Today’s digest is all about austerity and AAA. After the autumn statement George Osborne is under pressure as he admitted he has missed his debt reduction target and been forced to extend his austerity programme to 2018. Some of the papers report that at last we are all in this together as Osborne targeted both rich and poor, but as ever the very rich are still doing nicely. Osborne targeted benefits yet again slashing another £3.7 billion from the bill, and added more austerity with £10 billion of more cuts that could see 1.1 million more jobs lost in the civil service. £1 billion was also cut from pensions tax relief, while a sop to the driver was a cancellation of a planned rise in fuel duty. He did announce £5 billion for [free] schools, but at the same time proposed scrapping national pay for teachers. Despite the fact that many companies don’t pay tax, Osborne gave his buddies in business a one per cent cut in what the Telegraph termed: “Business put at heart of last ditch drive to rescue ailing economy.“ When the Telegraph is not impressed the Tories at heart are worried.
Unite general secretary Len McCluskey said: "Last year’s promise of £21 billion in investment has failed to materialise. £5 billion worth of investment has to be welcomed, but it is small beer given the scale of the problems before us. Working men and women will ask: Where are the jobs? Can we face the future without fear? This statement offers them no change and no hope. Osborne’s chill wind is howling through the households of millions of ordinary people. It will punish our people for years to come unless we have a change of course and a government that invests in growth and jobs.”
So the option is end Plan A and more austerity, engage Plan B for bye bye Osborne, and then deliver Plan C by stopping the cuts and implementing investment and a real strategy for growth and jobs.
One sliver of good news on the day was that Starbucks has realised its brand is getting contaminated so it has caved in and said it will pay some corporation tax, how much remains to be seen, although because the company is negotiating with the authorities – notorious for cutting nice deals for large firms – don’t expect it to be too high.
And finally there looks like a cap on pay day lenders will be forthcoming as the FT reports that vulnerable, low income borrowers are to be protected by new rules in 2014 after the financial watchdog indicated it will set limits and the government finally agreed to accept an amendment to the finance bill going through parliament. Len McCluskey sounded a cautious note: "This is good news and a step in the right direction. But as we wait for the new powers to come into force, legal loan sharks will still be preying on the misery of ordinary people forced to borrow to make ends meet. A squeeze in living standards not seen since the second world war, soaring energy prices, cuts in benefits and falling wages means more and more people are being forced into the clutches of these payday vultures.”
And finally a few business stories are circling, there is bad news in the services sector which looks like it could herald the triple dip recession, Tesco is in trouble in the US where it may exit from Free and Easy, Citigroup is to axe 11,000 jobs, while Virgin will operate the West Coast Mainline for the next two years. In aviation easyJet’s CEO has seen her pay soar, while in defence Berlin should get parity with Paris in EADS, but perhaps the story that has most interested the subs is that yet another iconic British firm has been sold abroad, this time United Biscuits has offloaded its snacks business to Germany, so it is bye bye Hula Hoops, adieu to KP Nuts and wilkommen to Wheat Crunchies…
(no links all stories behind paywall)
- Autumn statement: Hard road to 2013 – million drawn into higher tax (p1/6-10)
- Met silences whistleblower who voiced concerns over reforms (p18)
- The chancellor’s glass is still only half full – John Cridland (p30)
- Citi’s new man shows who’s boss (p47) [and cuts jobs]
- Tesco considers closing US operations (p51)
- Young and old hit by sweeping Irish cuts (p53)
- Germans take hold of Hula Hoops (p57)
(no links all stories behind paywall)
- Autumn statement: Osborne targets rich and poor but admits defeat on debt goal (p1-9)
- Payday lenders face charge cap (p11)
- EADS shake-up gives Berlin equal power to Paris (p23)
- Citi cuts 11,000 (p23)
- Alstom led consortium in S Africa train deal (p24)
- Stagecoach to expand rail division (p29)
- Starbucks to open 1,500 US outlets (p31)
Edited by Mik Sabiers