Rachel Reeves has defended her decision not to restore a cap on bankers’ bonuses, arguing businesses do not need “more chopping and changing”.
The shadow chancellor said that when the government scrapped the cap under Liz Truss, Labour did not “feel that was the right priority in that budget”.
But she said much stronger rules were now in place since the 2008 financial crash, when the cap was first introduced, and that it was no longer her priority to restore it.
“What I hear loud and clear from business is that what it will take to get them to invest in Britain is stability and the last thing they need is more chopping and changing,” she said.
“The chopping and changing has got to end if we’re going to give stability to business and that’s why we will not be bringing that back.”
Image: Shadow chancellor Rachel Reeves addressing 400 business leaders at the Kia Oval on 1 February 2024. Pic: PA
Addressing Labour’s business conference in central London this morning, Ms Reeves also announced she would not increase the headline rate of corporation tax of 25% during the first term of a Labour government but left the door open to changes in the rate in the future.
She said: “There have been 26 changes to our corporation tax arrangements in this parliament alone. We can’t go on like this.
“The next Labour government will make the pro-business choice and the pro-growth choice: We will cap the headline rate of corporation tax at its current rate of 25% for the next parliament.
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“And should our competitiveness come under threat, if necessary we will act.”
Ms Reeves also said Labour would maintain full expensing and the annual investment allowance and would provide a “road map” for business taxation within the first six months of government.
Ms Reeves has sought to portray herself as pro-business during her time as shadow chancellor, in contrast to her predecessor John McDonnell, who led Labour’s economic policy when Jeremy Corbyn was the leader of the Opposition.
Will Labour stick to £28bn a year green pledge?
However, the shadow chancellor is facing scrutiny over Labour’s pledge to spend £28bna year on green projects until 2030 if the party comes into power.
In a Q&A following her speech, Ms Reeves failed to commit to the policy, which some in Labour want Sir Keir Starmer to drop because it allows the Conservatives to cast doubt on the party’s commitment to fiscal discipline.
Asked by Sky News’s political editor Beth Rigby whether the pledge had become “an albatross around your neck” that “threatens to unravel all the hard work you’ve done to be trusted with economic competence”, Ms Reeves said there were “big opportunities to invest alongside business in the jobs and the industries of the future”.
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Will Labour spend £28bn?
But she said it was “absolutely essential that all of our policies are consistent with our fiscal rules” and that the green prosperity plan “was no exception to that”.
The shadow chancellor said that after the next budget, the party will “set out our plans and ensure they are consistent with our fiscal rules because they will always take precedence to guarantee the economic security of family finances and of businesses as well”.
Image: Sir Keir Starmer and Rachel Reeves during a visit to the London Stock Exchange Group last year. Pic: PA
Tories attack Labour over bonus cap change
The cap on bankers’ bonuses was first introduced in the wake of the 2008 financial crisis to limit annual payouts to twice a banker’s salary, but it was scrapped by former chancellor Kwasi Kwarteng during Ms Truss’s short time as prime minister.
During Prime Minister’s Questions this week, Rishi Sunak seized on the issue to argue that voters “cannot trust a word he [Sir Keir Starmer] says”.
“I was genuinely surprised that, after recently and repeatedly attacking not just me but the government for lifting the bonus cap, the shadow chancellor has announced, just today, that she now supports the government’s policy on the bankers’ bonus cap.”
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Sunak: ‘It’s the same old Labour party’
Ms Reeves and other senior Labour figures had been vocal critics of the government’s decision to axe the cap during a cost of living crisis, saying only three months ago that the decision to allow unlimited bonuses to be earned again “tells you everything you need to know about this government”.
The issue has caused some division within Labour, with Anas Sarwar, the party’s leader in Scotland, previously criticising Ms Truss as a “Thatcher tribute act” who would rather “boost bankers’ bonuses than help those in need”.
He told reporters in Westminster today that he stood by his previous words but added: “You have got to look at it in the balance. We have got to inspire confidence for them to make the strategic investments, but we can’t return to a situation where they get away with it.
“I’m not here to defend bankers’ bonuses, I’m not here to defend banks. That is something the UK Treasury has got to keep an eye on.”
Stephen Flynn, the SNP’s leader in Westminster and Labour’s main opponent in Scotland, sarcastically praised Mr Sunak for convincing the Labour Party to agree to a “bleak future”, saying it was a “great achievement” for the government.
A 21-year-old man has been arrested over a series of arson attacks, police have said, after a fire at a house owned by Prime Minister Sir Keir Starmer.
The suspect was arrested in the early hours of Tuesday on suspicion of arson with intent to endanger life, according to the Metropolitan Police.
He remains in custody.
Emergency services were called to fires at the doors of two homes in north London within 24 hours of each other – one just after 1.35am on Monday in Kentish Town and the other on Sunday in Islington. Both properties are linked to Sir Keir.
Image: Police are investigating links to several fires, which they are treating as suspicious. Pic: LNP
Detectives were also checking a vehicle fire last Thursday on the same street as the Kentish Town property to see whether it is connected.
Part of the area was cordoned off as police and London Fire Brigade (LFB) investigators examined the scene.
Neighbours described hearing a loud bang and said police officers were looking for a projectile.
Image: Emergency services were deployed to the scene in Kentish Town, north London, on Monday. Pic: PA
Image: Pic: PA
The prime minister is understood to still own the home, which was damaged by fire on Monday, but nobody was hurt. Pictures showed scorching at the entrance to the property.
Sir Keir used to live there before he and his family moved into 10 Downing Street after Labour won last year’s general election. It is believed the property is being rented out.
In the early hours of Sunday, firefighters dealt with a small fire at the front door of a house converted into flats in nearby Islington, which is also linked to the prime minister.
Image: Counter-terror police are leading the investigation. Pic: LNP
In a statement, police said: “As a precaution and due to the property having previous connections with a high-profile public figure, officers from the Met’s Counter Terrorism Command are leading the investigation into this fire.
“Enquiries are ongoing to establish what caused it. All three fires are being treated as suspicious at this time, and enquiries remain ongoing.”
The prime minister’s official spokesman said: “I can only say that the prime minister thanks the emergency services for their work and it is subject to a live investigation. So I can’t comment any further.”
Kemi Badenoch has condemned the suspected arson attacks.
Writing on X, the Conservative leader said: “This is a shocking incident. My thoughts are with the prime minister and his family. No one should face these sorts of threats, let alone people in public service.
“It’s an attack on our democracy and must never be tolerated.”
Shadow justice secretary Robert Jenricktold Sky News on Tuesday: “It’s important that the prime minister and anyone in public life has their family, their homes, protected.
“It is absolutely wrong, disgraceful, for any individual to take the kind of action that we saw against the prime minister’s home.”
Marks & Spencer has revealed customers’ personal data has been taken by hackers after it was hit by a damaging cyber attack.
The retail giant’s chief executive Stuart Machin said the data had been accessed due to the “sophisticated nature of the incident” but stressed that this does not include “usable payment or card details, which we do not hold on our systems”.
There is also no evidence that account passwords have been shared, according to the statement.
M&S did not say how many customers had been affected but in a social media post, Mr Machin said there is “no need for customers to take any action”.
“To give customers extra peace of mind, they will be prompted to reset their password the next time they visit or log on to their M&S account and we have shared information on how to stay safe online,” he said.
M&S had 9.4 million active online customers in the year to 30 March, according to its last full-year results.
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Who is behind M&S cyberattack?
A cybersecurity expert told Sky News, however, that the lack of sensitive data being shared “does not mean that customers are not at risk”.
“With simple data such as names, email addresses, and potentially other personal details like addresses or phone numbers, which have been reported as accessed, attackers can use this information to create highly targeted and convincing phishing emails or text messages,” said Tim Grieveson, CSO at ThingsRecon.
“These emails from attackers can appear very legitimate because they use real personal information.”
He added that stolen personal data can be used “as pieces of a puzzle by fraudsters”.
Image: An M&S in Aberdeen on 29 April. Pic: SponPlague
“For example, if an attacker has your name and address, they might combine it with other publicly available information to attempt to open accounts or conduct other fraudulent activities.”
M&S has been struggling for weeks after hackers, reportedly from the Scattered Spider group, attacked their networks.
Image: M&S’s recruitment page on 1 May. Pic: M&S
The British retailer was forced to halt recruitment amid the ongoing attack that became apparent on Easter Monday.
Shelves around the country have been bare and customers are unable to shop online.
An employee at M&S’s head office, who spoke to Sky News on condition of anonymity, said that last week had been “just pure chaos”.
“We didn’t have any business continuity plan [for this], we didn’t have a cyber attack plan,” the source said.
“In general, it’s lots of stress. People have not been sleeping, people have spent their weekends working, people sleeping in the office – just reactive response.”
The Co-op also faced a similar major incident and was forced to apologise after hackers managed to access the data of a “significant number” of past and current members.
In the same week, luxury department store Harrods also suffered an attempted hack and temporarily restricted internet access across its sites as a precautionary measure.
The National Crime Agency has said it is investigating the attacks individually but is “mindful they may be linked”.
Steve first spotted the eye-catching stickers while walking to the shops in Burton upon Trent. Plastered on bins and lamp posts, they featured a shiny, green cannabis leaf with a QR code and the words “get your delivery”.
The former prison officer, who is in his 50s, wanted to try the Class B drug as an alternative to prescribed opiates to ease his pain after breaking his back in three places.
He had only recently moved to the Staffordshire market town and was reluctant to buy off the street. “I didn’t want to just tap up some roadman,” he says.
Using his smartphone camera, he was taken to a slick, colourful site on the open web offering a wide range of cannabis products – from vapes and tinctures to pre-rolled joints, buds and gummies.
Just like legitimate online shops, it promised free delivery to arrive the next day and had glowing reviews on Google and Trustpilot.
Steve (not his real name) went on to order products including vapes and herbal cannabis.
“The first time I was shaking… when the postman came down the path – the package absolutely stank,” he says.
“It’s letterbox shaped so you don’t get a knock. The postman shoves it through your door and that’s it – job done.”
(Watch a video demonstration of how the QR codes work)
Similar stickers have been reported across the UK, from cities such as Birmingham, Glasgow and London, to smaller towns including Shrewsbury, in Shropshire, and Droitwich, in Worcestershire. There have also been sightings in South Wales.
Some have appeared near schools, universities and police stations.
Hidden gang network
A Sky News investigation has identified three different sticker designs, each of which directs users to separate, but linked, websites (which we are not naming), with their own branding.
Hidden in their source code is a long list of bank accounts and business names which are randomly selected when users make a purchase.
Image: One of the stickers on a litter bin
Using publicly available tools, we were able to build a network map of the businesses involved, the people behind them and how they are linked.
All are Lithuanian nationals, mostly registered to addresses in a small area of east London, one of which is linked to an alleged gangster found guilty of kidnap and torture in Lithuania.
Royal Mail tracking details also suggest the operation is based in this area as the packages passed through Romford’s mail centre.
An analysis of Bitcoin wallets – carried out by TRM Labs – shows one of the sites had received around $109,000 (£82,000) by mid-March, although the true income is likely to be far higher as more buyers use regular bank transfers than cryptocurrency.
When we visited a woman who owns two of the houses associated with the bank accounts, she said she had never heard of the website and had no idea a criminal enterprise may be being run from her properties.
She also said three Lithuanian nationals we identified as being connected with the site had left the UK.
Image: Former NCA head of drugs Tony Saggers says it shows the ‘evolution of online drug markets’
Former head of drugs threat and intelligence for the National Crime Agency (NCA), Tony Saggers, says the scale of the operation suggests those behind it have access to wholesale quantities of cannabis, which has probably been grown in the UK.
It also demonstrates the “evolution of online drug markets” from the dark web to open websites, “making them more accessible to the wider population”, he tells Sky News.
Ben (not his real name), a student in his early 20s, scanned a QR code sticker out of “genuine curiosity” after spotting it on a telecoms cabinet near the University of York.
He’d never bought or used drugs before but says he “had a moment of free will and the risk of losing money was minimal so I tried it”.
“Perhaps it’s something to do with the website, it’s like you are buying a professional regulated product so that made me worry less.”
A £10 pre-rolled joint arrived by Royal Mail first class post in “branded packaging and looked clean and professional”.
However, he says he didn’t enjoy smoking it and for his “mental health” hasn’t bought any more.
Image: A £10 pre-rolled joint arrived by first-class post
‘Russian roulette’
Dr Simon Erridge, research director at Curaleaf Clinic, where specialist doctors can legally prescribe medical cannabis, says people like Steve and Ben are playing “Russian roulette”.
The clinic has run a campaign using its own QR code stickers, which direct people to results from its study with Manchester Metropolitan University.
It found 90% of 60 illegal cannabis samples seized by the Greater Manchester and Northumbria police forces were contaminated with mould, yeast, lead, E.coli or salmonella.
An analysis of WEDINOS data, a service that tests drugs sent in by users, found 43% of the 1,635 samples bought as cannabis contained no compounds naturally derived from the plant.
Some 38% contained harmful substances, with 27% containing synthetic chemicals such as spice, a drug which is popular in prisons and that can cause dangerous side effects including cardiac arrest.
The clinic’s research also shows consumer habits are changing.
A survey of 500 cannabis users last year found that while street dealers are still the most common source (45%), just above friends and family (44%), more people are buying online.
Image: A clinic is running its own QR campaign to inform people about the risks. Pic: CuraLeaf Clinic/Third City PR
Some 7% said they had engaged with QR codes, while the use of websites offering illegal cannabis products almost doubled from 6% in 2022 to around one in ten (11%) in 2024.
The trend is even more pronounced among young adults, with 15% of 18-24-year-olds buying cannabis online.
Sarah (not her real name), a professional in her 40s, says “buying on the streets isn’t an option for me”. She has bought fake cannabis vapes through Instagram in the past.
But she says tests confirmed THC was present in a vape she bought through one of the websites.
It’s illegal to possess and sell products containing THC without a prescription, but Sarah says she’s more worried about losing money if the package gets intercepted.
“I don’t think the police would do much anyway,” she says.
What are police doing about it?
Supply can carry a maximum 14-year prison sentence, with five years for possession, although those caught with a small amount of cannabis are often dealt with by way of a warning or on-the-spot fine.
Police are aware QR code stickers are being used to sell drugs and see it as part of the evolution of how criminals have adopted technology.
They believe they could be used as evidence in future prosecutions, although none of the forces we contacted, where the issue has been reported, were able to point to any arrests.
Derbyshire Police says officers are on the look-out for stickers and will remove them when out on patrol but have not yet been able to identify the people responsible.
Detective Constable Matt Pedrick, from West Mercia Police, another area where the stickers have been reported, says any website advertising the sale of cannabis “is probably based outside the UK”.
“We remove the stickers when we find them, and would advise anyone to steer clear of these websites and to remember that drugs laws apply to all drugs regardless of where they are purchased.”
Police also believe the stickers aren’t just a matter for their officers and want councils, businesses and transport companies to remove them – and for postal services to ensure they’re not inadvertently helping supply drugs.
Ex-NCA officer Tony Saggers says the brazen nature of the operation suggests those behind it are “laughing in the face of law enforcement” but doesn’t think it represents decriminalisation by the back door.
He says the combination of an online marketplace and a drug that’s a lower priority for police “make it easier for some people to get away with that for periods of time”.
“But I wouldn’t ever suggest that they’re always going to get away with it because people’s time does come round,” he says.
“And if a site that’s doing well and selling high volumes and increasingly high volumes continues to be successful, they’re more likely to attract attention.”
We contacted the NCA about our findings.
“Many organised crime groups selling drugs use social media and communication platforms to promote and sell their illicit produce,” it said in a statement.
“The NCA is working with partners across law enforcement and government to tackle drug trafficking.”
It suggested we contact the Metropolitan Police and Ofcom, which regulates the postal service.
The Met pointed us to the National Police Chiefs’ Council (NPCC) because “the website covers the UK”, but the NPCC would not provide a comment on the record.