Self-employed? See if you'll pay more in national insurance

March 10, 2017, 11:00 pm

≫ Next: Being a global free-trading nation isn’t as easy as it looks

≪ Previous: Drive to replace UK-EU trade links with closer ties to Commonwealth

From 2018 you could find that you’re paying hundreds of pounds a year extra

The bottom 40% of self-employed workers will be spared any income losses from the changes to national insurance contributions (NICs) – if they go ahead – according to an analysis by the Institute of Fiscal Studies, but the top 10% will be paying around £430 a year extra.

The poorest 10% of self-employed workers will actually be net gainers from the changes. Low earners will gain from the abolition of “class 2 NICs”, offsetting the rise in the standard rate of national insurance for the self-employed, called “class 4 NICs”, from 9% to 11% between 2018 and 2019. But the average income loss for self-employed workers, according to the IFS, will be £120 a year, adding fuel to the controversy over what was the centrepiece of this week’s budget.

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Being a global free-trading nation isn’t as easy as it looks

March 11, 2017, 8:00 am

≫ Next: We will all need a stiff drink to swallow Hammond’s austerity

≪ Previous: Self-employed? See if you'll pay more in national insurance

As Britain prepares to strike out on its own, there is no shortage of cautionary tales about the difficulties – and dangers – of doing deals

The nature of trade has changed dramatically since the days when Britain’s manufacturing firms dominated the economic scene, refashioning imported raw materials into completed trucks, fridges and aeroplanes under one roof.

Nowadays, British manufacturers rarely get their badge onto a product. Most of their efforts go into intermediate goods, like wings for airliners or components for hatchbacks.

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We will all need a stiff drink to swallow Hammond’s austerity

March 11, 2017, 11:00 pm

≫ Next: Green Investment Bank sell-off racks up at least £1m in fees

≪ Previous: Being a global free-trading nation isn’t as easy as it looks

Despite their conciliatory words, the chancellor and Theresa May are merely continuing the damaging small-state policy of George Osborne

As the immensity of the consequences of the referendum strikes home, the May government is becoming increasingly dependent on the Conservative party’s rediscovery of the need for “infrastructure” and “industrial strategy”.

It was therefore entirely in keeping with the chaotic approach of the Brexiters that Theresa May should sack one of her leading advisers on both these subjects last week, because she did not like Lord Heseltine’s opposition to Brexit.

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Green Investment Bank sell-off racks up at least £1m in fees

March 12, 2017, 8:10 am

≫ Next: The Scottish economy has strengths – but could it make a success of independence? | Larry Elliott

≪ Previous: We will all need a stiff drink to swallow Hammond’s austerity

MPs condemn ‘waste of money’ as documents show controversial £2bn privatisation has cost taxpayers at least £1m in banking and legal fees

The troubled £2bn privatisation of the Green Investment Bank has already cost at least £1m of taxpayer money in consultancy fees, official documents have revealed.

Ministers have promised that the sale of the bank, which has invested in green projects from offshore windfarms to energy-saving street lights, will deliver value for taxpayers’ money. An announcement on the sale to Australian investment bank Macquarie was expected in January but has yet to materialise amid strong political opposition.

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The Scottish economy has strengths – but could it make a success of independence? | Larry Elliott

March 13, 2017, 9:34 am

≫ Next: Single market exit: UK construction 'could lose 175,000 EU workers'

≪ Previous: Green Investment Bank sell-off racks up at least £1m in fees

A plunge in the oil price since the 2014 referendum and a budget deficit appear to make Scotland’s finances less than rosy

Convincing the Scottish people that they would be better off after independence proved beyond Alex Salmond in 2014. Project Fear failed to deliver for David Cameron in the EU referendum last June but it did the trick in Scotland 21 months earlier.

Nicola Sturgeon faces the same tough challenge. Indeed, constructing an economic case for independence looks harder now than it did three years ago. Harder but not impossible.

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Single market exit: UK construction 'could lose 175,000 EU workers'

March 14, 2017, 11:30 pm

≫ Next: Don't be fooled. Britain's not too poor to be decent – video

≪ Previous: The Scottish economy has strengths – but could it make a success of independence? | Larry Elliott

Key projects could be in jeopardy if Britain does not retain access to European single market after Brexit, surveyors warn

The UK construction industry could lose more than 175,000 EU workers – or 8% of the sector’s workforce – if the country does not retain access to the European single market after Brexit, the government has been told.

Such an outcome could put key infrastructure and construction projects at risk at a time when the sector was also facing other pressures, including the tax changes in the recent budget, said the Royal Institution of Chartered Surveyors (Rics).

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Don't be fooled. Britain's not too poor to be decent – video

March 15, 2017, 12:00 am

≫ Next: Government has not assessed impact of leaving EU with no deal

≪ Previous: Single market exit: UK construction 'could lose 175,000 EU workers'

The narrative that Britain is a poor country has been peddled for years, says Hugh Muir. But, he argues, the government is using the excuse of poverty to avoid its moral duties, such as funding the NHS or accepting child refugees. There is money in the pot to fund Trident and the royal family, he claims, so it follows that many budget cuts are purely ideological

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Government has not assessed impact of leaving EU with no deal

March 15, 2017, 4:36 am

≫ Next: Good riddance to the unfair NIC tax rise. Now what about that £2bn black hole? | John McDonnell

≪ Previous: Don't be fooled. Britain's not too poor to be decent – video

David Davis tells MPs analysis of potential economic fallout has not been carried out since he became Brexit secretary

The government has not carried out a full assessment of the potential economic impact of Britain leaving the EU without a trade deal, the Brexit secretary has told a committee of MPs.

One government forecast was made before the referendum on 23 June, but no new study had been carried out while he had been Brexit secretary, David Davis told the exiting the European Union committee.

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Good riddance to the unfair NIC tax rise. Now what about that £2bn black hole? | John McDonnell

March 15, 2017, 10:50 am

≫ Next: Philip Hammond digs deep as he explains his NICs U-turn

≪ Previous: Government has not assessed impact of leaving EU with no deal

The chancellor must tell us how extra social care will be funded, after Jeremy Corbyn, Labour and civic society forced him into a U-turn

The government’s U-turn on the unfair £2bn national insurance hike for the self-employed is a humiliation for chancellor Philip Hammond, who has shredded his reputation after only his first budget – and broke a manifesto promise to do it. Labour opposed the measure from the start: Jeremy Corbyn made our opposition loud and clear in his immediate budget response, and Labour MPs hammered the same message home over the next few days. Opposition came from all sides of the house, and from business organisations like the Federation of Small Businesses, leaving the Tory leadership completely isolated.

The chancellor’s climbdown will be a huge relief to all those self-employed workers and businesspeople, earning as little as £8,000 a year, who faced a serious increase in their tax bill at a time when average pay for the self-employed has fallen dramatically – their average earnings are now just £12,480 a year.

This is the third Tory budget in a row that has resulted in a major U-turn

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Philip Hammond digs deep as he explains his NICs U-turn

March 15, 2017, 10:58 am

≫ Next: South Sudan needs Marshall-style plan | Letters

≪ Previous: Good riddance to the unfair NIC tax rise. Now what about that £2bn black hole? | John McDonnell

It had been absolutely right to raise contributions, the chancellor said, which was why he was no longer going to do it

The phone call had come through just after eight in the morning while Phil “The Undertaker” Hammond was eating breakfast. It was the prime minister ordering him to bury Class 4 NICs. He had tried telling her that doing a U-turn on your only real budget measure less than a week after it had been announced made him and the government look hopelessly incompetent, but Theresa wasn’t having any of it. The Tory backbenchers were on her back. The Daily Mail was on her back. And now she was on his back.

Six hours later The Undertaker rather sheepishly arrived in the Commons to try to explain how it was that, though he still absolutely stood by his budget because it was his budget that was his, he now wanted to fundamentally change it because although he hadn’t broken any promises in the Conservative party manifesto, as that’s not the sort of thing he would ever dream of doing, he had in fact broken the promises he had made in the Conservative party manifesto.

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South Sudan needs Marshall-style plan | Letters

March 15, 2017, 11:16 am

≫ Next: Bank of England keeps UK interest rates on hold as it warns on inflation

≪ Previous: Philip Hammond digs deep as he explains his NICs U-turn

The continued conflict and the impending famine in parts of South Sudan (Editorial, 13 March) is indeed in danger of increasing the “sense that the situation is beyond hope or resolution”. However, it is simply not true that “the international community has nothing to show for its attempts to engage with the government of South Sudan”. UKAid’s programme Girls Education for South Sudan has been immensely and measurably successful in increasing the numbers of girls attending school.

UN evidence shows that girls’ education is the single most powerful spur to reducing malnutrition, maternal and infant mortality, and promoting social and economic development – as argued powerfully by (unlikely bedfellows) Gordon Brown and Boris Johnson. It is crucial not to postpone investment in education until conflict and famine have been overcome. Our long-term partnership with Ibba Girls Boarding School (IGBS) shows that keeping good schooling going during periods of insecurity can act as a beacon of hope and “normality” for the community, and as a prototype for what peace might look like in practice. The school also grows much of its own food on campus, so is able to keep its students and staff from hunger.

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Bank of England keeps UK interest rates on hold as it warns on inflation

March 16, 2017, 5:10 am

≫ Next: Tories condemn May over chancellor's national insurance humiliation

≪ Previous: South Sudan needs Marshall-style plan | Letters

Monetary policy committee is split 8-1 as members decide base rate of 0.25% is appropriate for post-referendum economy

The Bank of England has held interest rates at their record low amid signs of an internal split emerging about how to tackle rising inflation.

The Bank’s monetary policy committee was divided on the rates decision, with Kristin Forbes voting to raise borrowing costs immediately. Other members also indicated that they could join her at future meetings if they felt inflation was rising too quickly.

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Tories condemn May over chancellor's national insurance humiliation

March 16, 2017, 1:29 pm

≫ Next: The Ronald, the Donald – and a hamstrung Hammond

≪ Previous: Bank of England keeps UK interest rates on hold as it warns on inflation

Prime minister accused of shabby treatment of Philip Hammond, while one ex-minister says there is ‘a battle for the future of our party’

Moderate Conservative backbenchers have rallied behind Philip Hammond and said Theresa May should have done more to defend his plan to increase national insurance contributions for the self-employed.

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The Ronald, the Donald – and a hamstrung Hammond

March 18, 2017, 11:59 pm

≫ Next: Brexit-proof the UK economy with more R&D, say employers

≪ Previous: Tories condemn May over chancellor's national insurance humiliation

Though he talked tax cuts, Ronald Reagan in fact turned on the public spending taps, to great effect at home and harm abroad. But 2017 is hardly 1981

For the first few months after his election, Donald Trump was cast by many in the financial markets as the reincarnation of Ronald Reagan. His plans for deep and widespread tax cuts and a bonfire of regulations would, they said, spark a business renaissance akin to that credited to the stetson-wearing president who dominated the 1980s.

Stock market investors lapped up Trump’s speeches and tweets, and sent the main New York share indices to fresh highs. Last October, before the US election, the Dow Jones Industrial Average was chugging sideways below 18,000. By the first week of March, its value had topped 21,000, a rise of almost 17%.

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Brexit-proof the UK economy with more R&D, say employers

March 20, 2017, 12:01 am

≫ Next: City minister in right and proper pickle over financial crime

≪ Previous: The Ronald, the Donald – and a hamstrung Hammond

New CBI campaign says economy risks being left behind unless UK research budget rises to 3% of GDP from 1.7%

Britain must Brexit-proof its economy by ramping up spending on research and development or risk being left behind in the global race to deliver game-changing innovations in areas such as space tourism and robotics, the country’s leading business group has said.

The CBI lobby group will launch a campaign on Monday to urge the government to adopt an ambitious new target for R&D spending of 3% of GDP, compared with the current level of 1.7%.

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City minister in right and proper pickle over financial crime

March 21, 2017, 9:53 am

≫ Next: Police to examine 'Global Laundromat' money laundering allegations

≪ Previous: Brexit-proof the UK economy with more R&D, say employers

We want British banks to lead the way in money laundering, jabbers Simon Kirby, whose floundering doesn’t wash with MPs

Cometh the hour, cometh the man. With Philip “the Undertaker” Hammond still sulking about his budget and refusing to talk to anyone, it was left to Simon Kirby, the City minister who looks like a cross between Swiss Toni and Geert Wilders– though without the gravitas – to take the hit for the government.

Kirby was on a warning. Having recently been relieved of any involvement in Brexit after everyone realised he was hopelessly out of his depth, the Treasury was conducting a process of elimination to discover if there was anything he could do well. On the basis of his answers to an urgent question from Labour on the Guardian’s allegations about British banks processing billions of pounds of dirty Russian money, the answer might well be nothing. Kirby is a man who likes to keep his talents well hidden.

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Police to examine 'Global Laundromat' money laundering allegations

March 21, 2017, 11:33 am

≫ Next: How the collapse in full-time work for men is fuelling record underemployment | Greg Jericho

≪ Previous: City minister in right and proper pickle over financial crime

Minister tells MPs FCA and police will look closely at Guardian reports that UK banks processed $740m from Russian operation

Fraud investigators have launched a review of the activities of Britain’s high street banks following revelations in the Guardian about a $20bn money laundering scam that MPs described as a national disgrace and scandal.

Forced to answer urgent questions in the House of Commons, the Treasury minister Simon Kirby announced the Financial Conduct Authority (FCA) and the National Crime Agency (NCA) would be examining allegations that Britain’s banks processed vast amounts of tainted money from Russian criminals without noticing.

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How the collapse in full-time work for men is fuelling record underemployment | Greg Jericho

March 22, 2017, 12:00 pm

≫ Next: The Trump bump for shares is dented – but watch where the oil price goes | Nils Pratley

≪ Previous: Police to examine 'Global Laundromat' money laundering allegations

With weak full-time employment growth, underemployment is now a better indicator of economic health than the unemployment rate

The latest unemployment rate figures brought the bad news that the unemployment rate is again rising, but perhaps more concerning is that February saw a record level of underemployment. With weak full-time employment growth, underemployment is in many ways now a better indicator of the health of the economy than the unemployment rate.

Before the 1990s recession, underemployment wasn’t really a thing. During the 80s the underemployment rate was rarely above 4%; after it, and the destruction it wrought on full-time work, it was rarely below 6%:

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The Trump bump for shares is dented – but watch where the oil price goes | Nils Pratley

March 22, 2017, 3:33 pm

≫ Next: Jeremy Corbyn says UK should not be afraid of debt to fund investment

≪ Previous: How the collapse in full-time work for men is fuelling record underemployment | Greg Jericho

US and UK markets fell as investors grew impatient with the president’s policies, but lower oil prices could also have a political impact

Let’s be fair to President Trump. The “worst falls” in stock markets since his election last November require perspective. The Dow Jones Industrial Average, which passed the 20,000 mark only in January, was approaching 21,000 before Tuesday’s decline that continued into Wednesday. The previous pace couldn’t have been sustained for ever. Stock markets rarely run in straight lines, especially when the US Federal Reserve has raised rates twice in three months.

It’s a similar story in the UK. Just as the Dow remains above 20,000, so the FTSE 100 index closed on Wednesday 300 points above the 7,000 mark, which it last passed around Christmas time. The Trump bump to share prices has merely received a dent, which was to be expected.

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Jeremy Corbyn says UK should not be afraid of debt to fund investment

March 25, 2017, 6:48 am

≫ Next: UK banks asked to draw up plans to show they are prepared for Brexit

≪ Previous: The Trump bump for shares is dented – but watch where the oil price goes | Nils Pratley

Labour leader responds to Theresa May’s jibes that he wants to bankrupt the country with defence of borrowing to invest

Britain should not be afraid of debt or borrowing money to fund investment, Jeremy Corbyn has said.

The Labour leader responded to Theresa May’s comments that he wants to “bankrupt Britain” by insisting that taking on debt can save money in the long run if it is used to invest.

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