Interest Rate Cuts Won't Save Britain
The Bank of England, Britain's central bank, on Thursday reduced its short-term interest rate by one-quarter percentage point to 4%. This is the fifth quarter-point rate cut in a year, and it was controversial even on the Bank's Monetary Policy Committee, which approved it by a vote of 5-4 on the second ballot.
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Yahoo
37 minutes ago
- Yahoo
Could a crackdown on ultra-fast fashion damage the UK economy?
The UK has become one of the biggest markets for ultra-fast fashion, including for China-founded Shein, which generated an estimated £1.5bn ($2bn) in UK revenue in 2023. With Shein reportedly exploring a London IPO, any potential shift in the UK's regulatory environment could materially affect its valuation, investor confidence, and growth trajectory. At the same time, other platforms such as Temu and Cider are rapidly expanding in the UK, drawn by relatively light-touch regulation and a digitally-savvy consumer base. With increasing focus on the industry's environmental impact, campaigners are calling for better regulation and more scrutiny of fashion retailers' conduct. If regulators do clamp down, striking the right balance between protecting the environment while minimising any economic fallout will be a tough challenge. After all, the Bank of England has already warned that economic growth is slowing and on top of that, the UK is grappling with a lack of investment, an exodus of millionaires, and a poor IPO outlook. Given that ultra-fashion is such a lucrative industry, increased regulation could signal further economic problems, despite its environmental merits. What is ultra-fast fashion? According to McKinsey & Company's State of Fashion report, ultra-fast fashion means making and selling new clothes within days by using data to spot trends quickly, flexible factories, and very cheap production. Read more: UK taxpayers 'subsidising' S&P 500, says LSEG boss The UK is the fourth-largest producer of textile waste in Europe, according to the Fashion Waste Index, which was produced by fashion retailer LABFRESH. The index showed that the UK generates 206,456 tonnes of textile waste each year and that, on average, each Brit discards 3.1 kg annually. Of the 3.1kg that is discarded, 0.3 kg is recycled, 0.2 kg is reused, 0.8 kg is incinerated, and 1.7 kg ends up in landfill. What could regulation do about it? Across the Channel, France faced a similar issue and has already started to take action. In a landmark move that could reshape global retail, it became the first country to directly crack down on the ultra-fast fashion industry with sweeping environmental reforms. Passed by the French Senate in June, the legislation introduces a €5 eco-tax per clothing item in 2025. This is set to double to €10 by 2030 and bans advertising for brands that fail to meet sustainability standards. The new French law also mandates 'eco-score' labels to measure garments' environmental impact and fines influencers who promote disposable fashion. The move marks a direct regulatory challenge to high-turnover, low-cost brands. Emily Carr, policy adviser at Green Alliance, told Yahoo Finance UK: 'British people think the government needs to step in to make the fashion industry more sustainable – previous polling for Green Alliance showed that seven in 10 would support environmental impact labelling for clothing.' France's policy has already caught the attention of British campaigners and green industry groups calling for stronger enforcement under the UK's Environment Act and reforms to its Extended Producer Responsibility (EPR) framework. 'The Environment Act 2021 gives the government lots of the powers it would need to catch up. For example, it could use powers in the Act to design an EPR scheme for textiles that penalises low-cost, low-durability products, like the French eco tax aims to do. Through this Act, the government has all the powers it needs, it just needs to show ambition by using them,' said Carr. These reforms could make producers and platforms financially responsible for the full lifecycle of the products they sell – from design to disposal. Dr Sarah Gray, lead analyst at Waste and Resources Action Programme (WRAP), a UK-based climate action NGO that works to reduce waste and promote a circular economy, told Yahoo Finance UK: 'Referring to last year's progress report for the UK Textiles Pact, we're seeing incremental improvements – but rising sales volumes are cancelling out the environmental gains.' Read more: What are share buybacks? WRAP and members of the UK Textiles Pact are working to define what a successful EPR system would look like. Dr Gray said that while strong models exist in France, the Netherlands, and Australia, the UK still needs clarity on product scope, eco-fee modulation, and how revenue would be collected and distributed. A circular economy strategy for England is expected this autumn, and with the climate crisis intensifying, calls for legislative urgency are growing louder. Influencers also play a crucial role in promoting ultra-fast fashion. France's new law proposes a full ban on advertising and influencer marketing for such brands. If passed, the content would be banned, with violations carrying fines of up to €100,000. According to WRAP, eco-scores and advertising bans such as those included in France's new law would be technically feasible within the UK framework, though it would be up to the government to legislate such measures. In a statement to Yahoo Finance UK, a spokesperson for Shein said: "The proposed bill, as currently defined, does not meet its stated objective of reducing the environmental impact of the textile industry… It inadvertently penalises French consumers, especially in the context of inflation.' Stocks: Create your watchlist and portfolio The company defended its approach, pointing to its 'demand-driven' model, which it said avoids overproduction. Shein proposed an alternative: a Sustainable Textile Transformation Roadmap — a framework focused on unsold inventory thresholds, responsible sourcing, and measurable sustainability goals. If the UK becomes subject to similar regulations as France, ultra-fast fashion brands may face a costly reckoning — reengineering supply chains, scaling back stock keeping units (SKUs), or absorbing eco-tax compliance costs that would squeeze already thin margins. Ultra-fast fashion may be big business and an important part of the UK's retail landscape but concerns about its environmental impact are not likely to disappear any time soon. How a potential clampdown on its practices could impact both the industry and the wider UK economy remains to be seen. Read more: The 'cheapest' stocks on FTSE 100 as UK blue-chip index Should you invest in gold? 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Yahoo
37 minutes ago
- Yahoo
Exclusive-USPS blocks shipping of illicit vapes in boost for Big Tobacco
By Emma Rumney LONDON (Reuters) -The U.S. Postal Service has cracked down on distributors of unregulated vapes using its services for business shipments, letters reviewed by Reuters show, in a blow to a multi-billion dollar industry that has dented Big Tobacco's sales. The letters, previously unreported, show that USPS wrote to major New York-based distributor Demand Vape, blocking it from using its services after New York City's Law Department, which represents the city's government and officials in legal matters, provided evidence that its shipments broke laws. USPS' action stands to benefit tobacco giants including Altria and British American Tobacco, which have for years battled against unregulated vapes, mostly from China. Unregulated vapes lack the authorisation from the U.S. Food and Drug Administration that is required for them to be legally sold in the United States, the world's largest market for smoking alternatives. USPS revoked Demand Vape's mailing exception last month after it received evidence the company shipped vapes lacking FDA authorisation and that violated a local flavour ban, a letter from USPS to the company, dated July 15, showed. "Your local Buffalo BME Office will not accept any packages from... Demand Vape that contain ENDS products," the letter read, referring to electronic nicotine delivery systems, another term for vapes. Demand Vape said it complied with relevant laws and was contesting the revocation, adding the industry operates in a "regulatory grey zone" with only a small number of FDA-authorised products that do not meet consumer demand. "We reject any characterisation that paints Demand Vape as anything other than a transparent, lawful and reputable business," it said in a statement. USPS did not respond to a request for comment. LIMITED EXCEPTIONS So far, the U.S. Food and Drug Administration has authorised only 39 e-cigarette products. But unauthorised devices are widely available as authorities struggle to contain them. Under a 2021 law, USPS is restricted from mailing vapes directly to consumers, internationally and in most other circumstances. The limited exceptions include domestic shipments between businesses, which need a "mailing exception" and their shipments must comply with relevant laws. Some other large carriers, including FedEx, refuse to ship vapes. DHL only offers carriage for business shipments with prior approval. USPS has provided NYC's Law Department with a list of other vape firms it has granted mailing exceptions so it can assess whether they should be challenged, in line with legal requirements, Eric Proshansky, deputy chief of the city's division of affirmative litigation, told Reuters. This could further limit the number of carriers available to the unauthorised vape industry. Other options, such as using smaller carriers or handling freight directly, tend to be more costly. MOUNTING PRESSURE BAT estimated the unauthorised vape market was worth around 6 billion pounds ($8.05 billion) last year. It is, however, increasingly under pressure. This year's U.S. import tariffs and seizures at ports have reduced unauthorised vape imports. The FDA also wrote letters to 24 U.S.-based middlemen, including distributors that are crucial to the unauthorised vape market, as part of a crackdown in May. This has led to empty shelves in vape stores, said Tony Abboud, executive director of the Vapor Technology Association, which represents firms including Demand Vape. USPS revocations will further damage U.S. vape businesses, he said. One of the largest U.S. e-cigarette distributors, Demand Vape sells to some 5,000 retailers in 49 states, according to 2024 filings in a NYC lawsuit against the company. The evidence city attorneys provided to USPS included copies of invoices showing Demand Vape's sales of unauthorised e-cigarettes. Brands the FDA has specifically flagged as illegal to sell were among them, a separate letter reviewed by Reuters showed. ($1 = 0.7452 pounds)
Yahoo
37 minutes ago
- Yahoo
Could an outright ban on zero-hours contracts harm working mums?
Since the Labour government came into power in the summer of 2024, ministers have pledged to crackdown on 'exploitative' zero-hours contracts as part of changes to the employment bill. Under the new rules proposed, employers will have to offer workers a contract that guarantees a minimum number of hours every week – a change many see as a significant step forward for job security. More than one million people in the UK are working on a zero-hours contract basis, in areas ranging from hospitality and warehouses to the NHS. Women are disproportionately affected by the precarious nature of zero-hours work, which contributes to the gender pay gap. Read more: Why did shared parental leave fail in the UK? According to the Trades Union Congress, women are 34% more likely than men to be on such contracts, and they earn nearly £10 less an hour than men who aren't on them. However, some argue that an outright ban, without tackling the growing shortage of flexible jobs, won't truly level the playing field for women and working mothers. Chronic lack of flexible work In a push to pre-pandemic flexible working arrangements, almost half of all businesses across the UK now want staff back in the office on a full-time basis, a British Chambers of Commerce survey of more than 500 businesses found. At the same time, more than a million UK workers have quit their jobs in the past year because of a lack of flexibility. This U-turn is hitting mothers hard, with one in four forced to leave the workforce because it's impossible to work and care for children without adequate flexibility. 'An outright ban on zero‑hours contracts could indeed harm working mothers, but not for the reasons you'd expect,' says Elizabeth Willets, founder of the recruitment firm Investing in Women. 'The issue isn't that women choose precarious work. It's that our labour market offers so few truly flexible, professional-level roles – and zero‑hours contracts often become the only way to combine work and caregiving.' Women aren't taking on zero-hours roles by choice. For many, there is no quality flexible or part-time equivalent. According to the 2023 Flexible Jobs Index by Timewise, the number of jobs advertised as flexible has plateaued. Only 31% overtly offer it – which is a negligible change from 30% in 2022. 'It leaves women balancing insecurity against inflexibility as their only options,' says Willets. Women need enough to live and plan on That being said, there's a need to balance flexibility with financial stability. For those without guaranteed hours, it's hard to anticipate income and schedule childcare in advance, says Rachel Carell, founder and CEO of childcare organisation Koru Kids. 'We've worked with many working mums as freelancers doing things like marketing and design – but rarely on zero hours,' she says. 'I've heard again and again that flexibility is vital, but so is the ability to plan and earn enough to live on. Zero-hours contracts rarely offer that.' Read more: What to expect from a maternity discrimination employment tribunal About 80% of zero-hours contract workers want regular hours, with 75% reporting financial hardship due to insufficient hours. And, these contracts can sometimes limit flexibility too. According to TUC research, two-thirds (67%) of mothers on zero-hours contracts have difficulty managing work with childcare – and two-thirds have missed out on a planned family event because of needing to work. When Carell launched the business, most of the nannies were on zero-hours contracts. 'But we moved away from these contracts voluntarily, because we heard from Koru Kids nannies that they didn't provide the security the nannies needed. We worked with parents to design new contracts that still gave flexibility, but also offered predictable hours and income,' she explains. Finding a flexible middle ground Clearly, change is needed – but simply banning zero-hours contracts may not be the solution. What could be done to keep those who rely on flexibility in the workforce, without forcing them to sacrifice their income? 'Countries like New Zealand, Germany and Ireland have shown ways to regulate zero-hours use while preserving flexibility,' says Willets. In 2016, New Zealand banned the insecurity of zero-hours contracts, not the adaptability. Employers still get to increase hours when needed, but workers start from a guaranteed base, are compensated for standby time and can decline extra work without fear of losing future shifts. 'Short-term reforms could also include guaranteed minimum hours after six months, notice periods for shift changes and pension contributions from day one, regardless of earning thresholds,' adds Willets. 'In the long-term? The real fix lies in businesses offering genuine alternatives like quality job shares, part-time roles aligned with professional pay scales, term-time contracts that don't penalise women and flexible working from day one.' Offering quality part-time work in senior roles would no doubt help to narrow the gender pay gap, which widens at higher salary levels. Below salaries of £20,000, 22% of job adverts offer part-time work, but this almost halves to 12% at the £20k point. And, it reduces to just 6% amongst jobs paid more than £60,000 a year. Improving access to promotions for part-time workers is also key. Michelle Chikanda, who founded the leadership firm Legacy Never Dies to work around her 2-year old son, adds that a ban on zero-hours could lead to more permanent and consistent work being available, if the government aids businesses. 'A ban must be matched with tax incentives for businesses that reduce the cost of hiring certain groups of people, like working mothers, creating a sustainable solution for all parties,' she says. Ultimately, the goal should be to replace zero-hours contracts with stable, flexible roles that don't force women into choosing between work, stability and their families. 'That's how we build real equity,' says Willets. 'Not with one-size-fits-all reform, but with thoughtful change grounded in lived reality.' Read more: How to speak to your boss about miscarriage How to stay motivated during a long job hunt Does mental health first aid work?Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
