Monday 7 August 2023

LONDON’S BUSINESS NEWSPAPER

CAN CRUISING BE COOL? OUR SCEPTICAL REVIEWER TAKES TO THE SEAS P16-17

CITY AIRPORT: GIVE US OUR WINGS

MUCH TO SMILE ABOUT? IT CAN ONLY GET BETTER FOR ENGLAND P19

Friday GDP data ‘good as it gets’

JAMES SILVER

ANALYSTS expect UK GDP to have eked upwards in June, with official confirmation coming on Friday of this week. Resilience in consumer spending and better-thanexpected PMI figures suggest the Office for National Statistics will declare the economy grew in June when it releases its monthly data later this week.

Oxford Economics expects the ONS to confirm a 0.2 per cent month on month increase from May into June, with the King’s coronation –and an extra bank holiday –providing a helpful comparator. Lower fuel prices have also helped. That would leave output across the whole second quarter growing 0.1 per cent on the first three months of the year.

EXCLUSIVE

GUY TAYLOR

THE BOSS of London City has said the airport’s expansion is “critical” to the UK’s business community, as it finds its plans to do so blocked by Newham council.

Robert Sinclair (right) told City A.M. that extended hours and higher passenger numbers would be vital to London retaining its spot as Europe’s number one financial destination.

The airport remains the capital’s business travel hub, with the relative

number of passengers transiting through the airport for work reasons greater than at London’s other airports.

City Airport has been locked in a battle with Newham Council over plans to expand its passenger capacity from 6.5m to 9m by extending flying hours.

Estimates suggest the expansion would create over 4,000 jobs and contribute around £700m in GVA to the capital.

However, last month, Newham’s strategic

development committee voted to block the proposals, citing concerns over noise pollution. The airport promptly launched an appeal against the decision in a bid to keep the project alive. Both sides now await a verdict from the Planning

Sinclair believes the post-Brexit capital is “facing challenges from other global cities… for capital, for talent and for

business” and would need to work harder to maintain its spot at the top table.

“There are challenges out there from Frankfurt, from Dubai, from Singapore, from Paris, from New York and I think one of the things that has always made London so attractive is its connectivity,” the Kiwi-born chief said. “Retaining that air travel and connectivity is critically, and I’ll use that word critically, important to London’s future.”

Sinclair said the evidence suggested that business travel was returning faster than many thought after the pandemic.

The second half of the year is expected to be tougher for the UK economy, as increases in the interest rate filter through to the wider economy. This week’s readout “could be as good as it gets for a while,” said Michael Hewson, chief markets analyst at CMC Markets.

“With rates now at their highest levels for over 15 years and more and more fixed rate mortgages set to be refinanced, the second half of the year for the UK economy could well be a lot more challenging,” he added.

Now even Zoom tells staff to head back to the office as remote honeymoon ends

JESS JONES

CITY leaders have long been predicting this September could signal a sea change in the ‘work from home’ debate, with more bosses insisting staff return to their desks more often once the summer holidays are over.

CEOs may well be emboldened after

Zoom –the video-conferencing platform that has become synonymous with remote working –called on employees to return to the office more often over the weekend.

Staff who live within 50 miles of a Zoom office should be in at least twice a week, the firm has said.

“We believe that a structured hybrid approach –meaning

employees that live near an office need to be onsite two days a week to interact with their teams –is most effective for Zoom,” a company

spokesperson told Business Insider, explaining the shift in strategy.

Zoom did not immediately respond to City A.M.’s request for comment regarding whether the changes apply in the UK.

The unexpected U-turn comes at a time when many

other companies have started requiring employees to head back to the traditional office space.

In May, Chancellor Jeremy Hunt, said the office should be the “default” location for capable workers as he expressed concerns that working from home could lead to a “lack of creativity” amongst employees.

STANDING UP FOR THE CITY

City Airport expansion is a no-brainer –except for the council

CITY Airport is a marvel. Close to the capital’s financial engines, it provides the sort of service which genuinely gives London a competitive advantage over other cities. It is therefore all too predictable that modest plans to expand are being held up by local council objections.

It is an all too regular, and boring, story in this country, with local objections overcoming the need for nationally important

THE CITY VIEW

projects to be completed on time and on budget.

HS2 is, of course, the most obvious. The merits of the scheme are shaky, but having started building it, it would rather make sense to actually do it properly. Alas a betting man

would currently conclude that the best odds were on the onceballyhoed north-south connection in fact providing only a quicker route to Birmingham from Old Oak Common, not even making it as far as central London. As a former chief economist at the Institute of Directors, Graeme Leach, put it so memorably, if we wanted to spend £50bn bringing Birmingham twenty minutes closer to London we should have

just rebuilt Birmingham. Heathrow’s third runway, too, is now once again uncertain; Gatwick will face an almighty fight to build its second. Wellmeaning housing policies are at the mercy of NIMBYs both local and national.

Now, we would not advocate some sort of central planning department which could ride roughshod over each and every objection. But some pressure from the centre might help. It is

MAMIL CROSSING Elite cyclists and weekend warriors alike raced through the Square Mile yesterday as part of Challenge London, the world’s largest city centre triathlon

apparent that Newham’s council, for instance, cannot see the merit of a project that would bring jobs and wealth to a borough in desperate need of it, so that leaves either bribery or mandation. Could government think more innovatively about how it forces major, important infrastructure projects through? Whatever the conclusion, something must be done to ensure Britain starts building once again.

Thatcherites keep tax cuts flame alive with call for PM to reverse tax increases

CITY A.M. REPORTER

CONSERVATIVE backbench totem Sir John Redwood has called for the UK’s corporate tax rate to fall to 12.5 per cent, alongside that levied across the Irish Sea. Redwood, who served as an aide to Margaret Thatcher and then served as a Cabinet minister under John Major, told GB News yesterday that Rishi Sunak and Jeremy Hunt have got it wrong by pushing forward with a corporation tax increase to 25 per cent earlier this year.

“As I've been explaining to the gov-

ernment for several years, the Irish collect four times as much tax per head from business tax than we do by setting a rate which is now half our level,” he said.

“We’ve watched as Ireland has attracted massive American investment, particularly in the digital industries, the really exciting growth area of the world economy, and much of that investment would probably come to Britain if we’d had the same

corporation tax rate as the Republic of Ireland.”

Stickier-than-expected inflation has quelled calls amongst Tory backbenchers for immediate tax cuts, with fears a move could further stoke inflation.

However, pressure is expected to build for a pre-election giveaway in next year’s budget, with the Tories still lagging in the polls and MPs concerned for their futures.

THE FINANCIAL TIMES

SCIENTISTS REPEAT FUSION POWER BREAKTHROUGH

US government scientists have achieved net energy gain in a fusion reaction for the second time, a result that is set to fuel optimism that progress is being made towards the dream of limitless, zero-carbon power.

THE GUARDIAN MAJOR GLOBAL HEDGE FUNDS FACE UK STRESS TEST

Many of the world’s largest hedge funds will reveal whether their investment activities risk amplifying economic shocks, after being recruited into the first-ever stress tests involving the shadow banking sector.

THE TELEGRAPH SOTHEBY’S OWNER BLAMES BREXIT FOR ART MARKET DECLINE AS PROFITS DROP Sotheby’s parent company Bidfair has blamed Brexit red tape for a decline in the UK art market as its profits tumbled by almost 75 per cent last year, according to its latest accounts.

war

THERESE Coffey, the environment secretary, said over the weekend that the Conservative party would need to stick to its guns on net zero policies in order to win the next election, despite a growing backbench revolt against the cost of climate-friendly policies.

WHAT THE OTHER PAPERS SAY THIS MORNING

GREEN DREAMS Therese Coffey opens another front in Tory net zero civil

Sir John Redwood is mounting calls for tax cuts

Pressure to improve audits drives up fees

BEN LUCAS

THE TOTAL amount in audit fees paid by the UK’s largest 500 companies has risen by 14 per cent in the past year, according to new data.

The value of audit fees paid by these firms rose from £1.12bn to £1.27bn for the 2021/22 financial year, according to new research by Thomson Reuters.

It said that the increase in the cost of audit work was being driven by the growing regulatory pressure to improve the robustness of audits and skills shortages.

Last year, the country’s audit regulator, the Financial Reporting Council, issued fines totalling £33.3m, up 77 per cent on the previous year.

“Auditors have invested heavily in recent years into delivering high quality audits. This has inevitably put upward pressure on audit fees,” Kyle Gibbons, managing director for Europe at Confirmation, a Thomson Reuters firm, said.

Commenting on the findings, Kathryn Cearns, former chair of the Office for Tax Simplification, said:

“There is a lot of focus on audit quality and that’s putting pressure on auditors to up their game.”

“There is also a scarcity of talent, which is putting pressure on audit fees,” she added.

To attract new recruits and retain existing staff, the Big Four accounting firms – EY, PwC, KPMG, and Deloitte –were forced to increase salaries across the board last year. However, that sector pay battle has eased over the as the national and global economic outlook remains uncertain.

PwC told its 25,000 staff in the UK in June to expect smaller bonuses and pay rises this year, with Ian Elliott, the firm’s chief people officer, reportedly writing to staff that the “exceptional” pay rises handed out last year would not be repeated.

Similarly, KPMG said in May that bonuses would be slashed.

Some 233 pubs entered insolvency in the second quarter of this year

Rate of pub closures hits decade high as food costs and wages rise

CITY A.M. REPORTER

THE NUMBER of pub closures in the UK has reached its highest quarterly figure in over a decade, new data reveals, as soaring costs force more of the country’s local watering holes to close their doors for good.

Some 223 pub businesses entered insolvency in the second quarter of this year, up from 200 in the first quarter,

Another UK chip darling heads to US as it slams government dither and delay

JESS JONES

CHIP MANUFACTURER Pragmatic

Semiconductor has suggested the UK’s weak semiconductor strategy is to blame for a US expansion.

The part-taxpayer-backed chipmaker is looking to raise upwards of £100m of investment as it eyes up a US expansion after setting up a subsidiary there in February.

Optimism falls as firms reckon with rate hikes

AUGUST GRAHAM

BUSINESS confidence dropped last month, according to a regular survey of companies, while firms also said they intended to hire less than they had before.

For the first time in six months the employment index from accountancy BDO dropped in July.

Businesses reduced vacancies as they were hit by higher interest rates, weak global demand and continuing supply chain difficulties. It came as BDO’s survey also showed that businesses were more pessimistic. Its “optimism index” fell for the first time in four months.

The manufacturing sector, which is particularly exposed to borrowing costs, is especially negative at the moment, the survey found.

according to analysis from accountancy firm Price Bailey.

A total of 729 pub businesses went bust over the last 12 months to June 30, marking an 80 per cent increase on the previous year, the firm found. Since the start of the year, wages, energy bills and food and drinks costs have all shot up, putting a pressure on margins, while pub-goers’ disposable income has been squeezed.

BDO partner Kaley Crossthwaite said: “A more pessimistic outlook from businesses and consequent loosening of the labour market are the first indicators of the slow in economic growth expected towards the end of the year.

“With yet another hike in interest rates... this downturn is only set to worsen in what should be a golden quarter for many, if more isn’t done to support businesses.”

“We’re not going to be raising 10 times that, but we’ll be raising more than that in this round,” Pragmatic founder Scott White told The Telegraph.

He said although the company’s desire is to keep their manufacturing capacity in the UK, “it is subject, to a certain degree, to having the right initiatives coming out of the [government’s semiconductor] strategy

that give us the support we need to do that and scale effectively within the UK.”

Tech and microchip bosses have slammed ministers’ pledges to invest £1bn in the semiconductor industry over the next decade, saying it is a “drop in the ocean” and leaves the UK “very vulnerable”. US investment totals £9.2bn, whilst Germany has pledged £17.3bn.

Microchips, deemed the ‘new oil’, are needed for almost all pieces of modern tech

Oil prices boosted by six weeks of gains as supplies tighten globally

NICHOLAS EARL

OIL MARKETS will open trading today having recorded six weeks of gains across both major benchmarks, as tightening supplies bolster prices.

Brent Crude finished last week’s trading sessions at $86.24 per barrel, while WTI Crude was up $1.27 at $82.82 per barrel, their highest

levels since mid-April.

This follows top producers and OPEC+ members Saudi Arabia and Russia extending swingeing cuts of 1m barrels per day and 300,000 barrels per day respectively through September, raising concerns of undersupply in the market later this year.

It comes after consistent predictions of supply deficits in the second half of the year from OPEC and the

International Energy Agency, with both organisations set to release their latest monthly reports on the market this week, which will predict pricing behaviour over the rest of the year. As things currently stand, the IEA is forecasting a deficit of 2m barrels per day while OPEC is predicting a shortfall of 2.5m barrels per day, meaning oil prices are likely to continue on their upward march.

Bill Gates-backed nuclear start-up eyes UK projects

NICHOLAS EARL

A BILL GATES-BACKED clean energy player is hoping to build dozens of reactors in the UK, and will enter the race alongside potential rivals Rolls-Royce and GE Hitachi with its own mini-nuclear power plant designs.

Chris Levesque, chief executive of nuclear start-up Terra Power, confirmed the company will bid for government approval to build small modular reactors (SMRs) in the UK, with the competition being overseen by freshly launched industry vehicle GB Nuclear.

“I’ve met with quite a few industrial partners in the UK and we really see partnerships here that we can leverage as we scale up,” he told The Sunday Times. SMRs refer to scaled down nuclear power plants, typically assembled in stages at factories before being shipped to construction sites, reducing the cost and development time.

Levesque has suggested Terra’s reactors could be built in shipyards as their assembly does not

require heavy forging.

The government has announced a bidding competition through GB Nuclear with hopes of first generation from new plants the 2030s, a target Terra expects to meet.

“We think we could build dozens of reactors in the UK in the 2030s,” Levesque said.

Terra was founded in 2006 by Gates (pictured), the co-creator of Microsoft and the world’s fifth richest man, to explore clean energy, with the firm developing a sodium-based nuclear reactor technology it calls Natrium.

Natrium provides some benefits compared to conventional reactors such as capabilities to store and release energy to the grid at times when demand Gates led a $750m (£588.3m) funding round for the nuclear project last year and remains its biggest investor. The government is pushing to ramp up nuclear power from 7GW to 24GW over the next three decades, with 85 per cent of the UK’s ageing fleet set to be decommissioned by 2035.

ENERGY BILLS More support with household bills unlikely this winter, admits Grant Shapps

ENERGY secretary Grant Shapps has warned households are unlikely to receive fresh energy bill support this winter from the government, which will instead prioritise future tax cuts. “We don’t want to be in a position… of having to constantly pay energy bills. We’re having to tax people in order to pay it back to people,” Shapps told The Sunday Times. The price cap remains at double pre-crisis levels.

Grid connections branded ‘greatest obstacle’ to UK

reaching net zero

NICHOLAS EARL

GRID CONNECTION wait times are a “national scandal” and the “greatest obstacle” on the path to net zero, renewable energy bosses have warned following the publication of a landmark review into the UK’s grid system.

“Power from renewables is currently cheaper than power from fossil fuels, but grid connection wait times remain a national scandal,” Zoisa North Bond, chief executive of Octopus’s renewables

arm, told City A.M.

Her comments follow the publishing of a landmark review into UK grid connections last week led by electricity networks commissioner Nick Winser, which North Bond praised as “brilliant”. Winser argued red tape must be slashed to ensure the rollout of new electricity lines can keep up with the building of new wind farms as the country scrambles to reach net zero.

Energy secretary Grant Shapps pledged to act on the report’s findings.

Santander and Lloyds face £1bn car finance claim

BEN LUCAS

SANTANDER and Lloyds face a new UK lawsuit over alleged “anti-competitive agreements” they had with car dealerships that pushed customers towards more expensive finance options when they were buying secondhand cars.

The claim, filed at the Competition Appeal Tribunal last month, targets three of the largest motor finance providers: Santander UK, Black Horse, which is part of Lloyds Banking Group, and Motonovo Finance.

The claim alleges that between 2015 and 2021 consumers were unknowingly charged higher interest rates “due to a network of anti-competitive agreements between providers of motor finance and automotive dealers”, where car dealers were given greater commission in return for getting customers to agree to finance deals that charged a

CAN IT DELIVER? Deliveroo investors hope for growth in first half results on Thursday

Co-operative Bank subject of bid speculation

CITY A.M. REPORTER

higher rate of interest.

This so-called “discretionary commission” model was banned by the FCA in January 2021.

The ‘opt-out’ action, which means all eligible borrowers are automatically included in the case, estimates that as many as 1m consumers might be affected, and the total value of those claims could reach nearly £1bn.

Doug Taylor, a consumer advocate and the class representative, said: “With this legal action, I am standing up for people across the UK who have been affected by the actions of these companies, seeking justice and compensation for the financial losses they have suffered.”

Lloyds said it was committed to ensuring customers have clear information to make informed decisions on the products they buy.

Santander and Motonovo Finance were contacted for comment.

expected

THE SMALL business lender Shawbrook is said to be keen on a tie-up with the Co-operative Bank, according to reports this weekend. Sky News’ Mark Kleinman first reported that an effective merger, which would value the combined firm at £3.5bn, has been mooted by Shawbrook.

The Co-op Bank has enjoyed two straight-years of profitability under CEO Nick Slape, who confirmed last year that the lender was looking at acquisitions. However, the acquisitive-minded Co-op could become the subject of a bidding war between major lenders as well as firms like Shawbrook. Should the Co-op Bank go under the hammer, it is expected that Onesavings Bank as well as high street regulars including Barclays (who are advising Shawbrook) and Nationwide will put in bids. A spokesperson for Shawbrook declined to comment when approached by Sky News over the weekend while the Co-operative Bank could not be reached for comment.

DELIVEROO could disappoint investors this week, with the takeaway giant

to deliver first half revenues of £1.03bn, up just 1.8 per cent, as demand continues to slow after its pandemic boom. Deliveroo said its earnings will be weighted to the second half.

Musk’s X to sue employers on behalf of users

JUBY BABU

ELON MUSK (pictured) has said his X social media platform will pay the legal bills and sue on the behalf of people who have been treated unfairly by employers because of posting or liking something on the site formerly known as Twitter.

Gambling giants cash in on USA

set to reveal its own double-digit rise in revenues on Thursday.

THEUK’s biggest gambling companies are set to announce further strong growth over the first half of 2023 this week as they continue to benefit from growth in the US.

Paddy Power owner Flutter

Entertainment has seen shares perform well this year on the back of soaring revenues and investors will be hopeful to see this momentum continuing when it reports its interim results on Wednesday.

Meanwhile, Ladbrokes owner Entain is

It comes as UK betting firms continue to look to international markets, and particularly the US, for growth amid steadier trading in their home market.

In the UK, firms are facing constraints to growth and profitability from gambling reforms announced in April, which will include tighter stake limits for online casinos and stronger affordability checks.

Flutter saw comparably strong growth in the UK at the start of the year; however, it

was among those which saw its strong performance heavily driven by the US market.

Headline revenues grew by 46 per cent over the first quarter, with a 92 per cent jump stateside as its sportsbook business soared as it benefitted from the loosening of sports betting rules in some states.

On Wednesday, analysts at Peel Hunt have forecast that Flutter will deliver earnings of £770m for the half-year, with around £5m coming from the US. The update also comes as Flutter moves

Revolut to stop offering crypto services to US customers amid SEC clampdown

CITY A.M. REPORTER

REVOLUT will stop offering crypto services to its US customers as regulators in the country begin to clamp down on the sector.

The digital lender is withdrawing services because of “the evolving regulatory environment and the uncertainties around the crypto market in the US”, a spokesperson for

the company said in a statement.

The spokesperson said that from 2 September, US customers will not be able to place orders for cryptocurrencies on Revolut, and from 3 October, customers will no longer be able to buy, sell or hold any cryptocurrencies.

“This decision has not been taken lightly,” the spokesperson said, but added that it will impact “less than

closer to its planned joint listing in the US by the final quarter of the year.

Entain investors will also have US opportunities on their mind as it provides its US update on Thursday.

Shares in the company have lifted strongly in recent weeks amid fresh speculation that the firm could be a takeover target for US joint venture partner MGM. .

Peel Hunt predicts Entain will deliver revenues of £2.3bn for the first half of the year, a jump of around 11 per cent.

“If you were unfairly treated by your employer due to posting or liking something on this platform, we will fund your legal bill,” Musk said in a post on X late on Saturday, adding that there will be no limits to funding the bills.

“And we won’t just sue, it will be extremely loud and we will go after the boards of directors of the companies too,” Musk said later in response to a post about nothing changing behaviour in the US faster than a threat of legal action.

PA Reuters

The pledge came as Musk also said that his proposed cage fight with Meta CEO Mark Zuckerberg would be live-streamed on X. Meta did not respond when contacted for comment.

one per cent of Revolut’s crypto customers globally”.

It comes as US regulators, such as the Securities and Exchange Commission (SEC), ramp up their scrutiny of digital assets following a number of high-profile collapses last year, including crypto exchange FTX. Meanwhile, Revolut is still waiting for its UK banking licence after saying that one was “imminent” in March. The Nik Storonsky-headed firm said the decision was “not taken lightly”

HENRY SAKER-CLARK

THE NOTE BOOK

Much to ponder for Rishi on his west coast getaway

An election looms next year, which for Rishi Sunak must seem about as appealing as a root canal sans anaesthetic. But there are signs that the process may not need to be as painful as it might currently seem.

The economy is likely to be in a better place, albeit that’s more a relative judgment than good news. Inflation will certainly be lower, regardless of whether the ballot is held in May or later in the year. Energy bills too are likely to have edged downwards too, and the general feeling of ‘things going up’ will have dissipated.

Yet for all that Bill Clinton’s former advisor James Carville was right when he said “it’s the economy, stupid”, elections are fought on more than that. The next few months will let us know whether Sunak has learned from the master of political sentiment, his former boss Boris Johnson.

Perhaps Sunak could do worse than turn on the news and read the business pages as he holidays in

DEBANKING ROW RUMBLES ON

California this week. Despite plenty of evidence to the contrary –see the state of San Francisco –the Golden State still retains an extraordinary optimism, which permeates through the business community.

There are plenty of reasons that California houses so many of the world’s leading firms –high-end universities including Berkeley and its near-neighbour Stanford, available capital, a liberal and appealing immigration policy for the world’s brightest –but mindset is undoubtedly one, too. We could do with that sunny outlook on life here. All too often we hear of growing start-ups struggling to scale, or our bigger companies being picked apart due to below-market valuations. Our investors, too, edge towards the short-term and leave long-term, homegrown plays unloved. Will a little sunshine be enough for Rishi to turn around a 20-point deficit? It’ll take more than that, but it can’t hurt.

it’s editor Andy Silvester with the notebook pen

A VERY JOLLY OUTING

The life of a regulator is never easy. You’re usually perceived as too strict and too slow-moving, until something goes wrong, at which point you’ve taken your eye off the ball. It doesn’t help when politicians keep throwing you hospital passes. Last week, the Chancellor said he’d task the FCA with a debanking review, tout suite, giving the general impression that the idea would never have occurred to the regulator. It soon became apparent the FCA had been working on exactly that, not that they’ll get much credit for it.

£ With even Zoom telling employees they need to turn up in the office more often, it is hard to see how the government avoids an autumn row over the cost of commuter rail. Reducing the price of occasional travel into the capital, with innovative ticketing or the removal of peak fares, would be a huge economic boon to London. The government should sit down with rail companies and find a way to bring fares in line with our much cheaper European rivals.

£ How many news articles written by places like City A.M. and other newspapers do you think get ‘stolen’ each year? Well, it’s about 700,000 this year alone, according to the content organisation NLA Media Access. Stories are ripped off by ‘content farming’ websites which effectively pick up whatever we write wholesale, stick it on a website hosted where UK copyright law isn’t recognised, and enjoy the cash that comes from eyeballs. One imagines big tech could stop it in a second –if they felt so inclined.

CAN I QUOTE YOU ON THAT?

I don’t know what he knows about the UK, but something’s gone wrong

Short-lived Chancellor Kwasi Kwarteng on the Bank of England’s appointment of Ben Bernanke to review forecasting

“You can keep the Costa Brava, and all of that palaver,” Chas and Dave once sang in their paean to Margate. It was with that (and fond memories of the Only Fools and Horses episode A Jolly Boy’s Outing) ringing in my ears that my partner and I headed down to the Kent coast at the weekend. Thanet is hardly unloved these days –the Turner Contemporary Art museum and a host of new bars, cafes, interior shops and restaurants in Margate have given the seaside town new life, and Broadstairs just down the coast is a buzzing little beach resort. But it is still a remarkably nostalgic, heartening visit –not least this weekend, with the Margate Soul Festival, a Happy Mondays gig and the usual downfrom-London restaurant crowd making for a most eclectic crowd. You can do worse with a weekend then a trip down to Margate –but as Del Boy found, you’re better off on the train.

Cheaper ‘burbs in fashion after mortgage spike

JAMES SILVER

THE RATE at which London homeowners are choosing to leave the capital remains higher than the pre-pandemic average, with estate agents warning mortgage rates are forcing the capital’s residents to look further afield.

The average ‘London leaver’ spent £429,000 on their property this year, down more than £60,000 on the year before.

“This year, London outmigration has increasingly been driven by need over want as higher mortgage rates reduce buyers’ budgets, pushing them in search of smaller homes in more affordable areas,” said Aneisha Beveridge, head of research at Hamptons.

“Looking ahead, the likelihood that mortgage rates will stay higher for longer may keep the pace of London outmigration up. We’re also reaching the point where a large number of

households who bought a home at the peak of the London market between 2014-2016 might be looking to move over the next few years,” she continued.

Mortgage rates have shot up as the Bank of England has attempted to tamp down on inflation with more than a dozen straight increases to the base rate, which filters through to homeowners’ pockets if they are on variable rates or when they come to refix their mortgage.

The number of London leavers spiked in 2021 as many in the capital, fed up with smaller homes and limited outdoor space during lockdown, headed out to the countryside.

However, the data now suggests that movers are being driven more by financial concerns. Those leaving are expected to save a combined £350m a year on their mortgage bills thanks to lower property prices.

HOUSE

IN

Persimmon to see earnings fall after rate hikes

CITY A.M. REPORTER

HOUSEBUILDER Persimmon is expected to report a fall in revenue in its half-year update on Thursday as the sector comes under increasing pressure from higher mortgage costs.

The FTSE 100 firm is expected to see revenue decline to £1.11bn, down from £1.69bn for the same period last year, according to CMC Markets.

In its update for the first quarter this year, posted in April, Persimmon said forward sales had dropped 30 per cent to £1.7bn.

However, despite the disappointing results and bleak outlook for the sector, the company said at the time that it was confident of meeting its full-year targets.

“Back in July, Persimmon shares hit their lowest levels in 10 years as concern over higher interest rates and lower demand weighed on the outlook for the UK’s house building sector,” Michael Hewson, chief market analyst at CMC Markets, said. Its share price has fallen some 20 per cent over the past 6 months, and is now trading at 1,147.50p.

PRICES

LONDONERS’ NEW HOMES ARE FAR LOWER THAN IN THE CAPITAL -37%

Havant -8% Banstead -3% Winchester -12% Horsham

-44% Medway

Londoners are heading to commuter towns at pace, with Rochester –in Medway –one of a number of towns offering more affordable housing

Aussie government to toughen up tax powers after PwC leak scandal

AUSTRALIA will toughen penalties against promoters of dodgy tax schemes and beef up regulatory powers under reforms announced yesterday after a scandal over the use of leaked fiscal plans by PwC Australia. The leak of the confidential government documents, by a former partner at the professional services firm, was revealed in January.

It caused a scandal that has forced out 12 PwC Australia partners,

including the chief executive, triggered the sale of its lucrative government consulting wing for AU$1, and embroiled clients Google, Uber and Facebook. Bills to be introduced this year would raise the maximum penalty for promoting tax exploitation schemes 100-fold to AU$78m ($40.2m) and make prosecution easier by expanding how the rules, which have only been used six times, are applied, according to a government statement. PwC Australia was not

Ukraine bruised by Russian drone and missile attack

LIDIA KELLY

RUSSIA launched a multi-wave overnight attack on Ukraine with 70 air-assault weapons including cruise and hypersonic missiles as well as Iranian-made drones, Kyiv’s Air Force said yesterday, and at least 10 missiles appear to have got through air defences.

Local media said a worker at a grain silo had been wounded in the overnight attack, which appeared to be focused on an area of western Ukraine, far from the front line.

President Volodymyr Zelensky said people had been killed and wounded in an earlier hit to a blood transfusion centre in the town of Kupiansk, a railway hub fewer than 10 miles from the front in the eastern Kharkiv region.

Rescue workers were extinguishing a fire at the scene, he said on Saturday evening, describing the strike as a “war crime”. He did not say how many casualties there were.

Russia denies deliberately targeting civilians in a full-scale invasion that has killed thousands of people, uprooted millions and destroyed cities.

Ukraine’s air defence destroyed 30 out of 40 cruise

missiles and all 27 of the Shahed drones that Russia launched overnight, the Air Force said on the Telegram messaging channel.

It also said Russia launched three Kinzhal hypersonic missiles, but did not disclose any further information on them.

“In total, in several waves of attacks, from the evening of Aug. 5 to the morning of Aug. 6, 2023, the enemy used 70 means of air assault weapons,” the Air Force said.

Reuters could not independently verify the reports.

There was no immediate comment from Russia.

Ukraine is two months into a counteroffensive to try to push out Russian forces occupying almost a fifth of its territory in the south and east.

US Secretary of State Antony Blinken said on 26 July that while Ukraine had recaptured half the territory that Russia had initially seized, the Ukrainian counteroffensive was in its early days and would take shape over “several

fined for the breach under the existing rules, and the changes will not be applied retroactively, a Treasury spokesperson told Reuters.

“The PwC scandal exposed severe shortcomings in our regulatory frameworks,” said the statement from the ministers for treasury and finance and the attorney general.

PwC Australia would digest the announcements carefully and work with government and regulators to “enhance overall regulation of our industry”, a spokesperson said.

DRINK UP New airline could signal return of economy bubbles

Suez tugboat sinks after colliding with tanker but shipping continues

YOUSRI MOHAMMED

A SUEZ Canal tugboat sank on Saturday and one of its crew was missing after it collided with a Hong Kong-flagged LPG tanker though shipping traffic in the strategically important waterway was largely unaffected, the canal authority said. Convoys of ships passing through

the canal from the north were not affected, while the passage of ships travelling from the south returned to normal by about midnight on Saturday, Suez Canal Authority (SCA) said in a statement.

The tanker, Chinagas Legend, is waiting in Port Said until the completion of procedures related to the accident, SCA head Osama Rabie

said in an earlier statement. Two canal sources said Chinagas Legend was undamaged by the collision, was functioning normally and had anchored at Port Said. Rabie told local TV that one of the tugboat crew had died. The dead crew member, Sayed Moussa, was a mechanic from Port Said, his family said.

The Suez Canal was shut for days after the Ever Given got stuck in 2021

LEWIS JACKSON

PwC’s Australia arm has been shorn of much of its senior leadership after the scandal

THE FOUNDER of Global Airlines –which will begin operating A380 flights between Gatwick and New York by the middle of next year –has dangled the prospect of economy customers being able to enjoy a free glass of Laurent-Perrier. James Asquith said the airline would be able to offer fares “in line with, if not cheaper” than main competitors BA and Virgin as the airline is buying aircraft outright, rather than through a lease operation. Asquith said passengers will “feel like a million dollars”.

Ukrainian President Volodymyr Zelensky

Reuters

ENERGY

THEFEVERISH backlash to the government’s oil and gas announcements must have been catnip for Prime Minister Rishi Sunak – who flew off to California on holiday at the back end of last week having made, for him at least, all the right enemies.

Sunak teamed up with energy security secretary Grant Shapps to unveil pledges for at least 100 new North Sea licences and two further carbon capture clusters on Monday – backing fossil fuels in a bid to strengthen the country’s energy security amid continued market volatility, which has wreaked havoc on wholesale costs.

Climate activists were stirred into such heated fury that Greenpeace protestors breached Sunak’s constituency home to provocatively unfurl banners from its roof, while Labour’s shadow climate secretary Ed Miliband accused Sunak of “driving a coach and horses” through the country’s net zero commitments.

All of this has very much been in Sunak’s interest, with the Prime Minister eager to turn climate policies into a wedge issue in a bid to contrast his ‘realist’ take on cutting emissions with Labour’s –and particularly Miliband’s –accelerated, and costly, timetable.

This can be seen with his order of a review into low traffic neighbourhoods, extensive anti-ULEZ campaigning, and in frontbencher Michael Gove’s warnings against net zero becoming an environmental “crusade”.

Yet much of it is utterly presentational. Sunak is, in fact, arguably the driving force behind the country’s green agenda.

OIL AND GAS SECTOR SUFFERS FROM TORY WINDFALL TAX

For all the rhetoric, it is the Conservative government that brought in a windfall tax last year to harness the profits of oil and gas producers, which was then hiked and extended under serving Chancellor Jeremy Hunt to last six years, creating a 75 per cent levy for the North Sea.

This has contributed to a severe downgrading in the industry’s ambitions, with Total slashing £100m plans to work on an infill well on Elgin this year, Enquest planning to leave its Kraken field in the North Sea to “natural decline”, and Harbour Energy cutting jobs at its Aberdeen base while shifting investment to the US and South America.

These funding decisions come with banks toughening the terms of lending, with the windfall tax deemed to be a policy change rather than a temporary relief measure for

WHY THE TORIES MIGHT BE THE ONES WHO JUST STOP OIL

price floor, will make little if any difference. Meanwhile, Sunak’s new licence pledges could take decades to come to fruition –assuming an industry still exists by then.

Figures from the North Sea Transition Authority this year indicate that investment will halve in British waters for oil and gas by the end of the decade, with the flagship Rosebank field the only major project potentially set for development.

POLICIES, NOT POSTURING, ARE WHAT MATTERS

Trade association Brindex, which represents independent oil and gas players, fears the

A ROSE BY ANY OTHER NAME

Energy secretary

Grant Shapps has been urged in the “strongest possible terms” to block drilling at Rosebank, the UK’s largest undeveloped oil and gas field and home to potentially 500m barrels of supplies. Last week, 50 MPs and peers, from all major parties, wrote a joint letter to the energy secretary raising concerns over its threat to the country’s climate goals and potentially £3.8bn in tax breaks –while doing little to reduce energy bills. It is worth remembering that Shapps doesn’t make the decision – at no point is he required to get out an ‘APPROVE’ rubber stamp in red font. Instead, regulators NSTA and OPRED make the decision and Shapps can opt to intervene if he so wishes.

Personally, I think Rosebank’s biggest threat comes from investors losing interest, with the approval process dragging into the summer, and the site likely to be subject to a flurry of legal challenges.

£ OPEC and its allies have voted to maintain oil output reductions, pushing prices upwards. It looks as if a bet that tightening supplies and rebounding demand would power prices in the second half of the year will pay off.

City A.M. that the “Energy Profits Levy in its current form continues to impact investment across the North Sea”. There is no doubt the North Sea is an ageing, declining basin that is less appealing to investors than rival markets due to its shrinking supplies, irrespective of the fiscal regime. Any government would now be overseeing its phased decline and necessary shift to offshore wind, carbon capture and hydrogen. Yet, domestic supplies still meet nearly half the UK’s consumption demand and are a vital resource for meeting the

alternatives like LNG – a matter too important for clumsy energy legislation and posturing.

Today’s column is not a verdict on net zero, where an environmentally sound progrowth argument exists for cutting carbon emissions and boosting the economy with green investment – alongside the real challenges for electrification and energy generation, which will require historical shifts in planning laws, foreign policy and consumption habits.

For all the talk, if oil and gas production collapses, it will be a consequence of Conservative policies, not protestors.

SEND US YOUR THOUGHTS

Any thoughts on Just Stop Oil? Email energy editor Nicholas Earl at nicholas.earl@cityam.com

City A.M.’s energy editor Nicholas Earl delves into the sector’s challenges in his weekly column

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Focus on US inflation for July as Wall Street eyes Fed’s next rate call

INVESTORS stateside will be keeping their eyes on US inflation numbers for July as they try to work out the Federal Reserve’s next interest rate decision.

In the last 12 months, US CPI has fallen from a peak of 9.1 per cent in June last year, slowing to three per cent last month. Core CPI – which removes items that are subjected to volatile price movements, like food and energy – slowed to 4.8 per cent.

The Fed launched what many thought will be its final interest rate hike in its current tightening cycle last month, where it raised the federal funds rate to a range of 5.25 and 5.5 per cent. But expectations for July are for headline CPI to tick higher to 3.3 per cent, according to CMC markets.

If inflation does come in hotter than expected, this could fuel speculation of

another Fed rate hike at its next meeting in September.

However, Michael Hewson, chief market analyst at CMC Markets, said:

“There is this sense that further rate hikes beyond July could be a big ask.” New figures out last Friday showed America’s job market was steady, with firms adding 187,000 jobs, while the jobless rate dipped to 3.5 per cent from 3.6 per cent in the prior month.

David Henry, investment manager at Quilter Cheviot said: “The economy’s robustness may mean that the Fed feels comfortable continuing to raise rates, but it has repeatedly stated that these decisions will remain dependant on the data.

“Whisper it, but the fabled ‘soft landing’ may just be achieved, although a lot can still happen before the Fed declares ‘job done’.”

Outsourcing expert Capita saw its shares slide a whopping 18.3 per cent on the FTSE 250 on Friday, with the company confirming a £25m hit from the Russian cyber-attack, wiping £58m from its value. The company runs crucial services for local councils, the military and the NHS. Peel Hunt still says ‘buy’, at a target price of 48p per share, with analysts confident in its fundamentals.

BUOYANCY IN THE USA

Telecom Plus, the mooted one stop-shop for your utility needs, has enjoyed a robust trading performance, which has continued since the year-end update. Confidence in earnings is supported by expectations of double-digit customer growth. Peel Hunt considers the stock undervalued, and has placed a target price of 2,600p per share.

“With the resilience of the US economy being tested and with the Fed unwilling or unable to confirm that it has completed its hiking cycle, sentiment remains cautious although even last week’s jitters have done little to upset the investing applecart. In the year to date, the Nasdaq remains ahead by 33.3 per cent.”

RICHARD HUNTER, INTERACTIVE INVESTOR

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OPINION

EDITED BY SASCHA O’SULLIVAN

The Sunak Gambit: betting on a chess renaissance is a genius move for the UK

VERY occasionally, you find yourself in a narrow age band which gives you a vivid set of recollections which mean virtually nothing to everyone else. I am in that position with chess. I was a sixth-former when, to everyone’s surprise, the sober-seeming board game suddenly burst into the news.

In 1993, improbable as it may sound, the chess world exploded in controversy. The International Chess Federation (FIDE) arranged to hold its world championship in Manchester without consulting either the reigning world champion, the brooding young JewishAzeri Garry Kasparov, or his challenger, Nigel Short, a stereotypically English, bespectacled figure of 28. The two players took the dramatic decision to walk away and formed the Professional Chess Association, with a rival tournament to be held in London.

That match was held in September and October in the Savoy Theatre, and, inexplicably, it seized the public’s imagination. It was sponsored by The Times, and Channel 4, proving their commitment to provocative and counter-intuitive programming, showed 81 (yes, 81) episodes of events from the Strand. Returning for my upper-sixth after the summer holiday, I was captivated.

Last week we learned that the govern-

ment would be acting to support the game with an award of £500,000 to the English Chess Federation. This may not seem like a significant sum—to the government it is not—but it is more important than it might seem. To begin with, this is the first time the government has ever given chess financial support: it is not eligible for funding from Sport England because it is not classified as a “sport”. But more important is a sense of perspective. Half a million pounds is the blink of a civil servant’s eye when it leaves a departmental budget, but when it arrives at the English Chess Federation (ECF), it will be, as they said, “potentially transformational”.

Malcolm Pein, the ECF’s director of international chess, explained that while

chess is a cheap sport, they have plans to use the money to invest in top-level coaches, training camps and computer technology to help promising young players analyse and improve their game. There are also plans at an early stage to support chess in schools and install chess tables in public parks.

There is a hint that the game is pushing at an open door. During lockdown, there was a 400 per cent surge in signups to chess websites as people looked for new recreations and distractions; at the same time, the 2020 Netflix miniseries The Queen’s Gambit, the story of a young female chess prodigy’s rise to the top of the game, was hugely popular, at one point being the provider’s most watched show.

There are high-level supporters of the game. At Westminster, the shadow chancellor, Rachel Reeves, was British girls’ champion, as were twin sisters Dame Angela and Maria Eagle, both former shadow cabinet ministers; other enthusiasts include Sir Richard Branson, Daniel Radcliffe and Anthony Joshua.

Playing chess is a good habit. The evidence seems to suggest it improves memory, enhances literacy, teaches forward planning and promotes creativity and problem-solving abilities. It may also have a role to play in warding off dementia. Although some warn of the game’s addictive nature, it is an allround gymnasium for the cognitive faculties.

From train robberies to ‘Hi Mum’ texts, we are fighting an ever-changing face of fraud

SIXTY years ago today, a travelling post office train carrying millions of pounds in bank notes left Glasgow Central for London Euston. It was supposed to be a routine journey, except the train never arrived.

Nearing the end of its eight-hour trip, at just after 3am the following day, the train ground to a halt and 15 men executed their intricate plan to rob its valuable cargo.

In the decades that followed, the “Great Train Robbery” transcended from shock and scandal to myth and legend. The story of the £2.6m theft – equivalent to tens of millions today – influenced everything from Andrew Lloyd Webber’s musical, Starlight Express, to Agatha Christie’s novel, At Bertram’s Hotel.

Sixty years on, much has changed: we no longer move money by trains but online. But much has remained: criminals are intent on defrauding people and businesses to steal their money.

Today, fraud is the most prevalent type of crime in England and Wales. It ac-

Chris Hayward

counts for 40 per cent of all offences.

Though fraud can be complex, it often presents in the simplest of ways: think of the “Hi Mum” messages, or the phishing emails we receive repeatedly at work and at home.

As daily life becomes ever more centred on the digital world, so too does the criminal’s methods – with 85 per cent of fraud now cyber-enabled.

This newspaper has consistently covered how the mechanism for scammers is everchanging. One of the most recent and sinister examples was the so-called “pig butchering” scam which manages to convince young, techsavvy Britons to part with their money

using various crypto platforms.

These all too familiar interactions are devastating for victims, so we must become even more vigilant to the threats we face.

The City of London Police is the national policing lead for fraud and cyber crime, which are major contributors to economic crime. It coordinates the country’s efforts to fight back against scammers and provides vital support to local police force investigations across the country.

Much of this work revolves around Action Fraud, the first nationally centralised system for fraud and cybercrime reporting anywhere in the world. However, after understandable criticism, the long-awaited replacement for Action Fraud is currently being developed to provide a muchneeded boost to the efforts to tackle economic crime and stop people becoming victims of fraud. A whole system response is needed to tackle this insidious crime, bringing together law enforcement, financial services, tech-

nology companies and the third sector.

Fraud is a threat to our nation’s competitiveness, and we will do everything we can to stamp it out. It matters not only to prevent fraud in the first place, but to protect the entire City business ecosystem which relies on us being a trusted place to do business.

Just as policing has always relied on a physical presence on the streets, it is increasingly the case that we need a strong digital presence too.

The City of London Police helps protect both worlds. Digital policing for the digital age.

Policing supports our economic security and economic prosperity, they are two sides of the same coin, and both aid the City’s competitiveness.

Sixty years after that infamous post office train failed to end its journey in London, it is the Square Mile that is playing the leading role in the fightback against fraudsters.

£ Chris Hayward is the policy chair of the City of London Corporation

Inevitably there have been nay-sayers who have mocked chess’s image as a haven for misfits and eccentrics, some commentators feel that it is not the government’s role to micromanage hobbies, and others lampoon the quantum of the money as far too small to cross a minister’s radar, let alone that of the prime minister. That attitude seems to me needlessly grudging. If the grant of £500,000 is useful to the English Chess Federation, then the government has, with virtually no effort, made modest contributions to children’s cognitive abilities and brought people together. Don’t look at the grant in isolation. Think of it like this: the world is brutally competitive, and we need every tool available to us to shore up our position. I’m drawn to a national application of Sir David Brailsford’s theory of marginal gains, the transformational approach he brought to British Cycling as director of performance. Look at everything you do, and seek to improve every part of it by one per cent. The overall effect is revolutionary.

Perhaps this is fanciful, but why shouldn’t chess be one of the examples of marginal gains? This is something which is, effectively, free to the government and therefore the taxpayer, and requires no further activity: the community which will make the running is in place. If that running leads to a gentle uptick in memory, planning, foresight, creativity and convergent thinking, especially among young people, then that would make a tiny gesture look like a bright star in a much broader constellation. Your move.

£ Eliot Wilson is co-founder of Pivot Point and a columnist at City A.M.

A THUN OF

EVENTS Greta Thunberg has pulled out of the Edinburgh International Book Festival next week after she accused it of being sponsored by ‘greenwashers’ Baillie Gifford Investment firm. The climate campaigner said the company and long time sponsor invests heavily in fossil fuels.

Eliot Wilson

Sign-ups for chess websites surged 400 per cent in lockdowns

WE WANT TO HEAR YOUR VIEWS

LETTERS TO THE EDITOR

Don’t bring back the flip phone

[Re: Flip phone comeback set to grip market, August 1] Mobile handsets and physical devices get an upgrade almost every year –there’s the annual iPhone announcement and, now, an increasing demand for gimmicky folding smartphones.

However, innovation elsewhere in the mobile industry has stalled, and business mobile calling remains stuck in the dark ages.

To date, the mobile network has been

hugely underused as a platform for innovation. But with wide reach, accessibility and no internet dependence, it’s a perfect tool for the modern workforce. A solution that offers advanced unified communications features but over this dedicated network will be a game-changer for the modern workforce.

For many workers, but on-the-go workers in particular – like those in construction, the care sector, real estate or charities – it’s not a flip-phone that matters. It’s high quality, consistent and collaborative calling from wherever they are.

Chris Brenchley PiPcall

GOING PEACEFULLY Environment

Sec refuses to work with Greenpeace

Post-Brexit rules for big tech give almost boundless power to the competition watchdog

Liza Lovdahl Gormsen

EUROPEAN regulations were holding back British prosperity; we were told this again and again as an argument for Brexit. Why be tied to burdensome red tape enforced by remote, unaccountable legislators in Brussels when we could set our own efficient and competitive regulatory agenda?

So when the Digital Markets, Competition and Consumers Bill was designed, it was done so with the aim of overhauling its competition regime. Its aim is to cultivate fairer competition in digital markets by facilitating greater choice and transparency for consumers.

Curbing the powers of Big Tech firms is seen as a priority, with a host of them now given a newly designed “strategic market status” to improve competition in digital markets postBrexit. Largely, these platforms have accepted that they will be subject to tighter regulation, providing this regulation is itself subject to the requisite checks and balances.

EXPLAINER: DOES IT MATTER IF RISHI SUNAK GOES TO THE UN SUMMIT?

Rishi Sunak is reported to be considering skipping the UN General Assembly next month.

It comes after the PM said he would allow a hundred more oil and gas licences for the North Sea, only to find himself. It put him at odds with the UN General Secretary Antonio Guterres, who described nations continuing to increase fossil fuels production as ‘dangerous radicals’.

If he did not attent, it would make him the first prime minister in a decade not to attend. Sunak is expected to

argue it would give him time to prepare for Conservative Party conference in October so he can focus on domestic issues. It is part of a concerted effort to make Sunak look like he understands the concerns of Red Wall voters ahead of a general election likely to be at the end of next year.

It is unlikely to sway voters either way, but could signal a further entrenchment of an isolationist Britain. Afterall, many of our problems - from inflation to migration - have global roots.

Yet, as it stands, the new laws will usher in a new regulatory framework which hands the CMA immense powers, but without the necessary checks and balances. A key example is the lack of scrutiny over the decisions it takes. The legislation will only allow firms to appeal on the basis of judicial review –a standard that assesses whether proper process has been followed. Whether the correct decision was reached is not a factor that can be considered.

The rationale for this is speed. Unfortunately, this is only partly true –whilst the process of a judicial review appeal can be a few months faster than a merits appeal, the only options available to the Competition Appeal Tribunal are to approve the decision or ask the CMA to correct its procedural mistake. The court cannot replace the CMA’s decision with its own judgment. If the CMA has to revisit and correct its decision, the whole affair can take double the time. Hardly the RollsRoyce standard for efficiency.

This is not to mention the vast accountability deficit within the regime. The judicial review appeal standard means there are few consequences for the CMA making the wrong decision. The worst that can happen is the Appeal Tribunal returns its homework

with a label “please try again”. While the CMA is an excellent competition law enforcer, it is now assuming the role of a regulator of firms with strategic market status – in essence, a new regime. No matter how good the CMA is, they are bound to make mistakes.

This is a glaring regulatory oversight which directly undermines the overarching aspiration of greater accountability and transparency for newly emancipated UK institutions. The simple fact is that the new laws entrust

the CMA with immense powers which are not subject to the countervailing mechanisms or checks and balances that are appropriate to the regime’s vast remit.

In the event that a big tech firm has reason to believe it has lost out on a decision that has not been properly scrutinised, they may feel they are left with no choice but to refer to the European Human Rights Convention (EHRC). The convention, which the UK is party to and has to adhere to, exists primarily to protect individual human rights, but businesses can indirectly benefit from certain rights it protects; namely, the right to a fair trial. So where are we left? The UK has successfully escaped the clutches of what it viewed as the bureaucratic Brussels blob, but is it really better for businesses and the competitiveness of the UK?

£ Dr Liza Lovdahl Gormsen is a director at the British Institute of International & Comparative Law

The CMA has been entrusted with immense powers but inadequate accountability

New competition laws would give the CMA power over big tech firms

Therese Coffey and Greenpeace were locked in a fight over the weekend, after the Department for Environment Food and Rural Affairs were told to stop working with the climate group. The campaigners said ‘the planet is on fire and Rishi Sunak is acting like nothing is happening.’

TRAVEL

ABOARDthe reborn Crystal Serenity you’ll find the first Nobu restaurant at sea, a signifier of the ship’s gleaming $150 million refurbishment. There are also gold-embossed suites with comfy beds that would feel airy and spacious on land, let alone floating in the middle of the ocean. But guests are all asking for one thing: “They miss the pea soup,” Jean, my butler, confesses. “People loved that pea soup... They’re going to have to bring it back.”

Such is the level of dedication of the Crystal Cruises clientele that a dish has gained cult status. Posh restaurants are all well and good, but when you go home for the weekend you just want home cooking and, well, when you go on Crystal Cruises, you just want the pea soup. One lady I met on board enthusiastically boasted that this was her 25th time with the firm, which started sailings in 1988.

I was gutted to miss the soup, but it was the future I was interested in. Crystal Cruises went under in 2022 but were bought by the luxury travel company Abercrombie & Kent earlier this year. Having undergone a huge refurbishment, Crystal Serenity, the first of the ships to sail again, is taking passengers from this month. Virgin Voyages has done a lot to make cruising feel relevant to younger audiences, particularly for people of working age, but could Crystal appeal to millennial audiences?

I was sceptical and had never been on a sea cruise before. However, a not insignificant proportion of my inner circle had been gossiping about the return of Crystal. A cohort of Londoners I trust said that no one does cruising like they do, plus, Abercrombie & Kent, leaders in luxury touring, were on board. My curiosity got the better of me and soon I was ascending a gangway in Naples, looking up towards a beaming man on the gangway, his hand outstretched, cloaked by an even more beaming white jacket. “Welcome to Crystal Serenity, sir.”

Some things that happened in my first ten minutes on board: a man in black tie turned up at my cabin door and told me he was my on-board 24/7 butler. He told me he’d press my shirts, deliver me limitless champagne, and serve me canapes in the afternoons. He also smiled at me in the corridors every time I saw him in a reassuring fatherly way. It was the sort of smile that says everything’s going to be fine. I’ll be honest, by the end of the cruise Jean had become invaluable emotional support. Sod therapy, imagine having Jean at home.

Also in the first ten minutes on board: a rather attractive pianist serenaded me oneon-one as I made my way through the ship, telling me “good afternoon, sir” with the sort of smile, and technical prowess on the keys, that left me frankly needing a cold shower. If I’d had one, I could have spent a few minutes deciding which of the three shower heads I would use, and upon which marble shower ledge I should sit, to freshen up. (Yes, the shower in my room was the size of a steam room.)

CAN CRUISING BE COOL?

Crystal has been tirelessly working to debunk the notion that cruises are old hat. Bigger suites, excellent restaurants and refashioned public spaces are fit for a modern era. Even the most basic double room comes with its own lounge area and a wall-sized window for decent sea views.

To do all this, they hired a former Soho House brand manager to rethink what cruising should look like today, and the cluster of newly imagined public spaces aboard are certainly the sort of places I’d hang around in if they were in London.

The suites are nice enough that you can spend hours relaxing in them as an activity in itself, without feeling you’re missing out on something on the top deck. I spent hours lording it up on my full-length sofa drinking champagne and looking out to sea. Who needs activities when you have this?

When I wasn’t drinking wine in my suite I

was probably eating. Two new restaurants, Nobu and Umi Uma, have their curtains closed as a way of saying, ‘hey, we might be on a boat, and there might be great views, but look at our decor! We’re a gorgeous enough restaurant that you needn’t look at the views.’ I understand the intention, even if we did open the curtains anyway: the food and service is genuinely on par with restaurants in Mayfair. Both have set menus which change daily and daily-changing wine pairings. My favourite was neither of these, but the Waterside restaurant, which lives up to its name and then some: book a table on the edge of the ship for brilliant views out to sea. In here there’s absolutely exquisite modern cooking. I have no idea how the dishes are made this freshly when we’re at sea, but I stopped thinking about that as it felt like too much hard work, and just ate: pasta with anchovy, and a steak with king prawn surf ‘n’ turf, the steak on par with anything I’ve had in London. One night I double dinnered just because I was on holiday and I have absolutely no regrets.

I haven’t even spoken about the exemplary top deck vibes, with swimming pool and hot tub, live music and panoramic views. The truth, though, is that all of these enhancements, funded by the cash and decades of experience of Abercrombie & Kent, are just a fabulous backdrop for the timeless joy that is cruising. Dour old boats with sad buffets and tiny cabins made the idea unattractive, but now that it can be done in style, there’s an incredibly good reason to enjoy the feeling of being at sea.

Humans have an undeniable attraction to water. We’re born into it, spend our weekends walking along it, and haemorrhage our bank accounts to live near it. As Ratty says to Mole in The Wind in the Willows, “there is nothing - absolutely nothing - half so much worth doing as simply messing

Crystal, one of the world’s most legendary liners, returns under Abercrombie & Kent ownership. But does this heritage brand work for today’s young professionals? Adam Bloodworth goes aboard to find out

about in boats.” Dare I say it, but many of us have stressful jobs and our own mental health challenges. A few days spent staring at the ocean is an intensely calming experience and that is why cruising will never go out of fashion, although, of course, the industry faces challenges with carbon output as we all face up to questions about climate change. There are other challenges too: the on-site excursions aren’t quite yet at the quality Abercrombie & Kent would like them to be. The practicalities of the tourism industry mean tours with local guides can get booked up by travel operators years in advance, so it’ll take a year or so for the day trips to become as bespoke as Crystal would like. And some of the on-board entertainment couldn't quite reach the heights of the world-leading food. But the wine experience I took in Tuscany certainly left me sated, and sloshed, and I even took some photos like a poseur in front of the old masarea we visited. What more could you want?

THE LONG WEEKEND

FRITTON LAKES NORFOLK

An ambitious rewilding programme attracted Lynn Houghton to Norfolk to hang out with ponies and long horned cattle

Later, back aboard, an island shifted slowly past my masseuse’s window. Afterwards, I hit the sauna and watched that same island, still drifting past, which felt like a hypnotic experience as the waves of heat rose from the sauna. It was one moment of peace before the organised chaos of night, when a DJ was playing on the roof. By the small hours one guy jumped in the pool fully clothed. My preconceived notions of people sitting around playing bingo felt impossibly far away. victxry

NEED TO KNOW

Crystal offers cruises all over the world. As an example, sail onboard Crystal Serenity for 10 nights from Miami to San Juan on November 13th from £3,500pp based on two people sharing a double guest room on an all-inclusive basis including airport transfers. Excludes flights. The Sapphire Veranda Suite Adam stayed in costs £6,600 per person

THE WEEKEND: Amongst the marshes, lakes and fields of Norfolk, a new trend is taking hold. Wild nature is coming back. For those considering a UK break this summer, you could be tempted by this area’s stunning beaches such as the award winning Gorleston-onSea, but you would be remiss not to explore the equally captivating countryside and forests. I stayed at Fritton Lake and discovered the one thousand enclosed acres that have been left to go back to nature with pigs, water buffalo, Exmoor Ponies and Long Horned cattle roaming freely.

WHAT TO SEE: The country villages near Fritton Lake, St. Olaves and Somerleyton have hospitality and history on offer. Somerleyton has bike rentals, an ice cream shop, plus an excellent pub called the Duke’s Head. The village of St. Olaves is within walking distance of Fritton Lake and is where you’ll find the Bell Inn, plus Priory Farm Restaurant. The nearby Broads National Park is awash with rivers and fens and chock full of stunning walks through gorgeous scenery. Villages and ancient churches dot the surrounding landscape as well as mediaeval windmills, the power source of their day. Take a meander along the Waveney River at

Herringfleet as I did, and you will come across a disused and dishevelled windmill that still oozes charm.

THE REWILDING: Conservation is making a big impact in East Anglia. Even with my untrained eye, I noticed that farmer’s fields are changing. Particularly on Hugh Somerleyton’s farms, bales of hay made for silage are disappearing as heavy ploughing is replaced by regenerative methods. A new organisation, Wild East, is encouraging people to let green areas in their gardens, or at other properties like at their workplace, go ‘back to nature’ by letting them grow wild. They want farmers to donate entire fields but also urban dwellers to consider letting small things like a window box go wild, or anything they can. A cash donation is always welcome, but the point is for rewilding to become a movement. Lynx is the symbol of this project as this solitary animal is thought to have roamed here as recently as early mediaeval times. The lynx needed large amounts of cover from which to launch an attack, but loss of habitat led to its extinction. It is the dream of the founder of Wild East, Hugh Somerleyton, for the Lynx to make a return to these lands sometime in the future.

WHERE TO STAY: Fritton Lake on the border of Norfolk and Suffolk was formerly a rambling family property but now is a private member’s club with 27 self-catering cabins and two farm cottages for guests. Near the lake is the Clubhouse, a renovated home with eight spacious rooms named after former family members and friends; here you’ll find an excellent restaurant serving local products along with a bar and friendly staff on hand. On checking into a cabin, guests receive a hamper filled with luxury food products from the farms on and near the property. Facilities available are, obviously, the two-mile long Fritton Lake where you can enjoy wild swimming, paddle boarding or the floating sauna. There is a BioGym, large heated outdoor pool with changing rooms, clay and grass tennis courts, plus walking and running trails.

VISIT YOURSELF: A seven-night cabin stay starts from £1,015. A twonight stay is from £360. To book visit the website at frittonlake.co.uk or call 01493 484 008. Greater Anglia has departures from London Liverpool Street and London Stratford to Somerleyton and Great Yarmouth from £20. Book on the Greater Anglia Rail app or visit greateranglia.co.uk.

FOOTBALL

I want to channel Terry, says Lioness Bright

ENGLAND Women’s captain Millie Bright has said she wants to emulate former England Men’s star John Terry as her Lionesses side get set to take on Nigeria this morning in the last 16 of the Fifa Women’s World Cup.

England topped their pool and have been rewarded with a knockout tie against African side Nigeria, who finished ahead of Canada to reach the last 16 of the tournament.

And the Chelsea defender – who inherited the vice-captain armband from the injured Leah Williamson for this tournament – says she wants to follow in the “fearless” leadership of fellow Blues player John Terry.

“JT was a big one for me. I think the way he carried himself and he always stepped out on the pitch, fearless,” she said yesterday. “Every team that he’s played in I think he’s done that and he’s

England captain wants to be “fearless” like ex-Chelsea player Terry as England get set for Nigeria match, writes Matt Hardy

led by example, his actions have spoken louder than his words. For me that’s definitely something I believe in as well. Off the pitch I think he’s a great human, he’s very caring. I know a lot from a personal level that he’s always given a lot to the women’s team.”

A win for England would see them take on either Colombia or Jamaica on Saturday before a potential semi-final against France next Wednesday.

The draw has really opened up for the Lionesses, with the United States the latest side after Brazil and Germany to crash out of the tournament.

It means England are now the second ranked side left having started fourth –only Sweden are ahead.

FANTASTIC JOB

Nigeria’s head coach Randy Waldrum said yesterday ahead of this morning’s clash in Brisbane that: “[Sarina Wiegman] has done a fantastic job with England, since she took over you can see the progression of the team.

“When I look at a coach and try to analyse, if I don’t know them personally, you look at the team and tell if they have an idea. In their organisation, they look like they have a plan [and] a way they want to play.”

England confirmed the return of Keira Walsh to training at the weekend despite the

ENGLAND ROUTE TO THE WORLD CUP WIN

GROUP

Barcelona midfielder injuring herself in the group stages. It is uncertain whether the 26-year-old will make an appearance this morning or be held back until the quarter-finals, should England make it, but her fitness status will be of a relief to the Lionesses.

England’s path is opening up, but Nigeria will be stiff opposition. And as the United States proved yesterday, reputation means nothing when push comes to shove.

W 1-0 v Haiti

W 1-0 v Denmark

W 6-1 v China

LAST 16 Vs Nigeria

QUARTER-FINALS

Vs Colombia or Jamaica

SEMI-FINALS

Wednesday 16 August, Sydney

FINAL

Sunday 20 August, Sydney

IF ANY one of the 23 who played for England on Saturday in their 20-9 loss to Wales thought they were guaranteed to be one of the names

Steve Borthwick lists in his Rugby World Cup squad this morning, they might want to think again.

What unfolded under the roof of the Principality Stadium in Cardiff this weekend was nothing short of embarrassing for Borthwick and his England project.

No try scored for the first time in over a year, unable to add to their halftime tally, firing shots at the opposition that ended up only in their own feet; it was dire.

It was billed by some as a selection showdown with a number of players looking to play themselves into the 33-man squad Borthwick names this morning.

Instead a number of starters played themselves out of the squad. Or so you’d assume.

There’s little point in second guessing Borthwick and who he may or may not include, but there’s purpose in unpicking what happened on Saturday –though reports suggest Henry Slade will not be included.

SMITH SELECTION

Since the maverick Marcus Smith was given a shot for England under former coach Eddie Jones – who will be licking his lips at the prospect of his former employer flopping at the coming Rugby World Cup – fans and explayers alike have been calling for the Harlequins No10 to be picked alongside his fellow south London club men.

Well that happened on Saturday, and it did not work.

Smith got his Harlequins No8, scrumhalf and outside centre in Alex Dombrandt, Danny Care and Joe Marchant but, combined with Leicester’s Guy Porter at

ENGLAND NEED MAGIC TOUCH IN SQUAD

No12, couldn’t run the game, order his pack or have an impact on the game. He scored all of England’s points but dampened the calls for this combination to be one for the long-term. And it’s understandable why Borthwick felt the need to call upon it, he’s not been in the job long and he needs those club combinations to transition to the international side. Which begs the question as to why the former Leicester coach and the Rugby Football Union have decided to name their squad today.

New Zealand and

Marchant looks to have replaced Slade

ENGLAND’S WARM-UP SUMMER SERIES

WALES

L 20-9, Principality Stadium, Cardiff

WALES

12 August, Twickenham Stadium, London

IRELAND

19 August, Aviva Stadium, Dublin

FIJI

26 August, Twickenham Stadium, London

Argentina release their squads today, too, but they’ve had years with their coach and a number of international Tests in the last couple of weeks to see where they are at.

England have had eight weeks training – despite a number of starters on Saturday looking unfit – and just one match.

All Borthwick is doing by releasing his squad today is sending those he ditches on holiday, risking their fitness going forward, and showing every other nation at the World Cup exactly what kind of squad he is taking and what sort of style they’re building towards across the next three warmup games.

Wales, for example, tried a lot of fringe players on Saturday but have another two games before they name their squad and can try other combinations.

BAFFLING

It baffles the brain as to why England are shooting so early.

And the reality is this: England did not impress too much in the Six Nations, there was no attacking flair or adventure in February and there remains little now, and they didn’t impress at the weekend.

So with their squad confirmed later today, they’ve got to show something against Wales next week, and Ireland and Fiji beyond that, that suggests they can compete at the World Cup in September.

Because on form alone, England could be on course to dump themselves out of the World Cup in the group stages. Would the sacked former coach, and 2019 World Cup finalist, Jones have had the same result if England had stuck with him for one more year? We will never know.

Borthwick’s side were woeful but he names his World Cup team today, writes Matt Hardy

Bright is captain in place of Williamson

RUGBY UNION

SPORT

READY TO ROAR

England take on Nigeria today for place in World Cup quarters

Slade set for axe from England World Cup squad

MATT HARDY

ENGLAND centre Henry Slade is set to be left out of Steve Borthwick’s World Cup squad, which will be named at 10am this morning.

The shock omission comes as England head coach Borthwick chooses to name his squad a month out from this autumn’s tournament, taking place in France next month.

Other players expected to be ditched by the former Leicester head coach are Newcastle Falcons hooker Jamie Blamire and Bordeaux No8 –and soon to be Saracens back-row –Tom Willis.

It is understood, according to reports in The Times, that 50-cap Slade was left bewildered over his omission from the 33-man squad.

GUNNING FOR IT

First blood Arsenal as they beat City to lift Community Shield at Wembley

MATT HARDY

Mikel Arteta hailed his bench yesterday after a 101st-minute Leandro Trossard equaliser helped Arsenal draw 1-1 with Manchester City before a successful Fabio Vieira shootout penalty earned the Gunners the Community Shield at Wembley.

Arsenal dominated the opening 40 but couldn’t convert either of their shots on target – a duo of attempts from new signing Kai Havertz were saved by City goalkeeper Stefan Ortega.

The deadlock was broken, though, in the 77th minute when City’s Cole Palmer followed up a sighter a couple of minutes earlier with a stunning strike from just

inside the box.

But when it looked as though City were on course to win the first domestic trophy of the season, Trossard found the net through a Manuel Akanji deflection in the 11th minute of injury time – the Football Association and Premier League are looking to add more time on to matches to stamp out decent and timewasting.

Martin Odegaard put Arsenal ahead on penalties – the Community Shield does not have extra-time – before Kevin De Bruyne missed City’s first.

Trossard and Bernardo Silva exchanged successful shots before Bukayo Saka made it 3-1 to the Gunners.

Rodri missed City’s second of the

England lose Netball World Cup final to No1 side Australia

CITY A.M. REPORTER

ENGLAND’S first ever appearance in a Netball World Cup final ended in defeat as the Roses were beaten 4561 by Australia in South Africa.

World No1 side Australia were heavy favourites heading to the match having appeared in every World Cup final ever.

But England had dramatically beaten their final opponents in the group stages and also famously toppled them in the 2018 Commonwealth Games final.

They were unable to complete an upset twice in one tournament, however, and Australia lifted their

12th title in Cape Town on Sunday.

“We are really grateful for that silver medal and over time I’m sure that it will sink in. But right now it is a measure of the belief we had in ourselves, the route we took to the final...[that we are disappointed],”

England head coach Jess Thirlby said. “We are obviously gutted with a losing margin like that in our first final but such is the difference between seasoned finalists and a team in their first final.

“The win on Thursday, we hit some of our biggest stats ever against Australia, and still only won by one, so we weren’t complacent about things.”

shootout before Fabio Vieira hit the winner.

“We are so happy to win a trophy at Wembley against the best team in the world. It was a really tough match,” Arsenal manager Arteta said.

“In the second half we made a big mistake in the high press to allow them to switch play and when you give them that they put the ball in the top corner and you’re 1-0 down.

“And in that moment we had to be clever, not give up and stay in the game. We knew how important changes were going to be and they were because Leo [Trossard] scored the goal and Fabio [Vieira] scored the winner.

“You play against a team that

dominated the moments so well and know how to run the clock down but we believed, made changes, changed formation and that caused them some problems.”

Only one club – Manchester City in 2018 – have won the Community Shield and gone on to win the Premier League but Arsenal will see the result as a positive start to their campaign, which truly gets underway on Saturday against Nottingham Forest.

Manchester City are still in the mix to win six trophies this season – the quadruple, plus the European Super Cup and Club World Cup – and begin their campaign on Friday away to former player Vincent Kompany’s Burnley.

England lost 20-9 to Wales on Saturday in a match which was billed by some as a selection showdown. Slade did not participate in the loss in Cardiff but was likely part of the selection discussion that took place after the match between Borthwick and his coaching staff, many of whom were with the former England international during his stint at Leicester Tigers.

England have three further matches this autumn –at home to Wales and Fiji and away to Ireland –before they head to the World Cup, where they will take Argentina, Japan, Samoa and debutants Chile.

“Every one of these experiences will be positive for us as we build over the next few weeks to the World Cup,” Borthwick said.

“Over the coming weeks the team will sharpen up.

“We’re still in quite a big training phase and we will sharpen up over the next three games together.

“I will reflect where I am in terms of the squad selection and whether this game changes anything or clarifies anything regarding that.”

It is expected that Joe Marchant –who was one of the few highlights in Saturday’s defeat –will make the squad alongside Harlequins teammates Marcus Smith and Danny Care.

£ ENGLAND ANALYSIS P19

Saudi PIF establishes new sports investment company

CITY A.M. REPORTER

THE SAUDI Arabian Public Investment Fund (PIF) yesterday announced the formation of a new company which will be at the heart of their sporting ambitions going forward.

SRJ Sports Investments will “invest in acquiring and creating new sports events IP, commercial rights of popular and prominent sports competitions and hosting major global events in Saudi Arabia”, according to a statement from the PIF.

England were dominated by Australia

“The company will complement other PIF investments in the sports sector, all of which are contributing to a more vibrant society, in line with PIF’s

strategy and Saudi Vision 2030,” head of MENA (Middle East and North Africa) direct investments at PIF Raid Ismail said.

It is uncertain as to what this news means for existing PIF investments, such as Premier League football club Newcastle United, but Saudi Arabia have in the past expressed an interest in hosting future Olympic Games and Fifa World Cups.

PIF, though various connections with Saudi Arabian companies, have links with the likes of Indian Premier League side Rajasthan Royals, both McLaren and Aston Martin Formula 1 outfits, Chelsea FC through Clearlake Capital and the LIV Golf league.

NETBALL

SPORT BUSINESS