This Sunday marked the first day of Autumn and the political climate in the Tory party is neatly echoing the changing season: inter-party politics are increasingly stormy and Brexit negotiations have left Theresa May out in the cold. But what of the opposition? Well, discussions from this week’s Labour Party Conference are beginning to reach our ears, so let’s interpret some of the fresh wisdom. Though from where I’m standing, the view is rather foggy.
Labour’s radical plans for “employee ownership” have already created quite a storm. The policy is based on the idea that every public company with more than 250 staff would have to hand over 10 per cent of the company to its employees over a period of 10 years. Workers would not be able to buy or sell shares, rather they would benefit from dividends paid out by the company, up to a maximum of £500 per worker, per year. Any payments above this threshold would go directly to the government, representing a contribution of over £2 billion per year after five years, according to Labour estimates.
The Institute of Directors has referred to the policy as “draconian”. They claim it would scare off investors and incentivise companies to delist from the stock exchange. The Conservative party remarked that the proposal was “just another tax rise” which discourages companies from hiring. And the general sentiment was scepticism yesterday as pundits scramble for clarity: will employees actually own the shares? Will the plethora of loopholes be closed? Meanwhile, the trade unions see the idea as a “powerful fillup” opportunity for the public coffers.
Shadow Chancellor John McDonnell admitted that the policy had flaws that would need ironing out, not least because employees of privatised utilities wouldn’t receive the bonus as it stands. He said that the policy would allow 11 million workers to “enjoy the rewards of their labour” – actual details of how the payments will work will follow later we assume – as he made an impassioned and “unashamedly socialist” speech at the conference.
Another topic contributing to the foggy feeling was John McDonnell’s will-they-won’t-they approach to a “people’s vote”. Corbyn owes his job to an empowered membership, so it seems fair that he promises them a say on the final Brexit deal, if Labour can’t force a general election first. But McDonnell backtracked yesterday, claiming that “even if the party backed a second referendum”, it would not include the option of remaining in the EU. This attracted outrage from pro-EU Labour MPs and made the party’s position on Brexit even more ambiguous.
But it’s far from sunshine and rainbows for the Conservative party. With the embarrassment of last week’s EU summit still fresh in our minds, the outlook for the next few months is decidedly overcast. (£)
The cabinet has unanimously supported a post-Brexit immigration system based on skills rather than nationality. People from the EU will face the same immigration rules as those from elsewhere, a recommendation of the Independent Migration Advisory Committee (MAC), which was also backed by Labour. May has repeatedly promised to end unlimited immigration from Europe, although some fear that banning low-skilled EU migrants will damage business.
Millions of people have been wrongly told that they are allergic to penicillin, greatly increasing their likelihood of contracting MRSA. More than nine in ten people who believe they are allergic are not, making them 69 per cent more likely to contract the disease, according to the National Institute for Health and Care Excellence. Medical notes from minor childhood reactions stay on records for decades, long after patients are likely to have grown out of the sensitivity. A true penicillin allergy can result in a life-threatening anaphylactic reaction. (£)
Brett Kavanaugh faces further criticism today, as a third woman is expected to publicly make accusations of sexual misconduct. But Trump’s nominee for the Supreme Court says he’s “not going anywhere” as more claims come to the surface. He vehemently denies the allegations and is asking for a “fair process where [he] can be heard defending [his] integrity”. The White House supports him, with Trump referring to the claims as “highly unsubstantiated” and “totally political”.
Business & Economy
Michael Kors is to buy Italian fashion house Versace for $2 billion. The American designer of popular but affordable luxury goods is buying the Italian brand 40 years after Gianni Versace created the brand and 21 years after he was murdered. The company designs, manufactures and distributes clothes, jewellery, watches, eyewear, accessories and home furnishings that bear the company’s distinctive Medusa logo. It has 200 boutiques worldwide and works with about 1,500 wholesalers.
The North Sea oil and gas industry was given a boost yesterday, as Total revealed it had made a significant discovery. The French company said the find could contain one trillion cubic feet of gas, around 176 million barrels of oil, 50 miles North West of Scotland. Oil and gas consultancy, Wood Mackenzie, said the find would be the biggest for a decade and could contribute as much as 10 per cent of the UK’s annual gas production. (£)
The two founders of Instagram have quit the app to “explore [their] curiousity and creativity”. The app is Facebook-owned, with the giant buying the photo-sharing platform for $1 billion six years ago. At the time this was seen as a high-risk move, but is now widely acknowledged as a steal. Instagram is an increasingly important part of the business, as Facebook has seen stagnant growth. This announcement comes less than six months after WhatApp’s founders quit the social media group after clashes with Mark Zuckerberg over privacy and data protection following the Cambridge Analytica scandal.
The FTSE 100 closed 0.4% lower yesterday at 7,458.41 points after the pound regained ground against the dollar. The pound climbed 0.32 per cent against the dollar to $1.31, as well as against the euro, gaining 0.26 per cent at €1.12.
Thomas Cook shares slumped 25% yesterday following a profit warning. They said they would not reach their targets as the heat wave saw more holiday makers opting to stay home. Additionally, shares in Comcast are down 6% over fears they are paying too much for broadcaster Sky. Comcast offered $40 billion in an auction over the weekend.
Meanwhile, the oil price hit a four-year high yesterday with Brent crude reaching almost $81 a barrel as the world’s largest oil producers decided not to increase production. Opec are expected to sit back and see how sanctions and tariffs turn out, so it is likely that oil will trend higher over the coming months.
This increase put pressure on US stocks, which closed lower yesterday after hitting record highs last Friday. The heightened trade tensions between the US and China are also a contributing factor, with the Nasdaq, S&P 500 and Dow down within a range of 0.4% to 0.5%.
Columns of Note
Jonathan Miller examines Macron’s self-destructive Brexit position in The Spectator this week. His steadfast commitment to the EU and deepening its control of member states has seen Theresa May bruised and battered in negotiations. Yet, France exports more to the UK than we do to them and the sharing of populations has been widely beneficial, not to mention EDF, which is “up to its neck in the British power industry”. Why then is Macron taking such a hard line? Miller suggests that Macron is either a victim of grandiosity; suddenly terrified that Brexit will be a success; or convinced that the UK will hold a second referendum. (£)
Hugo Rifkind looks at transgenderism and university debate in The Times, arguing that junior philosophers are “censorious”. This comes after a philosopher at Durham University was accused of belittling “trans experiences” for expressing that people with penises were not women. He was subsequently sacked from all his posts. Rifkind argues that philosophy departments are ignoring debates – which is surely contradictory – and asks “if it is not morally OK to discuss this stuff, is it morally OK to even discuss discussing it?” (£)
Did you know?
There are 16,859 businesses in the UK that contain the word 'son', and only 320 that contain the word 'daughter'.
House of Commons
In recess until Tuesday 9 October
House of Lords
In recess until Tuesday 9 October
Topical Questions (if selected)
Ministerial Statement: Mental Health Strategy - 2018 Annual Report
Scottish Government Debate: Scotland’s Role in the Development of Future UK Trade Arrangements
Government Business and Constitutional Relations
Culture, Tourism and External Affairs
Ministerial Statement: Common Agricultural Policy
Ministerial Statement: Dignity and Respect in Scotland's Security System
Scottish Government Debate: Supporting and Protecting Human Rights Defenders