How to ensure twenty-first century companies invest for the long term March 4, 2015 In the twentieth century, firms were predominantly capital-intensive and competed on cost efficiency. Companies with the most efficient factories could outcompete their rivals and become market leaders. The twenty-first century firm is different. Competitive success now depends increasingly on product quality and innovation. These in turn hinge on a company’s intangible assets, such as its [...]
Living standards are finally recovering – but we ignore poor productivity at our peril March 4, 2015 The metamorphosis of Labour’s attack lines on the economy has been a sight to behold. In the early years of this Parliament, the party argued that spending cuts were being implemented “too far and too fast”. After that came the infamous “flat-lining growth” hand gesture, and finally the “cost of living crisis”. This latter criticism [...]
We can protect the City’s interests in Europe – and we now have the proof March 4, 2015 Wednesday 4 March 2015 could come to be seen as a defining moment in Britain’s relationship with the rest of the EU, and for the City of London in particular. This is because of a ruling by the European Court of Justice (ECJ) yesterday, which upheld a vital British claim protecting the City from Eurozone [...]
As the government sells its stake in Eurostar for £757m, is this a good deal for taxpayers? March 4, 2015 Lord Paul Deighton, commercial secretary to the Treasury, says Yes There is no value in government owning assets that it doesn’t need to. It ties up resources that could be used for other objectives, like investing in new infrastructure or paying down debt. Eurostar is such an asset. It is managed on a commercial basis [...]
Budget 2030: What will chancellors of the future have to grapple with? March 3, 2015 Red box at the ready: it’s two weeks until George Osborne delivers his final Budget of this Parliament. As it is happening only days after Nesta’s future-gazing London festival FutureFest (taking place on 14 and 15 March), we’ve been speculating as to what the Budget in 2030 might look like. Let’s take a look into [...]
Mario Draghi calling: Why the ECB’s QE may struggle to reach €1 trillion March 3, 2015 The European Central Bank’s (ECB) version of quantitative easing (QE), which was announced to much fanfare in January, involves the purchase of bonds from both institutions and individuals. ECB president Mario Draghi hopes that the proceeds of these sales will be used to buy other assets or to lend, thereby oiling the wheels of the [...]
There’s nothing inevitable about slower growth – but we must embrace change March 3, 2015 Are we doomed to secular stagnation, to permanently lower rates of economic growth? The debate was sparked off nearly a decade before the financial crisis by the top US economist Robert J Gordon. He took a pessimistic view of the impact of the new wave of technology on productivity and economic growth. The latest contribution [...]
As M&A involving UK firms fell to 1987 lows in 2014, could politics harm prospects for 2015? March 3, 2015 James Fillingham is transactions services partner at PwC, says Yes In 2014, the Scottish referendum did give buyers and sellers pause for thought, but that was only part of the story. While M&A was down in the UK, we saw a massive, offsetting increase in IPO activity. We also saw much refinancing with plentiful, cheap [...]
The North Sea is drowning in tax: Only radical action will salvage UK oil now March 2, 2015 Following his comments at the recent opening of the OECD’s Economic Survey, it is to be hoped that the chancellor gives North Sea oil companies, their shareholders, and their employees enough reason to cheer when he announces the Budget on 18 March. He recognised that the oil and gas industry is a vital national asset [...]
The licence fee is obsolete – but a new BBC poll tax would be just as bad March 2, 2015 BBC director-general Lord Hall must have thought all his Christmases had come at once. For years, the corporation has been on the defensive about the future of the TV licence fee. Campaigners had highlighted how it is being rendered obsolete by the increasing numbers watching TV via iPlayer catch-up services, on tablets, computers and on [...]