Charlotte Street Partners

DAILY BRIEFING

DAILY BRIEFING

The history ploys

Written by Charlie Clegg, senior associate 
Edited by Kevin Pringle, partner
15 June 2021

Good morning,

“Historic” is one of the more tedious political tags: virtually any political occurrence can be relativised into becoming “historic”. Perhaps, though, last month’s Hartlepool by-election was historic. It showed the Conservatives are – post-Brexit – compounding the “red wall” gains they made in the 2019 general election. A month and a week since the Hartlepool by-election, Thursday’s Chesham and Amersham by-election could present another “historic” result. Or not.

The Lib Dems hope a combination of national and local factors can overturn a 16,000 Conservative majority in the Buckinghamshire seat. HS2, which would bisect the constituency, is proving especially salient. The party has even changed its national policy to oppose the rail link.

For the Lib Dems, the prize is morale. A win on Thursday could jolt the party out of its post-Brexit funk. Yet observers beyond the Lib Dems are excited to see if Chesham and Amersham could represent a shift away from the Conservatives in southern England. If so, “progressive” parties could find a counterweight to Conservative gains in northern England.

Even if the Lib Dems do win, it’s no guarantee they can build on the result. A Lib Dem hold at Eastleigh in 2013 did nothing to prevent disaster for the party at the following general election. Whatever happens, however, the interest of some observers is already speaking more to Labour and Lib Dem desperation than to posterity.

Draft English boundary changes announced last week also spoke to that desperation. Some speculated that the slight shift in seats from north to south could neutralise Tory gains in northern England. In fact, neither seat redistribution nor political realignment would be sufficient: this overdue boundary review would disadvantage Labour by five to ten seats.

In recent weeks, the idea of a Labour-Lib Dem-Green electoral pact resurfaced. Again, advantages for any participants would be negligible and the disadvantages could be crippling. Labour have been able to win elections even when the Tories have faced next to no competition for the right-wing vote. The system isn’t the problem and trying to trick it isn’t the solution.

For many in Labour and the Lib Dems, by-election upsets, boundary changes, and electoral pacts all seem to be that wind which will sweep them out of the electoral doldrums. In reality, each party will need to do the harder work of opposition. They first need to tell themselves why they are relevant before more voters will believe it. If they can do so, the results could truly be historic.

News

The UK government has announced that the lifting of restrictions on social contact will be delayed from 21 June to 19 July. Smaller changes – such as easing for weddings – will go ahead. A Commons vote on the delay is expected later this week; this could see a sizeable rebellion by Conservative backbenchers. All areas of Scotland are still expected to move to level 0 on 28 June with easing in Northern Ireland and Wales anticipated on 21 and 25 June respectively.

A UK-Australia trade deal is expected to be announced this morning. UK prime minister Boris Johnson and Australian prime minister Scott Morrison are believed to have settled the broad terms of a deal over dinner at Downing Street yesterday. The deal is expected to boost UK-Australia trade by £20bn a year though some, including Tory MPs, fear Australian farmers could undermine their UK counterparts. The UK department for international trade has insisted neither farmers nor existing standards will be undercut by the deal.

Trials have shown 90% efficacy for the Novavax Covid vaccine. The UK already has a £60m order in place for the drug. The agreement includes manufacturing capacity for the drug in north east England.

Business and economy

After 17 years, the EU and US are due to settle the dispute between Boeing and Airbus. Announcement of a breakthrough on state aid rules is due today at President Biden’s first US-EU summit. The dispute between the aircraft manufacturers has resulted in punitive tariffs between Europe and the US. (£)

A new study has shown men at director level in UK companies are paid, on average, 20% more than their female peers. At associate level (2 to 5 years’ experience), men receive over 50% more in bonuses. The survey also found women rate job satisfaction at 6.29 out of 10 while men rank it higher at 6.82.

Economists are phlegmatic about the impact of further Covid restrictions on the economy. Many in hospitality and entertainment have criticised the delay of easing in England as a major blow to their businesses. Yet The Times speaks to economists who believe that so long as the delay can be measured in weeks rather than months, its overall impact on the economy is likely to be negligible. (£)

Columns of note

As GB News launches, Hugo Rifkind explores the context of a news media in which impartiality no longer matters. While existing biases in some outlets owe more to unintentional groupthink than to a grand plan, Rifkind argues GB News is one of many outlets that now embrace groupthink so long as it cuts a certain way. (£)

A diverse coalition has united to remove Benjamin Netanyahu from power in Israel. The Financial Times’ FT View argues the new government’s biggest challenge will be to lessen the “poisonous” legacy of the departed prime minister. While Netanyahu’s successor, Naftali Bennett, is further to the right than Netanyahu, his more extreme views should be held in check if his fragile coalition is to survive. (£)

Cartoon source: The Times

Markets

What happened yesterday?

On Wall Street, the S&P500 closed up 0.2% after a last-minute rally, while the Nasdaq Composite climbed 0.7%. The results have been fuelled by rapid recovery in the US economy. In Europe, the FTSE350 and Stoxx Europe 600 index also rose 0.2%.

The dollar index dropped 0.1% while the euro was up 0.1% against the dollar at $1.212, and sterling finished flat at $1.411.

In company news:

GlaxoSmithKline has agreed to pay US company iTeos Therapeutics $2.1bn to collaborate on developing cancer drugs.

Samsung has entered the European telecoms market with a deal to supply Vodafone with 5G equipment in the UK.

What’s happening today?

Q3 results
Renalytix Ai

Q4 results
Ashtead Group

AGMs
Andrew Sykes
Concurrent Technologies
Coro Energy
Evraz
London & Associated Properties
Loopup Group
Northbridge Ind
Panther Metals
Pelatro Plc
Propty Franchis
Silence Ther.
Somero Enter Di
Starwood Eur
Wentworth Res.

Int. economic announcements
(07:00) Unemployment Rate
(07:00) Claimant Count Rate

Int. economic announcements
(07:00) Consumer Price Index (GER)
(10:00) Balance of Trade (EU)
(13:30) Retail Sales (US)
(13:30) Producer Price Index (US)
(14:15) Capacity Utilisation (US)
(14:15) Industrial Production (US)
(15:00) Business Inventories (US)

Source: Financial Times

did you know

        The only place where France and the Netherlands share a border is on the Caribbean island of Saint Martin.

Parliamentary highlights

House of Commons

Oral questions
Foreign, Commonwealth and Development Office

Opposition day debate

House of Lords 

Oral questions
Various

Legislation
Skills and Post-16 Education Bill [HL] – second reading

Scottish parliament 

Topical questions

First minister’s statement
COVID-19 update

Ministerial statement
Greenhouse Gas Emissions Statistics (2019)

 Scottish government debate
Women’s health

Share this post

Share on facebook
Share on twitter
Share on linkedin
Share on email