Marketing Newscast

(Edited 19 March 2025)

Work and Pensions Secretary Liz Kendall yesterday unveiled plans to cut the welfare bill by £5bn by 2030, but she will allow the overall benefits bill to continue to rise, from around £65bn currently, to some £100m by 2029. Her key aim in yesterday’s announcement, it seems, was to show her aim to put welfare on a more sustainable footing by getting people into work. Blaming the former Conservative Government, Kendall said the current social security system Labour inherited from the Conservatives “is failing the very people it is supposed to help and holding our country back,” while her reforms will “create “a more proactive, pro-work system for those who can work” and protect “those who cannot work now and for the long term”. “Disabled people and people with health conditions who can work should have the same rights, choices and chances to work as everybody else,” she added, while stressing: “Under this government, the social security system will always be there for people in genuine need. That is a principle we will never compromise on”. Kendall announced there would be £1bn a year more put into employment support, with an “expectation to engage”. Although she promised not to freeze or means test personal independence payments (PIP), the main disability benefit in England, Wales and Northern Ireland, she said eligibility would be tightened significantly from November 2026. She also announced a consultation on delaying access to the universal credit health top-up to under-22-year-olds, with savings made spent on training, and a move to “rebalance payment levels” in Universal Credit to “promote work and address perverse incentives” in the system. A consultation is also to be launched on merging the jobseekers and employment support allowance into a new, higher “time-limited unemployment insurance” through reform of contributory working-age benefits. Kendall also spoke of scrapping the work capability assessment by 2028 by folding it into the same one used to assess eligibility for PIP, and legislating for a so-called ‘right to try’ employment, which would allow benefit claimants to seek employment without losing their entitlements if the job does not work out. She also pledged that those with no prospect of any improvement in their health or the ability to return to work will see their incomes protected through an additional premium and will not be reassessed in the future. She also announced a permanent, above-inflation rise to the standard allowance of Universal Credit, equivalent to a £775 annual increase by 2029/30.

THE REACTION: - Shadow work and pensions secretary Helen Whately branded the planned welfare reforms “too little, too late” asking: “Where is the action on people being signed off sick for the everyday ups and downs of life? Why is she only planning to save £5bn when the bill is forecast to rise to over £100bn? Some Labour MPs, however, criticised the plans as being too harsh, among them Diane Abbot and Jeremy Corbyn. Labour’s Greater Manchester Mayor Andy Burnham also said the changes would “trap too many people in poverty,” and former Labour chancellor Ed Balls said the cuts were “not going to work” and “it’s not a Labour thing to do”. Meanwhile, over 100 charities represented by The Disability Benefits Consortium criticised the changes, saying the cuts were “immoral and devastating” and “will push more disabled people into poverty and worsen people’s health”. It urged the Government to abandon the “cruel cuts”. Other charities said the proposals were at odds with Labour’s child poverty strategy and manifesto promises to cut food bank use, and Scope noted the cuts were the biggest on record, even outstripping former Chancellor Geroge Osborne’s ‘austerity’ cuts of the early 2010s. The Resolution Foundation estimated that around a million people will completely lose their right to PIPs; and the Institute for Fiscal Studies suggested the disabled and long-term sick lose as much as £1,200 a year, and that new claimants to the health element of Universal Credit will receive £2,500 less a year than they would have without any changes.

Conservative party leader Kemi Badenoch said yesterday that it is “impossible” to deliver Net Zero by 2050 "without a serious drop in our living standards or by bankrupting us," despite the fact the goal was set by Theresa May’s Conservative government. "I don't say that with pleasure. Or because I have some ideological desire to dismantle it - in fact, we must do what we can to improve our natural world," she said, adding that she said she was not making a "moral judgment" on net zero or debating whether climate change exists, only that her party would "deal with the reality" of the target, something she argued Labour and past Conservative governments ignored. She did not set out an alternative bet zero delivery date, but said she would consider one if her party found a better way of delivering the target.

Net Zero will be responsible for ensuring Britain faces three years of industrial decline and falling factory employment, the EY Item Club yesterday, labelling the policy responsible for high energy prices that are crippling the manufacturing sector. UK energy costs are four times as high as those in the US, and 50% more than those paid by factories in France and Germany, the forecaster said, a fact contributing to its predictions that factory output will shrink by 0.6% this year. Peter Arnold, the UK chief economist at EY, said: “UK businesses currently pay the highest electricity prices in the developed world. This has been driven by high and volatile global energy prices, particularly for gas, which has left the UK exposed given its reliance on gas for electricity and heating and, combined with declining oil and gas production, has not been helpful for prices. The UK has invested heavily in renewables like wind and solar but these are intermittent, as opposed to say nuclear power, and this can also increase pricing volatility.”

The pound hit a four-month high against the US dollar yesterday amid fears that US President Donald Trump’s tariff war will spark a US recession. Sterling climbed 0.1% to spike above $1.30 for the first time since November.

Financial fraud is still rising, according to seven out of ten UK fintechs polled Alloy for its State of UK Fraud Report. 79% of firms said they lost at least £500,000 to fraud in the 12 months to October 2024; two in five recorded losses of between £1m and £5m; and nearly 9% said they lost over £5m.

The report, which surveyed 118 director-level fintech bosses, showed nearly three-quarters of them blamed organised crime rings for the majority of fraud within their business.

2,035 companies filed for bankruptcy in February, a 3% increase on January 2025, but a 7% year-on-year fall. Within those numbers, compulsory liquidations reached their highest level since 2014, and the Insolvency Service data also showed construction to be the sector most likely to fail in the year to January, accounting for 17% of all cases.

Sky News says that Modella Capital, the new owner of The Original Factory Shop is drawing up plans for a company voluntary arrangement which could trigger store closures and rent cuts less than four weeks after it took control of the chain.

Santander has announced it will close 95 of its bank branches across the UK – almost a quarter of the total - putting 750 jobs at risk. The Spanish bank is justifying the move by saying its customers are increasingly shifting to online banking, and that it will also reduce hours at a further 36 branches and remove the front counter from 18 others. Digital transactions have increased by just under two thirds since 2019, Santander said, with a similar drop for transactions in branches.

Shepherd Neame is to put up prices at its pubs, blaming cost pressures from the Government’s tax raid on businesses. From April, the national living wage and employers’ national insurance contributions (NICs) will increase, adding costs that have “undermined business and consumer confidence in the short term”, CEO Jonathan Neame said, adding that it would cost the family business an extra £2.6m. Shepherd Neame operates 290 pubs and employs 1,600 people.

Bentley says it will press ahead with plans to go ‘all-electric’ despite a recognition by CEO Frank-Steffen Walliser that some drivers will never want to give up petrol or diesel cars and the luxury carmaker’s ambition could scare off some customers. Bentley has recently begun work on its first electric vehicle production line in Crewe, Staffordshire.

AIM listed Big Technologies has suspended its CEO Sara Murray, citing concerns about her conduct related to ongoing litigation brought by former shareholders of Buddi Limited, a subsidiary of Big Technologies, related to its 2018 acquisition. CFO Daren Morris has assumed the role of interim CEO.