News Headlines – Monday 27th January 2014

Economics/Business
Businesses have accused Labour of being “anti-business” following their assertion they will reinstate the 50p rate of tax for high earners should they win the next election. The plan to revive the top rate of tax until the defecit has been cleared has been criticised by business leaders as well as former Labour ministers including Lord Myners. The Telegraph Leader accuses Labour of making the pledge for political rather than exonomic reasons stating that throughout most of Labour’s 13 years in office, the top rate of tax was 40p. It only increased to 50p just before the general election for populist reasons rather than economic ones – indeed, the move lost the treasury income. The pledge by Labour has also caused 17 business leaders including Sir Stuart Rose and Karren Brady to write a joint letter to the Telegraph saying the move will discourage investment into Britain, jeopardise the economic recovery and cause the loss of jobs. Telegraph, p.1, 23; FT, p.1

Employment/Recruitment
The economic recovery is widening the gap between London and other UK cities according to the latest Cities Outlook report from think tank Centre for Cities. London accounted for 79% of national jobs growth in the private sector between 2010 and 2012 with 216,700 jobs created over that period – 10 times more than the second fastest growing city, Edinburgh. The latest ONS data shows that London accounted for 22% of overall employment growth over the period, growing twice as fast as the national average. In contrast, towns such as Bradford, Blackpool and Glasgow have had job losses in both private and public sectors. FT, p,4

Property
David Cameron will today announce a drive to build thousands more homes by slashing building regulations. More than 100 rules applied to new homes will be cut to fewer than 10. The move will save developers £60m a year, equivalent to £500 for every new property built. Rules setting out minimum window sizes, the dimensions of rooms, the strength of front doors, and arrangements for lavatories, lighting, telephone lines and disabled access will be culled. It is hoped the move will result in far more homes being constructed. Telegraph, p.2

Personal Finance
Workers could increase their pension by a third in exchange for fewer guarantees about retirement income under a far-reaching pre-election shake-up of the industry. The Government will try to transform the pensions market by backing controversial occupational schemes commonly used in the Netherlands but previously rejected in Britain over fears the dangers were too great. Amid growing concern about falling pension incomes, ministers believe they can build enough safeguards into the proposed schemes to make them acceptable. Studies suugest the collective pensions could deliver returns of about 30% more than the occupational scheme currently used by most British employers. Times, p.1,2

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