Charlotte Street Partners



A critical moment for clarity

Written by Javier Maquieira, senior associate 
Edited by David Gaffney, partner
1 October 2020

Good morning,

Keeping track of all the Covid-19 restrictions currently in place across the UK has become a challenging endeavour, even for those responsible for introducing them. Rather than things becoming clearer with time, the recent uptick in cases has brought less clarity and more confusion to the debate than the first wave.
Speaking at a government press briefing yesterday as 7,108 new cases and 71 more deaths were confirmed in the UK, prime minister Boris Johnson warned he would not hesitate to “take further measures that would, I’m afraid, be more costly than the ones we have put into effect now”.
A few hours earlier – and after MPs voted to renew the coronavirus act – health secretary Matt Hancock had confirmed to the House of Commons that the government would consult parliament “wherever possible” for “significant national measures”, promising to hold votes before such regulations come into force.
The announcement appeared to have appeased rebel Conservative MPs, led by Graham Brady, who had complained at the lack of parliamentary oversight of the government’s powers to introduce local lockdowns and other restrictions, citing concerns about their impact on the economy and people’s liberty.
On the opposition front benches, Labour leader Sir Keir Starmer criticised the government for creating “widespread confusion about the restrictions” and abandoning people with “viable” jobs, particularly in the hospitality sector, by refusing adequate support during continued lockdown restrictions. In his response, Johnson accused Starmer of “sniping from the sidelines” and changing his mind over backing the measures.
Uncertainty was apparent in Edinburgh too. Asked about the possibility of a “circuit breaker” lockdown in mid-October, deputy first minister John Swinney said some form of “interruptive action” to try to curb the pandemic was being considered in Scotland, based on a suggestion that it “may be an effective or necessary intervention”, potentially involving a “stay at home order for two to three weeks”.

Regardless of the slightly more positive news received last night from an Imperial College London study that suggests growth of the virus is slowing again in England, a hard winter is coming, one way or another
Before then, we might all benefit if the crisp and clear autumnal weather many of us have been enjoying was matched by an outbreak of crisp and clear messaging from politicians.


US president Donald Trump has urged far-right group ‘Proud Boys’ to “stand down” after he had initially failed to condemn white supremacists in the presidential TV debate. Proud Boys members had earlier called Trump’s debate comments an endorsement, sparking a backlash on the president. The commission regulating the debates has already announced it would introduce new measures for the next two instalments to “maintain order”.
Downing Street is looking at plans to create an offshore processing centre for asylum seekers attempting to enter the United Kingdom. One option being considered is converting retired ferries and oil platforms into holding facilities, while the possibility of building one on a Scottish island is also said to be under consideration. Processing migrants abroad to places such as Moldova, Morocco, Papua New Guinea, or the south Atlantic islands of Ascension and St Helena has also been explored, but there are concerns about the cost, logistics and diplomatic consequences. (£)
The Spanish government has ordered a lockdown in the capital Madrid and surrounding areas badly affected by the coronavirus, following a rise in cases. The regional government, however, says the lockdown lacks legal validity. Under the restrictions, the Madrid region’s borders would be forced to close to visitors for anything other than essential trips.

Business and economy

Bank of England chief economist Andy Haldane has said in a speech that “now is not the time for the economics of Chicken Licken”, in reference to the children’s storybook character who feared the sky was falling. Haldane emphasised it was important not to overlook the UK economy’s quicker-than-expected recovery, despite admitting the economic news had not all been positive as a result of the “unholy trinity of risks from Covid, unemployment and Brexit”.
A recent YouGov poll has found 37% of more than 2,000 surveyed managers said they were likely to make staff redundant by the end of the year. Some 60% of managers from businesses with more than 250 employees said their companies planned to make redundancies over the next three months. The Labour party and the TUC have commented on the findings, urging the UK government to do more to protect British workers’ jobs.
In related news, the UK’s work and pensions secretary, Therese Coffey, told Sky News her department is bracing for up to four million unemployment claimants in the coming months as a result of the economic fall-out of the coronavirus crisis. The secretary confirmed her department has considered the Office of Budget Responsibility’s (OBR) forecast and was planning around that scenario.
The mayor of London, Sadiq Khan, has officially submitted to the Treasury a £5.7bn bailout plan of London’s transport system to reverse the damage inflicted on the network by Covid-19 emergency measures. The rescue package is needed to keep the system going for the next 18 months, according to Khan. (£)

Columns of note

As the 30th anniversary of the fall of the Berlin Wall approaches, Philip Stephens writes in the Financial Times that the global order that made Germany’s peaceful reunification possible is disappearing and being replaced by the most significant geopolitical uncertainty of the post-war era. Stephens argues that although the instinct of German leaders at times of crisis is to mediate, the new international disorder presents the unavoidable choice to take sides. (£)
The Herald’s health correspondent Helen McArdle argues the logical suggestion to shield the vulnerable while the rest gets on with their lives is doomed to fail, as such a move would risk storing up years of chronic health problems in a Scottish population “which was already the sick man of Europe even before the pandemic”. Crucially, McArdle writes, shielding is not as easy or effective as it may seem and would require expanding the criteria to include elderly people, regardless of their health.

Cartoon source: The Times


What happened yesterday?

London stocks finished on a mixed note yesterday following the chaotic debate between Donald Trump and his Democratic rival, Joe Biden overnight. The FTSE 100 ended the session down 0.53% at 5,866.10, while sterling was stronger against both the dollar by 0.27% at $1.2898 and the euro by 0.52% at €1.1010. Across the pond, the S&P 500 climbed 0.8%, while the tech-heavy Nasdaq index rose by 0.7%.
In Japan, a hardware glitch caused the Tokyo Stock Exchange to lose a full day’s trading for the first time in its history.
In company news:
Boohoo Group‘ s shares were down 3.72% despite the online fashion retailer posting sharp increases in sales and profits for the half-year and guiding higher for full-year sales growth.
Royal Dutch Shell closed 1.7% lower after the oil and gas company said it was cutting between 7,000 and 9,000 jobs globally, in response to the slump in oil prices.
William Hill was up 0.46% after the bookmaker agreed to a take-over approach by Caesars Entertainment in a £2.9bn deal.
Compass was off 3.23% as the services group reported an improvement in fourth quarter revenues.

What’s happening today?

James Halstead

Burford Capital

Anglo Afri O&g

UK economic announcements
(09:30) PMI Manufacturing

Int. economic announcements
(08:55) PMI Manufacturing (GER)
(09:00) PMI Manufacturing (EU)
(10:00) Producer Price Index (EU)
(10:00) Unemployment Rate (EU)
(13:30) Personal Spending (US)
(13:30) Personal Consumption Expenditures (US)
(13:30) Continuing Claims (US)
(13:30) Initial Jobless Claims (US)
(13:30) Personal Income (US)
(14:45) PMI Manufacturing (US)
(15:00) ISM Manufacturing (US)
(15:00) Construction Spending (US)
(15:00) ISM Prices Paid (US)
(20:30) Auto Sales (US)

Source: Financial Times

did you know

In 2008, The Independent on Sunday published a list of 100 people who made Britain a better and happier place to live. The only fictional character in the list was the Teletubbie, Tinky Winky. (source: @qikipedia)

Parliamentary highlights

House of Commons

Oral questions
Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office (including Topical Questions)
Business Statement
Business Questions to the Leader of the House – Mr Jacob Rees-Mogg
Business of the House Motion – Mr Jacob Rees-Mogg
Proceedings on a Bill relating to Social Security Benefits Uprating: all stages
Increasing penalties for fly-tipping – Paul Bristow

House of Lords 

Oral questions
Use of Do Not Resuscitate notices in hospitals and nursing homes since March – Baroness Browning
New sentencing tariff for those who intend to commission a crime and kill a member of the emergency services – Lord Brownlow of Shurlock Row
Whether the Net Zero Review will take into account co-benefits, relating to improved health, productivity, and employment, in calculating the costs and investments needed to reach net zero emissions – Baroness Hayman
Encouraging the uptake of the NHS COVID-19 application – Baroness Massey of Darwen
Agriculture Bill – Third reading – Lord Gardiner of Kimble
Fire Safety Bill – second reading – Lord Greenhalgh

Scottish Parliament 

First Minister’s Questions
Portfolio Questions
Stage 1 Debate
Forensic Medical Services (Victims of Sexual Offences) (Scotland) Bill
Financial Resolution
Forensic Medical Services (Victims of Sexual Offences) (Scotland) Bill
Scottish Government Business

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