Cooper still in last-minute talks with Treasury over spending review
The Home Office remains locked in negotiations with the Treasury over its budget with time running out before the spending review.
Rachel Reeves is expected to announce above-inflation increases in the policing budget when she sets out her spending plans for the next three years on Wednesday.
But Home Secretary Yvette Cooper is yet to agree a final settlement with the Chancellor, with reports suggesting greater police spending will mean a squeeze on other areas of her department's budget.
Downing Street is now understood to be involved in the talks, with Ms Cooper the last minister still to reach a deal with the Treasury.
The spending review is expected to see funding increases for the NHS, schools and defence along with a number of infrastructure projects as the Chancellor shares out some £113 billion freed up by looser borrowing rules.
But other areas could face cuts as she seeks to balance manifesto commitments with more recent pledges, such as a hike in defence spending, while meeting her fiscal rules that promise to match day-to-day spending with revenues.
On Monday morning, technology minister Sir Chris Bryant insisted that the spending review would not see a return to austerity, telling Times Radio that period was 'over'.
But he acknowledged that some parts of the budget would be 'much more stretched' and 'difficult'.
One of those areas could be London, where Sir Sadiq Khan's office is concerned the spending review will include no new projects or funding for the capital.
The mayor had been seeking extensions to the Docklands Light Railway and Bakerloo Underground line, along with powers to introduce a tourist levy and a substantial increase in funding for the Metropolitan Police, but his office now expects none of these will be approved.
A source close to the Mayor said ministers 'must not return to the damaging, anti-London approach of the last government', adding this would harm both London's public services and 'jobs and growth across the country'.
They said: 'Sadiq will always stand up for London and has been clear it would be unacceptable if there are no major infrastructure projects for London announced in the spending review and the Met doesn't get the funding it needs.
'We need backing for London as a global city that's pro-business, safe and well-connected.'
Last week, Ms Reeves acknowledged she had been forced to turn down requests for funding for projects she would have wanted to back, in a sign of the behind-the-scenes wrangling over her spending review.
The Department of Health is set to be the biggest winner, with the NHS expected to receive a boost of up to £30 billion at the expense of other public services.
Meanwhile, day-to-day funding for schools is expected to increase by £4.5 billion by 2028-9 compared with the 2025-6 core budget, which was published in the spring statement.
Elsewhere, the Government has committed to spend 2.5% of gross domestic product on defence from April 2027, with a goal of increasing that to 3% over the next parliament – a timetable which could stretch to 2034.
Ms Reeves' plans will also include an £86 billion package for science and technology research and development.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
27 minutes ago
- Yahoo
Analysis-Aluminium producers in the US win from Trump's tariffs
By Pratima Desai LONDON (Reuters) -Century Aluminum, the largest primary aluminium producer in the U.S., and top recycler Matalco will be among the big winners from President Donald Trump's higher tariffs on imports of the metal as domestic prices surge, four industry sources said. However, some sector players are worried that Trump's move from June 4 to hike the tariffs to 50%, from 25%, could push prices so high that demand starts to weaken. Higher revenues for U.S. aluminium producers and recyclers are expected mainly due to the way the market prices the metal key for construction, power and packaging industries. The companies typically charge customers the London Metal Exchange aluminium price plus a physical market premium to cover other costs including freight and taxes. The so-called Midwest premium hit a record 62.5 U.S. cents a lb, or $1,377 a metric ton, on Friday. Since Trump was elected for his second term in November, it has surged nearly 190%. Consultancy Harbor Aluminum said the premium would have to rise to 70 cents a lb, or $1,543 a ton, to fully reflect the 50% tariff. Century, in which London-listed miner Glencore is the top shareholder with a stake of more than 40%, declined to comment beyond a statement it issued last week, in which it welcomed the 50% tariff. Century produced 690,000 metric tons of aluminium last year. Miner Rio Tinto, which owns a 50% stake in Matalco, declined to comment, speaking on behalf of the U.S. company, which produced 528,000 tons of recycled or secondary aluminium last year. U.S. imports of scrap aluminium remain free of tariffs, but aluminium recycling needs primary metal to maintain properties of alloys used to make industrial goods. UNINTENDED CONSEQUENCES Alcoa, one of the world's largest aluminium producers, said its U.S. smelters would also benefit from the tariffs, and that its active production capacity in the United States totalled 291,000 tons. Alcoa's global aluminium output was 2.215 million tons last year. Constellium, which has a capacity to recycle 360,000 tons of aluminium annually in the United States, said it supported the original 25% tariff because it helped address unfair trading practices by non-market economies. "However, we are concerned that increasing the tariff beyond this level could have unintended consequences - potentially disrupting the aluminum supply chain and impacting demand," it added. Higher aluminium costs are likely to be passed on to consumers, which analysts expect will eventually hit demand. SCRAMBLE FOR SCRAP With its local primary aluminium industry in decline for years, the U.S. relies on imports of large amounts of unwrought aluminium and alloys - more than 3.9 million tons last year, according to U.S. government data. The U.S. produced more than four million tons of aluminium last year, most of it recycled material, according U.S. Geological Survey. Industry sources expect U.S. scrap aluminium imports to climb as recycling companies take advantage of high premiums to ramp up production. Already U.S. scrap aluminium imports have started to rise. Data from information provider Trade Data Monitor shows U.S. scrap aluminium imports rose more than 30% to 201,968 tons in the first quarter of this year from the same period in 2024. Traders said the high Midwest premium would allow recyclers to bid more for scrap than buyers outside the United States, as they can sell aluminium locally at a higher price. LME aluminium is trading around $2,500 a ton, while the duty-paid premium in Europe has dropped more than 50% to $170 a ton since January on expectations some global producers will divert primary metal to Europe to avoid U.S. tariffs. 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
Yahoo
41 minutes ago
- Yahoo
Defence or environment? London faces spending choices
Torn between growing geopolitical tensions and constrained public finances, Britain's finance minister Rachel Reeves is set to unveil feared trade-offs in a government spending review on Wednesday. Prime Minister Keir Starmer is boosting the defence budget, and reports point to National Health Service (NHS) being bolstered -- forcing other key ministries to tighten their belts. "Sharp trade-offs are unavoidable," said the Institute for Fiscal Studies, a respected think tank, of the spending plans through to 2029-2030. Reeves, the chancellor of the exchequer, is to detail day-to-day spending plans in her review to parliament on Wednesday. An inaugural budget in October featured tax rises and big spending announcements on infrastructure, meaning belt-tightening has to come from elsewhere. Already in March, Labour announced contested cuts to disability welfare payments, hoping to save more than £5 billion ($6.8 billion) by the start of the next decade. Thousands of protestors gathered in central London on Saturday, many holding placards that read "tax the rich, stop the cuts -- welfare not warfare". The government on Sunday announced £86 billion of investment in science and technology and defence by 2030. Reeves hopes the spending will boost sluggish growth, which risks added pressure from the tariffs trade war unleashed by US President Donald Trump. Reeves is set to announce a funding boost of up to £30 billion for the NHS, according to The Times newspaper. Britain's media has in recent days reported on tough, last-minute discussions between the Treasury and the interior ministry, particularly regarding the police budget, as well as with the energy department amid fears for the UK's carbon-reduction commitments. - Defence priority - Reeves has amended her fiscal rules to allow the government more headroom for investment in the run-up to the spending review. At the same time, she wishes to balance the books so that tax revenues match day-to-day spending, meaning the government borrows only to invest. The chancellor has allowed the Treasury to borrow more, particularly for infrastructure projects across the vital housing and energy sectors. This has handed her a windfall of £113 billion over five years. "When it comes to capital spending, government investment is set to be sustained at historically high levels in the coming years," the IFS noted. "If spent well, this should help contribute to growth and to better public services in years to come." Citing Russia's invasion of Ukraine, London has announced it will increase its defence budget to 2.5 percent of UK gross domestic product by 2027 -- and up to 3.0 percent by 2034, helped by cutting international aid. "While going for growth and fixing the NHS will still be central to the Spending Review, bolstering the nation's defence is now considered an urgent pressing need," said Susannah Streeter, head of money and markets at Hargreaves Lansdown. While seeking to cut costs, it has been reported that the Labour government may later this year announce plans to lift a cap on child benefits and reverse a decision to scrap a winter heating benefit for millions of pensioners, after a backlash over the policies from some of its party members. Possible "U-turns on benefit and welfare spending, increased pressure to ramp up defence spending and higher borrowing costs have left the chancellor, Rachel Reeves, in a sticky position", concluded Ruth Gregory, deputy chief UK economist at Capital Economics. "If she wishes to avoid a political backlash and/or an adverse reaction in the financial markets, she probably has little choice but to raise taxes in the Autumn Budget." The government has already hiked a business tax that entered into force in April. bur-ode/bcp/jkb/rmb
Yahoo
an hour ago
- Yahoo
Dutch investor Haerlem Capital tries to gatecrash sale of FX firm Argentex
A Dutch private equity investor is trying to gatecrash the emergency sale of Argentex Group, a London-listed currency management firm caught in the financial crossfire of Donald Trump's tariffs crusade. Sky News has learnt that Haerlem Capital has approached the board of Argentex with a proposal that would see it injecting £5m in exchange for a 50% stake in the company. Haerlem Capital has also offered to provide a £15m funding line to Argentex as part of the deal, according to people close to the situation. Money latest: Sources said the approach had been rebuffed because it was deemed unworkable in the context of a sale of the whole company, which has already been agreed to IFX Payments. Argentex shareholders are scheduled to vote on the IFX deal on Wednesday. In April, Argentex, whose clients include the FTSE 100 insurer Aviva, asset manager Barings, and Triumph Motorcycles, said it had been "exposed to significant volatility in foreign exchange rates, particularly in relation to the rapid devaluing of the US Dollar against other major benchmark currencies which has been precipitated by the various recent announcements from President Trump regarding tariff policies and US government spending cuts". The company was forced into emergency sale talks, with its board ultimately succeeding in securing a deal on a solvent basis - albeit at a steeply discounted price It announced late last month that it had drawn down £6.4m of a £20m revolving credit facility provided by IFX Payments. "These drawn amounts are in addition to the £10.5m secured bridging loan provided by IFX Payments and have been applied to ensure that the Company remains within its liquid assets threshold requirement (LATR) and to satisfy certain margin calls from its liquidity providers," it said. Argentex floated on London's junior AIM market in 2019, and counts Lord Jones, the former CBI boss, among its board members. Shares in the company, which recently resumed trading on the junior AIM stock market, were changing hands for about 2.5p on Monday morning, giving Argentex a market capitalisation of just under £3m. A spokesperson for Argentex declined to comment on the approach from Haerlem Capital.
