Latest news with #JeremyHunt
Times
17 hours ago
- Business
- Times
London Stock Exchange chief calls for new ‘Tell Sid' campaign
The head of the London Stock Exchange has called for a 'Tell Sid'-style campaign to encourage the public to invest as part of efforts to rescue Britain's faltering equities market. Dame Julia Hoggett said on Friday that despite a series of reforms by the government and regulators in recent years to try to make the UK market more attractive 'we have still not seen the real turning point in terms of flows of risk capital within and into the UK'. She argued that 'a lot of investors are more fearful of investing in the real economy than investing in cryptocurrency' and that 'now is the time for a long-term public campaign that would demystify investing'. This should be a 'Tell Sid 2.0' to get Britain investing, Hoggett said, referring to the famous advertising blitz by the Thatcher government to encourage households to buy shares in British Gas during its 1986 privatisation. It is the second time in less than two years that the idea of reviving 'Tell Sid' has been floated and comes amid mounting concern that the London stock market is shrinking. The market's woes are partly being driven by a lack of demand for UK equities, which has depressed valuations and led to companies being taken private and deterred private businesses from listing on the exchange. The previous Conservative government planned a retail offer of NatWest shares as part of the process of reprivatising the bank, with Jeremy Hunt, who was then chancellor, saying: 'It's time to get Sid investing again.' However, the initiative was scrapped by the new Labour government last July. Rachel Reeves, Hunt's successor, claimed it was 'a bad use of taxpayers' money'. • Encouraging savers to buy shares is worthy, but stunts won't help Even so, Reeves signalled in February that she wanted 'to create more of a culture in the UK of retail investing like what you have in the United States'. The number of Britons investing in the stock market stands at 23 per cent, whereas in the US stock market participation is 61 per cent. One way the government might do this is by imposing tighter limits on the amount savers can put into cash Isas each year, to nudge them into shares. This idea has faced resistance in some quarters, and Reeves has yet to announce a consultation on changes to Isas, although one might be unveiled when she sets out the government's strategy for the financial services sector next month. Hoggett, 51, was speaking at a conference hosted on Friday by the Capital Markets Industry Taskforce, a lobbying body she chairs, where top officials from British regulators insisted they were playing their part to boost the City and the economy, and heeding government calls to cut red tape, although they said this required more risk-taking in society. Richard Moriarty, who runs the Financial Reporting Council, which oversees corporate governance and audits, said that guidance on governance 'infantilises boards [who] need to think for themselves'. Sarah Pritchard, the deputy chief executive of the Financial Conduct Authority, told the conference that 'if we have more companies listing then some of them will fail and that should be OK and the first reaction shouldn't be, 'There must be something wrong with the regulation.'' She also signalled that proposals were imminent to help consumers to manage their finances.
Telegraph
20 hours ago
- Politics
- Telegraph
The Daily T: Can We Be Great Again? Jeremy Hunt on how to solve mass migration
Is it actually possible to solve the problem of mass migration? And more specifically, that of illegal migration? It's the policy issue that continues to sink successive governments - but Jeremy Hunt thinks he has the answer. Along with Camilla Tominey, Jeremy is joined by former Lord Chancellor and Secretary of State for Justice, Alex Chalk, and Director of the Migration Observatory, Madeleine Sumption to put his ideas for solving the problem to the test. In this episode of The Daily T, Hunt admits that the Conservative party failed on immigration when they were in government, and that the issue was 'problematic in lots of Conservative seats' at the last general election, but also insists that 'Labour will bitterly regret cancelling the Rwanda scheme'. As well as outlining his case for international laws and treaties to be rewritten in order to fix the current 'intolerable situation', the former chancellor also makes the point that the people most concerned about uncontrolled immigration are actually immigrants themselves, that they're 'proud to be British' and don't like the idea that 'British hospitality is being abused'. In this special Daily T series inspired by his new book, Jeremy Hunt pitches his optimism and ideas to leading experts on how the UK can change the world for the better. From mass migration to leading the AI revolution, we ask, can we be great again? Can We Be Great Again?: Why a Dangerous World Needs Britain, by Jeremy Hunt (Swift Press, £25), is out now. Click here to order Watch episodes of the Daily T here. You can also listen on Spotify, Apple Podcasts, or wherever you get your podcasts.
The Guardian
2 days ago
- Business
- The Guardian
Number of higher-rate UK taxpayers expected to hit more than 7m this year
The number of people in the UK paying income tax at the higher rate is expected to increase by 500,000 this tax year, to more than 7 million, according to official figures. Income tax thresholds used to rise in line with inflation but have been frozen at the same level since 2021, a move announced by the then-chancellor, Rishi Sunak. In the 2021-22, 4.4 million people paid tax of 40% on some of their income, the data from HM Revenue & Customs shows. Over the same period the number of people of state pension age paying some income tax has risen by almost 2 million. The freeze on tax thresholds, which was extended until 2028 by the former chancellor Jeremy Hunt, has meant that as wages and pensions have been increased to help people cope with inflation, more have moved into a higher tax bracket - a phenomenon known as fiscal drag. The threshold for the personal allowance – the sum you can earn each year before paying income tax – is set at £12,570. HMRC's figures show there are expected to be 39.1 million people earning above that in the current tax year, with the majority – 30.4 million – paying tax at the basic rate of 20%. The full new state pension now adds up to £11,973 a year, and there are expected to be 8.7 million people of state pension age paying income tax in 2025-26. Laura Suter, thw director of personal finance at the investment platform AJ Bell, said: 'Everyone is caught by frozen tax thresholds, including pensioners and anyone with earnings above the £12,570 personal allowance threshold. However, it is those who drift into higher tax bands as a consequence who feel the most pain.' Thresholds are different in Scotland, but in the rest of the UK, 'once you move over the £50,270 mark, your next pound of earnings is hit with a 40p deduction, rather than the 20p paid by basic-rate taxpayers, meaning you see much less of any salary increases in your payslip at the end of the month', Suter said. 'They now account for almost a fifth of all taxpayers, illustrating that the higher rate of tax, once reserved for those on healthy salaries, is now pretty commonplace.' A government spokesperson said: 'This government inherited the previous government's policy of frozen tax thresholds.' 'At the budget and the spring statement, the chancellor, Rachel Reeves, announced that she would not extend that freeze. We are also protecting payslips for working people by keeping our promise to not raise the basic, higher or additional rates of income tax, employee national insurance or VAT.'
Scottish Sun
2 days ago
- Business
- Scottish Sun
Warning for 420,000 people on the state pension being hit with tax bill for the first time – can you avoid it?
We reveal how you make the most of your cash to avoid paying income tax below TAXING TIMES Warning for 420,000 people on the state pension being hit with tax bill for the first time – can you avoid it? Click to share on X/Twitter (Opens in new window) Click to share on Facebook (Opens in new window) HUNDREDS of thousands of state pensioners are set to be stung with a tax bill for the first time. Fresh data from HMRC shows 8.7million people of state pension age or older will pay income tax on their retirement income in 2025/26. Sign up for Scottish Sun newsletter Sign up 1 State pensioners are facing paying income tax due to fiscal drag Credit: Getty This is a 420,000 rise compared to the previous financial year and a hike of 1.85million from 10 years ago (2015/16). The blow comes due to a combination of a rising state pension, under the Triple Lock, and frozen income tax thresholds - known as fiscal drag. The full new state pension is currently worth £11,973 a year while the personal allowance is £12,570, with the threshold frozen until 2028. The full new state pension amount on its own is not yet enough to breach the allowance. However, older people receiving income from other avenues like a private pension or job on top of a state pension can end up going over the threshold and having to pay tax. David Brooks, head of policy at leading independent consultancy Broadstone, said: "We would expect a growing number of pensioners to be liable for income tax as the country's demographic changes due to our ageing population. 'Fiscal drag, however, is also bringing hundreds of thousands more pensioners into paying income tax bracket every year as the frozen personal allowance thresholds combines with the Triple Lock-protected state pension. 'While perhaps personally frustrating for many pensioners, it reflects the nature of inflation linked occupational pensions and a Triple-locked state pension that continue to rise." It's not just people receiving income through a state pension and other streams who are set to pay income tax either. As the state pension rises under the Triple Lock, some relying solely on this could end up paying tax. What are the different types of pensions? The Triple Lock ensures the state pension goes up by whatever is highest out of inflation, 2.5% or wages. Previous forecasts by Deutsche Bank predict the Triple Lock will rise by £600 in April 2026 to £12,631. This would see someone on the full new state pension breach the personal allowance for the first time and having to pay tax. In May 2024, then Chancellor Jeremy Hunt said the income tax personal allowance would be frozen at £12,570 until 2028. The freeze was first put in place in 2021. In her first Budget in October that year, Chancellor Rachel Reeves had been widely expected to extend the freeze beyond 2028. The Sun asked the Treasury to comment. How to avoid paying income tax on your state pension There are a few tricks you can use to lessen the chances of being taxed on your income if you're a state pensioner. The first is by withdrawing from a private or workplace pension tactically. It's tempting to take out your whole private or workplace pension when you reach retirement and put it into a savings account. But do this and you'll end up paying income tax on any sitting in taxable accounts. Instead, you can actually take out 25% of the value of the pension tax-free. You can either do this as a lump sum or in smaller gradual amounts to top up your state pension without being taxed on it. A second way is by making the most of your ISAs as withdrawals from these types of accounts aren't subject to income tax. For example, if you withdrew 4% from a £100,000 ISA pot, your take home pay would be £4,000. How does the state pension work? AT the moment the current state pension is paid to both men and women from age 66 - but it's due to rise to 67 by 2028 and 68 by 2046. The state pension is a recurring payment from the government most Brits start getting when they reach State Pension age. But not everyone gets the same amount, and you are awarded depending on your National Insurance record. For most pensioners, it forms only part of their retirement income, as they could have other pots from a workplace pension, earning and savings. The new state pension is based on people's National Insurance records. Workers must have 35 qualifying years of National Insurance to get the maximum amount of the new state pension. You earn National Insurance qualifying years through work, or by getting credits, for instance when you are looking after children and claiming child benefit. If you have gaps, you can top up your record by paying in voluntary National Insurance contributions. To get the old, full basic state pension, you will need 30 years of contributions or credits. You will need at least 10 years on your NI record to get any state pension. Do you have a money problem that needs sorting? Get in touch by emailing money-sm@ Plus, you can join our Sun Money Chats and Tips Facebook group to share your tips and stories
CNBC
3 days ago
- Business
- CNBC
CNBC's UK Exchange newsletter: The U.K.'s pension shake-up is facing pushback
Since the Global Financial Crisis, poor productivity has bedeviled the U.K. economy for various reasons, including regional disparities and over-dependence on London and the southeast of England. Most economists agree, though, that the main factor has been low investment in skills and infrastructure. In response, the last government devised the "Mansion House reforms" in July 2023, so-called because Jeremy Hunt, then chancellor of the Exchequer, announced them at the official residence of the Lord Mayor of London (the Lord Mayor, not to be confused with Sadiq Khan, the mayor of London, is head of the City of London Corporation, the Square Mile's governing body). The proposals sought to unlock £75 billion ($102 billion) from defined contribution and local government pension schemes with the aim of directing a greater proportion of retirement savings toward private markets and assets such as infrastructure. In his announcement — which carried approving quotes from the likes of Jamie Dimon, chairman and CEO of JP Morgan Chase, and C.S. Venkatakrishnan, the Barclays CEO — Hunt noted: "The United Kingdom has the largest pension market in Europe, worth over £2.5 trillion … but how this money is invested is limiting returns for savers." "Comparable Australian schemes invest ten times more in private markets than U.K. schemes, reaping rewards that U.K. savers are missing out on," he went on. The news was accompanied by a "Mansion House compact" in which nine of the U.K.'s largest defined contribution pension providers committed to allocate 5% of assets in their default funds to unlisted assets, such as private equity or start-ups, by 2030. When Rachel Reeves succeeded Hunt, in July 2024, she pledged to build on the proposals and, for a while, there was excitement in the pensions industry. Unfortunately, it feels as if that initial enthusiasm has curdled. An early indication the industry might not be completely in tune with Reeves's ambitions came after she announced, last November, plans to create "megafunds" — modelled on Australia's superannuation funds and Canadian pension schemes such as the Ontario Teachers' Pension Plan — by consolidating assets from 86 separate local government pension scheme authorities into eight pools each worth an average of £50 billion by 2030. In theory, this would unlock huge efficiency gains, as well as allowing more money to be invested, longer term, in private assets and infrastructure. But it has run into criticism — partly because local authorities fear losing influence over how their pension assets are invested and partly because of the likely job losses among local government officials. Alongside this, the government aims to encourage consolidation among the U.K.'s defined contribution pensions, the main means by which Britons now save for retirement. It wants defined contribution multi-employer pension schemes to be worth at least £25 billion by 2030, again with the aim of building scale and efficiency, with schemes also empowered to transfer assets into the planned megafunds. This has won broad industry backing. In May, 17 leading defined contribution scheme providers signed the "Mansion House accord," building on Hunt's 2023 compact, volunteering to invest 10% of their workplace portfolios in assets like infrastructure, property and private equity by 2030. At least 5% would be ring fenced for U.K. assets. So far, so good. Explosively, though, the government is planning a "backstop provision" allowing it to set "binding asset allocation targets" — in other words, forcing megafunds to invest in private markets and U.K. assets if they fail to meet the voluntary targets. The justification is to ensure some schemes do not lose business by making costly up-front investments, while rivals hold back. But it has proved contentious. Some in the industry question why ministers should tell them how to allocate assets and have noted the irony in ministers and civil servants — who enjoy generous defined benefit pensions funded by taxpayers — obliging those same taxpayers to adopt more risk with their own retirement savings. Amanda Blanc, chief executive of Aviva, one of the U.K.'s biggest insurers, spoke for many when she called the measure a "sledgehammer to crack a nut." UK stocks in the spotlight There are questions on how mandation might be enforced and why, if unlisted assets are so attractive, these schemes are not already invested in them. Several senior leaders have also told me privately that there is insufficient industry expertise to manage such assets. Reeves sought to defend the move when, last week, she told The Times CEO Summit that she doubted it would be necessary to use the backstop. However, the following day, the Financial Times reported that Scottish Widows, the U.K.'s second-largest pensions provider, is cutting the U.K. equities allocation in its highest growth portfolio from 12% to just 3%. Significantly, Scottish Widows — which is owned by Lloyds Banking Group — had signed the original Mansion House compact, but not the later accord. Simon French, the influential head of research at the investment bank Panmure Liberum, described it as "an inevitable reaction to the Mansion House accord which … pushes/strong-arms U.K. pension flows into private assets over the next five years." Ironically, all this is happening just as, after years of indifference among investors, U.K. equities are having their moment in the sun, with the FTSE 100 so far outperforming not only the pan-European Stoxx Europe 600 but also the S&P 500 this year. One prominent City figure told me last week that his investment bank's trading desk had just enjoyed its busiest day in more than 20 years — with American investors, in particular, showing renewed interest in U.K. equities. Ministers will argue that, with tax relief to private pension contributions costing £46.8 billion in 2022-23, the latest year for which figures are available, they are entitled to ask for more pension savings to be channelled toward the U.K. economy. Institutions might respond that, if the government is keen to see that happen, it might remove some barriers to investing in the U.K. such as the unpopular 0.5% levy paid on share purchases. It all creates a sense that, while ministers and investors are agreed on the desirability of investing more in the U.K., there is little agreement on how to achieve that. And it certainly feels as if Reeves and her colleagues are more interested in seeing investment in private assets rather than public of London can be a springboard for economic growth in the UK, says the Lord Mayor Alastair King, the Lord Mayor of London, discusses business activity in London ahead of the UK government's 10-year industrial strategy. The future of exchanges: Global capital flows in the age of Trump, tariffs and trade wars CNBC's Martin Soong hosts a roundtable in Singapore with stock exchange leaders from around the world to discuss how U.S. exceptionalism is reshaping global capital flows. Europe has been underinvesting in defense, says Deutsche Bank CEO Christian Sewing, CEO of Deutsche Bank discusses how the business is responding to current geopolitical uncertainty and outlines how the bank plans to finance defense spending through a mix of public and private sector could face changes to search in the UK as regulators crack down. Britain's Competition and Markets Authority said it's consulting on a proposal to give Google "strategic market status." NATO allies pledge to hike defense spending – but will they deliver? Whether allies' defense spending promises materialize is the key question. Conflict or ceasefire, most markets remain unfazed — here's why. Global equities posted muted gains Tuesday, as investors digested U.S. President Donald Trump's announcement of a ceasefire between Iran and Israel, as well as growing signs of fatigue toward Trump's policymaking.U.K. stocks have fallen by 0.8% over the last week, with the FTSE 100 finally closing flat on Tuesday after three consecutive trading days of losses. Meanwhile, the British Pound gained nearly 1% to reach $1.36, its strongest level against the U.S. dollar since January 2022, according to FactSet. In government bond markets, 10-year gilt yields slipped over the last week and now trade around 4.47%. In case you missed it, Amazon said it will invest £40 billion in the U.K. over the next three years to build and upgrade its large warehouses. The British government welcomed the investment as it looks to boost domestic growth and productivity.
