General election 2024: Businesses have a long wish-list from parties

Published

1 year ago

May 23, 2024

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The approach of business to general elections is not what it was.

Not that long ago, it was common for big corporates to make donations to political parties, including big FTSE 100 names such as SmithKline Beecham, United Biscuits, General Accident and Whitbread.

Most of these donations would go to the Conservatives but there were some companies, such as Marks & Spencer and Pearson, which also made donations to other parties.

Some, such as Hanson – whose founder Lord Hanson was a loyal supporter of Margaret Thatcher – continued to do so even after the 1992 Cadbury Report recommended companies stop making contributions to political parties.

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Even after the political contributions dried up, FTSE 100 chief executives were not shy about endorsing or criticising politicians at election time.

In 1997, a number of well-known business people including Robert Ayling of British Airways, Bob Bauman of the old British Aerospace (now BAE Systems) and George Simpson of GEC endorsed Tony Blair’s Labour ahead of that year’s election, while John Major’s Conservatives also had plenty of backers.

Business people were also happy to speak out about particular policies. Ahead of the 1997 election, BT’s chairman, Sir Iain Vallance, lashed out at Labour’s proposals for a windfall tax on the privatised utilities while Brian Stewart, chief executive of the pubs and brewing giant Scottish & Newcastle, criticised Labour’s plans to create a Scottish Parliament with tax-raising powers.

None of that happens any more. Most CEOs, while having their own political opinions like the rest of us, prefer to keep them to themselves. The more astute, realising that it makes sense to speak to politicians, are careful to ensure they are seen to be behaving even-handedly and not expressing a preference for one side or the other.

Business wish-lists

That does not mean businesses do not have their own wish-lists of policies.

This is particularly true of small businesses. Their wish-list has not changed in the last couple of decades and is topped by wanting a change in the law to enforce prompt payments from larger businesses to their suppliers and the reform of business rates, which is also a bugbear for larger companies in sectors such as retail and hospitality.

Higher up the corporate food chain, what big businesses crave most is clarity and consistency in policy.

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As Dame Amanda Blanc, chief executive of insurance, savings and pensions giant Aviva, told Sky News today: “Obviously we’re apolitical. What we want is for the environment to be one where we can invest, with certainty. You know, we want consistency and stability and so that whoever is the winner of the election, we want the election to be decisive, and we really want there to be certainty for us to be able to invest in things like UK infrastructure.”

Dame Amanda, who has served on both the prime minister’s business council and on the business taskforce put together by shadow chancellor Rachel Reeves, added: “We’ve invested £9.5bn in UK infrastructure in the last three years.

“Our commitment is £25bn over the next 10 years. In order to do that, you have to have a more certain environment. And so that’s what we look forward to.”

That desire for stability and consistency was why the brief tenure of Liz Truss in 10 Downing Street was so damaging and why, off the record, a lot of business executives will admit to being grateful to Rishi Sunak and Jeremy Hunt for restoring order to public finances after the firestorm created by Kwasi Kwarteng’s mini-budget in September 2022.

They feel it is the first time, since David Cameron was in office, that a PM had the corporate world’s back. Theresa May alienated a lot of globe-trotting CEOs with her infamous 2016 speech in which she said “if you believe you are a citizen of the world, you are a citizen of nowhere”. She was replaced by Boris Johnson who, as foreign secretary in 2018, infamously said “f*** business.” And then came Ms Truss.

If business leaders are grateful to Messrs Sunak and Hunt, there is also warmth towards Sir Keir Starmer and Ms Reeves for their constructive approach.

Yes, there is some unease about deputy Labour leader Angela Rayner’s proposals to ban zero-hours contracts, end fire and rehire and to give workers full rights and protections from day one of their employment.

But there is a sense that after the leadership of Gordon Brown, Ed Miliband and Jeremy Corbyn, who went into the 2019 election campaign threatening to nationalise much of the energy industry, the water industry and BT’s broadband network, this is the most pro-business Labour leadership since the days of the much-missed Tony Blair.

While big businesses chiefly seek stability and consistency of policy, that is not to say they do not have specific wish-lists of their own.

The big leisure, hospitality and luxury goods companies would like the restoration of VAT-free shopping for international visitors, the loss of which, they argue, has driven business away from the UK to destinations like Paris and Milan.

Most businesses with property interests – which is nearly all of them – would like to see a more coherent planning regime. Housebuilders would like a relaxation of rules requiring a proportion of housing developments are devoted to affordable homes.

Shoplifting scourge

Retailers would like the police to be required to make tackling the scourge of shoplifting a greater priority.

Manufacturers, in particular, would like to see an easing to some trade frictions that have built up since Brexit.

And carmakers – currently under threat of being fined if a certain proportion of their sales are not electric vehicles – would like to see a restoration of government incentives to buy EVs and for the roll-out of EV charging points.

Businesses, it is often pointed out, do not have votes.

But they do create the jobs and wealth on which this country relies. Those hitting the campaign trail over the next six weeks will need no reminding of that.

Business

US trade war: The state of play as Trump signs order imposing new tariffs – but there are more delays

Published

12 hours ago

August 1, 2025

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US trade war: The state of play as Trump signs order imposing new tariffs - but there are more delays

Donald Trump’s trade war has been difficult to keep up with, to put it mildly.

For all the threats and bluster of the US election campaign last year to the on-off implementation of trade tariffs – and more threats – since he returned to the White House in January, the president‘s protectionist agenda has been haphazard.

Trading partners, export-focused firms, customs agents and even his own trade team have had a lot on their plates as deadlines were imposed – and then retracted – and the tariff numbers tinkered.

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While the UK was the first country to secure a truce of sorts, described as a “deal”, the vast majority of nations have failed to secure any agreement.

Deal or no deal, no country is on better trading terms with the United States than it was when Trump 2.0 began.

Here, we examine what nations and blocs are on the hook for, and the potential consequences, as Mr Trump’s suspended “reciprocal” tariffs prepare to take effect. That will now not happen until 7 August.

Why was 1 August such an important date?

To understand the present day, we must first wind the clock back to early April.

Then, Mr Trump proudly showed off a board in the White House Rose Garden containing a list of countries and the tariffs they would immediately face in retaliation for the rates they impose on US-made goods. He called it “liberation day”.

The tariff numbers were big and financial markets took fright.

Just days later, the president announced a 90-day pause in those rates for all countries except China, to allow for negotiations.

The initial deadline of 9 July was then extended again to 1 August. Late on 31 July, Mr Trump signed the executive order but said that the tariff rates would not kick in for seven additional days to allow for the orders to be fully communicated.

Since April, only eight countries or trading blocs have agreed “deals” to limit the reciprocal tariffs and – in some cases – sectoral tariffs already in place.

Who has agreed a deal over the past 120 days?

The UK, Japan, Indonesia, the European Union and South Korea are among the eight to be facing lower rates than had been threatened back in April.

China has not really done a deal but it is no longer facing punitive tariffs above 100%.

Its decision to retaliate against US levies prompted a truce level to be agreed between the pair, pending further talks.

There’s a backlash against the EU over its deal, with many national leaders accusing the European Commission of giving in too easily. A broad 15% rate is to apply, down from the threatened 30%, while the bloc has also committed to US investment and to pay for US-produced natural gas.

Where does the UK stand?

We’ve already mentioned that the UK was the first to avert the worst of what was threatened.

While a 10% baseline tariff covers the vast majority of the goods we send to the US, aerospace products are exempt.

Our steel sector has not been subjected to Trump’s 50% tariffs and has been facing down a 25% rate. The government announced on Thursday that it would not apply under the terms of a quota system.

UK car exports were on a 25% rate until the end of June when the deal agreed in May took that down to 10% under a similar quota arrangement that exempts the first 100,000 cars from a levy.

Who has not done a deal?

Canada is among the big names facing a 35% baseline tariff rate. That is up from 25% and covers all goods not subject to a US-Mexico-Canada trade agreement that involves rules of origin.

America is its biggest export market and it has long been in Trump’s sights.

Mexico, another country deeply ingrained in the US supply chain, is facing a 30% rate but has been given an extra 90 days to secure a deal.

Brazil is facing a 50% rate. For India, it’s 25%.

What are the consequences?

This is where it all gets a bit woolly – for good reasons.

The trade war is unprecedented in scale, given the global nature of modern business.

It takes time for official statistics to catch up, especially when tariff rates chop and change so much.

Any duties on exports to the United States are a threat to company sales and economic growth alike – in both the US and the rest of the world. Many carmakers, for example, have refused to offer guidance on their outlooks for revenue and profits.

Apple warned on Thursday night that US tariffs would add $1.1bn of costs in the three months to September alone.

Barriers to business are never good but the International Monetary Fund earlier this week raised its forecast for global economic growth this year from 2.8% to 3%.

Some of that increase can be explained by the deals involving major economies, including Japan, the EU and UK.

US growth figures have been skewed by the rush to beat import tariffs.

The big risk ahead?

It’s a self-inflicted wound.

The elephant in the room is inflation. Countries imposing duties on their imports force the recipient of those goods to foot the additional bill. Do the buyers swallow it or pass it on?

The latest US data contained strong evidence that tariff charges were now making their way down the country’s supply chains, threatening to squeeze American consumers in the months ahead.

It’s why the US central bank has been refusing demands from Mr Trump to cut interest rates. You don’t slow the pace of price rises by making borrowing costs cheaper.

A prolonged period of higher inflation would not go down well with US businesses or voters. It’s why financial markets have followed a recent trend known as TACO, helping stock markets remain at record levels.

The belief is that Trump always chickens out. He may have to back down if inflation takes off.

Business

Trump’s tariffs are back – here’s who is in his sights this time

Published

15 hours ago

August 1, 2025

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'A BIG DAY FOR AMERICA!!!' - Trump's tariffs are back, and will affect dozens of countries

It is “Liberation Day” III – the third tariff deadline set by Donald Trump.

Countries without bilateral trade agreements will soon face reciprocal tariffs – ranging from 25% to 50% – with a baseline of 15% to 20% for any not making a deal.

He has delayed twice, from April to July and from July to August, but hammered this date home in his trademark caps-on style: “THE AUGUST FIRST DEADLINE STANDS STRONG, AND WILL NOT BE EXTENDED. A BIG DAY FOR AMERICA!!!”

“Will not be extended” for anyone but Mexico, it seems. The country secured a 90-day extension at the last minute, with Mr Trump citing the “complexities” of the border.

By close of business on the eve of deadline, he had a handful of framework deals – some significant – including the UK (10%), the EU, Japan and South Korea (15%), Indonesia and the Philippines (19%), Vietnam (20%).

On the EU agreement, which he struck in Scotland, the president said: “It’s a very powerful deal, it’s a big deal, it’s the biggest of all the deals.”

But what happened to the “90 deals in 90 days” touted by the White House earlier this year?

The short answer is they were replaced by letters of instruction to pay a tariff set by the US.

Amid of flurry of late activity, the US played hardball with major trading partners like Canada.

“For the rest of the world, we’re going to have things done by Friday,” said US Commerce Secretary Howard Lutnick – the “rest of the world” meaning everyone but China.

There is, apparently, the “framework of a deal” between the world’s two largest economies, but talks between Washington and Beijing are continuing.

In terms of wins, he can claim some significant deals and point to his tariffs having generated an impressive $27bn (£20.4bn) in June, not bad for a single month.

But the legality of the approach is under siege – with the US Court of International Trade ruling that the “Liberation Day” tariffs exceeded the president’s authority, with enforcement paused pending appeal.

The deadline has stirred the pot, forcing a handful of deals onto the table. Whether they stick or survive legal scrutiny is far from settled.

But the playbook remains the same – threaten the world with trade chaos, whittle it down, celebrate the wins, and pray no one checks what’s legal.

Business

Microsoft is now worth over $4 trn, becoming only second firm ever to pass milestone

Published

1 day ago

July 31, 2025

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Microsoft has become only the second publicly traded company after Nvidia to surpass $4 trn (£3.03trn) in market valuation, after registering huge earnings.

On Thursday, shares rose on Wall Street with the S&P 500 and Nasdaq climbing to new record highs.

Stocks in Microsoft jumped after posting better-than-expected results, helped by its Azure cloud computing platform, which is a centrepiece of the company’s artificial intelligence (AI) efforts.

Shares in Facebook and Instagram’s parent company, Meta, also surged after beating sales and profit targets.

Technology giants Apple and Amazon will report their results after Wall Street’s close.

Microsoft first cracked the $1trn (£760bn) mark in April 2019, but its move to $3trn (£2.27trn) took longer than technology giants Nvidia and Apple.

Nvidia tripled its value in just about a year and clinched the $4trn milestone before any other company on 9 July. Apple was last valued at $3.12trn.

In comparison, the biggest UK company by market value is drug manufacturer AstraZeneca, worth $235.97bn (£178.55bn).

Companies ranked by market value (USD), according to tradingview.com

1. Nvidia (US) $4.43trn
2. Microsoft (US) $4trn
3. Apple (US) $3.12trn
4. Amazon (US) $2.47trn
5. Alphabet (US) $2.35trn
6. Meta (US) $1.95trn
7. Saudi Arabian Oil (Saudi Arabia) $1.56trn
8. Broadcom (US) $1.42trn
9. Berkshire Hathaway (US) $1.03trn
10. Tesla (US) $1.02trn
11. Taiwan Semiconductor Manufacturing (Taiwan) $1trn
29. Samsung Electronics (South Korea) $338.06bn
36. Alibaba (China) $284.62bn
52. AstraZeneca (UK) $235.97bn

While sweeping US tariffs had investors worried about tighter business spending, Microsoft’s strong earnings have shown that the company’s books are yet to take a hit.

Microsoft’s multibillion-dollar bet on OpenAI is proving to be a game changer, powering its Office Suite and Azure offerings with cutting-edge AI and fueling the stock to more than double its value since ChatGPT’s late-2022 debut.