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The poorest half of UK families will have to wait until the end of 2026 for their real incomes to return to pre-COVID levels, according to independent analysis.

The National Institute of Economic and Social Research (NIESR) said low to middle income households face seven years of falling living standards due to the fallout from the pandemic and, latterly, the continuing cost of living crisis.

Lockdowns and restrictions on earnings, followed by price hikes and Bank of England interest rate hikes since December 2021 to help tame inflation, have meant wages have mostly struggled to keep pace with price growth and rising borrowing costs alike.

The rate of Inflation peaked last year above 11% but it currently stands at 6.7%.

The annual pace of price increases is forecast to have fallen dramatically last month.

That is mostly due to the worst impact to energy bills from Russia’s invasion of Ukraine, falling out of the calculations.

Nevertheless, the NIESR said that real incomes, which take account of inflation, in the bottom half of the income distribution, will be around 5% lower in the 2023/24 financial year compared with the year ending March 2020.

That is despite average wage rises of around 7% in the current year, a figure that is expected to remain around the same level next year.

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‘Most households are just one pay cheque away from being homeless’

Professor Adrian Pabst, deputy director for policy at the NIESR, said: “Higher real wages this year are a welcome boost, especially for low-income working families who have been hit hardest by the COVID and inflation shocks.

“But a return to pre-pandemic living standards will require sustained real wage growth, including further increases in the National Living Wage.”

The NIESR’s latest quarterly forecast report said that if living standards were to rise, and help boost the country’s “anaemic” economic growth, public investment must be the focus of the looming autumn statement.

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The ‘fiscal bind’ facing Jeremy Hunt

Chancellor Jeremy Hunt has ruled out pre-election tax giveaways and also signalled a focus on bringing down debt.

A lack of new spending or tax cuts, while tough for many Tory MPs who are worried about their seats, will aid the government’s target to halve inflation this year.

The NIESR believed that the Bank of England would not have to impose further interest rate hikes beyond the 14 consecutive increases already seen, given that inflation was expected to continue to ease sharply.

Its report warned that while rising borrowing costs, which have exacerbated the shocks to household bills, may have peaked, there was no prospect of Bank rate returning to its COVID-era level of 0.1%.

It saw the interest rate settling at levels closer to 3-3.5%, with the first declines expected later next year.

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Struggling Aston Martin steers into fresh pay controversy

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Struggling Aston Martin steers into fresh pay controversy

Aston Martin is steering a path towards a twin-pronged pay row with shareholders as it grapples with the impact of President Trump’s tariffs on car manufacturers.

Sky News can reveal that the influential proxy voting adviser ISS is urging investors to vote against both of Aston Martin Lagonda Global Holdings’ remuneration votes at next week’s annual general meeting.

The pay policy vote, which is binding on the company, has attracted opposition from ISS because it proposes significant increases to potential bonus awards to Adrian Hallmark, the company’s new chief executive.

“Concerns are raised regarding the increased bonus maximums, which are built upon competitively[1]positioned salary levels and do not appear appropriate given the company’s recent performance,” ISS said in a report to clients.

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Aston Martin is also facing a meaningful vote against its pay report for last year – which is on an advisory basis only – because of the salaries awarded to Mr Hallmark and other executive directors.

The company’s shares have nearly halved in the last year, and it now has a market value of little more than £660m.

Despite the ISS recommendation, Aston Martin will win the vote by virtue of chairman Lawrence Stroll’s 33% shareholding.

The luxury car manufacturer has had a torrid time as a public company and now faces the headwinds of President Trump’s tariffs blitz.

This week it said it would limit exports to the US to offset the impact of the policy.

Aston Martin did not respond to a request for comment ahead of next Wednesday’s AGM.

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Financial wellbeing platform Mintago lands £6m funding boost

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Financial wellbeing platform Mintago lands £6m funding boost

A financial wellbeing platform which counts the alcohol-free beer producer Lucky Saint among its clients has landed a £6m funding injection from a syndicate of well-known investors.

Sky News understands that Mintago, which was founded in 2019, will announce in the coming days that Guinness Ventures has jointly led the Series A round alongside Seed X Liechtenstein and Social Impact Enterprises.

Mintago, which also counts car rental firm Avis and Northumbrian Police among its customers, aims to help employees save and manage their money more effectively.

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A number of the start-up’s current investors, Love Ventures and Truesight Ventures, are also understood to have reinvested as part of the fundraising.

MINTAGO
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The company, which counts Lucky Saint and Avis among its users, has finalised a Series A funding round

The company was set up by Chieu Cao and Daniel Conti, and claims to offer more salary sacrifice schemes than any other UK provider.

It also provides independent financial advice, a service for finding lost pension pots, retail discounts and GP services.

“We realised that organisations are crying out for the same help we provide their staff,” Mr Conti said.

“The benefits of providing that support impact everyone.

“When a company improves their salary sacrifice benefits engagement, they can save thousands in National Insurance Contributions, but their employees save too, easing the strain on their finances.”

The new capital will be used to develop additional products using artificial intelligence, according to the company.

“Mintago is enabling its customers to become truly people-centric organisations by giving them the tools to support their employees’ financial wellbeing,” Mathias Jaeggi, a partner at Seed X Liechtenstein, said.

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iPhones sold in US will no longer come from China – as Apple reveals impact of Trump’s tariffs

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iPhones sold in US will no longer come from China - as Apple reveals impact of Trump's tariffs

Apple says devices sold in the US will no longer come from China, as the tech giant tries to mitigate the impact of Donald Trump’s tariffs.

Most iPhones will be sourced from India instead, with iPads coming from Vietnam, to prevent dramatic price rises for American consumers.

Unveiling financial results from January to March, the company said the US president’s escalating trade war has had a limited impact on its performance so far.

However, Apple CEO Tim Cook believes the tariffs will add £677m in costs during the current quarter – assuming Trump’s policies don’t change.

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Revenue for the first three months of the year stood at £71.8bn, with earnings of £18.6bn also beating analyst expectations.

High demand for iPhones during this period may have been driven by US shoppers rushing to make purchases before the new tariffs came into force.

But the full impact of any panic buying will only emerge when Apple reports its results from April to June later in the year.

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Apple’s reliance on Chinese factories to manufacture its iPhones meant the company was far more exposed to the impact of Trump’s trade war than others.

Read more from Sky News:
NHS may offer weight loss jabs over counter
Trump’s national security adviser to leave role
North Korean hacker caught red-handed

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Trump: Tariffs making US ‘rich’

After the president unveiled plans to impose reciprocal tariffs on dozens of countries – now largely paused for 90 days – Apple’s stock plunged by 23%, wiping out £582bn of value.

While its share price has recovered slightly, it remains 5% lower than before “Liberation Day”.

Growing tensions between Washington and Beijing are also having an impact on Apple’s sales in China, which fell 2.3% between January and March.

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Addressing the planned changes to manufacturing, Mr Cook added: “We have a complex supply chain. There’s always risk in the supply chain. What we learned some time ago was that having everything in one location had too much risk with it.”

Devices sold outside of the US will continue to be made in China.

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