FirstFT: Sunak prioritises NHS, skills and levelling up in Budget windfall
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Rishi Sunak will use this week’s Budget to shore up the UK’s fragile public finances, while focusing remaining resources on the NHS, the “levelling up” agenda, skills and helping hard-pressed families.
The chancellor is expected to be given a short-term Budget windfall by the Office for Budget Responsibility, which is set to upgrade its forecasts to show stronger growth in 2021 and 2022.
Sunak will use some of this fiscal boost to pay for key government priorities — including helping families through a cost-of-living crunch this winter — but he will also bank some of it as insurance against future economic shocks.
The chancellor admitted yesterday that Britain’s public finances were more exposed to changes in interest rates than most other advanced economies, while the Covid-19 crisis remains a threat to the economy.
Have feedback on the newsletter? You can reach me at [email protected]. Thanks for reading FirstFT Europe/Africa. Here’s the rest of today’s news — Gary
Five more stories in the news
1. Poland PM accuses EU of holding ‘gun to our head’ Mateusz Morawiecki promised to dismantle a disciplinary chamber for judges that the European Court of Justice found to be illegal by the end of the year. But he warned that if the European Commission “starts the third world war” by withholding promised cash to Warsaw, he would “defend our rights with any weapons which are at our disposal”.
2. UK ‘gigafactory’ set for huge expansion Envision, the Chinese company behind the UK’s only “gigafactory”, is planning a huge expansion of the Sunderland facility and looking to spin off its electric vehicle battery division as it builds its European business.
3. Brussels warned over delaying capital rules for EU banks The secretary-general of the Basel Committee on Banking Supervision has warned the EU not to delay the next phase of global banking rules, as draft plans show that Brussels is suggesting giving European banks a two-year extension to an internationally agreed deadline.
4. UK exporters falling foul of post-Brexit trade rules Many British businesses that export to Europe are failing to comply with a key element of the EU-UK Trade and Cooperation Agreement and could face a flood of disruptive enforcement actions by the bloc’s customs authorities next year, industry insiders have warned.
5. UniCredit walks away from Monte dei Paschi rescue The Italian government and UniCredit have called off negotiations over the acquisition of troubled lender Monte dei Paschi di Siena, after attempts to reach a deal over a costly recapitalisation fell through.
The day ahead
Earnings The earnings season will be in full swing over the next seven days with 200 S&P 500 companies reporting results in the US and many others doing likewise in Europe. Facebook, HSBC, Michelin and Posco report third-quarter earnings today.
Facebook whistleblower testifies Frances Haugen, a former Facebook product manager, will give evidence to a UK parliamentary committee today. Among the findings from internal documents Haugen released: Facebook’s services were used to spread religious hatred in India. (FT, WSJ)
What else we’re reading and listening to
Mozambique reels from ‘tuna bond’ scandal The admission of fraud in Mozambique’s $2bn “tuna bond” scandal put Credit Suisse in the spotlight last week, but the corruption in one of the world’s poorest countries has been on lurid display in the African nation’s biggest ever graft trial.
Saudi Arabia flexes its economic muscles The cosy relationship companies based in the United Arab Emirates have enjoyed with Saudi Arabia — the main market for many Gulf businesses — is being shaken up. Saudi Arabia’s “awakening” is reverberating through boardrooms of local and multinational businesses based in the Gulf state.
Indra Nooyi: ‘Companies like ours are little republics’ The former PepsiCo chief, over a $28 plate of grilled cheese and tomato soup at the Baccarat Hotel, weighed in on changing giant businesses, how to help more women succeed — and why obesity is not the food industry’s fault alone.
Pawternity leave a step too far in pandemic pet boom The idea of “PETernity leave” has taken off during the pandemic as pet ownership has boomed. But demands for time off to be with lockdown critters is jarring when millions still lack paid parental leave, writes Pilita Clark.
Listen: Hell of an Episode, with Jason Mott In this week’s edition of the FT Weekend podcast, FT’s Lilah Raptopoulos talks to Jason Mott on his novel Hell of A Book and goes shopping for trainers with financial commentator and style columnist Robert Armstrong.
House & Home
Madison Darbyshire, my FT colleague in New York, this summer drove nine hours to buy a bed. She’s among the many millennials forsaking flat-packs for second-hand furniture. Meanwhile, the cost of antiques has skyrocketed in the past few years as their popularity has grown. Nostalgia is in vogue.
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