From Daily Telegraph: Boris Johnson was embroiled in a diplomatic row with Brussels on Friday night after he was accused of using a four-letter F-word to dismiss an ambassador’s question about the post-Brexit needs of British business.
From The Independent: The UK economy will grow at its slowest rate since the financial crisis in 2009, thanks to a lacklustre outlook for consumer spending, business investment and trade, according to a leading business group.
From The Guardian: Britain’s leading employers’ organisation, the Confederation of British Industry, has warned the UK economy will shift down a gear this year and risks remaining in the slow lane.
Cutting its growth forecasts for the year, owing to heavy snowfall in the opening months of 2018 and lingering fears over Brexit, the CBI said it expected the growth rate for the British economy to slow to 1.4%, from 1.8% last year.
The rate of GDP growth is then forecast to fall further still, to 1.3% next year, as the UK leaves the EU.
The downgrade comes as business groups become increasingly worried about the lack of progress being made by ministers in talks with Brussels, amid divisions between senior cabinet members. Business leaders fear there will be little progress made before parliament breaks for its summer recess next month.
From The Guardian: The weakest household spending for three years and falling levels of business investment dragged the economy to the worst quarter for five years, official statisticians have said.
The Office for National Statistics confirmed its previous estimate that GDP growth slumped to 0.1% in the first quarter, while sticking to its view that the “beast from the east” had little impact.
The latest figures will further stoke concerns over the strength of the UK economy, amid increasing signals for deteriorating growth as Britain prepares to leave the EU next year. Some economists, including officials at the Bank of England, thought the growth rate would be revised higher as more data became available.
From ThisIsMoney.co.uk: The Bank of England slashed its economic growth forecast for 2018 today as its policymakers kept interest rates on hold at 0.5 per cent.
Tory council becomes the first in 20 years to ban all new expenditure after ‘completely running out of money’
From Daily Mirror: Tory-run Northamptonshire County Council has become the first council in 20 years to ban all new expenditure after completely running out of money.
From BBC News: The prediction that average UK earnings in 2022 could still be less than in 2008 is “astonishing”, according to an independent economic think tank.
Paul Johnson, director of the politically independent Institute for Fiscal Studies, added that the economic forecasts published in the Budget made for “pretty grim reading”.
He highlighted that since 2014 growth in earnings has been “choked off”.
“We are in danger of losing not just one but getting on for two decades of earnings growth,” he said.
The narrative of the Tory press is that the UK’s debt issues are all Gordon Brown’s doing, and #ToryCompetence (LOL) is saving the day.
This infographic from the Press Association tells an ever-so-slightly different reality.
From The Independent: The UK is on course for the longest period of falling living standards since records began, according to a leading think tank.
From The Guardian: Employers and unions have called for a rethink of the Tory government’s apprenticeship policies after a 59% fall in those taking up trainee posts since a new scheme was launched in April.
Just 48,000 people started an apprenticeship in the final three months of the educational year to July 2017, compared with 117,800 in the same period a year before. The biggest drop came in the lowest level “intermediate” apprenticeships, which dived by 75%, compared with a 48% drop in the most advanced training courses.
Critics of the scheme say the increased costs and complexities are deterring employers from creating apprenticeship posts.
From Financial Times: The International Monetary Fund singled Britain out as a “notable exception” to an improving global economic outlook, as it confirmed a cut to its long-term forecast for UK growth.
From The Guardian: Students appear to be paying a heavy price for the UK’s inflation surge after the Brexit vote, which will drive the interest rate on their loans up by a third to 6.1%.
The rise in inflation, driven by a decline in the value of the pound since June, means students will be charged substantially more interest on their loans, despite the fact that many other consumers are benefiting from record low interest rates. Personal loans from high street banks have rates starting at 2.8%, while five-year fixed-rate mortgages are available from 1.29%.
Student loan interest rates are tied to March’s retail price inflation figure, published on Tuesday. At the moment, new starters and current students are charged 4.6% – the March 2016 RPI figure of 1.6%, plus 3% – on their loans. But from September this will rise to 6.1%, made up of the March 2017 figure of 3.1%, plus 3%.
From Daily Telegraph: High youth unemployment is costing the British economy £45bn per year, according to research from PwC, as well as blighting the careers of workers who miss out on a job in their teens and twenties. The proportion of 16- to 24-year olds not in education, employment or training – known as NEETs – is also uncomfortably high at 17pc.
From BBC News: More than 16m people in the UK have savings of less than £100, a study by the Money Advice Service (MAS) has found.
In five areas of the country, more than half the adult population has savings below that level.
Tory “economic competence”: Britain has biggest fall in real wages since financial crisis of any advanced country except Greece
From The Guardian: Britain has suffered a bigger fall in real wages since the financial crisis than any other advanced country apart from Greece, research shows.
A report by the TUC shows that real earnings have declined more than 10% since the credit crunch began in 2007, leaving the UK equal bottom in a league table of wages growth. Read more
First-time buyers need a £33k deposit to get onto the property ladder and a quarter now stretch mortgages to 35 years
From Daily Mail: The plight of first-time buyers has reached a new level as new research suggests they now need a deposit worth £33,000 on average, while the amount they pay for a home has never been higher.