NEWS – TUESDAY 26TH MAY 2020

NEWS ROUNDUP

TAX NEWS – TUESDAY 26TH MAY 2020

Brussels looks to new taxes to pay off pandemic recovery debt

The European Commission is mulling green taxes and new levies on companies to help pay for a €500bn debt-financed COVID-19 recovery fund.

Financial Times, Page: 4

FINANCIAL SERVICES NEWS – TUESDAY 26TH MAY 2020

City workers expect to spend more time at home

A survey by Deloitte has found that the majority of City workers expect to spend more time working from home after the lockdown has ended. The poll of 500 workers, who live in London and the home counties, found that more than 75% of financial services workers believe that they will work remotely at least one day a week after the restrictions end, up from 41% previously. Only 10% of respondents said they had endured a negative experience operating remotely, while 70% said it had been positive. Richard Hammell, of Deloitte, said: “The City will need to use this experience to reconsider the employee proposition that underpins the financial services industries. Far from being the death of the City, it’s a chance to shape it for the future.” Elsewhere, former City minister Mark Hoban writes in the Telegraph about the need to improve the digital skills of the financial services workforce. “COVID-19 has accelerated the digitisation of the sector and will continue to do so,” he says, adding that increased digitisation will strengthen the sector.

The Times, Page: 32 The Daily Telegraph, Business, Page: 3

CORPORATE NEWS – TUESDAY 26TH MAY 2020

UK ready to take stakes in key industries

Whitehall officials are working on plans for the UK government to take stakes in failing companies deemed vital to the economy. Dubbed “Project Birch”, the plan would give the Chancellor room to rescue individual companies deemed viable but that had exhausted all other options. The move would be unusual in Britain but would echo bailout plans in Germany and France, which are set to take equity states in airlines and carmakers. The news comes amid reports that Jim O’Neill, former Treasury minister and ex-chief economist at Goldman Sachs, has been attempting to persuade the government to set up a sovereign wealth fund to take stakes in “inherently stable” businesses. Lord O’Neill could also lead a new Northern Powerhouse “growth board” to help deliver on Boris Johnson’s election promise to “level up” prosperity across the country.

Financial Times The Daily Telegraph, Business, Page: 1 Daily Mail, Page: 12 Financial Times, Page: 3 The Guardian, Page: 29 The Times, Page: 6 Daily Express, Page: 18

REGULATION NEWS – TUESDAY 26TH MAY 2020

Pre-pack watchdog facing collapse

The Pre Pack Pool’s oversight committee has warned the government that unless referrals of pre-pack sales to it are made mandatory the body is at risk of collapse. The Pool was launched in 2015 to review pre-pack administrations in order to bring greater transparency to the controversial insolvency process. But only about 10% of eligible cases are being referred to the body, which relies on income received from referrals from prospective purchasers. The government’s power to make referrals mandatory under a sunset clause in the Small Business, Enterprise and Employment Act 2015 lapsed yesterday. A spokesman for the Insolvency Service said: “The government will continue to work with the regulators in the insolvency industry to ensure that pre-packs work effectively.”

The Times, Page: 36

PENSIONS NEWS – TUESDAY 26TH MAY 2020

Just 20% of FTSE 100 firms comply with new pension guidelines

A new report from pensions consultancy LCP shows that just one in five FTSE 100 companies are complying with guidelines from the Investment Association recommending bosses’ pension contributions are brought in line with those of their workforce by the end of 2022. The median pension contribution rate for FTSE 100 CEOs is three times higher than for the average employee relative to their salaries, LCP says. Phil Cuddeford, a partner at LCP, said the new guidelines were having an effect but: “With many workers seeing pay cuts or facing job insecurity, it will be increasingly difficult to justify the large divide between top executives and their employees.”

The Daily Telegraph

PROPERTY NEWS – TUESDAY 26TH MAY 2020

Land registry under fire over Amazon contract

HM Land Registry is facing criticism over a cloud contract worth up to £4.8m that it recently handed to Amazon, whose UK boss sits on its board. HM Land Registry chose Amazon Web Services (AWS) to provide software package and information systems back in February, procurement documents show. The contract is thought to be part of an effort by the government organisation to make its systems faster and easier to access. However, the decision to choose Amazon for the cloud hosting services has prompted some concerns, given Doug Gurr, the UK head of Amazon, sits on the Land Registry board as a non-executive director. There is no suggestion that there was impropriety in the decision, but Robert Barrington, a professor of Anti-Corruption Practice at the University of Sussex, said it could damage the public trust.

The Daily Telegraph, Page: 3

ECONOMY NEWS – TUESDAY 26TH MAY 2020

UK companies tap bond and stock markets for £30bn

Some 150 UK companies have raised a total of £30bn from financial markets to shore up their balance sheets against the coronavirus crisis, according to analysis by New Financial and BNP Paribas. Some £25bn has been raised by 50 firms in the corporate bond market, while an additional 100 companies sold £5bn of stock. “Given how important capital markets are today to UK companies and the UK economy, they will have to play a vital role in helping support the economy through this crisis and in fuelling an economic recovery,” said William Wright, founder of New Financial.

The Daily Telegraph, Business, Page: 1

Retailers welcome move to reopen shops

Boris Johnson has announced that all non-essential retailers will be able to reopen in England from 15 June, providing progress on fighting the coronavirus continues. Outdoor markets and car showrooms will be able to reopen from 1 June. New guidance had been published for the retail sector “detailing the measures they should take to meet the necessary social distancing and hygiene standards”, the Prime Minister said. The British Retail Consortium welcomed the announcement, adding it provided “much-needed clarity on the route ahead”.

BBC News Daily Mail

OTHER NEWS – TUESDAY 26TH MAY 2020

German economy sees signs of confidence returning

Business confidence in Germany’s services, manufacturing and export industries increased this month, according to a new survey from Ifo. Katharina Koenz at Oxford Economics said increase in sentiment “hints that the worst could be behind us, although the road to full recovery may be long.”

The Daily Telegraph, Business, Page: 2 The Times, Page: 34

Contact Paul Southward

Paul Southward