Charlotte Street Partners



Keir Starmer's yellow brick road

Written by Adam Shaw, associate partner 
Edited by Kevin Pringle, partner
21 October 2021

Good morning,

“Nicola Sturgeon’s handling of the pandemic has been no better than Boris Johnson’s.”
That was the message that Labour leader Sir Keir Starmer attempted to land in a briefing with Scottish journalists yesterday, in which he also attacked the SNP’s domestic record,  focussing on education, health and drug deaths.
His criticisms are not without merit. Scotland’s relative Covid figures are broadly in line with those in the rest of the UK. Shortly after Sturgeon became first minister in 2015, she asked to be judged on education, yet the attainment gap remained wide even before the pandemic. Accident and emergency department waiting times are at a record high, while Scotland’s drug deaths are the highest per capita in Europe and more than three-and-a-half times that of the rest of the UK – which Sturgeon herself described as “shameful”.
The problem, politically from a Labour perspective, is that these are not new issues. Indeed, they were all in play at the Scottish parliament election just six months ago, in which Labour lost seats and the SNP was returned to government for a fourth consecutive term.
With no sign of the SNP’s dominance of Scottish politics abating any time soon, Starmer will need to find a path to Downing Street without being able to lean on a cohort of 40-plus Scottish Labour MPs – as Tony Blair and Gordon Brown did – at the next general election.
While he’d be loath to admit it, Starmer would undoubtedly be making a call to Sturgeon for support in the event of a hung parliament. And in England, Starmer would likely also be relying on another yellow-branded party for help. In certain areas, the Lib Dems are far better positioned than Labour to win seats currently held by the Conservatives.
Seeking some comfort following their disappointing performance at the 2019 election, the Lib Dems were quick to highlight that they were now in second place in 91 constituencies, the majority of which were won by Conservatives. They have been buoyed since by their victory in the Chesham and Amersham byelection at which they overturned at huge Tory majority.
Analysis by The Times earlier this year found that the Conservatives are at risk of losing 23 seats in the south or east of England if the Liberal Democrat surge in Chesham & Amersham were to be repeated in a general election. Of course, it’s unlikely that the conditions of a byelection would be replicated at a general election. However, it illustrates where the Tories might be vulnerable.
A Lib Dem recovery that allowed the party to recapture at least some of the seats it lost in 2015 – a long shot though it may be – might contribute to Boris Johnson being deprived of another majority and offer Labour an opening.
Following the yellow brick road might not be Starmer’s preferred path, but at this juncture it would appear his most viable route to Downing Street.


The UK health secretary, Sajid Javid, has warned that daily Covid cases could hit 100,000 this winter and urged people to get vaccinated in order to avoid further restrictions. While Javid said the government would not be bringing ‘Plan B’ measures – which include mandatory face coverings and working from home – “at this point”, he put the nation on notice that they would be implemented if the number of cases and hospital admissions continue to climb. (£)
In related news, the British Medical Association has said that ‘Plan B’ should be implemented immediately in England to address an “unacceptable” rate of Covid infections. The trade union, which represents doctors, accused the government of taking its “foot off the brake” and being “wilfully negligent” for not reimposing rules.
Documents seen by the BBC have revealed how countries are attempting to change a crucial scientific report on how to tackle climate change. The leaked documents show that Saudi Arabia, Japan and Australia are among countries asking the UN to play down the need to move rapidly away from fossil fuels, and that some wealthy nations are questioning paying more to poorer states to move to greener technologies. The leak comes less than two weeks before the start of the COP26 climate summit, during which governments will be asked to make significant commitments to slow down climate change and keep global warming to 1.5 degrees.

Business and economy

The UK has agreed a free trade deal with New Zealand, which will see tariffs removed on a range of goods and increased opportunities for workers to move between the two countries. The Department for International Trade has lauded the agreement as a “groundbreaking” achievement, but according to the government’s own figures the deal itself is unlikely to boost UK growth.
Shares in China Evergrande, China’s second biggest property developer, have tumbled after plans for it to offload a stake in one of its units fell through. The company has debts of $305 billion and will officially go into default if it fails to stump up $83.5 million when a 30-day grace period for a repayment originally missed in September ends on Monday. It would become China’s biggest ever corporate failure and there are fears that its collapse could send shockwaves through global markets.
Tesla has reported record revenue and profits during the third quarter, despite a global computer chip shortage and port congestion across the motor industry. The electric car maker posted a net profit of $1.6bn for the quarter, its highest ever, which comes just three months after it reported its first $1bn-plus quarterly profit since its creation in 2003. (£)

Columns of note

Writing in The New Statesman, Sophie McBain questions a range of surveys that suggest falling fertility rates are due to Millennials and Gen-Z being hesitant to having children due to anxiety over climate change. While acknowledging that this will be a consideration for many, she argues that this oversimplifies things and ignores the “hostile economy” for young families: the housing crisis, high childcare costs, economic insecurity and the “motherhood penalty”.
In the Financial Times Big Read, Guy Chazan and Sam Fleming consider what the end of Angela Merkel’s tenure as German chancellor will mean for European diplomacy (£). They highlight that Merkel has often played the role of mediator and fostered close ties with Viktor Orban of Hungary and Poland’s Jaroslaw Kaczynski, despite disagreements over policy. However, some have accused Merkel of appeasing “illiberal democracies” and the new German government – made up of the SPD, Greens and liberal Free Democrats (FDP) – has advocated a tougher, more confrontational approach.

Cartoon source: The Telegraph


What happened yesterday?

Global stocks largely ended in positive territory as investors digested a raft of corporate announcements and inflationary news.
The FTSE 100 closed the session up 0.08% at 7,233.10. International Airlines Group, parent company of British Airways and Iberia, was the biggest faller on the main index, dropping 4.87% over concerns about increasing fuel prices, the ongoing Covid-19 pandemic and a hike in airport fees.
Mining companies also saw losses with a fall in metal prices. Rio Tinto shed 3.26%, Antofagasta was down 0.95%, Glencore fell 0.72%, BHP dropped 0.27%, and Anglo American was 0.05% lower.
Meanwhile the FTSE250 was 0.38% lower at 22,966.67.
Across the Atlantic, the S&P 500 climbed 0.37% to 4,536.19, the Dow Jones Industrial Average was up 0.43% to 35,609.34, and the Nasdaq fell 0.05% to 15,121.68.

What’s happening today?

Renalytix plc, Renishaw

Q3 results

Trading announcements
AJ Bell, Anglo American, Pensionbee, Rentokil Initial, Spectric, St James Place, Unilever, Vivo Energy

Alumasc Group, Dechra, Renishaw, Stand Life UK

Vr Education H.

UK economic announcements
(07:00) Public Sector Net Borrowing

International economic announcements
(13:30) Initial Jobless Claims (US)
(13:30) Philadelphia Fed Index (US)
(13:30) Continuing Claims (US)
(15:00) Existing Home Sales (US)

Source: Financial Times

did you know

The brother of actor Ewan McGregor, Colin, flew Tornado jets for the RAF. Colin’s call-sign was ‘Obi-Two’ in tribute to Ewan’s role as Obi Wan Kenobi in the Star Wars films.

Parliamentary highlights

House of Commons

Oral questions: International trade (including topical questions)
Business statement: Business questions to the leader of the house
Backbench business
General debate on COP26 and limiting global temperature rises to 1.5 degrees – Caroline Lucas
General debate on World Menopause Month – Carolyn Harris and Caroline Noakes

House of Lords 

Introductions: Lord Sedwill
Oral questions
Employing ‘elemental analysis’ to determine where cotton used in goods imported to the UK was cultivated – Lord Rooker
Support for people at high risk of developing type 2 diabetes who have gained weight during the Covid-19 pandemic – Baroness Merron
What environmental considerations influence government trade policy –Baroness Quin
Takeover of UK companies by private equity firms – Lord Sikka
Impact of the Protocol on Ireland/Northern Ireland on trade with the island of Ireland since 1 January – Lord Hain
Discussions with the vice president of the European Commission following the publication of the EU’s proposals regarding the Protocol on Ireland/Northern Ireland – Baroness Ritchie of Downpatrick
Diplomatic consequences for trade negotiations of the government’s decision to renegotiate the Protocol on Ireland/Northern Ireland – Baroness Hayter of Kentish Town
Private notice question: To ask the government, further to the rising number of Covid-19 cases and comments made by the NHS Confederation regarding the introduction of certain restrictions, what criteria they have put in place as the triggers to implement their Covid-19 “Plan B” – Lord Scriven
Legislation: Skills and Post-16 Education Bill – report stage (day 2)
Short debate: Government plans to consult on measures to enhance the integrity of electoral processes

Scottish parliament 

The Scottish parliament is in recess. The parliament will next sit on 26 October 2021.

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