Wednesday 11 January 2023

DRY? TRY POURING JANUARY LIBBY BRODIE ON THE NEW RULES OF WINE DRINKING P16

THE UNIBOMBER

ANOTHER ATTACK ON UNILEVER –A YEAR AFTER INFAMOUS MAYONNAISE ROW

ANDY SILVESTER

RESPECTED City investor Terry Smith launched another excoriating assault on Unilever yesterday, a year after his infamous criticism of its focus on the purpose of its flagship brand Hellman’s.

In his annual letter to shareholders, the Fundsmith chief yesterday listed a series of complaints about the consumer goods firm, saying it had failed to engage shareholders, had been opaque about transaction costs and allowed investors to “measure annual growth if you could only count to three”.

Smith also says the firm has “asked [investors] to suspend disbelief” that the arrival of notorious activist Trian Partners’ investor Nelson Peltz on the board had nothing to do with the September departure of embattled CEO Alan Jope.

“This explanation sounds like it was lifted from the script of Miracle on 34th Street,”

Smith writes.

Smith, who was City A.M.s investor of the year in 2022, goes on to say that Unilever did not make contact with Fundsmith – “about the 12th largest investor” – for the first eight years of their holding. When they eventually did, his “points about what we saw with the performance of the business and the focus of the management” were “duly ignored”.

Last year the investor made headlines when he attacked Unilever’s focus on so-called ESG metrics.

“A company which feels it has to define the purpose of Hellmann’s mayonnaise has in our view clearly lost the plot. The Hellmann’s brand has existed since 1913 so we would guess that by now consumers have figured out its purpose (spoiler alert – salads and sandwiches),” he wrote in 2022.

Unilever declined to comment last night.

LME should have done better: report

NICHOLAS EARL

THE LONDON Metal Exchange (LME) failed to police large positions on the nickel market and did not have sufficient volatility controls to deal with soaring prices, according to a long-awaited report on last year’s sudden suspension of nickel trading.

Consultancy group Oliver Wyman –which was appointed by the LME to conduct a review into a decision to cancel $3.9bn-worth of trades amid a short-selling frenzy –urged the LME to bring in risk and control functions to prevent market distortions, upgrade volatility controls and spend more time monitoring risks in the market.

The report did not look at LME’s decision-making process and governance – which remain under investigation by both the Financial Conduct Authority and Bank of England.

Its conduct during the crisis is also the centre of mega lawsuits brought by Elliott Investment Management and Jane Street.

The LME welcomed the report’s findings and said in a statement it would set out by the end of March how it will implement recommendations to prevent market distortions and improve risk monitoring.

‘Talking’s better than walking’: Khan calls for an end to Elizabeth Line strikes

SADIQ KHAN has urged rail unions to call off their planned strike on the Elizabeth line this week and encouraged them to get back to the negotiating table, saying that “talking is better than walking”.

Rail platform workers on the line

from unions TSSA and Prospect are set to down tools tomorrow after rejecting an offer of a 8.4 per cent salary increase.

No services will run in the central section of the line, between Abbey Wood and

Paddington, with shortnotice cancellations expected on the east and west ends of the line.

“There’s no need for the strike to take place this Thursday,” the mayor told City A.M.

yesterday. “I’d encourage the unions to please, please, please talk to Transport for London (TfL).”

“Talking is better than walking,” he said.

Khan’s words were echoed by TfL’s interim commissioner Andy Lord, who took over on 25 October last year after Andy Byford stepped

down. He told City A.M. talks with TSSA and Prospect were still ongoing, but Prospect boss Mike Clancy said they still wanted “substantive movement” on pay.

Both were talking at an event marking the 160th anniversary of the London Underground –complete with a new roundel.

NICKEL FIASCO

ILARIA GRASSO MACOLA

Tube anniversary a welcome reminder of London’s potential

LIFE was different in 1863. Londoners woke to headlines of a distant civil war in the United States, a week or so late. They celebrated the opening of the Arts Club in Hanover Square –yes, that one –founded by Charles Dicken et al. They hailed the arrival of the newly-patented linoleum. And they got on the tube, too, for the first time. One hundred and sixty years later, London’s underground marvel is still going

THE CITY VIEW

strong. It’s odd then to think that a century and a half later, central government insists on still making life harder for the capital to have a functioning –and growing –transport system. The last few years have been marked by interminable rows between

City Hall and Whitehall over the future of London’s transport network, with central government seemingly incapable of grasping the idea that the capital and the south east –the engine of Britain’s chuntering economic growth –should have long-term certainty over the future of its transport system. Eventually, a deal was struck to patch over the holes in Transport for London’s finances, inflicted on it by Downing Street-ordered

lockdowns that in hindsight appear to have lasted too long and been far too stringent. But that deal comes attached with so many strings it will take a weaver to make it work for the capital. It is a crying shame that projects like Crossrail 2 and the Bakerloo Line extension will be forced to sit on the backburner. As our forebears knew back in 1863, transport is vital for economic growth in London. That, in turn, is crucial for the rest of the

country. Much of the cash put into the building of the Elizabeth Line ended up being spent elsewhere –the trains were built in Derby, and the roundels on the Isle of Wight. Standing still is the easiest way to be overtaken. Our global competitors are growing and developing.

Central government must realise sooner rather than later that the best way to keep the British economy going is to keep London moving.

THE DAILY TELEGRAPH

ELECTRIC CAR PRODUCTION SLOWS AS DRIVERS OPT FOR CHEAPER MODELS

Carmakers plan to slash the number of electric vehicles they manufacture as the spiralling cost of battery-powered models makes them increasingly unaffordable for drivers.

THE TIMES

CHINA BUILDING LASERBEAM DRONE FOR PERMANENT FLIGHT

China is developing a drone powered by high-energy laser beams which can remain airborne for unlimited periods. Drones have proven devastatingly effective on the modern battlefield.

THE GUARDIAN UK AIR ACCIDENT OFFICIALS TO INVESTIGATE FAILURE TO GET SATELLITES INTO ORBIT

British air accident investigators are to examine the failed attempt to send satellites into orbit from Cornwall as the teams behind the historic mission described tearful scenes at the launch.

Global economy teeters on the edge of a worldwide recession, World Bank warns

THE GLOBAL economy “is perilously close to falling into recession” after central banks across the world have collectively raised interest rates aggressively to tame roaring inflation, one of the globe’s top economic institutions has warned.

World GDP will expand just 1.7 per cent this year, a slump beaten only by the Covid-19 pandemic and financial crisis-induced recessions in around the last three decades, the World Bank said yesterday.

The fresh projections were down-

graded 1.3 percentage points from the Washington-based organisation’s June 2022 projections.

The looming downturn will be driven by a “synchronous monetary policy tightening around the world to contain” inflation that has resurfaced after around four decades of lying dormant, the World Bank said.

Although a worldwide economic reversal is not the organisation’s base case, negative shocks such as “higher inflation, even tighter policy, financial stress, deeper weakness in major economies, or rising geopolitical tensions” would spark the slump.

If that scenario did happen, it would be the first time the world has experienced two recessions – counting the pandemic-induced decline – in the same decade for 80 years.

Rates have climbed at the fastest pace in the US since the 1980s, with Federal Reserve chief Jerome Powell and the rest of the federal open market committee backing four successive 75 basis point rises in 2022.

The Bank of England has lifted borrowing costs nine times in a row to 3.5 per cent. A 75 point jump in November was the largest move since the 1980s.

JACK BARNETT

SOMEDAY MY PRINCE WILL COME Caroline Lennon was the first and only customer in the queue to buy a copy of the Duke of Sussex’s controversial autobiography Spare

Watchdog tells insurers to get ready for stress...

LOUIS GOSS

THE UK’s insurance giants were told to brace themselves for a “prolonged” recession by boosting their risk management processes by Threadneedle Street’s in-house watchdog yesterday.

In a letter to insurance chief executives, the Bank of England’s Prudential Regulation Authority (PRA) warned that various risks might stem from the downturn as it called on insurers to take “proactive steps” to assess their risk management controls.

The body also warned that inflation was driving uncertainty in the cost of fulfilling claims and it called on insurers to factor increasing prices into its risk models.

High levels of inflation in the UK economy has driven up the costs general insurers face in fulfilling policyholders claims, due to the higher costs of materials and goods such as

second-hand cars.

The PRA’s letter warns that “recent events” including the liability-driven investment (LDI) crisis that saw the Bank forced to intervene in the UK’s bond market further demonstrate the importance of risk management.

The PRA also said it will continue pushing forwards with the push to overhaul the EU’s Solvency II laws that govern the amount of capital insurers must hold to reduce the risk of insolvency.

The UK’s planned Solvency II reforms are set to free up capital for investment in areas such as infrastructure and clean energy by letting ringfenced reserves be invested on a wider basis.

Insurance sector lobby groups have however warned the plans could backfire, in requiring some insurers to hold larger amounts of capital on their books –largely defeating the purpose of the changes.

... and warns banks they still haven’t learnt lessons of 2008

CHRISTOPHER DORRELL

BANKS were given a ticking-off yesterday for not adequately improving their risk management processes since 2008.

In a separate letter to bank bosses, the Bank of England’s PRA put financial resilience at the top of its agenda –in particular

“deficiencies in banks’ risk management and governance frameworks”. These issues, the letter said, were brought to light by the dramatic collapse of Archegos. The investment fund collapsed after defaulting on margin calls, with the PRA criticising a lack of sector-wide action despite “regular messaging”.

Smith to keep shares despite many concerns

CONTINUED FROM PAGE 1

In his usual unforgiving style, Smith went on to criticise Unilever’s “virtue signalling”.

“Among the outpouring of comments last year were a number of apologists for Unilever who were at pains to point out that the Hellmann’s brand has been growing revenues well and this was proof that ‘purpose’ works,” Smith wrote, which he said “confuses correlation with cause and effect”.

“To further illustrate the point, this year we are moving on to soap,” he continued.

“When I last checked it was for washing. However, apparently that is not the purpose of Lux, the Unilever brand, which apparently is all about ‘Inspiring women to rise above everyday sexist judgements and express their beauty and femininity unapologetically’.”

“I am not making this up... I will leave you to draw your own conclusions about the utility of this.”

Smith did, however, say he would keep his holding in the firm.

HOT TAKE: CRYPTO EXPERTS REACT TO CITY MINISTER’S WORDS

CHARLES KERRIGAN Partner,

CMS

“The minister adopts a balanced and sophisticated position. Highlighting the potential of the underlying technology to eliminate risk and transaction costs reflects a desire to find a middle way that keeps UK financial services industry at the front of policy and incumbents in the picture. It’s right to get the basics sorted but only legislation does that. But the industry still sees the UK as a place of regulatory uncertainty until we have something on the statute book.”

ANDREW WHITWORTH Policy director, EMEA, Ripple

“It shows the government is listening to industry. This is all positive, and in line with what the government has said for some time –now is the time to put it into action. We look forward to seeing the upcoming consultation in ‘weeks not months’, as he said. This will keep the UK at the front of the global pack in putting in place the needed comprehensive, riskbased framework for the cryptoasset sector.”

IAN TAYLOR Executive director, CryptoUK

“We felt the general rhetoric was positive. It’s clear there is a real appreciation for the opportunities within the sector and the promise to foster growth and innovation with the near term goal of developing UK Stablecoin solutions. We also feel positive about the acknowledgement that recent events have highlighted some issues previously raised around regulatory clarity. They have been brought back onto the agenda for further discussion and debate.”

City minister says crypto regs won’t be ready in 2023

CHRIS DORRELL

CITY minister Andrew Griffith said regulations for digital currencies are unlikely to be ready in 2023, as he reaffirmed the government’s aim to be “the home of well-regulated [and] technologically-advanced financial systems”.

In a wide-ranging Treasury committee hearing yesterday, Griffith was quizzed by MPs on the risks facing the crypto industry and the potential for the UK to lead on crypto regulation.

Setting out the government’s strategy, Griffith said they would be coming forward “in weeks” with two public consultations: one on the general regulatory approach to crypto assets and one on Central Bank Digital Currencies.

“I think we should all be humble about our ability to predict future technologies but it would be wrong for the UK not to be forward leading to seek to make the most of the opportunity,” he said.

However, Griffith admitted that “we’re probably not going to be legislating in 2023”.

“I don’t accept the implied criticism that, by spending time with the industry at this stage, that we’re doing anything wrong”, he said, although he accepted a range of risks facing the sector.

Those risks have become increasingly prominent since April 2022 last year, when then-Chancellor Rishi Sunak expressed his wish for the UK to be a “global crypto assets hub”.

A series of high-profile collapses last year, culminating in the insolvency of FTX, led many to doubt the future of the industry.

Reflecting these concerns, the City minister was reluctant to say whether he was pleased or concerned that 2.3 million people in the UK own some form of crypto asset, after he was pressed by Labour MP Emma Hardy.

Griffith was also worrid about the potential for regulation to create a “halo effect” around crypto assets, making them appear to be safer than they actually are.

“That is a big concern, and it is one reason why we are taking our time and trying to get the balance right,” he said.

Coinbase to lay off 20 per cent of staff as crypto market declines

MANYA SAINI

COINBASE said on Tuesday it will reduce its workforce by about 20 per cent, or 950 employees, as part of a restructuring plan, in a third round of layoffs for the cryptocurrency exchange since last year.

The company said it expects to incur about $149 million to $163 million in restructuring expenses. Its shares reversed course to fall 2.7 per cent premarket after rising more than 5 per

cent after the layoffs announcement.

“The entire industry is going through a crisis of confidence and trading volume remains very weak, this job cut is a reflection of the current challenging environment,” said Owen Lau, analyst at Oppenheimer.

Last year, rising interest rates and worries of an economic downturn wiped out more than a trillion dollars from the crypto sector, forcing key industry players Three Arrows Capital and Celsius Network to shut shop.

The job cuts mark the third round of redundancies for the exchange since last year

BRANSON’S PICKLE Virgin Orbit shares crash back to earth after failed Cornish launch

Virgin Orbit shares have come plummeting back to earth after its much-anticipated UK space launch failed last night. Shares for the Richard Branson-headed company dropped by 23 per cent on NASDAQ pre-trading and were trading down around 16 per cent yesterday afternoon.

Airbus: China’s reopening could cause troubles heading into 2023

ILARIA GRASSO MACOLA

AIRBUS warned today that China’s decision to end its strict zero-Covid strategy and reopen its borders could pose difficulties for the company heading into 2023.

“In the short term, China will create additional difficulties and complexities that we will have to deal with,” chief executive

Guillaume Faury informed journalists today.

The warning comes as the European plane manufacturer announced that it only sold 661 planes in the last 12 months, after it abandoned its target of 700 annual deliveries for 2022 last month due to ongoing global supply chain issues.

But the impact of Beijing's decision on the company will

eventually ease, Faury said.

He said China’s reopening “means that it will be possible for us to travel again to China to meet customers, suppliers and partners.”

“It will also mean the reopening of aviation to a much larger extent,” he added.

Nevertheless, Faury remained very prudent, as ongoing and new issues could cause significant headaches.

Treasury under fire over delays to BNPL rules

CHARLIE CONCHIE

THE TREASURY has come under fire from a Tory peer after more delays to the rollout of buy-now pay-later (BNPL) regulation, amid concerns fintechs have been left in limbo and shoppers are landing themselves in unmanageable piles of debt.

BNPL firms like Klarna, Clearpay and Laybuy, which allow shoppers to defer and split up payments, remain unregulated in the UK despite the governmentcommissioned Woolard review warning of the need for “urgent” rules nearly two years ago.

Ministers announced an initial framework for regulation in June and City minister Andrew Griffith said the government would open a consultation on draft legislation by the end of 2022. But the Treasury is yet to give an update. The stretched timelines drew the ire of top Tory peer Chris Holmes, co-chair of the parliamentary group for fintech, who told City A.M. business confidence in the UK was at risk.

“I think it’s important that we get on with the regulation. Both the industry and consumer groups are on the same

page. Regulation is positive for consumers and raises the standards across the industry too,” he said. “We need to make sure the UK is an attractive place to do business as this indecision is causing unnecessary uncertainty.”

A spokesperson for the Treasury said that it would “consult on draft legislation in the coming weeks” and was looking to hold the sector to “the high standards we expect of other loans and forms of credit.”

An FCA spokesperson said it has been “consistently calling for a change to the law to bring buy-now-pay-later products under our regulation”.

It said it is waiting for the Treasury to legislate to bring the sector into its remit before it is able to draw up rules.

“We’re now coming up to two years since the Woolard Review but BNPL remains unregulated,” Luke Kosky, fintech lead at lobby group Codec told City A.M. “Delays mean more confusion for firms and consumers.”

Debt campaigners at Stepchange said the government’s commitment to regulate the sector by the middle of this year was “welcome and cannot come soon enough.”

IPO activity in London curtailed by twin spectres of inflation and war

CHARLIE CONCHIE

The amount of cash raised through initial public offerings (IPOs) in London plunged 90 per cent last year as the market was buffeted by soaring inflation and the shocks of war in Ukraine, new figures show.

London IPO activity raised just £1.6bn across the year after a bumper year in 2021 which saw £16.3bn raised in a postpandemic floatation frenzy, according to EY’s latest market tracker, IPO Eye.

The value of IPOs in the capital slumped more sharply than the global average, with IPO proceeds around the world tumbling 61 per cent in 2022.

The US and Americas region also suffered a sharp downturn as proceeds fell 95 per cent in terms of money raised.

In the final quarter of the year, London’s main market notched just nine IPOs raising a total of £380m, down from 17 IPOs raising £1.9bn in 2021. EY said the market was likely to remain depressed for months to come.

Model train maker Hornby put off track for full year as sales slump

HENRY SAKER-CLARK

MODEL train maker Hornby yesterday warned that sales were “behind budget” due to pressure on consumer finances amid rocketing living costs.

Shares in the company slid over 15 per cent yesterday as a result.

The London-listed firm blamed “the challenging consumer economic climate” as it said that the performance over the three months to 31 December will “impact” its fullyear performance.

The firm added: “We remain cautious in our outlook for the full year and beyond due to a high level of uncertainty around the impact of several factors on our sales, such as inflation and mortgage costs for consumers, but, with employment expected to remain high, we are hopeful that the confidence in consumer spending remains.”

Hornby highlighted that group sales over the third quarter were ahead of the same period last year.

It added that cumulative group

sales for the year so far were up six per cent against the previous financial year.

“This has been driven by better availability of stock, price increases, and investment in e-commerce platforms and digital media,” the company told shareholders.

Hornby added that its order book remained “strong” ahead of product releases for the new year.

The group said it is forecasting a “modest” underlying pre-tax loss for the year to March.

Amazon UK site closures to put 1,200 jobs at risk

HENRY SAKER-CLARK

AMAZON yesterday revealed plans to shut three UK warehouses in a move which will impact 1,200 jobs.

The company has launched consultations over the closure of sites in Hemel Hempstead, Doncaster and Gourock, in the west of Scotland.

All 1,200 workers at these sites will be offered roles at other Amazon locations, the firm said.

The online technology giant has also revealed plans for two new major fulfilment centres in Peddimore and Stockton-onTees, which will create 2,500 jobs over the next three years.

Around 500 employees currently work at Amazon’s Hemel Hempstead site, and will all be offered roles at its nearby Dunstable warehouse or other nearby locations.

The consultations will involve around 400 staff at its Doncaster site in Balby Carr Bank, who the company plans to transfer to its two other fulfilment centres at Doncaster’s iPort.

The proposals will also affect around 300 workers based at the Gourock site.

Furthermore, Amazon said last night that it was closing seven of its delivery stations across the UK.

Five stations in Huntingdon, Horley, Birmingham, Newcastle and Hemel Hempstead will close, with staff given the opportunity to transfer to stations in the local area.

Also stations in Portsmouth and Aylesford will shut, with Amazon planning to open new delivery stations in Havant and Aylesford that staff can move to. Each of these sites employ a few dozen workers at most.

It is understood these proposals are separate from Amazon’s plan to cut around 18,000 jobs worldwide as part of a drive to cut costs.

A spokesman for the company said: “All employees affected by site closure consultations will be offered the opportunity to transfer to other facilities, and we remain committed to our customers, employees, and communities across the UK.”

Steve Garelick, GMB union organiser, describes the plans as a “kick in the teeth” for Amazon workers.

Brexit, Covid-19 and Ukraine drag on Games Workshop’s profits despite record £212m sales

MENDEL

WARHAMMER-MAKER Games Workshop has recorded sales of over £200m for the first time, but Covid-19, Brexit and the war in Ukraine continue to dent its commercial plans.

The FTSE 250 firm announced it made £212m from May until the end of 2022, up more than £20m on the previous year.

But it also reported a dip in operating profit of £83.6m, down from £88.5m last year. Its profit

Spin Wars: Teneo snaps up PR outfit Tulchan as City comms battle hots up

JAMES SILVER

PR AND advisory giant Teneo has bought comms firm Tulchan, it confirmed yesterday.

It represents a sizeable expansion for Teneo, with new UK CEO Nick Claydon hailing the pick-up as “strengthening our financial and political offer”.

Tulchan, which employs around

70 people in London and Singapore, was founded by Andrew Grant in 2000. He was later joined by Lord Andrew Feldman.

The Tulchan senior team will also be joining Teneo as part of the transaction, reporting into Claydon.

The UK expansion is a welcome shot in the arm for Teneo, which saw its founder Declan Kelly resign in 2021

after he became inebriated at a Global Citizen event, and then saw a string of high-profile UK clients take flight.

Reports elsewhere suggest the transaction totals near £65m.

It is the latest consolidation in the comms space, with Finsbury recently merging with Sard Verbinnen and Co. Maitland also recently merged with Cicero to create a comms powerhouse.

before tax was also £5m down on 2021.

“Games Workshop and the Warhammer hobby are in great shape,” said CEO Kevin Rountree, despite the disappointing profit numbers.

He said it had been “another rewarding and successful period for the global team with core sales for the six months of over £200m for the first time.

“We will continue to focus on making the best miniatures in the world, sign new licensing contracts

with partners to exploit our IP outside of our core business and support our staff,” Rountree said.

The company also posted a slump in sales in China, which has spent the majority of last year under strict zero-Covid restrictions, though the firm said the around £1m lost sales from China for the last six months were “not as bad” as forecast.

The firm added that it had also incurred extra costs from Brexit while also losing £2m in trade sales in Russia.

Shares closed down 2.52 per cent.

Miniature-maker Games Workshop said the demand for its products were in “great shape”, despite the dent in profits

The deal comes as the latest consolidation in the London comms market

JACK

The model train maker said cost of living pressures had dented sales PA PA

Hiring slowdown on the horizon, warns recruiter

JACK BARNETT

JITTERS over the UK economy tumbling into a tough recession is likely to trigger a hiring slowdown, sparking recruiter Robert Walters to yesterday warn its full year profits will drop below expectations.

The alert sent the firm’s London-listed shares down more than three per cent, clawing back some ground after shedding around nine per cent during early exchanges.

Robert Walters had ridden a wave of hiring activity after Covid-19 restrictions were scrapped. Worker shortages also steered companies toward using recruitment specialists to fill roles quickly.

However, a souring economic outlook has made firms cautious, reducing the need to enlist recruitment consultants.

Analysts now reckon the UK is in the early stages of a drawn-out recession.

“The global macroeconomic backdrop became increasingly uncertain as the [fourth] quarter progressed, resulting in a softening of recruitment activity levels across many of the group’s markets,”

Robert Walters, chief executive of his namesake firm, said.

Investors ditched rival recruiters Hays and Page Group yesterday, sending their respective shares around six per cent lower.

US tech firms hobbled by their share prices collapsing in response to the Federal Reserve raising interest rates aggressively are likely to shun taking on more workers, again dragging down Robert Walters’s bottom line.

Facebook-owner Meta, Salesforce, Twitter and

Amazon yesterday warned over 1,000 UK jobs were at risk

other tech darlings have trimmed workforces in response to their tumbling shares.

Yesterday, online retailer Amazon also said it was shutting three warehouses in the UK, leading to more than 1,000 job losses.

Despite the outlook warning, Robert Walters said profits climbed 11 per cent to £105.3m in the three months to December thanks to strong activity in Europe lifting its performance.

Pantheon warns UK recession to be fed by reduced business investment

JACK BARNETT

THE UK recession is set to be powered by businesses slashing investment due to higher interest rates squeezing their finances, City economists have warned. Finance chiefs are “despondent” amid a rapid acceleration in borrowing costs caused by the Bank of England scrambling to

tame sky high inflation, Samuel Tombs, chief UK economist at Pantheon Macroeconomics, said in a note to clients last night.

Some nine back-to-back rate increases by Bank governor Andrew Bailey and the rest of the monetary policy committee (MPC) have made opportunities less affordable.

Pantheon Macroeconomics estimates around 77 per cent of the

corporate debt pile is tied to floating interest rates. This means businesses’ debt servicing costs respond quickly when the Bank changes the UK’s official interest rate. In fact, rates on businesses’ loans have climbed at the fastest pace on record over the last year. The jump will cause nearly one fifth of companies’ profits to be eaten up by repaying debt.

Bank heads play down their roles in lowering climate change

JACK BARNETT

ANDREW Bailey and Jerome Powell, two of the globe’s top rate setters, yesterday said central banks should only have a limited role in tackling climate change.

The chiefs of the Bank of England and US Federal Reserve, speaking at a new summit hosted by the Swedish central bank, played down their roles in offsetting rising temperatures.

Powell acknowledged the Fed has “narrow, but important responsibilities”

in managing risks to the US financial system from climate change.

Banks could lose billions if natural disasters become more frequent.

However, “without explicit congressional legislation, it would be inappropriate for us to use our monetary policy to promote a greener economy,” Powell said.

Bailey echoed Powell’s hawkish climate sentiment by signalling he will not base interest rates decisions on whether they help to reach net zero.

Andrew Bailey follows his US counterpart Powell in spelling out the Bank’s responsibilities

AO World ‘cautiously optimistic’ looking ahead despite slipping sales

HENRY SAKER-CLARK

AO WORLD yesterday said it was “cautiously optimistic” as the online electricals retailer revealed that moves to slash costs have helped the firm’s profits surpass expectations.

Last year, the Bolton-based electrical retailer closed its lossmaking German business and launched actions designed to save at least £30m a year by 2023-24, including axing a raft of senior and middle management jobs.

In November, the firm posted widened losses after it was hit by sliding sales and the impact of labour shortages and supply chain disruption.

The retailer yesterday told investors that sales slipped again over the latest quarter as it failed to keep up with pandemic-boosted levels.

AO said revenues dropped by 17.2 per cent over the three months to 31 December, compared with the same period last year.

It said the sales slump was in line with the board’s expectations.

Europe warned to up its clean energy game

EUROPE risks an exodus of clean energy investment to the US, unless it brings in its own inflation reduction strategy, Goldman Sachs has warned.

The investment banking titan has estimated the US Inflation Reduction Act could drive up to $1.5 trillion of capital mobilisation into clean energy projects by 2032, with $675bn in direct investments.

It argues this could kick-start the “electrification of America” by vastly transforming its power generation and infrastructure.

This would include boosting the base of installed renewable projects from 300GW to over 1,000GW in the next 10 years, while also promoting the manufacturing of solar, renewable energy storage and carbon capture technologies.

In a research note, Goldman Sachs warned, however, that this “attractive level of support” could pose a risk to Europe’s leadership in clean energy.

The bank also said that a successful effort to “electrify America” could cement the gap between US and EU energy bills, where EU energy costs are roughly 60 per cent higher, potentially causing a further de-industrialisationof Europe.

Goldman Sachs raised concerns that frequent regulatory changes in Europe, such as MIFIDII, and the lack of meaningful reforms, in areas such as easing planning restrictions and boosting green subsidies, could hamper the trading bloc.

It fears electrification investments in EU member countries could fall short of expectations, and be worsened by inflation.

The company has drafted its own European inflation reduction act plan, based on the RePowerEU proposals established by the European Commission, to help boost renewables and reduce its reliance on Kremlin-backed fossil fuels following Russia’s invasion of Ukraine.

To achieve this, it has called on the EU to bring in granular legislation to cut down the approval time of green energy projects to about one year, alongside incentives to support “out of the money” technologies such as storage, renewable hydrogen and carbon capture and storage.

The financial giant has also suggested incentives to promote the reshoring of the supply chain for solar panels, renewable energy storage and hydrogen power technology.

Meanwhile, it said it now expects to deliver adjusted earnings of between £30m and £40m as it benefits from reduced costs.

The company said it was on track to deliver earnings at the top of a £20m to £30m range in its previous update.

In a statement, the firm said its actions to improve margins were “gaining traction”, with profitability “running ahead” of previous expectations,

Shares tumbled after the update, closing down 5.39 per cent.

Government urged to help firms reduce their energy consumption

THE GOVERNMENT must offer more support for firms looking to boost their energy efficiency and drive down bills, a senior member of a leading business energy supplier has said.

Anthony Ainsworth, chief operating officer at Npower Business Solutions, told City A.M. there needed to be “additional government policy” to help businesses “proactively invest in measures to help protect them from any future volatility”.

“It is more important than ever that

they also have the support to reduce consumption through greater energy efficiency,” Ainsworth said.

“Any further incentives from government would have a hugely positive impact,” he added.

Gareth Miller, chief exec at Cornwall Insight, also favoured further incentives to cut demand.

“If the government is going to reduce support for business energy bills, then perhaps the policy focus should turn to how they can offset this through investment incentives,” Miller said.

Safe haven gold rallies to

eightmonth high

NICHOLAS EARL

GOLD prices stayed firm in yesterday’s trading – with the precious metal peaking at $1,880 per ounce yesterday morning, amid growing expectations of less aggressive hikes from the Federal Reserve (the Fed) this month.

Yesterday’s peak price was within a hair’s breadth of the eight-month high it recorded on Monday when gold rallied to $1,881 per ounce.

Prices dipped slightly last night to $1,874 per ounce, but remained 0.22 per cent up on Monday’s closing price.

This comes with the US dollar weakening against other currencies after a robust 2022, with the metal enjoying an inverse relationship with the greenback.

There are also growing expectations the Fed will only raise interest rates 25-50 basis points next month, which are currently set at 4.25-4.5 per cent.

This more dovish outlook contrasts with the hawkish approach taken by the central bank last year.

The Fed rapidly hiked rates over the autumn and winter to combat inflation, which peaked at a massive 8.2 per cent in September before easing later in the year to 7.1 per cent in November.

Gold also has a reputation as a flight-to-safety asset, which has also lured investors amid expectations of a sharp economic downturn.

BMW getting back on track despite chip shortages and China lockdowns

ILARIA GRASSO MACOLA

BMW’s sales have slumped in 2022 due to supply chain issues and the scrapped zero-Covid policy in China.

A byproduct of the pandemic, supply chain issues such as chip shortages and higher raw material costs were magnified by Beijing’s decision to implement severe

lockdown measures for the good part of last year.

The German automotive giant delivered 2.4m cars over the past 12 months, 4.8 per cent down on 2021 levels. Sales for the BMW brand dropped 5.1 per cent to 2.1m units.

Sales levels were affected in the first six months of 2022, but picked up pace in the second half.

Over the last quarter, the group reported a 10.6 per cent increase in sales, as more than 650,000 cars were delivered to customers.

Despite the impact of Covid-19 in China – as well as the war in Ukraine –BMW has remained optimistic. “Our strong product line-up is the best response to the current environment,” said BMW board member Pieter Nota.

NICHOLAS EARL

Chancellor Jeremy Hunt has been told to help firms invest in energy efficiency Despite

NICHOLAS EARL

Shares in AO World dropped over five per cent yesterday, despite the firm’s optimism

PA

Lidl benefits from a cut-price Christmas as shoppers trade down

THE GERMAN supermarket chain Lidl recently reported that it saw an influx of 1.3m customers over the Christmas period. The retailer claimed that it had seen a cost of living boost as consumers looked to cut spending.

Data from YouGov BrandIndex UK shows that, over this period, the chain outperformed the industry average in a few different respects. Current Customer scores (which ask whether members of the public have recently bought anything from a retailer in the past 30 days) for supermarkets in general rose from 8.4 to 9.0 (+0.6) between 1 – 25 December. But iover the same period, Lidl saw these scores jump 5.8 points from 31.4 to 37.2. Compare scores from Christmas day 2021 (23.3) and you have an increase of 13.9 points.

Beyond customer growth, shoppers developed a more positive opinion of Lidl in other areas. Impression, a measure of general good or bad sentiment towards a brand, climbed from 41.6 to 45.1 (+3.5) in the leadup to Christmas, compared to a slight decline from 10.7 to 9.5 for the supermarket sector on average (-1.2) – which may indicate that a discount brand may have more appeal at a time when consumers are tightening their belts.

It's a similar story with Purchase Intent, which asks the public which brands out of a list they would be most likely to buy from. Lidl’s scores improved from 12.8 to 15.2 (+2.4) while the industry average only moved from 3.0 to 3.1.

YouGov polling conducted just before Christmas found that 55 per cent of consumers said they would spend less on the holiday this year, with 32 per cent saying they intended to spend less on food. Against this backdrop, Lidl was well-positioned to benefit compared to its more mid-market and upmarket competitors; whether this success is sustained may depend on whether or not the public get back into old spending habits next Christmas.

Stephan Shakespeare is the co-founder and CEO of YouGov

City law firms may be forced to make layoffs

GOSS

THE CITY’s top law firms could soon be set to follow their US counterparts in laying off staff, recruiters have said.

The UK’s corporate law firms may be forced to lay off lawyers due to the wider economic downturn and a lull in M&A activity, recruiters told City A.M.

Scot Gibson, director of legal sector recruitment firm Edwards Gibson, said that, while “no law firm wants to be the first to do it”, redundancies could be on the horizon soon.

He warned that after a boom in hiring on the back of bumper profits, UK law firms may soon be forced to reduce their “fixed costs” by laying off staff.

The comments come as some of the US’s top law firms have already begun laying off lawyers following a slowdown in work.

In December, tech specialist Cooley laid off 150 employees, including 78 lawyers, on the back of a downturn in the tech sector. More recently, Bostonheadquartered firm Goodwin Procter laid off five per cent of its US associates, paralegals and operations staff.

The layoffs come as research from

Thomson Reuters shows profit-per-equity-partner (PEP) at US law firms has dropped for the first time since the financial crash in 2009.

The Covid-19 boom saw law firms bolster their ranks in a bid to capture more work, as the US’s top firms started a pay war that drove up salaries for newlyqualified (NQ) lawyers to record highs.

The uptick in profits as a result of a surge in work “meant law firms suddenly felt very, very flush,” Gibson said.

The pay war saw NQ salaries in City law firms surge to heights of well over £100,000 a year, with those at the top end receiving up to £179,000.

UK law firms have however held out from laying off lawyers and other staff, despite also suffering a downturn in work.

Andrew Waters, managing partner at recruitment firm Chadwick Nott, noted the City’s top law firms are continuing to be profitable.

He explained that law firms are “committed to keeping their top talent” despite the slowdown in work.

Waters however noted that these companies “will resource to the extent that there’s any given work at the time”.

BARCLAYS has teamed up with a specialist insolvency practitioner to recover money loaned to small businesses through the UK’s Covid19 support schemes.

The British bank has joined forces with firm Manolete Partners to recover emergency loans paid through the UK government-backed Bounce Back Loan Scheme (BBLS), the Financial Times first reported.

The UK’s BBLS initiative saw top banks pay out zero interest loans of

up to £50,000 to small and medium enterprises (SMEs) on a six-year basis.

The British Business Bank’s (BBB’s) scheme saw around £46bn worth of 100 per cent paid out to UK SMEs.

Barclays, the largest lender in the BBB-backed scheme, loaned £10.8bn to SMEs. The bank has now partnered with Manolete to collect money from more than 100 companies that have defaulted on the loans.

A Barclays spokesperson said that, although the bank “looks to support customers who are facing financial difficulties, including those who

MICROSOFT is in talks to invest $10bn (£8.2bn) into ChatGPTowner OpenAI, according to reports by Semafor earlier today, citing people familiar with the matter. According to the report, Microsoft’s investment would take OpenAI’s valuation up to $29bn. The deal would initially be based on a revenue share, which will see Microsoft take 75 per cent of OpenAI’s earnings till it recoups its investment.

borrowed under the government schemes… in certain circumstances, including where there appears to be misuse of funds, formal recovery action must be taken to recover taxpayers’ money.”

AIM-listed Manolete Partners is a specialist litigation financing company that funds and buys insolvency claims.

Manolete chief exec Steven Cooklin told City A M that the company has also recently worked on a series of projects to recover “misappropriated Bounce Back monies”.

LOUIS GOSS

US LAW firm Dechert has hired “highstakes” litigator Kaplan, Hecker & Fink to defend it from being sued by a former Wall Street Journal reporter, over claims it hired hackers to push him out of a job.

Dechert is being sued by the Wall Street Journal’s former chief foreign

correspondent, Jay Solomon, over claims two of the firm’s former partners worked with hackers in India to steal emails between him and one of his sources.

The WSJ reporter’s tenure at the New York newspaper ended in July 2017 after the “illegally obtained” emails were published in the press.

The US lawsuit claims Dechert’s

former head of white-collar crime compliance Neil Gerrard caused “irreparable harm and damage” to Solomon’s reputation as an “ethical journalist”. The reporter claimed the “hack-and-smear” operation prevented him from securing employment as an investigative journalist

Dechert and Kaplan, Hecker & Fink were approached for comment.

LOUIS

Dechert is being sued in the US by the Wall Street Journal’s ex-foreign correspondent

LOUIS GOSS

Stephan Shakespeare

THE NOTE BOOK

Data-driven future must be embedded in today’s schools

ISTARTED Jimmy’s Jobs of the Future as a lockdown project whilst I was a stay-at-home dad. I had gone from being then-Prime Minister Theresa May’s business adviser to spending 12 hours a day at home with my six-month old daughter. I had gone, effectively, from Downing Street to diapers. We listened to a lot of podcasts and I wondered if there was a way to help tackle what I worry is a coming unemployment crisis.

It was part of my job at Downing Street to tell the PM about job redundancies at the daily 8am meeting. There was much to say, but we were still at record high employment numbers. “Where are all these new jobs coming from?,” she would often say.

And the truth is, they come from entrepreneurs creating perhaps two to three jobs a week, leading to thousands a week across the country. These small increases don’t get the headlines but they are a fascinating insight as to where our economy is heading.

When we interview entrepreneurs on the show, there are two areas that come up every time: “data and engineers”. That’s why I think May’s successor-but-two Rishi Sunak is right to focus on getting better numeracy and data understanding in our academic system.

The challenge we face is making this relevant for Gen Z. When I was at school, we were shown how to use trigonometry to calculate how high a cat was stuck up a tree –something I am yet to apply to the real world.

Instead we should use more reallife examples in our schools, using social media and sport case studies. Could kids look at social media engagement data and decide when best to send a tweet, instead of how to get Felix the cat down from the sycamore?

You would never hear a CEO say “I know nothing of finance, I leave that to the CFO.” The same is becoming true of data: Rishi Sunak is right to put it at the heart of the country’s education.

ENTERPRISING HONOURS

£ Kudos to Tooting lad Amol Rajan for his documentary on how to crack the class ceiling, examining why the working class is being held back in all levels of British society from business to politics. Our last five prime ministers have included two women, the first man of Asian heritage and two Old Etonians. While diversity and inclusion is becoming an ever important topic in boardrooms, there is less of a focus on the diversity we cannot see, such as class.

£ I have been engrossed in Matthew Perry’s autobiography, ‘Friends, lovers and the big terrible thing’. Once you’re past the string of lovers –which largely feels like a long apology letter to each of them –it is a harrowing read on drug and alcohol addiction. I am frankly amazed he managed to fit so much in. There are political links, too: his mother was an aide to Pierre Trudeau who was Canadian Prime Minister and of course father to current PM, Justin. He also recounts an hilarious Newsnight interview with Peter Hitchens, available on Youtube.

Electric truck maker Tevva gears up for UK mass production after regulatory okay

ELECTRIC truck maker Tevva is set to start mass production of electric vans after receiving the green light from both UK and EU regulators.

The Essex-based “scale up” has received the okay from the UK Vehicle Certification Agency as well as Sweden’s transport agency, meaning it can manufacture and sell trucks with both left and right-hand drive.

“I am incredibly proud of our team who have worked tirelessly to secure

this certification and get our 7.5-tonne electric truck in customers’ hands and on the roads,” chief executive Asher Bennett said.

Endowed with a 105 kilowatt-hour battery, Tevva’s trucks can run for up to 140 miles on a single charge. The range will be amplified to 354 miles later this year by a new fleet of vans with hydrogen range-extenders.

“By embracing both hydrogen and electric fuel sources, we can rethink the energy mix in transport, reduce strain on our electricity grid and

accelerate electric truck adoption,” Bennett added.

The company, which was founded by Bennett in 2013, plans to expand to continental Europe, selling to clients in the German and French markets.

“The first quarter we’re focused on UK deliveries and then we’ll start moving to building our trucks in Britain and delivering them to Europe later on,” the chief exec told City A.M.

Tevva has also been mulling about setting up shop in the US, but plans have yet to be announced. Tevva’s

CAN I QUOTE YOU ON THAT?

We’re entering an AI-powered golden age. It’s

Andreesen Horowitz’s Marc Andreesen on the rise of AI in writing, art, music and science

Last year we witnessed incredible drone light shows –above Buckingham Palace and as part of the New Year’s Eve display. They will soon replace fireworks displays. These drones are actually operated by a British-based company, New Substance, that employs 50 people in Leeds. As they are a B2B company, they don’t have much brand exposure, but they are a great example of British innovation and a job of the future.

The founder, Patrick O’Mahoney, recently appeared on my podcast, Jimmy’s Jobs of the Future, to talk about the future of the creative events space, including how they are repurposing a North Sea Oil Rig for new, enterprising uses.

Jimmy’s Jobs of the Future is available on all platforms and at jobsofthefuture.co

It’s where business leaders get a few things off their chest. Today, it’s Jimmy McLoughlin, former No10 adviser turned podcast host

going to be glorious

Kudos to Ben Francis and Bejay Mulenga who were both awarded MBEs in the New Year Honours list. Too often our honours system goes to big business elites who seem to have whole teams dedicated to applying for honours. Sir Hugh Robertson, who is chair of the ports honours division is onto them, saying “we can spot the polished ones”. It can be hard for the government to be aware of the work of entrepreneurs. Bejay and Ben’s gongs suggest that’s changing.

NO CHANCE OF HIM DRONING ON, I PROMISE

ILARIA GRASSO MACOLA

electric trucks can run for up to 140 miles on a single charge

CITY DASHBOARD

YOUR ONE-STOP SHOP FOR BROKER VIEWS AND MARKET REPORTS

LONDON REPORT BEST OF THE BROKERS

New year rally loses ground on central bank rate warnings

LONDON’s FTSE 100 premier index’s new year rally lost some steam yesterday driven by investors wobbling over a string of hawkish comments from central bankers and Ocado’s shares slumping.

The flagship index shed 0.39 per cent to close at 7,694.50 points, while the domestically focused mid-cap FTSE 250 index, which is more aligned with the health of the UK economy, lost 0.45 per cent to fall to 19,390.97 points.

The losses were sparked by traders betting top central banks, such as the Bank of England and US Federal Reserve, will push back against market optimism over how high interest rates will peak this year.

Chief economist at the Bank, Huw Pill, who admitted the Bank underestimated the surge in inflation, this week signalled he will back another 50 basis

point rise at the next MPC meeting on 2 February, sending borrowing costs to four per cent.

He said the Bank was concerned about soaring wages – which are trailing inflation – engineering “persistent” price rises in a speech in the US.

“The labour market holds the key and we’re not seeing much in the way of slack,” said Neil Wilson, chief market analyst at Finalto.

Fed officials have also hinted at more steep rate increases this week. Investors had expected chief Jerome Powell to follow that tone in a speech at an event hosted by the Swedish central bank. He ended up glossing over discussing policy.

Recent data has indicated inflation in the UK and US has passed its peak and will gradually fall in 2023, raising the likelihood of the Fed and BoE taking their feet off the accelerator.

Electrical retailer AO World upgraded its FY23 forecast despite reporting a 17 per cent fall in sales in the third quarter. Analysts at Peel Hunt noted the drop in sales was in line with forecasts. The analysts pointed out AO deliberately softened the November trading peak, avoiding unprofitable sales. They rate it a ‘hold’ with a target price of 80p, up from 70p.

GAMES WORKSHOP

Games Workshop reported revenue and profit ahead of its December guidance. The Warhammer-maker also announced a 130p dividend, taking its total dividend to record levels. Peel Hunt analysts said the shares have performed well recently after the company secured a deal with Amazon to potentially bring Warhammer to film and TV. Games Workshop was rated a ‘buy’ with a target price of 9,500p.

CHRISTMAS HANGOVER “Retail played a big part in dragging down the FTSE 100 yesterday with Next, Frasers Group and B&Q owner Kingfisher all in the red. December’s retail figures didn’t exactly set pulses racing, with people spending more than last year but buying less.”

DANNI HEWSON, AJ BELL

EDITED BY SASCHA O’SULLIVAN

As we modernise education, we can’t allow hackers to target our kids’ future

Rosie Beacon

rity systems, leaving a gap for opportunistic hackers to exploit.

IT is a rule in politics almost as old as time that when a threat does not feel immediate or tangible, it is consistently deprioritised in the cut and thrust of politics, but then quickly sees a climax when a threat does materialise. By this point, it is usually too late. We saw it with pandemic preparedness. Cybersecurity is in the early stages of a similar reckoning.

I recently discovered that my old school had been struck by a ransomware attack. And for the entirety of the first academic term, the school systems were essentially paralysed by a hack to the school infrastructure.

Ransomware is a particular type of malicious software that not only hacks into an infrastructure but encrypts all of the servers until the ransom is paid (in this case, £500,000). So aside from the obvious financial and privacy threats, it also makes the systems totally unworkable. The hackers were able to steal data from the school’s servers, including home addresses, bank details, medical records and students’ psychological reviews.

The hackers threatened to make the stolen data public if the school fails to pay the ransom, “all of your child’s private information will be online for everyone and for free”.

It is safe to say that upon hearing this, I no longer viewed cybersecurity as the essential but intangible provision I had flippantly started to view it as. Evidently, not only does effective cybersecurity protect the privacy and safety of both students and teachers, it also prevents unnecessary disruption to students’ valuable education.

The real-life ramifications of such disruptions could translate into the grades students leave school with or the university they get accepted into.

The monumental scale of the disruption is hard to predict or overstate: three years down the line as students try to enter a saturated graduate labour market, the effects of cyberse-

curity neglect could still be felt. And if it were not a school but a hospital, what is the equivalent level of disruption? Crucial scans lost, operation schedules unobtainable? A life-threat-

ening delay to treatment?

The problem is that schools, parents and students believe they are now benefiting from digitisation. There is no more signing slips of paper for school trips, school reports go straight to inboxes and there is access to numerous educational tools. But without matching that rapid digitalisation with security then the school is exposed.

Thus schools, and many other public service institutions, have fallen victim to what Dr Melanie Garson, Associate Professor of International Security at UCL (and my colleague at the Tony Blair Institute) has titled “the attacker’s arbitrage”. This is when digital systems mature much faster than secu-

My old school is also not alone in its cyber vulnerabilities. The UK’s education sector has been experiencing a significant increase in these types of incidents – the National Cyber Security Centre highlighted an increase in August 2020, and again in February 2021. It is not just happening in the UK either. LA Unified School District –America’s second largest school district – suffered significant disruption in September due to a cyber attack.

The problem with cybersecurity as a policy priority is that it feels both improbable to happen and impossible to fix. Not only is it uniquely technical, it is also constantly evolving in sophistication.

Pandemic resilience (or lack thereof) is a useful analogy for cyber resilience. During the pandemic, which many wanted to believe would never happen, any and all vulnerabilities in our public services were ruthlessly exposed. And, three years down the line, any weaknesses exacerbated by the pandemic are now causing unprecedented chaos in virtually all our public services. It is the same with cybersecurity.

It is ultimately a good thing that public services are digitising. Schools can be both digital and secure – it is not a trade off. But the government needs to start investing in national critical infrastructure, especially education, and not see it as a costly or burdensome afterthought. As in the pandemic, it comes down to prevention and resilience, not reactive firefighting.

Sunak is right. If more Brits could do maths our economy might just start growing again

ACCORDING to Rishi Sunak, everyone up to the age of 18 should be learning maths. It was an idea widely disparaged when the prime minister laid out his plans for the year ahead. But it is essential at all levels of society.

It was during the pandemic that we saw the importance of having a Chancellor who understands mathematics. He was one of the few able to wrestle with the scientific modellers and acknowledge the multiple trade offs of shutting our economy.

Most of the Cabinet at the time –and, to be fair, this seems true of most historic Cabinets – were by and large innumerate. Prime Minister Boris Johnson was notorious for the glazed look which spread across his features when presented with a slide containing any numbers at all.

The basic principles of epidemic modelling can be understood from a simple set of ordinary differential equations, the so-called Susceptible-Infected-Removed (SIR) model. Of course,

Paul Ormerod

ability range where the real problems lie. Every few years, the OECD measures young people’s skills across the globe with the International Student Assessment (PISA) tests. It focuses on those essential to modern society, including - quelle surprise - maths.

dust by East Asian countries such as South Korea and Singapore.

But as the OECD tactfully puts it “81 per cent of students in the United Kingdom attained Level 2 or higher in mathematics”.

DISAPPEARING

for many of Sunak’s arts graduate colleagues, the previous sentence might just as well be written in Tibetan or Sanskrit.

Sunak, however, was able to apply himself to the task. And increasingly, the jobs which pay the highest salaries need quantitative skills. You need strong mathematical abilities to understand Big Data and social media. Google, for example, has made its founders unimaginably rich. But the company was formed on a fairly advanced mathematical concept called an eigenvector. The opportunities are there in abundance, but only a minority has the skillset to take real advantage of them.

Yet it is at the opposite end of the

In the latest set of results, published in 2018, over half a million students from 72 countries were measured, looking not just at memorised answers but how well young people can extrapolate and apply their knowledge.

In the UK, our mathematical skills have seen some marginal improvement. In the 2015 PISA research, we scored just below the OECD average in maths, and in 2018, British students were slightly above the average.

At the top level, out of six, students “are capable of advanced mathematical thinking and reasoning...they can apply this understanding to develop new approaches and strategies for attacking novel situations”.

The UK does reasonably well at the top two tiers, with 13 per cent in these categories. Even so, we are left in the

Tactfully because this means 19 per cent are in the bottom level. This means students may not be able to understand price labels in shops, let alone calculate a percentage.

Even level 2 is not much to write home about. At this level students can perform tasks such as converting prices into a different currency or comparing the total distance across two alternative routes. They struggle with anything harder.

There is an entirely separate question as to how it can be that young people emerge from over a decade of state education with such low numeracy skills. But at least the Prime Minister knows his own times tables, and understands the problem at hand.

£ Paul Ormerod is an author and economist at Volterra Partners LLP

MAN Here lies Boris Johnson, former prime minister, former Mayor of London, former friend of Michael Green. Or sorry, we meant Grant Shapps. We can’t remember which is his real name. Either way, the Business Sec posted a picture with the ex-PM airbrushed out. Shapps’ team says he had no idea.

£ Rosie Beacon is a senior policy analyst at the Tony Blair Institute

An increasing number of students are using online tools for their education

The real-life ramifications could translate into grades or even university entry

WE WANT TO HEAR YOUR VIEWS › E: opinion@cityam.com COMMENT AT: cityam.com/opinion

LETTERS TO THE EDITOR

A birthday wish for the internet

[Re: As the Internet turns forty, we must invest in digital skills, Jan 4]

With the internet turning middle-aged this year, the importance of data for businesses has never been more central.

The 40th birthday of the internet should act as a call to arms for business leaders as online innovation enters a new stage. While the article correctly highlights the importance of predictive technology for future growth, it fails to elaborate on what this “predictive” technology means for businesses.

The spiral of economic challenges in 2023 mean that business leaders are under huge more pressure to make informed, data-driven decisions. However, many lack the skills to benefit from these insights – if they can access

them at all.

To fulfil this need, many businesses across sectors are investing in “predictive” approaches to Business Intelligence and analytics.

Being predictive, however, is only one part of the puzzle. AI and machine learning is transforming how businesses prepare data, generate insights, and explain those insights to people. This is putting the power of analytics in the hands of more decisionmakers than ever, without necessarily requiring them to have a technical background.

There is huge potential here for firms in London to benefit, whether it is a retailer seeking to understand customer behaviour to decide on their next product lunch, to the capital’s worldleading finance firms still struggling to monetise decades of legacy data.

Tom Warren MD of UKI at Pyramid Analytics

Stop blaming lazy landlords for empty shops and look for the cause not the symptom

Dominic Curran

You know those tiny bottles of wine you buy for a picnic or for a Coq a vin? Well soon they’ll be bottled no more and in a can instead to try and save 320 tonnes of packaging at the supermarket giant. It kicks in from Sunday.

EXPLAINER-IN-BRIEF: WHAT’S INSIDE THE NEW ANTI-STRIKE LAWS

Yesterday the government proved it wasn't prepared to abandon its carrot and stick approach to the unions just yet, bringing in anti-strike legislation.

Business secretary Grant Shapps said there was a “duty to protect the public access to essential public services”, and called it a “common sense approach”. The rules will mandate that critical industries must have “minimum services” in place even on strike days. This tactic was already taken by the Royal College of Nursing when their members went on a strike last

year. It would apply to pretty much all public sectors, including health, transport, education and the fire and rescue service.

After months of stalemate, there might be some progress on a deal. Health secretary Steve Barclay is trying out a good cop approach, allegedly considering moving the wage hike for 2023/24 to the start of this year.

The government had previously maintained that this was off the table, so it would be an important concession.

ELENA SINISCALCO

PLANNING rules for new homes. Housing targets. Michael Gove, the levelling up secretary has had plenty on his hands with new legislation to solve the housing crisis. But one new rule which has flown under the radar aims to address the many empty shops on Britain’s high streets. So-called high street rental auctions were presented as a new power for local authorities to take over leasing out high street and town centre units if they have been continuously empty for a year, or for 12 months in the preceding two years. Gove justified this measure as an attack on “lazy landlords”. Others, such as think tank Onward, opined that it was largely faceless corporate landlords who were disproportionately responsible for the scandal.

And who could disagree? Everyone can probably think of at least one shop or restaurant in their area that seems to have been empty for an unjustifiably long time. And recent analysis by the Centre for Retail Research found that 17,145 shops closed last year. Why not force these units to be occupied, to support local jobs and add to local vitality? And why not bash these commercial titans, no doubt headquartered overseas, in the process?

But Gove was confusing correlation with cause. The places with the highest level of vacancies are often those with the lowest income to spend in shops. That’s why the northeast of England has almost double the vacancy levels of more prosperous London. Are Geordie landlords “lazier” than London ones? Of course not. Sometimes local demand just isn’t there to sustain shops and restaurants. In addition, the huge burden of business rates, particularly when transitional relief heaps extra costs onto the bill, can make leases simply unviable for businesses.

Property owners generally don’t want to keep properties empty – it deprives them of rental income, requires them to pay business rates, and invites vandalism and higher maintenance costs. So, who owns these empty shops? The British Property Foundation decided to develop the evidence base that the Government didn’t have.

We gathered data on the top ten “most vacant” town centres in England

and Wales. In three of them, their vacancies were based on large shopping centres awaiting sale or redevelopment.

Of 700 units identified as vacant, it transpired that private individuals accounted for four out of ten empty properties. Taken together with small companies – usually owned and registered in the same region – and local authorities, they accounted for two thirds (67 per cent) of all vacant units. So, far from being caused by uncaring distant corporate behemoths, a sizeable majority of vacant units were owned by individuals and local firms.

In fact, large property companies, real estate investment trusts and pension funds accounted for just two out ten (21 per cent) of all empty units, with overseas companies accounting for only one in ten (11 per cent). So far, so few lazy landlords.

Empty properties should be put to better use, whether that’s being occupied or redeveloped to provide what people actually want. But the blunt

tool of high street rental auctions, which undermines property rights and investor confidence in large responsible property owners, is based on flawed assumptions. These property companies are often the only private sector bodies capable of providing the investment needed to level up town centres.

Rather than threatening them, these auctions should be better targeted at those smaller individual landlords who are not even trying to rent out their properties. Ministers should also simultaneously re-build relationships with large property owners to see how they can be a friend in levelling up and regeneration, rather than pointing the finger at them.

These businesses want to see vibrant high streets and town centres with occupied retail, leisure and other uses; bashing them for a problem that is not their fault helps no one.

£ Dominic Curran is the assistant director of policy at the British Property Federation

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New rules will force rental auctions on empty shops

CAN IT Waitrose looks to slash carbon footprint by putting wines in a can

LIFE&STYLE

WINE-DOWN WEDNESDAY

We may have entered that dreaded time of year known as “dry January” but thankfully wine is still being popped, poured, sipped and slurped across London. I am a big advocate of enjoying your beverage however you see fit, but for those attending a particularly fancy do there are some basic rules of wine-etiquette the casual imbiber might want to know.

Though tempting to fill to the brim after 24 hours with the in-laws, pour your wine up to the widest part of the glass to allow the most oxygen to hit it and release its aromas. This also means you can do the slight swirl in the glass that shows you know your wine and how to get air into it, without it slopping out over the rim.

Lighter red wines can be served lightly chilled, but most will be at room temperature which is understood to be between 16-18C and does not take into account central heating or, this year, the lack of it. Should your red be a tad chilly, you can warm it gently by holding the bowl of the glass in your hands or against your chest.

Bottles on radiators or beside the fire will certainly heat your wine, but so drastically it will also damage it.

Should your wine not need warming, hold the glass by the stem or the base.

There is a lovely sense of ceremony to decanting a wine, especially if you have a crystal decanter to beautify the table, but in truth you can decant into a water jug as all you are doing is open-

WINE

Champagne that overdelivers in spades. An exceptionally classy glass at a fantastic price point, this is a way to feel sophisticated but spend-savvy at the same time. Utterly dignified drinking.

Rails is the new top dining spot at the transport hub that is King’s Cross, replacing Plum + Spilt Milk in a large airy space on the first floor of the Great Northern Hotel.

Designed to be bold yet elegant the high-ceilinged dining room is full of warm wooden panelling, cream leather banquettes, hanging pendant lights and large abstract paintings on the walls.

On a Friday evening it was surprisingly empty, with only a few full tables while we dined, but the convivial service by the charming staff and cosy corner booth meant this did not affect our experience.

Having walked past an array of glass cabinets boasting some of the best Champagne houses on offer I

DINING DIARY

was already excited by the wine list, and it did not disappoint with some truly fantastic bottles.

A bottle of Sanford 2019 Chardonnay from Sta. Rita Hills was a sumptuous delight and paired indulgently with the baked St Marcellin starter served with truffle honey that I smeared on thick slices of toasted French bread.

The mains menu is succinct, and

the Grill is clearly King, so we opted for the Chateaubriand to share. It was fantastic. Butter-soft slices of pink tenderloin beef in so large a portion that even between two we failed to finish it.

My personal pièce de résistance however was the Île Flottante, which has to be one of the most heavenly joyful desserts ever created, but one which I rarely find in London. A little island of fluffy meringue gracefully floating on a pool of delicately sweet custard and topped by crunchy flakes of almond. It will always leave a smile on my face.

Whether heading home from work or off on the Eurostar to Paris it is worth factoring a few extra hours into the commute and indulging in Rails’ fine-dining fare.

Wine without the snobbery, by Libby Brodie

ing up the wine with oxygen and getting rid of any sediment. When sediment hits the neck of the bottle, stop decanting or pour the wine through a muslin cloth or coffee filter to catch it. You can decant both red and white wines, but bold full-bodied reds will benefit the most. It is a process of practice but as a general rule you might decant a white for 5-20 minutes and a red for 30 minutes to an hour.

If you are pouring from the bottle, then hold it towards the base rather than the neck and as you’re finishing the pour twist the base away from you as you turn the bottle upright again. This should minimise drips running down the bottle and onto any hands or tablecloths.

Different cultures have different rules for that important toasting moment. The Debrett’s Guide to etiquette says glasses should be raised rather than connected, but where is the fun in that? A useful tip however is that glasses should be clinked at the widest part of the bowl to avoid smashing the more delicate rim and any sloshing out of the wine.

Finally, a top tip for the lipstick wearers among you. Aim to sip from the same side of the glass each time, otherwise you will end up with a smudgy rim and a sticky glass. My solution won’t be winning any etiquette awards, but saliva works as a pretty excellent barrier so if you can find a way to lick the rim before you drink, it will keep the lipstick from sticking to the glass.

Tips

tricks to make it look like you know what you’re doing when it comes to

Sober IS fun: low alcohol events to go to this month

Whether you’re swerving the sauce completely or scaling back the drinking with a Damp January, here are the low and no alcohol events this month that don’t skimp on fun. Party, laugh out loud and experiment with new flavours with these booze-free events.

A NEW BAR ON BRICK LANE

Brick Lane is now home to more than boozy curry houses: it’s touting London’s first non-alcoholic cocktail bar.

East London-based boozeless spirits purveyors Kahol are on board to help with the menu at Maya’s, and drinks promise to one-up your classic mocktail. From 12 March.

A LOW AND NO TASTING

The Lord Napier Star on White Post Lane, Hackney Wick, is hosting a night of celebration for low and no alcohol. Big Drop Brewery are on duty with the no alcohol beer tasters and Ceders Gin will be shaking low alcohol cocktails. Tickets are a steal, starting from only £5, and include a try of the drinks themselves.

A GUILT-FREE APERITIF

On Thursday 17 January there’s an-

other opportunity to hit up your local without having to face the drunken walk home. The Signature Brew headquarters at Blackhorse Road are welcoming in no alcohol aperitif and digestif creators High Point for a

night of collaboration. A free drink on arrival and a tutored tasting are included in the ticket price.

DRY JANUARY COMEDY

Comedy feels inexorably linked with

booze, so it’s refreshing to see a comedy night going boozeless. Laughing makes us feel good anyway so why do we need the booze hit? The Backyard Comedy Club’s website promises that “Sober IS fun” and the Bethnal Green

venue has table football and table tennis alongside the comedians in case sober comedy turns out weaker than a Jim Davidson punchline. Live at the Apollo comedian Paul Mcaffrey is the first to be announced. The event takes place on 22 January.

A FEMALE ONLY PARTY

The Ministry venue on Borough Road is hosting a female only booze-free night on 31 January to round out Dry January. Meet new friends over a no or low alcohol drink and get a free Caleño cocktail on arrival. They’re the no alcohol sponsors inspired by the drinking culture of Colombia. They mess around with flavours including Inca berry, citrus, pineapple, ginger and kola nut spices.

THE CLUB SODA TASTING ROOM

Over one hundred of the UK’s low and no alcohol spirits brands are available at this Covent Garden tasting room. The name kinda gives it away, but tastings are available too. It’s a great opportunity to get a proper understanding of the flavours of no and low alcohol drinks available. Let’s face facts: normally it’s pretty hard work finding these drinks behind bars.

ASK THE EXPERT: LONDON DONE PROPERLY

The Tent (at the end of the universe) chef John Javier tells us about his favourite London restaurants

OLD STREET CHINESE RESTAURANT

Hands down my favourite Chinese restaurant in London. You gotta know what to order though! The fish fillet with sizzling oil, crispy lamb with cumin and chilli as well as the twice cooked pork belly are my top picks. The braised cabbage in broth and the cold sliced beef tripe are really good too. If you’re feeling adventurous, the wok fried kidneys in chilli sauce, the chopped rabbit or frog legs in iron wok are also up there amongst my regular orders.

tKILN

Probably the restaurant I eat at most. It’s so good each and every time. I’ve noticed they’ve turned up the spice recently which is something I really dig. They’re also open on Sundays and Mondays, which are sometimes the only days I have off work. Get all the snacks, all the laarp, the brown crab with glass noodles… actually just get everything.

t UMUT 2000

The OG ocakbasi. It’s without a doubt the best one in London, if not one of the best in the world. The lamb baked with bread, butter and yogurt is out of this world and so are the lamb ribs. The grilled onions are another favourite –they always come out super smokey and full of flavour. It’s not listed on the menu but also ask for the grilled lamb heart.

SINGBURI

t t

If you like really spicy Thai food, this is for you. You’ll find all the chefs from east London eating here on Sundays. Don’t think, just order the whole specials board. You can split it with two or three mates and leave spending about £35 each. You won’t regret it. It’s the best bang for buck restaurant in London and also some of the tastiest Thai food you’ll find anywhere. Plus, the chef, Siri, is an absolute legend.

ROYAL CHINA CLUB

I only go here for the dim sum. If nothing else, just get 10 orders of the lobster dumplings. I miss that old world service, large format, Cantonese restaurant vibe. It reminds me a lot of the Chinese restaurants in Sydney and Hong Kong that I grew up eating at.

Don’t let Dry January spoil your fun –there are loads of great booze-free options across London, says Adam Bloodworth

THE PUNTER

Fine day ahead for Fownes in the January Cup

TAKE a chance with the Caspar Fownes-trained NEARLY FINE to surprise better fancied rivals in the feature race at Happy Valley; the Group Three January Cup (1.45pm) over nine furlongs.

This is the only Group contest in the racing calendar at the city track, with past winners including smart Group One performers Military Attack and Eagle Way.

Fownes, who has saddled 16 of his 21 winners at the city track this season, won this corresponding race last year with useful performer Zebrowski, and has good claims of making a successful follow-up.

The five-year-old grey Nearly Fine has

been in the form of his life since September, winning three times – twice over the course and distance – and rocketing up the ratings.

On paper he faces his stiffest task to date, taking on some Group Three contenders for the first time, but races off joint bottom-weight with 8st 3lbs, after recently carrying some welter burdens of 9st 8lbs and 9st 9lbs.

Obviously, he is facing better class middle-distance performers, but the son of Exosphere looks to be progressing quickly and is capable of making the most of his attractive weight.

Many will be dissuaded from supporting him with the booking of Keith Yeung in the saddle, as the former

Champion Hong Kong apprentice has only ridden a handful of winners this season.

Yeung, however, doesn’t get the rides he deserves, and is more than capable of holding his own when given suitable opportunities.

This was highlighted by the accolade given to him for his ‘Ride of the Meeting’ at the Valley last week, when partnering talented but wayward 29-race maiden Amazing News to victory.

The opposition looks strong on paper, with championship leading trainer Frankie Lor saddling three runners, spearheaded by Money Catcher who exceeded expectations when third to jointhighest Hong Kong galloper Romantic

Warrior in the Group One Hong Kong Cup last month.

That form is the best on view, but the five-year-old has proved costly to supporters in the past, being a four-timebeaten favourite, and only a winner once in 15 starts.

It is also worth pointing out that only one market leader has won this contest in the last 10 years.

The likes of Berlin Tango are favoured by conditions of the contest, although trainer Tony Cruz has yet to taste success in this contest, having saddled 16 runners with no success.

Talented Rise Brethren has already won over the distance at Sha Tin back in October, but has been slightly disap-

pointing since, especially when offered winning opportunities.

He does, however, race off an attractive handicap mark, and alongside another of Frankie Lor’s contenders Celestial Power, poses a major threat.

Celestial Power races at the city track for the first time since June 2021, but has an unbeaten one-from-one record over the course and distance, and can improve markedly back at the Valley.

POINTERS

Nearly Fine e/w 1.45pm Happy Valley

Change of luck on the cards for Hewitson and Happy Soul

FORMER South African Champion

Jockey Lyle Hewitson finally looks set for a change of luck when he renews his association with the Danny Shum-trained HAPPY SOUL in division three of the Great George Handicap (12.45pm) over six furlongs.

Hewitson is presently lying fifth in the jockeys’ championship table with 16 victories, but has had a quiet period over the last couple of weeks with

numerous places; he rode four seconds at the Sha Tin meeting over Christmas, but hasn’t recorded a victory in four race meetings.

With a full book of rides at the city track, he gets his chance to return to the winners’ circle, notably with Happy Soul who finally gets his chance to record his first win in Hong Kong.

The Australian-bred import has been plagued by a series of double

figure or awkward draws this season, seeing him either getting too far back in his races, or suffering wide and tough journeys.

This time from a middle draw of seven, he should at least be able to slot into midfield along the rails, behind a probable mad early dash led by fast-starting Flying Bonus, Happy Fat Cat and Solar Partner.

Provided the four-year-old is within

striking distance turning into the home straight, there is little doubt that he is good enough to mow down his opposition in the closing stages and provide a welcome winner for his jockey.

Will wonders never cease?! Champion Jockey Zac Purton has gone two race-meetings without riding a winner for the first time this season.

The Zac-Man will be hoping speed-

ball Whizz Kid, who has been unbeaten in four races at the Valley over five furlongs, can defy top-weight in the Cannon Handicap (12.15pm) over the same trip, and break his rare losing streak.

POINTERS

Happy Soul 12.45pm Happy Valley

Wally Pyrah previews today’s card from Happy Valley

Nearly Fine has won three times at Happy Valley already this season

European rugby was sexy, now it’s a turn-off

THE CHAMPIONS Cup is back but I just don’t really care.

When I was a toddler in the stands of England’s Premiership grounds, I loved the top flight European Cup – seeing my club play in it meant so much more than watching domestic rugby. That aura has vanished.

I don’t know whether it is the inclusion of South African sides or the revamped group stages, but it’s lost its sex appeal.

Compare it with football: a Premier League or LaLiga title means the world but winning the Champions League is everything. It’s that step above, the reward for conquering a continent.

But back to the oval ball game, there’s just so much wrong with it – mainly the group stages.

Gone are the days of four-team pools, where every game mattered, and here is the era of two 12-team conferences where one match point has seen teams progress in the past.

It’s lost its jeopardy, it’s lost its spark – and that’s a shame.

Gone, too it seems, are the days where teams were punished for fielding frankly comical sides in what’s supposed to be the top drawer European competition.

Gloucester sent a pitiful side to Leinster in this season’s second round – and were beaten 57-0 – while a number of sides, notably Northampton Saints,

have seemingly forgotten to get off the bus for their fixtures.

WHEN I WAS YOUNGER When I was younger, my father and I would travel Europe supporting our club. Those weekends have become talking points at the pub since.

And despite our desire to go to South Africa to experience some of its world famous rugby hospitality, it’s simply too expensive to justify the thousands it would cost to get there and back to watch our side put out a XV that will be on the end of a drubbing.

Europe used to be the holy grail. Mun-

ster, Leinster and Toulouse are some of those whose entire professional history is built on Heineken Cup success.

A tweak to the groups and a commitment from clubs to give a toss would dramatically shift the competition’s tectonic plates back into alignment.

It’s no slight on the South African sides; they’ve added to the competition on the pitch. But I think it was a move which was cemented too early. The four sides should have been able to establish themselves in the United Rugby Championship for five years – simply to grow their brand and appeal in Europe – before they entered the Champions Cup.

And why is a South African rugby team – the Cheetahs – who are not in the URC allowed in the Challenge Cup ahead of, say, a triumphant team from one of Europe’s other domestic leagues – such as the Super Cup?

Short sightedness and a lack of planning has created a product that turns me off from European rugby – and it needn’t have been this way.

I just wish fans had been thought of beforehand. I cannot jet off to Pretoria for two days like I can to Dublin, La Rochelle or Parma.

I will be watching Leinster’s trip to a Premiership ground this weekend. Why? It has nothing to do with the competition they play in but because it’s Leinster. The attraction to the teams is there, it’s the competition that lets them down.

WHILE some readers will have New Year’s resolutions and supporters may have January wish lists for their clubs, I have my own hopes for football in 2023 and they revolve around refereeing.

Recent times have seen a conveyor belt of tweaks to officiating that I believe has only muddied the waters. The thinking has not been joined-up and it has left us with a product that can leave us baffled. That has to change this year.

The appointment of leading former official Howard Webb as English football’s new referees’ chief just confirms to me that there is a problem. I think Webb is a good hire, though, and I hope he gets the game back on track by addressing the following issues.

1. REFINE VAR

Video assistant referees have been the biggest change to football in the last few years and, whatever we might think, they are here to stay. The question, then, is how to make them better.

For me, that means delivering absolute clarity on two things: the threshold for VARs to correct a clear and obvious error, and whether there ought to be a margin of error for offsides.

2. HANDBALLS

What is a handball? It sounds like an easy question but it has become anything but. I want to see Webb sort this out and explain it to officials, players and fans alike.

In my opinion, it should hinge on whether a defender’s arms are in an unnatural position, and that has to be determined by the ref. But I’m not convinced they currently have enough of an understanding of the game from a player’s perspective, so they may need educating.

3. MANHANDLING

Confusion is rife over what constitutes manhandling of an opponent that should be punished with a penalty kick. We saw it at the World Cup, where England saw Harry Maguire wrestled to the ground against Iran only to be penalised for a similar offence later in the same game.

My view is that if a defender’s arms are around an opponent and they are not looking at the ball, then that ought to be given as a foul. In the box that means a penalty, and that needs to be made crystal clear.

4. YELLOW CARDS

I think we have lost sight of what should result in a yellow card. Too many bookings are being issued for collisions that are mistimed by a split second, resulting in too many players being suspended, and that is detrimental to the game.

A defender who stops a breakaway when they are not goal-side of an attacker, on the other hand, should absolutely be a yellow card. Referees need to focus on punishing cynical play rather than physicality.

the ball for a certain number of steps or seconds before releasing it. Why

can’t we do the same with throw-ins?

Throw-ins should be taken within two yards of where the officials indicate, not the six yards or more we often see now. Players who infringe should get one warning and then a booking.

6. CONCUSSION BREAKS

I’m tired of seeing players treated on the pitch after a blow to the head and being given the chance to argue that they are fine to continue.

Get them off the pitch and away from the cameras to be properly assessed and allow teams to make temporary concussion substitutions at no cost in the meantime.

7. FA CUP

It’s a ridiculous situation that we have VAR in some FA Cup ties but not others,

until the semi-finals, when the competition moves to Wembley.

Some may find these suggestions boring but I think they would improve football and no one can tell me that any of them are debatable.

In time, I’d also like to see sin bins and the broadcasting of conversations with the VAR, but those can wait until we have resolved some basic issues with the rules of the game and the way it is refereed.

Trevor Steven is a former England footballer who played at two World Cups and two European Championships. @TrevorSteven63.

FOOTBALL COMMENT

Trevor Steven

WHAT FOOTBALL NEEDS IN 2023

Trevor Steven on the seven changes to refereeing on his wish list

England chiefs take the Bazball blueprint to county cricket

HARDY

ENGLAND captain Ben Stokes and head coach Brendon McCullum have given Zoom presentations to county head coaches about how to implement their winning “Bazball” formula.

The tutorial was delivered by the duo from England’s footballing HQ St George’s Park on Monday and focused on the ethos that has seen the Test side swing from consistent failure to astounding success.

Since the duo took the reins of the five-day team, they have won nine of their 10 Tests – including series wins against New zealand, South Africa and Pakistan.

Reports suggest the term Bazball was not itself used – it’s a word that players have said McCullum, whom the style of play is named after, despises – but the discussions covered a shift to positive cricket and how to ride pressure.

Discussion of draws was dismissed and a focus was placed on the field’s role to solely get wickets.

There is hope within the England ranks that – despite the video conference not being a mandatory call to change county cricket styles – the philosophy will filter down through the national ranks.

In the wider meeting between the England and Wales Cricket Board and the county teams, whose season begins

on 6 April, there were talks about ground staff producing harder, flatter pitches similar to those seen overseas and a desire for a couple of county fixtures to play with the Kookaburra ball, which is widely used in Australia among other countries.

Furthermore, with a new structure for English domestic cricket set to be introduced in 2024, there could be changes to the T20 Vitality Blast –though reports suggest one county coach pushed back on this.

Elsewhere, a number of England stars were in action last night in the opening match of the new SA20

Twenty20 league in South Africa.

Jofra Archer made a return to cricket as his MI Cape Town team beat the Paarl Royals by eight wickets. The England fast bowler took three wickets for 27 runs as Cape Town restricted the Royals to 142 –Jos Buttler scored 51 runs, Jason Roy scored 13 and Eoin Morgan knocked 19 at Newlands.

Dewald Brevis’ 70 not out powered Cape Town towards the win with Ryan Rickelton scoring 42 and England’s Sam Curran knocking 20 to aid their chances as they wrapped up the game inside 16 overs.

Durban’s Super Giants play the Joburg Super Kings tonight.

Cowan-Dickie ruled out of Six Nations with ankle injury

MATT HARDY

ENGLAND hooker Luke Cowan-Dickie has been ruled out of the Six Nations next month due to an ankle injury that could require surgery.

The Exeter Chiefs hooker limped off during the second half of his side’s big Premiership win over Northampton Saints on Saturday.

The 29-year-old, who has signed for French Top14 champions Montpellier ahead of next season, has been a key cog for the English national team over a number of years and his injury adds to the potential losses of the likes of fly-half Marcus Smith.

“It does look like an operation is going to be required but that said, at this stage, it wouldn't be a season-ending situation,” Exeter director of rugby Rob Baxter said.

“He’s seeing a surgeon today [Tuesday]; that will maybe give us a more definitive outcome and timing.

“We could still see him back for a good chunk of the season if rehab and everything goes well.”

England begin their Six Nations campaign versus Scotland and finish away to Ireland in March.

Messi lifts PSG wage bill to a record £642m

FRANK DALLERES

PARIS SAINT-GERMAIN’Ssigning of Lionel Messi contributed to the club setting a new record for the biggest wage bill in European football history last season.

The French champions paid their players and staff €728m (£642m) in 2021-22, a year-on-year increase of 45 per cent, according to a new report by advisory Football Benchmark. It followed the transfer of Argentina superstar and seventime Ballon d’Or winner Messi from Barcelona in summer 2021.

Messi is reported to earn €63m (£56m) a year, while the arrival of other big names, including Sergio Ramos and Gianluigi Donnarumma,

also increased PSG’s wage bill.

PSG’s wage bill was by far the biggest among the winners of Europe’s biggest domestic leagues, the Football Benchmark report reveals. Real Madrid were a distant second on €519m (£458m) after their salary costs rose 29 per cent in part as a result of bonuses paid for winning the Champions League.

Premier League winners Manchester City’s wage bill was €418m (£369m), up four per cent year on year. But while City reported a €49m (£43m) profit on operating revenues of €731m (£645m), PSG suffered a record net loss of €369m (£326m), despite growing revenue to €670m (£591m).

Messi is reported to be only PSG’s

FOOTBALL

second highest earner, with France forward Kylian Mbappe overtaking him after signing a lucrative new contract last summer.

Brazil star Neymar is also believed to earn around €50m a year. Messi’s contract is due to expire this summer but the Qatar-owned club hope to tie him to a new deal following his success with Argentina at the World Cup in the Middle East last month.

PSG’s owners, meanwhile, are interested in buying a stake in Tottenham Hotspur or another Premier League club.

Qatar Sport Investments plan to increase their network of clubs in 2023, having taken a minority stake in Portuguese side Braga last year.

Football executives to meet over new WSL ownership

MATT HARDY

A NUMBER of football’s top executives are due to hold talks this evening with hopes of hashing out a new structure of ownership for England’s top-flight women’s league.

The meeting will see those present look at funding proposals for the Women’s Super League.

The chief of the Football Association, Mark Bullingham, is set to be at the meeting alongside Tottenham Hotspur’s chairman Daniel Levy and West Ham United’s vice-chair, Baroness Brady, among others.

The meeting will go beyond the WSL and also assess proposals for the second-tier Championship, according to Sky News’ Mark Kleinman.

The league is said to be looking at securing as much as £100m in funding for the Women’s Super League while Premier League chiefs have previously stated their interest in taking control of the competition.

Chelsea sit atop of the WSL table with Arsenal, Manchester United and Manchester City in behind the Blues.

Leicester City are bottom of the league and are without a point after nine games.

The league returns this weekend.

MATT

Messi is reported to be only PSG’s second highest earner, with France forward Kylian Mbappe overtaking him last summer

England have won nine out of their 10 Tests under Stokes

RUGBY UNION