While the contest to replace Theresa May as leader of the Conservative Party(and next Prime Minister) continues, a different leadership race is unfolding in Brussels – one that will certainly affect the United Kingdom.
The EU’s top position, President of the European Commission, is up for grabs and the search is still open following the European Parliament (EP) election in May in a procedure known as the Spitzenkandidat (‘lead candidate’) process. Besides the Commission presidency, other top jobs up for negotiation include the presidencies of the Council, the Parliament, the High Representative of the Union for Foreign Affairs and Security Policy, and the European Central Bank.
The Spitzenkandidat process establishes that the Commission presidency goes ‘to the candidate of the political party capable of marshalling sufficient parliamentary support.’ With this in mind, the EU’s three main political groups –the European People’s Party (EPP), the Party of European Socialists (PES), and the Alliance of Liberals and Democrats for Europe (ALDE) appointed six so-called ‘coordinators’ at an informal European Council meeting two weeks ago to discuss the future of the Union’s leaders and ultimately fill all the EU’s top leadership jobs.
The talks between the six EU prime ministers took place last Friday over dinner at Egmont Palace in Brussels. Although the coordinators stressed the informality of the meeting, some have argued that the rejection of the EPP’sSpitzenkandidat, Manfred Weber, is already imminent despite the party finishing first in the EP election with a projected 179 out of 751 seats. In response to this, the European conservatives have insisted on Weber’s candidacy and warned that opposing him could lead to deadlock in Parliament.
While the Socialists haven’t yet put forward any alternative names to their Spitzenkandidat Frans Timmermans, the ALDE has decided to suggest a team of seven nominees in protest at the Spitzenkandidat process, which liberals see as favouring the EPP.
And the situation becomes even more complex when one looks at the EP election results. Because even though the Greens were absent from Friday’s ‘informal’ dinner, their expected control over 70 seats in the EP could prove instrumental during coalition negotiations.
Game of Thrones may be over, but leadership contests are well underway in real life Kingslanding. And more than a fancy chair is at stake. Whoever finally does take the leadership roles in the UK and the EU at this time of upheaval will inevitably play a leading part in writing the common history of our future relations.
Vice chairman of the Conservative party's backbench 1922 committee Dame Cheryl Gillan announced the final list of 10 candidates officially running to replace Prime Minister Theresa May as Tory leader. The ten contenders –who required the support of a proposer, a seconder, and six other members in order to run– are Environment Secretary Michael Gove; Health Secretary Matt Hancok; former Chief Whip Mark Harper; Foreign Secretary Jeremy Hunt; Home Secretary Sajid Javid; former Foreign Secretary Boris Johnson; former Leader of the House Andrea Leadsom; former Work and Pensions Secretary Esther McVey; former Brexit Secretary Dominic Raab; and International Development Secretary Rory Stewart. Conservative MPs will now proceed to vote so as to whittle the list down to two candidates.
Tory frontrunner Boris Johnson is facing criticism from his rivals in the Conservative leadership contest following his £10bn pledge to cut income tax, a measure that they argue would benefit rich pensioners as well as himself. Mr Johnson was also accused of supporting a Brexit plan that would ‘annihilate’ the party and allow opposition leader Jeremy Corbyn to become prime minister by Christmas.
The BBC announced that it will scrap free television licenses to over 75-year-olds unless they are on Pension Credit. Around 3.7 million households with a free licence are expected to be affected and will have to start paying for one in June 2020. Free licences were offered to over-75s as part of a government scheme before funding was cut fifteen years later. Theresa May has shown her disappointment with the BBC’s decision, and the government has asked the corporation to ‘look for further ways to support older people.’
Business and Economy
Car production in the UK fell by 24% in April after the target Brexit date passed, translating into a 0.4 percent decrease in Britain’s gross domestic product compared to the previous month. The Office for National Statistics has emphasised that falling vehicle output due to Brexit uncertainty is the main cause for the drastic decline, with several UK-based firms planning to halt activity and close factories. Production of chemicals, basic metals, and pharmaceutical products also decreased in April.
US President Donald Trump has threatened China with an immediate imposition of trade levies if Chinese President Xi Jinping does not attend the G20 summit in Japan. Officials in Beijing have not yet confirmed Mr Xi’s attendance to the meeting, widely seen as an opportunity to get Sino-American negotiations back on track. Mr Trump said in an interview withCNBC on Monday that he believed the Chinese premier would attend the summit in Osaka. If Mr Xi failed to show up, however, Mr Trump added that tariffs on $300bn worth of additional imports would be levied. (£)
Tesco plans to award store and warehouse workers a 10.45% rise to £9.3 an hour over the next two years from September 2019 onwards. A second hourly pay rise is expected to take place in October 2020 and will be offset by the loss of an annual cash bonus. The decision brings the grocer into line with rates paid by Sainsbury’s (£9.2) and Asda (£9.1).
What happened yesterday?
London closed in the green on Monday after US President Donald Trump decided to ease trade tensions with Mexico and not to levy tariffs on the Central American country over immigration issues. The FTSE 100 was up 0.59% at 7,375.54, while the pound was weaker against both the dollar by 0.36% at $1.27 and the euro by 0.22% at €1.1213 following information about the UK’s car production fall in April and the country’s disappointing growth figures.
While Mr Trump announced his decision not to impose duties on Mexico after the Mexican government agreed to deal with immigration flows to the US, he confirmed on Monday that additional tariffs on Chinese imports would be levied if Chinese President Xi Jinping decides not to attend this month’s G20 meeting. With the US president willing to use tariffs as a policy tool for achieving his non-economic interests, the EU is thought to be a possible target so as to get the 2% defence spending target from member states.
In equity markets, the standout riser was online grocer Ocado (up 5.67%) following the announcement that it would invest £17m in the vertical farming industry. On the downside, Ferguson’s stocks (down 4.64%) dropped after the plumbing products distributor reported a fall in revenue for Q3 as a result of slower growth in the US, its largest market. Woodford Patient Capital Trust (down 6.05%) also plunged, even as Neil Woodford sought to reassure that the suspension of the equity fund had not affected the company’s operational performance.
In the US, the S&P 500 closed 0.47% higher for the fifth session in a row amid positive news on the likelihood of lower interest rates and the Mexico-US deal on migrant flows. The Dow Jones Industrial Average and the Nasdaq were also up 0.3% and 1.05% respectively by close of play.
B.P. Marsh & Partners
IG Design Group
Aberdeen Standard European Logistics Income
Martin Currie Global Portfolio Trust
New Century AIM VCT 2
Primary Health Properties
Somero Enterprises Inc. (DI)
VPC Specialty Lending Investments
UK Economic Announcements
(09:30) Claimant Count Rate
Int. Economic Announcements
(13:30) Producer Price Index (US)
Source: FTSE 100, Financial Times
Columns of Note
Writing in The Guardian, Polly Toynbee argues that Tory leadership candidates are oblivious of the challenging task they will face to get the UK back to 2010 levels before austerity plans and tax cuts. She concludes that the hopes for a restored and better Britain that Conservative contenders hold ignore the scale of the current ‘national catastrophe,’ pointing to the contradiction between social repair and tax cuts that candidates are promising.
Taiwan’s minister of foreign affairs, Jaushieh Joseph, writes in The Times about China’s constant wish to influence and interfere democratic societies around the world. Mr Joseph defends Taiwan’s independence from the People’s Republic of China (PRC), accusing Chinese leaders of interfering with his country’s international participation through cyberattacks and disinformation campaigns, as well as intimidating transnational companies like British Airways to list Taiwan as a province of the PRC. (£)
Cartoon source: The Times
Did you know?
The human eye has a resolution of about 576 megapixels. By comparison, a 4K screen has about 8.5 megapixels.
House of Commons
Business, Energy and Industrial Strategy (including Topical Questions)
Ten Minute Rule Motion
United Kingdom Atomic Energy Authority Pension Transfers (Parliamentary and Health Service Ombudsman Investigation) - Mr Edward Vaizey
To approve a Statutory Instrument relating to the Draft Consumer Rights Act 2015 (Enforcement) (Amendment) Order 2019 - Kelly Tolhurst
To approve a Statutory Instrument relating to the Draft Child Support (Miscellaneous Amendments) Regulations 2019 - Will Quince
UK Voluntary National Review on the Sustainable Development Goals
Rising crime and anti-social behaviour on Slade Road in Birmingham - Jack Dromey
House of Lords
Ensuring that banks provide free withdrawals from current accounts at cash machines - Baroness Bryan of Partick
Latest figures for the gross domestic product per capita for England, Scotland, Wales and Northern Ireland; and the percentage increase for each such figure since 1999 - Lord Wigley
Whether the Foreign Secretary’s speech at the Lord Mayor’s Banquet on 13 May represented a change in the Government's policy on defence expenditure - Lord Robathan
Preventing homophobic and misogynistic attacks - Lord Kennedy of Southwark
Non-Domestic Rating (Preparation for Digital Services) Bill - Second reading and remaining stages - Lord Bourne of Aberystwyth
Kew Gardens (Leases) (No.3) Bill (HL) -Third Reading - Lord Gardiner of Kimble
Protecting children from harmful vehicle emissions - Baroness Randerson
Operation of the theatre market and ensuring that theatre is accessible - The Earl of Glasgow
Topical Questions (if selected)
Update on P1 Standardised Assessments
Stage 3 Debate
Fuel Poverty (Target, Definition and Strategy) (Scotland) Bill
Human Tissue (Authorisation) (Scotland) Bill
Standards, Procedures and Public Appointments Committee Debate
Changes to Standing Orders
The Way of St Andrews – Murdo Fraser
House of Commons
Women and Equalities (including Topical Questions)
Prime Minister's Question Time
Ten Minute Rule Motion
Parental Leave (Premature and Sick Babies) - David Linden
Opposition Day Debate
Inequality and Social Mobility; Discrimination in Sport - Jeremy Corbyn
Cornish wrestling - Scott Mann
House of Lords
Support among UN Member States for the UNs Security Council Resolution on sexual violence in conflict - Lord Collins of Highbury
Supporting the government of Rwanda in its preparations for hosting the Commonwealth Heads of Government Meeting in 2020 - Lord Popat
Reducing delays in probate being granted to non-professional claimants - Baroness Browning
Age of Criminal Responsibility Bill - Third reading - Lord Dholakia
Holocaust (Return of Cultural Objects) (Amendment) Bill - Committee stage - Lord Sherbourne of Didsbury
Report from the Constitution Committee 'The Legislative Process: Preparing Legislation for Parliament'; Report from the Constitution Committee 'The Legislative Process: The Delegation of Powers' - Baroness Taylor of Bolton
Report from the Communications Committee 'Regulating in a digital world' - Lord Gilbert of Panteg
S5M-16939 Miles Briggs: Love Your Lungs Week
Scottish Greenhouse Gas Emissions 2017
Update on Veterans Strategy
Stage 3 Proceedings
Census (Amendment) (Scotland) Bill
S5M-16487 Johann Lamont: New Report Calls for More Housing Co-ops in Scotland