a lack of

transparency around FTX’s business practices to rapidly raise billions of dollars from some of the biggest names in venture capital, all the while rubbing shoulders with the political and business elite. Yet despite making the cover of Forbes, Bankman-Fried’s $32bn business empire ultimately turned out to be a house of cards, with FTX now officially bankrupt, unable to pay back its tens of thousands of customers, and subject to investigations by regulators. A less stark but equally instructive example is Mark Zuckerberg’s stewardship of Meta, the company he founded (as Facebook) in 2004. While Zuckerberg’s success in turning Facebook

into a social media empire is undeniable, his current mission to create the “metaverse” by spending tens of billions of dollars a year – while simultaneously laying off over a tenth of Meta’s staff – is more questionable. But thanks to the belief that founders always know best, investors allowed Zuckerberg to maintain a “dual class” shareholding structure at Meta even after its public listing. It made him largely untouchable when it comes to major business decisions.

It's not as if we haven’t been here before. One need only recall Elizabeth Holmes, who conned investors out of hundreds of millions of dollars based

on bogus claims about

the initial public offering of

own company after evidence of his financial and strategic mismanagement came to light – and who is now staging an unlikely comeback. Why do we keep falling for it?

A society that values the contributions of entrepreneurs is no bad thing – indeed quite the opposite. But current attitudes towards founders veer beyond appreciation towards idolatry, blurring the lines between entrepreneurship, celebrity and influencer culture. The causes of this are

wide-ranging, from the mythification of the tech founder through figures such as Steve Jobs and Bill Gates and the role of social media platforms in giving individuals a platform for selfpromotion, to the cheap money and rapid growth of the tech sector over the past decade.

No matter how visionary the founder, creating, growing and running a successful company is a collective endeavour that relies on the effort and ingenuity of many talented people, not just one. And that is without mentioning the many other factors that determine a firm’s prospects, from access to skilled workers, high-quality infrastructure and the rule of law, to a conducive macroeconomic environment and of course, a healthy dose of luck. In other words, individual brilliance is a necessary, but not sufficient condition for creating and sustaining a world-class business. Some studies even suggest that companies led by founder-CEOs perform worse on management than any other kind of leadership structure, including family and private equity-run companies.

Today’s challenging economic conditions are forcing a delayed but necessary reckoning with the cult of the founder, in the process separating the wheat from the chaff. One can only hope that moving forward, investors –and society more generally – will be a little more careful about putting blind faith in charismatic founders, and pay more attention to the many other ingredients that go into building a successful company.

£ Max von Thun is a political consultant and commentator

Our productivity problem won’t solve itself by magic, Britain needs some real ambition

YESTERDAY, UK business leaders gathered at the CBI’s annual conference to address how the country can achieve long-term growth in the face of tough economic conditions. As these headwinds continue to gather pace, UK productivity is weak. For over 80 per cent of business leaders, the next three years will be the most challenging they have faced.

Boosting competitiveness is critical. Cutting costs is one option, but a better solution is boosting employee productivity.

Low productivity in the UK is not a new phenomenon. We have lagged other Western economies for more than a decade. But as a key enabler of future growth and competitiveness, now is the time to look beyond the economic doldrums and focus on lifting the UK out of its productivity slump.

British business showed its resilience during the turbulent times of the Covid-19 pandemic. Global operations and complex supply chains were transformed with unparalleled speed in re-

Simon Eaves

lenges without forgoing plans for the next growth cycle. This will keep us competitive, but we also need a new approach to productivity.

sponse to the challenges brought by sudden lockdowns and seismic changes to working practices.

And while UK businesses are facing a crossfire of headwinds, many are still confident in their resilience. UK firms remain more positive about the future than any of their European peers. This determination must be combined with a political focus on kickstarting our economic growth, to give us the confidence that industry can adapt.

Rishi Sunak, in his keynote speech yesterday, acknowledged the challenge we face in fixing the producitivity slump we’ve seen since 2008.

For the moment, businesses need to make it through the short term chal-

Gone are the days when we can simply ask employees to work harder or longer. As we move from one crisis to another, many employees are feeling overwhelmed and fatigued. Instead, businesses must ask how they can help their people work smarter.

Recent research from Accenture and Frontier Economics found that, by building their digital capabilities, the UK has the potential to add £33bn to national output in 2030 – adding 1.5pp to growth and more than doubling the forecast rate of economic expansion.

It will require organisations to overcome a vicious, failure-inducing cycle which bugs digital transformation projects: weak ambition, low investment and tentative delivery. But doing so will enable them to adopt and exploit a new wave of technologies which can revolutionise productivity up and down their supply chains.

From machine learning to extended reality, new tech can help workers overcome the time, distance and knowledge gaps that weigh on productivity.

Realising this potential is not a walk in the park. These capabilities rely as much on human ingenuity as they do on technology – so creating a culture of change to enable employees to reimagine their work and investing in upskilling cannot be overlooked.

Getting this right will provide an invaluable boost to the economy during tough times, but it will also ensure businesses are in the strongest possible position to support themselves, their customers, and the wider economy, by reinvesting in upskilling, talent retention and local economies to support regional growth.

It’s high time businesses stop expecting output to grow of its own accord. Neither their companies nor the country can afford to wait.

£ Simon Eaves is the market unit lead in

the UK and Ireland at Accenture

EDITED BY SASCHA O’SULLIVAN

revolutionising blood testing. Or Adam Neumann, the eccentric WeWork founder who botched

his

Elon Musk’s purchase of Twitter has stoked fears the social media site is headed for demise

NO REST FOR NADINE Nadine Dorries, apart from writing an ode to Boris Johnson’s career, was banking on a peerage to keep her in politics. But Rishi Sunak is apparently considering blocking some of Boris’ plans to vault allies into the House of Lords. Worse still, Keir Starmer would have them elected

Buy now, edge us out later

[Re: Klarna amps up super-app aims with price comparison tool , Nov 14]

Klarna’s new price comparison tool, while a positive thing for consumers, is a significant step towards cutting merchants out of a crucial part of the shopping experience. This only makes it clearer that BNPLs have no intention of staying in the checkout and are making inroads further and further into the purchase journey.

Buy now, pay later’s endgame is to edge merchants out of shopping itself, ultimately relegating them to order fulfilment. But brands rely on the ability to create a real and meaningful connection with their customers from the beginning to the end of the purchase journey.

What will accompany this is the loss of brand loyalty and customer relationships for brands that don't take action now. It's time for merchants to recognise the strategic threat “one-stop-shops” represent and commit to saying bye now to this version of pay laters entirely.

Martin Magnone

Sport has significant soft power and we shouldn’t have caved in over armbands

Lewis Iwu

ON THE eve of the England Men’s World Cup matches, long-suffering fans of the Three Lions are focused on selection dilemmas, pre-tournament drinking scandals or tactical machinations. At this edition of the biggest platform in sport, the focus is on a debate about how England should take a moral stance against homophobia and human rights more broadly. It’s a good sign of the times that we’re even having this conversation. But the last-minute decision not to wear the One Love armband, in support of LGBT people marginalised in Qatar, has caused understandable anger.

It is worth saying, at the outset, that it is promising the FA, along with the federations including Wales, Denmark, Germany, and the Netherlands, take a united stance on discrimination in the first place. Sport is not immune from the conversation about institutions and purpose. Sport has a long tradition of being inextricably connected to significant social and political developments.

Over the past few years, we've seen a dramatic increase in the expectations of fans, the bravery of sponsors and, notably, the athletes' activism on the role of sport in society. I’ve worked

EXPLAINER-IN-BRIEF: A SWISS DEAL, FULL OF HOLES OF OUR OWN MAKING

Even the mention of a Swiss-style relationship with the EU threw Brexiteers into pitbull mode with Nigel Farage apparently willing to come back and “crush” the Tories. The government has already come out to deny the claims, with Rishi Sunak guaranteeing any trade agreement with the union won’t rely “on alignment with EU rules”. A Swiss-style proposition had been proposed by the EU side during the negotiations, but was rejected by then Brexit negotiator David Frost. It would basically mean access to the European

single market without the freedom of movement clause. It would also mean a more prominent role for the European Court of Justice in the relationship, something that riles up the Eurosceptics.

The Chancellor Jeremy Hunt seems to be open to a more amicable approach to the EU, and has expressed hope that most barriers to trade will fall in the next few years. But given the reaction from some in his party, it’s unclear whether he’d be allowed to embrace a less aggressive attitude.

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closely with a range of bodies in sport on purpose. Institutions like the FA recognised that this development should be embraced rather than pushed away for fear of “getting it wrong”. Ten years ago, it's unlikely we would have been having this conversation.

But with beliefs and values, you need follow through. The FA should have taken the risk of having players booked. Sometimes taking a stand means bearing the risks. Yes, there was a possibility that England would face disruption on the field, but sometimes

(in fact, often) activism requires some sacrifice. Yesterday we saw the Iranian players stay silent during their team’s national anthem, presumably in protest against the regime in Tehran, an act which will potentially put them at far greater risk than a yellow card.

If the football federations involved had decided to wield their collective power and threatened to boycott their games FIFA would have likely yielded. However, there’s a broader lesson in this. Organisations would be wise to wargame what their efforts to take principle stances would mean in practice across a range of scenarios, factoring the real risk of not following through and being accused of caring about the issues only to the extent there are no costs.

All is not lost. There are other creative ways for England to spotlight these issues. The coaching staff should consider wearing the OneLove armband as Alex Scott did in the pre-match broadcast. England players will also individually have opportunities to drive their message in press interviews (where they should be given a license to be bolder). Collectively, the players

have formidable social media clout which they can use to advance their message. FIFA may have blocked a tactic, but that need not block the message.

The real focus after Qatar must turn to FIFA. The corporate sponsors, who have had to turbocharge their diversity, equity and inclusion strategies in recent years after the murder of George Floyd, need to collectively use their clout to drive cultural change at the organisation. There are good people at FIFA but it’s clear that the leadership and culture is significantly behind where many of their fans, federations and sponsors are. This tension can’t persist.

This World Cup has helped to normalise the idea that athletes and the organisations representing them can work together to push for meaningful change beyond tokenism. The dispute over armbands has upset many, but player-led activism in the beautiful game is here to stay - and that’s a good thing.

£ Lewis Iwu is a founding partner at Purpose and author of Words that Win

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Sport is not immune from the conversation about institutions and purpose

Editorial Editor Andy Silvester | News Editor Ben Lucas

Comment & Features Editor Sascha O’Sullivan

Lifestyle Editor Steve Dinneen | Sports Editor Frank Dalleres Creative Director Billy Breton | Digital Editor Michiel Willems Commercial Sales Director Jeremy Slattery

England fans watching the Football World Cup in Croydon yesterday

Pod Point, the electric car charging group, has issued a profits warning after a fall in sales for at-home charging points. Some customers are waiting as long as a year or more for new cars and delaying the installation of chargers.

FILL

MOTORING

THISweek’s motoring page comes live from Dunsfold Aerodrome, better known as the Top Gear test track. And I am the star in a reasonably priced car.

Hang on… ‘star’? Granted, I’m A Celebrity won’t be calling anytime soon, but everyone deserves their 15 minutes. And, um… ‘reasonably priced’? Well, the Porsche 911 GT3 RS costs a not-insignificant £178,500, but when you consider it could potentially beat The Stig’s lap record – embarrassing several hypercars in the process – it looks almost good value.

Indeed, the frenzied buzz and long waiting lists that accompany any new Rennsport model mean that, if you’re one of the chosen few allocated a GT3 RS, you could sell it for a tidy profit. But that’s quite enough cold-blooded consumer advice. Honestly, the GT3 RS is far too excit-

ing to treat as an investment piece.

I mean, just look at it. The monstrous rear spoiler is even more extreme than that bolted to a Le Mans-spec 911 RSR, with active flaps that pop up to boost cornering grip or lie flat to reduce drag.

In fact, every surface on the car’s body is peppered with aero addenda, from the cutouts behind the front wheels to the toothy rear diffuser. Its street presence is off the scale.

The result is a level of downforce seldom seen in a road-legal car. At 177mph, the RS has an additional 860kg compressing its Cup 2 tyres into the tarmac. That’s approximately the weight of a Lotus Elise, or three times more than a ‘standard’ GT3. At the Nurburgring, it translates into a lap time of 6min 44.8sec – only six seconds slower than the Manthey-modified 911 GT2 RS that holds the production car record.

The new RS also introduces a level of

configurability more akin to a racing car. Four rotary buttons on the steering wheel allow you to adjust the dampers for compression and rebound, tighten the lock rate of the limited-slip differential and control the traction and stability systems. Perfect if you’re tackling the Karussell one day and, er, Gambon the next.

Its chassis may have gone digital, but the 911’s engine remains resolutely analogue: a naturally aspirated 4.0-litre flat-

six that revs to a stratospheric 9,000rpm. Power output climbs by a modest 15hp to 525hp, although a top speed of 184mph is actually 14mph slower than the GT3 – blame the drag generated by all that aero. Reinforcing its focus on lap times, the RS only comes with the paddle-shift PDK transmission.

I warm up with a few laps in a 911 GT3 Touring that Porsche has helpfully brought along for comparison. The circuit seems tighter and more cambered than it looks on TV, with a hump on the exit of Hammerhead that threatens to throw the car off-balance. The Touring feels balanced, progressive and ferociously quick, but I’m itching to try its shoutier sibling.

This particular GT3 RS has the £25,739 Weissach Package, including a carbon fibre rear rollcage. Settling into the 918style seats, it otherwise feels quite fa-

miliar – there’s still air-con and infotainment – but the difference is immediately apparent on the circuit. Where the GT3 Touring starts to slide, the RS feels locked onto the racing line. You can brake later, get on the power earlier and simply carry more speed.

My ability might be closer to Captain Slow than The Stig, but my lap times are undoubtedly quicker. Whether all that downforce actually makes the RS more fun is debatable, but the ability to constantly tweak its set-up certainly adds an extra dimension to track driving. In my time at Dunsfold, I barely scratched the surface.

I suspect the smaller and (slightly) less aggressive Cayman GT4 RS is a more rewarding road car. But on a track, the new 911 GT3 RS reigns supreme. And on that bombshell…

Tim Pitt writes for motoringresearch.com

UNLIKEthe GT3 RS above, we haven’t driven the Tolman 205 GTI on the Top Gear test track. However, if you watched the BBC motoring show on Sunday evening, you’ll know the TG team – Chris Harris, Freddie Flintoff and Paddy McGuinness –did just that. So why is everyone getting excited about an old Peugeot?.

Well, as any car bore will tell you, the 205 GTI is widely considered the greatest hot hatchback of all time. Eager performance, agile handling and steering that fizzed with feedback all made it a standardsetting, life-affirming joy to drive. Factor in practicality and affordable prices and a giant-killer was born.

Warwickshire-based Tolman

Motorsport aims to enhance the GTI without diluting its character. Founder Chris Tolman said: “For me, 205 GTIs were a first taste in performance cars: something rewarding, responsive and engaging. Current hot hatches surpass these cars in so many areas, but they fail to rekindle that emotional involvement that made us feel special with the 205.”

The 205 GTI Tolman Edition is an ‘OEM+’ restomod, rebuilt from a bare shell – a process that takes 700 hours – with more power, uprated suspension, better brakes, full corrosion protection and modern LED lighting. Options include a Quaife limited-slip diff, air conditioning, digital dials and a touchscreen with

smartphone connectivity.

We drove the 130hp 1.6-litre development car, as featured on Top Gear, last summer. Our verdict: ‘It feels like a 205 GTI after a few months at the gym: fitter and more focused.’ Now the first customer Tolman Edition (pictured here) has been revealed, complete with a 1.9-litre 16-valve engine that produces a zesty 200hp. In a car weighing around 900kg, that should be plenty.

Prices for the restomod GTI start from £55,000, and we’re told other hot hatches of the 1980s and 1990s will get the Tolman treatment soon. It will be fascinating to see where the company goes next. A Renault Clio Williams, perhaps, or a Ford Escort RS Cosworth? Watch this space.

SPORT

England get Qatar World Cup off to a flyer with thrashing of Iran, writes Frank Dalleres

ENGLAND blew away months of growing pessimism with a freewheeling start to the World Cup yesterday, smashing six goals past Iran to underline their credentials as potential winners.

Bukayo Saka scored twice while Jude Bellingham, Raheem Sterling, Marcus Rashford and Jack Grealish also netted as Gareth Southgate’s team put down a marker in Qatar.

Two goals from Mehdi Taremi, the second a stoppage-time penalty, took some gloss off England’s day, while Harry Maguire’s positive return was cut short by a head injury.

But this was a near-perfect start to Group B for the Three Lions, especially given the doubts that had been sown by a six-match winless run heading into the tournament.

YOUNG LIONS STAR

England retain a familiar spine but it was two newer additions who inflicted the most damage on Iran: winger Saka and central midfielder Bellingham.

Saka showed why he has become undroppable, repeatedly prising Iran open with direct running and mustering two excellent finishes with his left foot. The first he volleyed into the top corner after Maguire nodded down a corner, while the second he passed into the net after dummying two defenders.

Bellingham, meanwhile, capped a brilliant display with his first international goal, England’s opener at this World Cup, a 35th-minute header into the far corner from Luke Shaw’s cross.

The 19-year-old, who was still at school when the team reached the last four at Russia 2018, dazzled with an influential box-to-box display.

MAGUIRE’S MIXED FORTUNES

Southgate took a calculated risk by picking the out-of-form Maguire but was rewarded with a strong display from a player who is often at his best for England.

Solid and assured at the back, he was also a menace in the opposition box and should have been awarded a penalty when he was hauled down inside the first few minutes.

Maguire’s positive afternoon ended around the 70th minute when he was substituted after complaining of blurred vision following a blow to the head.

It is unclear whether he suffered a concussion and England played down

WORLD CUP BRIEFING

BALE EARNS WALES DRAW WITH USA ON WORLD CUP RETURN

£ Gareth Bale won and scored a secondhalf penalty to earn Wales a 1-1 draw with the USA in their first World Cup match for 64 years last night. Timothy Weah ran onto a through-ball from Chelsea midfielder Christian Pulisic to poke the USA in front on 36 minutes, but Wales rallied after the break and talisman Bale smashed a spot-kick past Arsenal goalkeeper Matt Turner in the 82nd minute to ensure England’s Group B rivals shared the points. USA face Gareth Southgate’s men next in Qatar on Friday evening, while Wales meet Iran.

GULFINCLASS

CONCUSSION ROW

Head injury protocol arose early in the game when Iran goalkeeper Alireza Beiranvand collided with defender Majid Hosseini when intercepting a cross from Harry Kane.

Despite needing nine minutes of treatment, Beiranvand briefly continued the match in apparent contravention of football’s concussion rules.

Why officials did not feel the need to step in is unclear, as was their reticence to allow Eric Dier onto the field to replace Maguire after he was removed for similar reasons.

VAR controversy will have been despairing at this World Cup so far.

After Ecuador had a goal ruled out against hosts Qatar on Sunday for a marginal offside that the automated system had failed to detect, the video assistant referee found more questionable ground here.

Iran’s penalty for a shirt pull by John Stones looked generous in isolation but next to a clear foul on Maguire earlier in the game which was waved away, it was nonsensical. Fortunately for England, they were out of sight by then, although Southgate declared himself “a bit fed up with the end” of

England axed plans for captain Kane to wear a One Love armband against Iran to support inclusion after Fifa threatened them with sporting sanctions.

Having served notice of their intention to sport the armband in September, the governing body did not clarify its position until hours before this fixture. Fearing Kane would be instantly booked, the Football Association and its counterparts in Wales, Belgium, Denmark, Germany, the Netherlands and Switzerland dropped the protest.

Amnesty International accused Fifa of “failing to fully uphold its own values and responsibilities”.

DUTCH LEAVE IT LATE TO SINK GROUP A RIVALS SENEGAL

£ Late goals from Cody Gakpo and Davy Klaassen earned the Netherlands a 2-0 victory over Senegal in their opening match of the World Cup in Qatar yesterday. PSV Eindhoven forward Gakpo enlivened a drab encounter with a well-timed run to meet Frenkie de Jong’s cross and head the Dutch in front in the 84th minute. Former Everton midfielder Klaassen added the second in the ninth minute of injury time when he followed up after Chelsea goalkeeper Edouard Mendy had parried a shot from substitute Memphis Depay.

TODAY’S MATCHES AND WHY YOU SHOULD WATCH THEM

£ Argentina v Saudi Arabia, 10am, ITV Argentina are one of the favourites and have high hopes of bouncing back from their worst World Cup performance for 24 years in Russia. Now into their fourth decade since lifting the trophy, this will be their last chance with Lionel Messi in their ranks. They begin against Saudi Arabia, who have only progressed from the group stage once, in 1994.

£ Denmark v Tunisia, 1pm, ITV Somewhat surprisingly, this is only

Denmark’s sixth World Cup appearance. Of their previous five, they’ve progressed out of the group stages on all but one occasion – in France 1998. They face Tunisia, who haven’t escaped their pool in the last five attempts. In a group with France and Australia, both sides will be eyeing the runner-up spot.

£ Mexico v Poland, 4pm, BBC Despite a patchy record in qualifying for the tournament, Poland have actually finished third twice, in 1974 and 1982. Mexico have featured at all but four World Cups and cohold the record for the most second round

appearances – along with Brazil –but have never made it beyond the quarter-finals.

£ France v Australia, 7pm, BBC Holders France begin their defence tonight against Australia, who they also faced in the group stage four years ago in Russia. Back then Les Bleus won 2-1, thanks to an Antoine Griezmann penalty and Paul Pogba’s shot deflecting in off Aziz Behich for the winner. Pogba and N’Golo Kante are absent this time, as is Karim Benzema, ruled out with an injury suffered in training last week. Australia are the lowest ranked team in Group D.

Eight teams out for Russia’s Davis Cup crown

BRITISH interest in the Davis Cup has long faded this year given the side’s return to obscurity in the international team tennis tournament.

Bar their 2015 victory, Great Britain have struggled in living memory to perform in the competition, which now has a new hub city-based format.

But sport does not begin and end with British participation and there are eight teams left in the Davis Cup, who will gather in Malaga this week to determine the 2022 champions.

In an old-school knockout format that starts today, Italy will play the USA, Germany face Canada, Australia play the Netherlands and hosts Spain compete against Croatia. Last year’s champions Russia were not allowed to compete.

Croatia return with the same team who lost the 2021 final but have added Borna Coric. Their opponents are with-

The holders –and Britain –are absent but the team tennis competition concludes this week in Spain, writes Matt Hardy

out world No1 Carlos Alcaraz, in what will be seen as a major blow, but have a strong line-up.

The Dutch look weaker than other teams, although Botic Van de Zandschulp can cause a stir. There’s no Nick Kyrgios for the Australians but seasoned performers Thanasi Kokkinakis and Alex de Minaur are set to feature.

Germany were a solid team in the group stages, remaining unbeaten against three other European nations and lost just three rubbers on their way to Malaga. Canada finished second in Valencia behind Spain and scraped through by winning five matches to four.

The USA’s tie against Italy is arguably the most exciting of the quarter-final

stage. The States will play with Taylor Fritz. Frances Tiafoe, Tommy Paul and Jack Sock – an incredibly strong team – while Italy will bring Wimbledon finalist Matteo Berrettini and highlyrated youngster Lorenzo Musetti as well as Fabio Fognini.

But as is usual with the Davis Cup, it falls at the very end of the calendar year and therefore lacks some of the star power it otherwise would attract.

Neither of the world’s top two players – both Spanish – are present in Malaga while only two of the top 10 will play in Spain this week. Even Jannik Sinner, the top Italian, will not feature.

The round of eight begins today, with the semi-finals taking place on Friday and Saturday and the grand final due

to be contested on Sunday.

The Davis Cup is a world away from the sleek lines and finesse of Wimbledon, however. Fans are encouraged to be tribal and chant for their favourite players and countries to crank up the atmosphere. The USA have the most wins, having lifted the trophy 32 times. Britain are one of four teams to have won the Davis Cup 10 or more times, but before the triumph in 2015 they had not done so since 1936.

As is often the case with tennis, when you think it is all over for the season, it isn’t. The Davis Cup offers a different dynamic to the week-in, week-out action on the ATP Tour – but as usual, there’s no British angle for fans to gravitate towards.

SCHEDULE: DAVIS CUP FINALS WEEK

QUARTER-FINALS Today

Australia v Netherlands, 3pm Tomorrow Croatia v Spain, 3pm Thursday Italy v USA, 9am Germany v Canada, 3pm

SEMI-FINALS Friday

Australia/Netherlands v Croatia/Spain, 3pm Saturday Italy/USA v Germany/Canada, 12pm

FINAL Sunday, 12pm

ERASMUS IS DAMAGING SPRINGBOKS, SAYS SMIT

NOBODY in the world is playing better at the moment than Rory McIlroy and Jon Rahm, who concluded the European season in winning style on Sunday.

In a magnificent finish to the Race to Dubai, Rahm won the DP World Tour Championship for a third time while McIlroy’s fourth place saw him end the campaign as European No1.

Rahm didn’t drive the ball as well as he can but the rest of his game was superb. He delivered a killer blow to the field by birdieing the first three holes of his final round, and every time the chasing pack got close he pulled away again.

McIlroy, meanwhile, took a wee while to get going but glided up the leaderboard as the week went on. For the first time, he holds the European order of merit, the FedEx Cup and the world No1 ranking at the same time.

I don’t think he has ever swung the club better. They used to say that Jack Nicklaus was a poor bunker player but that was only in comparison to the rest of his game.

The same has been true of Rory’s short game, but he is now in the top five in the world for that aspect too.

It has been an incredible year for McIlroy, winning three times and contesting in most of the tournaments he entered. He will enjoy a break now but must be desperate for April and the Majors to start up again.

We shouldn’t judge too harshly that he didn’t win one this year. After all, he finished in the top 10 in all of them, and there are so many elements that go into winning in golf.

The other side of the coin, though, is that the top players themselves place so much importance on winning the majors. Next year it will be nine years since Rory’s last and that is too long for a player like him.

This year has certainly been the best he has played since he last won a major; in fact, I think he might have played his best ever golf this season. It’s very exciting for 2023 and, the way he is playing, I believe he will win the Masters next spring.

NEVER BEEN BETTER

ranking system.

Despite beating a very high quality field in Dubai he has not moved from fifth place. He has only climbed one spot since embarking on a purple patch of two wins and a fourth place in his last three outings.

When Rahm won the DP World Tour Championship in 2019 he received 52 ranking points. This time it was under 22. That is ridiculous and shows why he has been loudly criticising the system lately. It is in a mess and obviously needs addressing.

laden back nine on Saturday but he is a great player and will keep improving. Matt Fitzpatrick looked like pipping McIlroy to the Race to Dubai at the start of the week but faded on Sunday. He may be tired after a wonderful year that included his first major at the US Open. There ought to be a plaque at Brookline where he played his winning shot into the last.

Adrian Meronk also deserves congratulations for a brilliant year that ended eighth in the European order of merit. That is a fantastic achievement for the

MAGUIRE AND HALL SHINE

There was cause for celebration for British and Irish players on the LPGA Tour too, where Lydia Ko won the season-ending CME Group Tour Championship with an incredible display.

Ireland’s Leona Maguire capped a superb year with second place, while England’s Georgia Hall also rounded off a fine season in fourth.

Sam Torrance OBE is a former Ryder Cupwinning captain and one of Europe’s most successful golfers. Follow him @torrancesam

£ South Africa’s director of rugby Rassie Erasmus is making life more difficult for the Springboks by turning people against them, says their former player John Smit. Erasmus will not be banned from the touchline when the world champions face England at Twickenham on Saturday after issuing his latest criticism of refereeing decisions on social media.

“It’s hard to defend him,” Smit told the BBC Rugby Union Daily podcast. “He is making it difficult for his team. It’s made us so easy to dislike.”

STRICKEN WORCESTER

OWED

MORE THAN £30M

£ Worcester Warriors rugby club owed more than £32m when they went into administration in September. Their debts included £16m to the government for a Covid support loan, £2.1m in unpaid taxes to HMRC, £5.8m to businesses, banks and ticketholders, £2m to former directors and £6.8m via their payroll arm, according to a report by administrators Begbies Traynor.

Former Worcester chief executive Jim O’Toole’s consortium is in exclusive negotiations to buy the club, which was expelled from the Premiership for financial difficulties.

WOLFF HEAPS PRAISE ON ‘OUTSTANDING’ HAMILTON

Mercedes Formula 1 boss Toto Wolff has hailed Lewis Hamilton’s attitude after the team struggled to compete in 2022. Hamilton failed to win a race for the first season in his career as Mercedes finished third in the Constructors’ Championship, their lowest placing for a decade.

“He was exceptional,” Wolff said. “Better than all the performances in the car, his attitude and mindset this year was outstanding.”

PDC MAKES ROOM FOR SHERROCK AT ALLY PALLY

£ Trailblazing female darts player

Fallon Sherrock has been invited to play the PDC World Championship next month after missing out on qualification. Teenager Beau Greaves beat Sherrock to a place at Alexandra Palace, where Lisa Ashton will also compete alongside the men, but the 28-year-old has been granted entry for winning the Women’s World Matchplay earlier this year. “It’s great that I will now get to go back to Ally Pally,” said Sherrock.

SPORTS DIGEST

GOLF COMMENT

Sam Torrance

THE ALL­ELECTRIC iX

Fuel economy and CO2 results for the BMW iX. Mpg (l/100km): Not applicable. CO2 emissions: 0 g/km. The iX xDrive40 electric range: 253­264 miles. The iX xDrive50 electric range: 365­380 miles. Range figures obtained after the battery had been fully charged. The iX is a battery electric vehicle requiring mains electricity for charging. Figures shown are for comparability purposes. Only compare electric range figures with other cars tested to the same technical procedures. These figures may not reflect real life driving results, which will depend upon a number of factors including the starting charge of the battery, accessories fitted (post registration), variations in weather, driving styles and vehicle load.