12 February 2019

Scott Reid

12 February 2019

Good morning,
 
As the mornings brighten, and the more curious features of the local area come into view on my daily commute, I’ve been struck by a sinister new development on the streets of Edinburgh.
 
No, not the forbidding visage of some of my fellow Leithers appearing with the morning dawn. Or even the discovery of a Christmas tree which has only just found its way onto a street in the New Town in the last week.
 
Instead, lock boxes. Everywhere. You know, the ones affixed to the doorways of self-catered property blocks, and which for some, have become the latest mark of a resident Airbnb host. And it would seem everyone is at it. On one 12-flat tenement, I counted precisely 12 boxes lining the doorway, presumably hinting that an entire block has been committed for commercial use.
 
My curiosity proved topical yesterday as news broke that the city of Paris is suing Airbnb for €12.5 million over thousands of adverts of allegedly “illegal” rentals beyond the maximum 120-day limit. Last week in Edinburgh too, councillors voted in favour of a proposal that would levy a £2-a-night “tourist tax” on all overnight stays, something that has since been mooted for other cities across the UK. Sustainable tourism is the zeitgeist in Europe’s city halls.
 
A commentator suggests in the Financial Times this morning that taxation is a gamble. But if tourism is to remain an economic and cultural good – as it rightly is in Edinburgh – the likes of Airbnb, partnering with government, has a task on its hands to think up a model that avoids erecting “ghost hotels” that kill local communities, one that doesn’t drive up city-centre property prices to the point where they become inaccessible for all but the few.
 
The best thing about travel is surely the local welcome. An over-saturated market without due support might just sour the mood.

News

Democrats and Republicans have announced a tentative deal to avert another government shutdown. Although official details are yet to be released, congressional aides have suggested the agreement will include close to $1.4 billion for 55 new miles of barrier on the US-Mexico border. President Trump now has until Friday to give the spending bill his assent if shutdown is to be avoided.
 
Theresa May is expected to request more time for Brexit negotiations as she updates MPs later today. MPs are due to debate Brexit on Thursday, when they will be able to table further amendments to the Withdrawal Deal, an eventuality the prime minister is working hard to avoid.
 
Meanwhile, The Times leads with a poll suggesting that the Conservatives would win a working majority if a general election were held today. The YouGov poll put the Tories on 321 seats (+4 on 2017), Labour on 250 (-12), the SNP on 39 (+4), the Lib Dems on 16 (+4), and others on 7 (+1).
 
The sister of Thailand's king has been banned from standing in elections next month which may have seen her elected as the county's prime minister.  The Thai Raksa Chart party, which Princess Ubolratana Rajakanya Sirivadhana Barnavadi was planning to run for, is loyal to ousted prime minister Thaksin Shinawatra, whose allies have won every national election since 2001. King Maha Vajiralongkorn dubbed the electoral bid by his elder sister as "inappropriate" and unconstitutional.

Business & Economy

UK economic growth has eased to its slowest annual rate since 2012, the latest figures from the Office for National Statistics revealed yesterday. Growth fell to 0.2% in December of last year, down from 0.6% in the previous quarter, resulting in annualised growth of 1.4% during 2018. The figures also revealed the first cross-sectoral slow-down since 2012 as services, manufacturing and production all contracted. 
 
Debenhams has secured £40 million to extend its £520 million borrowing facilities. The chain, which issued three profit warnings last year, is still in talks with investors and banks over its future refinancing. Earlier this month, Debenhams announced it would accelerate a programme of store closures with 20 locations earmarked during 2019.
 
Eurotunnel is suing the UK government over its decision to charter firms to run extra ferries in the event of a no-deal Brexit. The Channel Tunnel operator said the contracts were decided in a “secretive and flawed procurement process”. The move comes after one firm, Seaborne, was revealed to have no ships in December, before its funding fell through just days ago.

Markets

What happened yesterday?

A fall in the pound on the back of downbeat UK growth figures made for gains on the London stock market with the FTSE 100 adding 0.82% to close 7,129.11 points. By close of play, sterling was down 0.6% on the dollar at $1.29 and on the euro by 0.26% at €1.14.
 
In corporate news, travel operator Tui (up 4.90%) racked up strong gains following sore losses last week on the back of a profit warning. It was joined by FTSE 250-listed Just Eat (up 3.81%) on the day’s list of gainers after the food delivery group was urged by shareholder Cat Rock Capital Management to merge with a “well-run industry peer” following the departure of chief executive Peter Plumb. In an open letter, Cat Rock expressed "deep concern" over the company's recent appointment of executives, saying they lack online food delivery experience.
 
Smith & Nephew (down 3.00%) was the day’s worst performer following a report late on Friday that it is in discussions to buy US medical equipment company NuVasive for more than $3bn. Also on the slide was RBS (down 0.54%) after the bank was downgraded to “equalweight” from “overweight” by Morgan Stanley.

Finals  
Plus500 Ltd (DI)
 
Interims          
A&J Mucklow Group
Pluss500 Ltd (DI)
 
Trading Announcements
AA
Loopup Group

Q1 Results       
TUI AG Reg Shs (DI)

AGMs
BMO Capital & Income Investment Trust          
Pressure Technologies
TUI AG Reg Shs (DI)
 
UK Economic Announcements
(09.30) GDP (Preliminary)
(09.30) Industrial Production

Columns of Note

Alex Massie writes in The Times that previously loyal Labour members are beginning to lose faith in Jeremy Corbyn. Massie points to recent polling which shows that the Labour leader's support among party members has fallen into negative territory. But of all the reasons he thinks those members may have to dislike Corbyn's leadership, he suggests Brexit may be the weakest. (£)
 
Ed Conway writes for Sky News on the lesser-spotted features of yesterday’s lacklustre UK economic growth figures. He notes that despite growth of 0.2% in October, the economy contracted fully 0.4% in December, setting the new year off on a bad note. Moreover, despite a weak pound, export growth continues to fall, which should put paid to the Brexiteer notion that falls in the currency might lead to economic revival.

Did you know?

In New Zealand, McDonald's Happy Meals no longer come with a toy; instead, the chain is handing out abridged versions of Roald Dahl classics.

Parliamentary highlights

TODAY
 
House of Commons
Oral questions
Business, Energy and Industrial Strategy
 
Ten Minute Rule Motion
Child Cruelty (Sentences) – Tom Tugendhat

Legislation
Mental Capacity (Amendment) Bill [Lords] – remaining stages
 
Adjournment
Licensing of medical devices – Owen Smith

House of Lords
Oral questions
Achieving net zero carbon emissions in farming – Baroness Jones of Mouslecoomb
 
Devolution in Yorkshire – Lord Wallace of Saltaire
 
Implementing the 70 recommendations in the Report of the Stephen Lawrence Inquiry
 
Acquired Brain Injury assessments for all prisoners on reception into prison – Lord Ramsbotham
 
Orders and regulations
Various
 
Scottish Parliament
In recess until 19 February
 
TOMMOROW
 
House of Commons
Oral questions
International Development (including Topical Questions)
 
Prime Minister's Question Time
 
Ten Minute Rule Motion
Bus Drivers (Working Hours on Local Routes) - Matt Western
 
Debate
Tributes to the Clerk of the House
 
Motion
Securitisation Regulations 2018
 
General debate
Connecting Communities by Supporting Charities and Volunteers
 
Adjournment
Health service and the menopause - Rachel Maclean

House of Lords
Oral questions
Introduction of a uniform system for labelling plastic and bin collections in England - Baroness Neville-Rolfe
 
Providing greater clarity on constituency expenditure on behalf of a candidate and national expenditure on behalf of a party, following the verdict of R v Mackinlay, Gray and Little - Lord Rennard
 
Ensuring commercial air routes between the UK and East Africa are allocated sufficient departure slots - Lord Popat
 
Government advice to schools whose students plan to take part in the pupils’ strike on climate change - Lord Greaves
 
Debate
EU Withdrawal
 
Scottish Parliament
In recess until 19 February