18 June 2018

@ScottReid1992

18 June 2018

Good morning,

You’d have thought that two years on from the Brexit referendum, we’d all have had enough of policymaking by bus.
 
Not so the prime minister, it seems, who in announcing her latest spending plans has sought to out-do even the boldest claim of the Brexiteers – helpfully plastered onto a large red bus by Vote Leave – that the NHS could receive an extra £350 million a week when Britain leaves the EU.
 
In a major speech later today, Theresa May will say that by 2023 the budget for NHS England will increase by £20 billion, equivalent to an estimated £384 million a week. This will accompany a boost of £2 billion to the Scottish government, £1.2 billion in Wales and hundreds of millions for the health service in Northern Ireland. 
 
And yet as sure as buses are buses, all is not well in the government. The Times reports that the prime minister may be facing a black hole of up to £11 billion after cabinet ministers failed to confirm how the investment will be financed. 
 
A lot is riding on the plans; the health secretary Jeremy Hunt, for one, reportedly told his closest allies on Friday that he was prepared to resign if the investment was not forthcoming. At least six other senior cabinet members are thought to be on the point of mutiny if they don’t see more money for police, defence, housing and schools. Others have questioned where the cash will come from, with one government official telling The Times that, “we’re going to have to have a conversation about tax.”
 
For now at least, the prime minister will be more interested in gaining support from her backbenches as the EU Withdrawal Bill enters another week in parliament. A more cynical commentator might suggest that was behind this sudden change of heart on the NHS.

News

Angela Merkel is pushing for crisis talks on migration reform at next month’s EU summit in order to save her country’s governing coalition from collapsing. The German chancellor is facing a challenge from her long-standing coalition partner, the Bavarian Christian Social Union, which under the leadership of interior minister Horst Seehofer, is seeking to start turning away migrants at the border. Merkel has so far refused to discriminate against access for any migrants seeking refuge in Germany, with the suggestion that taking in only the most at risk asylum seekers – including children – may provide a “consensual solution” to the impasse. 
 
Households could be left up to £1,000 a year worse off under certain post-Brexit trade arrangements, a new report will suggest. According to research by the global consultancy firm Oliver Wyman, the most negative trade scenario of high import tariffs and high regulatory barriers would cost the economy £27 billion. The report, seen by the BBC, suggests that prices in even the most favourable scenario will increase by at least one per cent for all households. 
 
Ivan Duque has been elected president of Colombia, pledging to implement changes to the historic but controversial peace deal the country negotiated with Farc rebels in 2016. The conservative political newcomer won 54% of the vote in elections on Sunday and will govern alongside Marta Lucía Ramirez, who becomes Colombia’s first female vice president.
 
David Dimbleby is to step down as the presenter of BBC’s Question Time after 25 years on the flagship political programme. The 79-year old will leave his position in December, insisting that he was “not giving up broadcasting”, but planned “to return to my first love: reporting”.

Business & Economy

Virgin Money is expected to agree a £1.6 billion all-share takeover offer by CYBG today, according to The Sunday Times. The sweetened final deal is expected to value shares at Virgin Money at 1.2125 and give Virgin’s investors a 38% stake in the new company. Up to 1,500 jobs are thought to be at risk in the new venture, with CYBG boss David Duffy taking control of the combined company. 
 
Senior staff at Sky will share a pay-out of at least £350 million from the expected takeover of the broadcaster later this year. Comcast last week announced a proposed £12.50-a-share offer for Sky, valuing the company at £22 billion and beating a longstanding offer of £10.50 per share from 21st Century Fox, which already owns a 39% stake in Europe’s largest pay-TV company. If the Comcast deal is finalised in the autumn as expected, Sky’s investors would collect about 28 million shares, equivalent to an average pay-out of at least £500,000.
 
Debit card transactions overtook cash as the UK’s most popular form of payment for the first time in 2017, new figures from UK Finance have revealed. According to the industry group’s annual UK Payment Markets report, the annual volume of cash transactions fell by 15% year-on-year, with a doubling in the number of contactless payments since 2016 behind the rise of debit card transactions. 

Markets

The week ahead
Investors will be looking out for two big events from the world’s central bankers this week; the ECB central banking forum to be held in Sintra, Portugal on Monday, and the Bank of England’s rate meeting and Mansion House Speech on Thursday. 
 
Monday’s forum will feature speeches by ECB president Mario Draghi and US Federal Reserve chair, Jay Powell, who have both made headlines in the past week by their decisions to change fiscal direction by increasing interest rates. Expect scrutiny to be more intense in Draghi’s case, given the ECB’s further decision to end its long-held quantitative easing programme last week.
 
On Thursday, Chancellor Philip Hammond and BoE governor Mark Carney will use the annual Mansion House dinner in London to set out their updates on the state of the UK economy. Given the widely-held expectation that the Bank’s Monetary Policy Committee will leave interest rates unchanged when they meet earlier in the day, scrutiny will be more focussed on Hammond, who investors hope will outline a plan for financial services after Brexit.
 
On Wednesday, corporates are in the limelight as Berkeley Group reports full-year earnings and MPs vote in a one-off evidence session on the proposed merger of Asda and J Sainsbury. Details of the session are tightly guarded, with the possibility of appearances by Asda CEO Roger Burnley and his counterpart at Sainsbury, Mike Coupe.
 
Tailing out the week are parliamentary and presidential elections in Turkey on Sunday, which despite President Recep Tayyip Erdogan’s ascendancy, has surprised commentators as a tighter race than many expected. Some have entertained the possibility that Erdogan may lose his parliamentary majority, which would send the already-plunging lira further down, having lost around one-fifth of its value since the start of the year.

AGMs
Angling Direct
Ascent Resources
Boston International Holdings
Comptoir Group
Cyanconnode Holdings
Directa Plus     
EVR Holdings
Horizon Discovery Group
ICG Enterprise Trust
IP Group
MHP SE GDR (Reg S)
Papua Mining
Premier Technical Services Group
OJSC Rostelekom ADR (level I)
Mission Marketing Group

Finals  
Thalassa Holdings Ltd. (DI)
 
Interims
Standard Life Private Equity Trust

GMs
Standard Life Private Equity Trust

 

Columns of Note

The director of Reform Scotland, Chris Deerin, writes in The Times Thunderer column that Scotland should be removed from immigration targets in order to boost the working-age population. Deerin points out that Scotland has the lowest rate of fertility of any UK nation or region, with the number of pensioners expected to increase by 25% over the next 25 years, including a 79% increase in the number of those aged over 75.
 
In The Sunday Times yesterday, Kevin Pringle comments on the recent debacle over the passage of the EU Withdrawal Bill in Westminster and the importance of words. Pointing to the Secretary of State for Scotland’s comments that “Scotland is not a partner of the UK; Scotland is part of the UK”, Pringle suggests the UK government’s approach highlights an unhelpful turn for British unionism, and is out of step with political feeling in Scotland.

Did you know?

If you want to say good luck or ‘break a leg’ in Italian, you say; “In culo alla balena!”, meaning literally; “Into the arse of a whale!”

Parliamentary Highlights

TODAY
 
House of Commons
Oral questions
Housing, Communities and Local Government (including Topical Questions)
 
Emergency Debate
Sewel Convention - Ian Blackford
 
Motion
Statutory Instrument relating to the Draft European Union (Definition of Treaties) (Canada Trade Agreement) Order 2018 - Dr Liam Fox
 
European Documents relating to EU Trade Agreements: EU-Japan Economic Partnership Agreement - Greg Hands
 
General debate
Acquired Brain Injury
 
Adjournment
Accessibility challenges for people with invisible disabilities - Martin Whitfield
 
House of Lords
Oral questions
Impact on hospices of NHS pay increases and the ability of voluntary hospices to access additional funding - Lord Goddard of Stockport
 
Improving performance on immigration matters in the Home Office - Lord Roberts of Llandudno
 
Bringing private burial grounds in line with cemeteries and burial grounds regulated by statute - Baroness Hussein-Ece
 
New exploration and recovery of oil and gas from the UK's continental shelf - Lord Bruce of Bennachie
 
Legislation
European Union (Withdrawal) Bill - Consideration of Commons amendments - Baroness Evans of Bowes Park, Lord Callanan
 
Scottish Parliament
No business scheduled
 
TOMORROW
 
House of Commons
Oral questions
Health and Social Care (including Topical Questions)
 
Ten Minute Rule Motion
Representation of the People (Gibraltar) - Craig Mackinlay
 
Opposition Day Debate
Subject to be announced
 
Adjournment
Chronic Regional Pain Syndrome - Ruth George
 
House of Lords
Oral questions
Short-term holiday lets and legal requirements - Baroness Gardner of Parkes
 
Funding to ensure roads are maintained in a safe condition - Lord Berkeley
 
Improving the outcome of Personal Independence Payment assessments - Baroness Thomas of Winchester
 
Investigation into alleged Russian interference in the EU referendum - Lord Tyler
 
Legislation
Rating (Property in Common Occupation) and Council Tax (Empty Dwellings) Bill - Committee stage - Lord Bourne of Aberystwyth
 
Short debate
Encouraging a recovery in the population of bees and other pollinators - Baroness Bloomfield of Hinton Waldrist
 
Scottish Parliament
Topical Questions (if selected)
 
Ministerial Statement
Progress in EU Exit Negotiations
 
Stage 1 Debate
Scottish Crown Estate Bill
 
Financial Resolution
Scottish Crown Estate Bill
 
Members’ Business
Welcoming Women in Engineering Day – Gillian Martin