The Hargreaves Lansdown investor confidence index dropped more than 11% over the last month as Budget fears spread. “The looming budget in the UK, due to be delivered just one day before Halloween, seems to have spooked investors, with many worrying about cuts to the capital gains tax (CGT) allowance, rises in the CGT rates and potential pension reforms,” said Victoria Hasler, head of fund research at Hargreaves Lansdown. Budget fears also hit optimism for UK economic growth, which fell almost 20% as investors feared the new Government’s growth plans may not be as strong as promised before the election. “It would seem that investors’ initial enthusiasm for the potential stability of a new government has waned, and they now have less faith in the new government’s ability to grow the economy, at least until they have seen the details of the upcoming Budget,” Hasler added.

Chancellor Rachel Reeves is said to be considering scrapping or modifying salary sacrifice tax breaks for electric cars (EVs). The Telegraph claims she considers them ‘unfair’ as they disproportionately benefit the wealthy, and that civil servants have suggested abolishing the schemes to both Reeves and her predecessors as a way of saving the Treasury up to £100m. The scehemes are used by tens of thousands of drivers every year to lease EVs, with monthly instalment payments taken from employee pay packets before Income tax and National Insurance are deducted. They are credited with propping up EV sales at a time when demand for new cars has suffered a slowdown, and support the Government’s EV sales targets, but officials from the Treasury are understood to have discussed the financial impact of the salary sacrifice schemes with members of the British car industry in August. Yesterday, The Resolution Foundation also called for salary sacrifice and company car tax breaks to be axed; the influential left-wing think-tank argued they only benefit “a relatively small number of better-off households who buy new cars”. Top rate taxpayers currently benefited from discounts of up to 62%c through the scheme, the Foundation said, but those paying the 20% basic rate of tax got discounts of only 28%. Lower earners are also often barred from salary sacrifice schemes because of rules that prevent net incomes falling below the minimum wage, it added, saying it felt the Chancellor should instead encourage EV take-up by raising taxes on petrol and diesel cars. However, James Court, CEO of the Electric Vehicles Association, said: “Salary sacrifice is the one government policy remaining that helps working people bridge the upfront cost of EVs. Removing it before we reach price parity with new petrol cars would be hugely damaging in achieving our EV sales targets, as well as blow a big hole in our carbon budgets, for which ministers would have to develop a new policy to replace the gap.” The British Vehicle Rental and Leasing Association (BVRLA) agreed, saying the scheme is used increasingly being by households that might otherwise struggle to afford an EV. Roughly eight in every 10 cars leased via salary sacrifice are electric, the BVRLA says, adding that according to data from the trade body’s members, 52% of salary sacrifice drivers are also basic-rate taxpayers. “The salary sacrifice market is a major success story and is central to the UK meeting its ambitious decarbonisation targets. It is responsible for a major share of new EV registrations and is helping to democratise access to zero emission motoring,” BVRLA CEO Toby Poston said. A HM Treasury spokesman told the Telegraph: “We do not comment on speculation around tax policy changes outside of fiscal events.”

The Telegraph says it has been told that local councils are growing increasingly concerned that the Chancellor will use her forthcoming Budget to scrap The Bus Service Improvement Plan (BSIP) and the Bus Service Operators Grant, which allows local bus operators to claw back up to 80% of the fuel duty they pay. The BSIP, introduced in 2022 under former Prime Minister Boris Johnson’s “bus back better” plan to encourage people back onto public transport after Covid, will provide £1.08bn in funding by the time it expires. According to the Urban Transport Group (UTG), which campaigns on behalf of transport authorities in England, one in four bus services in towns and cities face closure if the funding scheme is withdrawn, because it supports vital early morning and late night services which are essential to get people to work, but which are not independently financially viable. Sunday buses would also face cutbacks, UTG claims, while almost two thirds of “socially necessary” routes that are fully funded by local authorities through BSIP grants could also cease. Steve Warrener, Chairman of The Bus Service Improvement Plan (BSIP), said: “There is an imperative for the Chancellor to confirm core funding for the bus. Without it, the opportunity for our city regions to deliver economic growth and support the Government’s wider missions could be undermined, Warrener said, adding: “This Budget gives the Treasury a chance to demonstrate its commitment to safeguarding vital public transport services.” Reeves is also expected to announce that a £2 cap on bus fares across England will be phased out or eliminated when a current extension expires in December. A Department for Transport spokesperson told the newspaper: “This Government is determined to deliver better services, grow passenger numbers and drive opportunity to under-served regions. The Government will introduce a Buses Bill later this year to empower local leaders to take back control of buses, end the bus postcode lottery and finally deliver the reliable services that local people deserve.”

Investor Harry Stebbings has warned that tech entrepreneurs will leave the UK “en masse” if the Chancellor announces a significant increase in Capital Gains Tax (CGT) at this month’s budget. Stebbings, a British podcaster turned investor who raised a $400m (£310m) fund this week, said the UK was “a bad place to do business” because of its tax environment. Plans to scrap the non-dom tax regime had sent a negative signal, but an increase in CGT – which is levied on the sale of assets such as shares and second homes – would pose the most serious concern to entrepreneurs, he said. It is said Rachel Reeves is considering raising CGT to between 33% and 39%, up from a range between 18% and 28% currently. “Why would you look to invest in the UK if you’re looking at a 35% CGT rate, or wherever it lands,” the 28-year-old asked.

Investment platform AJ Bell says reports that the Chancellor is likely to increase taxes at the Budget on 30^th October had spooked some of its customers into making withdrawals up to their tax-free allowance from their pension pots. Wealth management firm Quilter, which manages more than £113bn of customers’ money, also said it had experienced a surge in calls from customers wanting to withdraw cash from their pensions, as did Royal London Asset Management. AJ Bell CEO Michael Summersgill said yesterday: “Pensions are the primary retirement savings vehicle in the UK and customers are unsurprisingly sensitive to changes in their tax treatment. We have seen a noticeable change in both customer contributions to pensions and tax-free cash withdrawals.”

AJ Bell has also reported a 22% increase in assets under administration for the year ended 30^th September, taking the amount invested to an all-time high of £86.5bn. The FTSE 250-listed investment platform said customer numbers increased 14% to close at 542,000, with total advised customers up 8% at 171,000 and direct-to-customer clients increasing 17% to 371,000. Gross and net inflows were also both "significantly higher" than the prior year, AJ Bell said, with gross inflows surging 41% to £13.1bn and net inflows improving by 45% to £6.1bn.

Ryanair boss Michael O’Leary says he could have to axe hundreds of UK flights if Rachel Reeves raises aviation taxes in her Budget. Any hike in air passenger duty (APD) would hurt customer demand and undermine the viability of some routes, he said, and spark inevitable cut-backs ay the Irish airline. “If they raise APD again on domestic flights then there will be a cut in capacity, no question. These routes are not particularly profitable, they barely break even,” he said. Ryanair has already slashed 12% of its capacity in Germany in protest against higher taxes, The Telegraph notes.  

O’Leary has also backed Boeing’s move to abandoned talks with 33,000 striking workers after they rejected a 30% pay increase deal. The aircraft maker now says it will cut 17,000 jobs, or 10%c of the global workforce. “The negotiations are going nowhere. There’s nothing else they can do at the moment other than play the longer game,” O’Leary said, adding that the International Association of Machinists and Aerospace Workers (IAM) had been “mad” to reject the improved deal and that both Boeing CEO Kelly Ortberg and commercial jets chief Stephanie Pope were “doing a really good job in difficult circumstances on the ground”. “They have to see out this strike,” he added, even it if means aircraft deliveries are held up by several months.

Safeguarding minister Jess Phillips told hundreds of executives at an event on Wednesday that that the majority of businesses employ domestic abusers or rapists. “Almost every single one of you as an employer is currently employing a perpetrator of domestic abuse and or rape,” she said, at the gathering held at Google’s London headquarters and hosted by the Employers’ Initiative on Domestic Abuse (EIDA), a charity that helps companies tackle domestic abuse by providing support to staff. Among those she was speaking to were representatives from Amazon, Vodafone, National Grid and Hogan Lovells. Employers could play a massive role in tackling domestic violence “way more than the Government” could, she said, adding that managers had to stop being “terrified” of having uncomfortable conversations with staff seeking help.  She called for domestic violence to be considered a workplace issue: “If you’re working with people, you’re working with people who suffer from abuse. We need to take it on as if it’s a harmful material or a grinding machine. It’s as dangerous to the victims that you are working with, if not more dangerous. You could lose your life, not just your limbs.”  She added: “You don’t need to train yourself to be an independent domestic violence adviser. What I would say is that people are terrified. Employers are terrified of not knowing what to do in the case of a disclosure,” she said. “People tell me that they’ve been raped while at the Tesco checkout – people use different language. And what I wouldn’t worry [about] is not knowing what to do, because most victims just want somebody to listen to them.”

City minister, Tulip Siddiq has confirmed the Government intends to regulate Buy Now Pay Later (BNPL) companies via the Financial Conduct Authority. She has launched a third consultation, which will run until 29^th November, which will offer companies such as Klarna and Clearpay a chance to feed into the planned regime, alongside consumer groups and other interested parties. The former Conservative Government said in February 2021 it would introduce legislation, and launched consultations on various proposals, but they did not reach fruition amid pushback from the BNPL industry. Now, new rules are expected to be implemented in early 2026.

Meanwhile, BNPL firm Klarna is selling off its UK loan book to hedge fund Elliott to free up some £30bn to fund its global growth plans, the company has announced. Niclas Neglén, CFO of the Swedish headquartered firm said: “This is a unique deal, designed to support Klarna’s global growth as we continue on our journey to become the commerce network for the next generation”. According to figures shared with City AM last week, Klarna’s network of UK merchants has grown by roughly a third over the past year to 41,496, up from around 30,000 in 2023.

Retail sales slowed last month as shoppers cut back on spending in supermarkets, The Office for National Statistics (ONS) says. The office data shows sales volumes expanded by 0.3% in September, following a rise of 1% in August, the weakest growth since a decline of 0.9% in June.  Supermarket sale volumes fell 2.4% during the month, leading to the largest month-on-month fall for food stores this year. Retailers told the ONS they blamed poor weather and consumers continuing to cut back on luxury food items.

UK house prices rose by 2.8% in the year to August 2024, taking the average price of a home to £293,000, a 1.8% increase on the 12 months to July, The Office for National Statistics said yesterday morning. Private rent prices also climbed, increasing by 8.4 % in the 12 months to September this year. Meanwhile, a separate report from property website Rightmove concluded that 18% of homes up for sale in September had previously been available to rent – the highest figure since it started collecting data in 2010. Rightmove attributed the increase to landlords’ fears of a rise in capital gains tax (CGT) in this month’s budget, and tougher rules on energy performance certificates (EPCs) on rental homes.

Fraudsters are stealing more than £3m on average every day, according to figures from the banking industry. Typically, criminals target victims by tricking them out of their one-time passcodes, trade body UK Finance said, adding there had been 16% increase in the number of fraud cases in the past six months. However, total losses have fallen slightly - totalling £572m in the first half of the year.

Tesco and Shell are buying the entire output of a what is planned to be the UK’s largest solar farm under construction on the Kent coast that was originally meant to power 100,000 homes, The Telegraph says. The two companies have signed deals to purchase all the electricity generated by Cleve Hill, which won planning permission despite massive local opposition.  However, 65% of the output has now been purchased by Tesco, to power up to 144 of its supermarkets, and the remaining 35% by Shell. Vicky Ellis, of the Kent branch of CPRE, the countryside charity, said: “This project was approved on the premise that it would power homes, not petrol stations and supermarkets. The irony of a major supermarket such as Tesco and a prominent oil producer such as Shell buying into the green energy market to run their petrol stations and supermarkets is not lost on us. We suspect this is another example of greenwashing.” Cleve Hill is owned and financed by Quinbrook Infrastructure Partners, a US investment fund based in Houston, Texas, which specialises in energy projects.

London Underground drivers are going on strike again next month in their ongoing protest over pay and working conditions. Train operators and management grades will not work on 7^th or 12^th November, and there will be an overtime ban in place on Sunday 3^rd November and Saturday 16^th November, after members of the Aslef union voted overwhelmingly to walk out. Aslef also said engineering drivers will not work from late on Friday 1^st November until the next evening, when there will also be another overtime ban.

Meanwhile, journalists at The Guardian are voting on possible strike action in protest at the proposed sale of the newspaper’s Sunday sister title, The Observer, to Tortoise, a loss-making media startup founded by former BBC News boss James Harding. The National Union of Journalists (NUJ) said a consultative ballot would run for the next week.  Last month, the Scott Trust, the £1bn fund that owns both titles, were accused of “betrayal” by the NUJ, and staff last month passed a vote of no confidence in the fund. They have accused Tortoise of failing to provide sufficient assurances over job security and that plans to implement a paywall on the newspaper will harm accessibility and media plurality. Tortoise, however, has pledged to invest £25m in The Observer over the next five years and keep on all 70 Observer employees, maintaining their existing conditions, pay, and pension contributions.

Stringfellows was hit with a winding up petition by HM Revenue & Customs (HMRC) because of unpaid bills at the lap dancing venue, The Telegraph reports. However, a spokesman for Stringfellows said the company had now settled the issue with HMRC, calling the sum “a small amount” and insisting that the company was “very much solvent”. The club was founded by Peter Stringfellow in 1980, who at the time was a veteran of the nightclub industry. It attracted countless celebrities over the decades, including Marvin Gaye, Tom Jones and even Professor Stephen Hawking. Stringfellows is owned currently by George Georgiou, who bought it in 2020 when Peter Stringfellow died from cancer in 2018 aged 77.

Future plc CEO Jon Steinberg is stepping down from the board to relocate back to the US with his family. The FTSE-250 media group will search for a successor during his 12-month notice period.

Boohoo CEO John Lyttle has announced he is stepping down from the online fashion retailer . The news comes as it launches a strategic review of its brands, which include Debenhams, Karen Millen and PrettyLittleThing, that could result in a breakup of the company, The Guardian says. Lyttle, who joined from Primark in 2019, has agreed to remain in post until a successor is found.

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