Marketing Newscast

Chancellor Rachel Reeves will tonight unveil what she will call the “biggest set of reforms to the pensions market in decades,” by announcing plans for a Pension Schemes Bill. This will include setting a minimum size limit on defined contribution pension schemes in the private sector – encouraging the pooling of around 60 different multi-employer funds - and consolidate numerous local government pension schemes. By creating such ‘megafunds,’ Reeves hopes to “unlock tens of billions of pounds of investment in business and infrastructure, boost people’s savings in retirement and drive economic growth so we can make every part of Britain better off,” she will say in her first Mansion House speech to City bigwigs this evening. Her speech will claim the plans will give funds greater firepower to invest in a broader range of UK and overseas assets, including infrastructure and high-growth companies, and “unlock” up to £80bn in investment into the UK. "Our pension funds in Britain are too small to be making the investments that get a good return for people saving for retirement and to help our economy to grow," she will explain, basing her reasoning on a Government analysis of pensions which revealed funds begin to return “much greater productive investment levels” once the size of the assets they manage hits between £25bn and 50bn. She will also outline her ambition to amalgamate the UK’s near £400bn local authority pension schemes: currently, 86 different local government pension schemes are managed independently by local government officials and councillors, with each one managing assets between £300m and £30bn. It is believed she will also say she has drawn inspiration from pension models in Australia and Canada, such as the Ontario Teachers’ Pension Plan, which has pooled resources to invest in assets such as Bristol Airport. “Last month’s Budget fixed the foundations to restore economic stability and put our public services on a firmer footing. Now we’re going for growth,” Reeves will say. However, Tom Selby, director of public policy at AJ Bell told City AM: “Conflating a government goal of driving investment in the UK and people’s retirement outcomes brings a danger because the risks are all taken with members’ money. If it goes well, everyone can celebrate. But it’s clearly possible that it will go the other way, so there needs to be some caution in this push to use other people’s money to drive economic growth”.

Reeves will also set out plans for a new mutual council in her Mansion House speech, City AM says, one made up of some of Britain’s largest customer and member-owned firms, including Nationwide, Royal London and the Co-Op Group. The Labour party general election manifesto promised to support “diverse business models which bring innovation and new products to the market” and pledged to “double the size” of the co-operative and mutuals sector.  Across the UK, co-operatives and mutuals, which are owned by their members rather than shareholders, have combined revenues of some £165.7bn. “The Government is committed to unlocking the full potential of the mutual and co-operative sector to support inclusive growth and will work with the sector to ensure it is fully supported to grow,” a Treasury spokesperson said.

More concerns now about the Chancellor’s Autumn Budget, this time from entrepreneurs club Helm, formerly The Supper Club. 59% of its 400 members surveyed - all of them business founders – said they will have to implement a hiring freeze ahead of the employers’ National Insurance Contributions (NICs) increase set to come into effect in April next year. 16% also said they planned to reduce headcount because of the increased costs. “British entrepreneurs put blood, sweat, and tears into keeping their businesses – and the UK’s economy – afloat,” Helm CEO Andreas Adamides said. He added: “After years of struggling with high inflation, tight margins, and a challenging economic environment, this increase in National Insurance could undo the hard work and progress made by scale-ups. This policy is a threat to our nascent recovery and should be reversed before it does major damage.” Helm’s members have a combined annual turnover of more than £8 billion.

The Financial Conduct Authority (FCA) has said it intends to “fundamentally reshape” its controversial ‘name and shame’ policy following a backlash. The FCA had proposed announcing which firms it was investigating before they had been found guilty of any wrongdoing, a move City finance firms said could be devastating to their business, even if they were exonerated. Yesterday, FCA chair Ashley Alder admitted to the House of Lords’ Financial Services Regulation Committee that the way in which the City watchdog had unveiled the policy was “probably not” it’s finest hour, and that several “misunderstandings” had arisen as a result. “We all acknowledged within the organisation that it could have been trailed a bit better beforehand and it didn’t appear in the regulatory grid, which is the place in which forthcoming consultations and proposals are normally positioned,” he told Peers. FCA CEO Nikhil Rathi also told the committee that the FCA will “absolutely not be announcing every investigation,” and that the move was “not a case of us opening up the entire book of investigations, that was never our intention”. He also confirmed plans to inform companies they are being investigated only one day before a public announcement of that fact will change tot ten days’ notice. A new plan will be published by the FCA, Rathi said, “in the next week or so”.

Gas prices have surged to their highest level in a year breaching €46 per megawatt hour for the first time since November. The rise was triggered by a legal case concerning “irregular” gas supplies to Austrian energy group OMV from Russia’s state-controlled Gazprom in 2022, one OMV warned could impact or at worst halt its gas supplies from Russia.

Homebase has gone into administration, but The Range is expected to buy 75 stores - saving around 1600 jobs – in a £30m deal. The Range will also take over Homebase's brand and ecommerce business. All Homebase’s Irish stores are included in the sale, but up to 1,000 frontline and HQ staff are still at risk of losing their jobs unless administrator Teneo can find buyers for the remaining 50 stores nationwide. Homebase has been owned for the past six years by Hilco, the retail investor which bought the struggling chain off Australian group Wesfarmers, under whose ownership it lost hundreds of millions of pounds and almost collapsed completely. The Range trades from more than 200 outlets across Britain selling homewares, furniture and DIY products and, a year ago, it bought the Wilco brand for £5m. The range was founded by Chris Dawson, who has been nicknamed the ‘Del Boy billionaire’ because his £250,000 Rolls-Royce Wraith coupe has the number plate “DE11 BOY”. He told The Telegraph: “We are delighted to be able to save so many stores and jobs, and look forward to adding the Homebase brand and subsidiaries to the expanding Range group of companies.”

Production of UK-made Typhoon jets has “essentially stopped” according to trade union Unite, which fears the Royal Air Force will buy US-made aircraft instead. The Telegraph reports Unite executive Steve McGuinness as having written a letter to MPs on the Defence Select Committee which says: “As it stands, there are currently no Typhoons being final-assembled at Warton site and no orders for any future aircraft”. “We are becoming increasingly concerned with reports that the Typhoons being retired from active RAF service are to be replaced with American-built F-35A aircraft. “This would be a hammer blow to the British aircraft industry and potentially could end the design, manufacture and assembly of fast jets in this country, seriously damaging our sovereign capability.” A BAE Systems plant near Preston was assembling the jets for Qatar following a £6bn order placed by the country seven years ago, but that work is now winding up, and no similar orders are outstanding.

Boohoo is urging its shareholders to reject Mike Ashley’s Frasers group’s attempt to take control of the fashion brand, accusing the FTSE 100 firm of having “ulterior motives”.  Frasers, which is Boohoo’s largest shareholder, is demanding Boohoo does not sell off any assets without shareholder approval, a demand the fashion brand claims could potentially harm the board’s ability to restructure debt. Boohoo owns the Debenhams, Karen Millen and PrettyLittleThing brands, while Frasers owns Sports Direct, Jack Wills, GAME, Evans Cycles, and bespoke tailors Gieves & Hawkes, among other outlets.

Mohsin Issa’s EG Group, the British firm which owns thousands of petrol stations and convenience stores across Europe, the United States and Australia, has paid off hundreds of millions of pounds in debt to clear its immediate obligations, the Telegraph reports.  EG also sold 19 Mini-Mart convenience stores in the US earlier this month, with both deals generating around $400m (£315m) in cash, funds the newspaper understands were used to reduce EG’s debt pile from £10bn to $5.27bn since January last year. Rating agency Moody’s has upgraded EG’s outlook from negative to stable.

P&O Ferries has received more than £400m in loans from its Dubai owner since it sacked UK workers and replaced them with cheaper foreign staff, The Telegraph reports. Accounts for P&O show the Dover-Calais ferry operator has turned to the state-backed DP World three times for support since the dismissals in March 2022.

And finally… “We wanted to let readers know that we will no longer post on any official Guardian editorial accounts on the social media site X (formerly Twitter),” the Guardian newspaper said yesterday, effectively announcing its withdrawal from the social media platform owned by Elon Musk, whom US President Elect Donald Trump has made head of his new Department of Government Efficiency (DOGE). “We think that the benefits of being on X are now outweighed by the negatives and that resources could be better used promoting our journalism elsewhere.” the newspaper added, before going on to denounce the “often disturbing content promoted or found on the platform, including far-right conspiracy theories and racism.”  Admitting that the US presidential election campaign “served only to underline what we have considered for a long time: that X is a toxic media platform and that its owner, Elon Musk, has been able to use its influence to shape political discourse,” the article reassured readers, however, that they will still be able to share Guardian articles on the platform. Shortly after the results of the US election were announced, it was reported elsewhere that Guardian workers were being offered counselling to help them cope with a second Trump term. In his new role, Elon Musk will aim to "dismantle government bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure federal agencies". Musk told a Trump rally in October the thought the US government's budget could be cut by "at least" $2tn from a total budget of around $6.5tn, and that the number of government employees could be significantly reduced. He will run the department alongside former Republican presidential candidate Vivek Ramaswamy, who has already put forward plans to scrap the Department of Education, the Nuclear Regulatory Commission, the Internal Revenue Service and the FBI. The name and acronym of the new department appears to be a play on Musk’s favoured cryptocurrency, Dogecoin.