13 September


13 September

Good morning,

The decision by the UK government yesterday to lift the one per cent annual cap on public sector pay may have brought an end to seven years of pay controls, but it seems to have created a new problem for Theresa May in the form of possible widespread industrial action.

Downing Street announced yesterday that police and prison officers would both receive pay rises in 2017-18 above one per cent, and made a commitment to “flexibility” for all public sector workers from next year. The announcement – made on the same day that official figures showed greater-than-expected inflation - brought a close to one of the most controversial austerity policies introduced in the wake of the financial crisis.

However, the news has not been met with universal approval, far from it. Three of Britain’s biggest unions, who represent more than two million workers, derided the increase and warned of the “strong likelihood” that coordinated strike action is an option on the table. The leaders of GMB, Unite and PCS unions have claimed that the increase does not go far enough and instead are pushing for pay rises of at least five per cent for the whole of the public sector workforce.

The government's announcement hasn’t even appeased the unions representing the workers who will benefit from the increase. Steve White, the chair of the Police Federation of England and Wales, claimed that many of his members would be “angry and deflated”, while the Prison Officers Association said the deal amounted to a real terms pay cut. Labour leader Jeremy Corbyn yesterday refused to say whether he would support any illegal strikes over pay, simply claiming it was a “matter for the unions.”

The strength of fallout from yesterday’s decision gives an indication of the scale of the task in front of the prime minister, as she navigates the country’s industrial relations amid rising inflation, and tries to avoid strikes in the public sector.


The next round of Brexit talks has been delayed a week to give UK and European Commission negotiators “more time for consultation”. The fourth round of UK-EU negotiations was due to get underway on September 18, but will now begin on the 25th.

Apple’s new iPhone X has been described by the company’s chief executive as “the biggest leap forward since the original iPhone”. Unveiled yesterday, the new model will cost £999 and go on sale from November. (£)

Emmanuel Macron yesterday faced the first major disorder of his term as tens of thousands of people protested against the French president’s employment law reforms. Macron has vowed to stay firm on his plans to push through the reforms as he attempts to modernise the economy and cut the unemployment rate of 9.5 per cent. (£)


Karen Bradley, the culture secretary, yesterday said she was “minded” to refer 21st Century Fox’s £11.7 billion bid to take over Sky to the Competition and Markets Authority over concerns that the deal could affect media plurality. Bradley’s comments overrules updated advice from Ofcom, which identified “non-fanciful concerns” relating to broadcasting standards, but said that “we do not consider that these are such as may justify a reference in relation to the broadcast standards public interest consideration”. (£)

Research by a house lender has found that more than half of Britain has seen wages rise faster than house prices in the last decade. The report by the Yorkshire Building Society also found that the gap had widened dramatically in other areas, which they believe had accentuated a north-south divide.
The Trump administration has promised that it will not introduce excessive regulation that could slow the progress made in the development of self-driving cars. Transportation secretary Elaine Chao has warned state governments not to introduce inconsistent rules and instead embrace technologies that will revolutionise transport in coming decades. (£)


What happened yesterday?
Stronger than expected inflation in August yesterday caused the pound to hit its highest level against the dollar this year.

CPI inflation rose to 2.9 per cent, which was 0.1 per cent above forecast and a rise of 0.3 per cent on July’s rate. This news trigged a rise in the pound, which ended 0.84 per cent up to $1.3275 at the close of London business hours.

The rise in inflation means all eyes will be on the Bank of England tomorrow, which is expected to make a decision on whether to increase interest rates.

The movement of the pound caused the FTSE 100 to fall 12.9 points, ending the day at 7,400.69. The most high profile mover was Sky, where shares fell 5 per cent at one point after the UK government confirmed it was “minded” to investigate 21st Century Fox’s attempt to take over the business. Shares were down 1.5 per cent by the close of business.

Dunelm Group, Galliford Try, Haynes Publishing Group, Town Centre Securities, Wilmington

Advanced Medical Solutions Group, Alliance Pharma, Columbus Energy Resources, Epwin Group, Eve Sleep PLC, Gaming Realms, Ingenta, Just Group, MyCelx Technologies Corporation (DI), Soco International, SQS Software Quality Systems AG, Sigmaroc, Ten Entertainment Group

UK Economic Announcements
(09:30) Claimant Count Rate

Int. Economic Announcements
(07:00) Consumer Price Index (GER)
(07:00) Wholesale Price Index (GER)
(11:00) Industrial Production (EU)
(12:00) MBA Mortgage Applications (US)
(14:30) Producer Price Index (US)
(15:30) Crude Oil Inventories (US)


Labour MP Caroline Flint explains in The Guardian why she opted to defy her party’s three-line whip on Monday and support the government’s EU Withdrawal Bill. A campaigner for Remain during the EU referendum, Flint acknowledges that there are flaws with the bill but ensuring that the UK secures a smooth Brexit will require the adoption of current EU law onto the British statute book.
Writing in The Times, Daniel Finkelstein says that the best leader does not always win, and that is why Jeremy Corbyn could still become prime minister if he fights another general election. Finkelstein says circumstances, as well as character, define political victories and a flagging economy at the time of the next vote could see Corbyn enter Downing Street as prime minister. (£)


House of Commons
Oral questions
Northern Ireland

Prime Minister's Question Time

Employment tribunals - Mike Penning

House of Lords
Oral questions
Comprehensive timetable for Brexit negotiations with the EU; and the public availability of all relevant documents - Lord Foulkes of Cumnock
Addressing concerns about the breeding of dogs and cats - Lord Black of Brentwood
Implementing the Government commitment to bring 480 unaccompanied child refugees from Europe to the UK - Lord Dubs

Financial Guidance and Claims Bill [HL] - Committee stage (day 4) - Committee of the Whole House - Baroness Buscombe

Scottish Parliament
Portfolio Questions: Environment, Climate Change and Land Reform
Scottish Conservative and Unionist Party Debate: Housing


House of Commons
Oral Questions
Digital, Culture, Media and Sport (including Topical Questions)

Business Statement
Business questions to the Leader of the House 

General Debate
Abuse and intimidation of candidates and the public during the General Election campaign

House of Lords
Oral Questions
Recommendations in the Housing White Paper 'Fixing our broken housing market' - The Lord Bishop of St Albans

Scottish Parliament
General Question's

First Minister's Questions

Ministerial Statement: Community Justice in Scotland

Scottish Government Debate: Scotland’s Food and Drink Strategy, Ambition 2030