Latest news with #LondonDefenceConference
Yahoo
6 days ago
- Business
- Yahoo
Rachel Reeves's fiscal rules have become a bad joke
That famous Hemingway quote – 'How did you go bankrupt? Two ways. Gradually, then suddenly' – has been much in use of late. For the moment, high income, advanced economies such as the UK are still in the 'gradually' phase, but the tipping point is approaching fast. This should be obvious to almost everyone. Certainly it is now widely recognised in sovereign bond markets, where yields on longer dated maturities have risen to levels that factor in a real possibility of eventual default. That's a big change in what hitherto has been regarded as the ultimate 'risk free' asset. Investors are beginning to charge against the off chance they won't get their money back, or that some backdoor method of effective default might be pursued, such as inflation or currency devaluation. Yet it is as if our politicians haven't even noticed. Only a few weeks back at the London Defence Conference, Sir Keir Starmer said that the organising principle of his Government was defence and security. Good, you might have thought. Here's a Prime Minister who is finally beginning to get his priorities right. Sadly, it was just words. As it turns out, the more important principle continues to be entitlement and dependency. One way or another, Britain's beleaguered Chancellor, Rachel Reeves, is going to have to find the money both to reverse her own actions in cancelling the winter fuel allowance and to end the two child benefit cap imposed by preceding Tory governments. Under pressure from backbenchers, she'll very probably also have to row back on at least some of the Government's reforms to disability benefits. Sir Keir appears in no mood to resist these pressures. With Reform UK snapping at his heels, he's rediscovered some of his ideological roots, so uncomfortably repressed while pursuing power with the faux-promise of fiscal responsibility. If Nigel Farage's Reform UK is now the main opposition to Labour, there's very little sign of economic realism from that quarter either, with the party now going full tilt at outdoing the Government on the winter fuel allowance and the two child cap. It's a catastrophic political misjudgement on Farage's part. By swinging left, he's shown himself to be no different from the vote-chasing political mainstream. The veil has fallen, and Farage is exposed as no more than an opportunistic paper tiger who prioritises unaffordable state dependency over sound economic judgment and what he believes to be right. Reform's emerging policy mix of fantasy economics and wishful thinking outbids even Labour in its determination to bankrupt the country. People aren't stupid, and my guess is that they'll see straight through Farage's cynically motivated make-believe. Reform's attempt to stand for both red in tooth and claw capitalism and high dependency state handouts is a contradiction in terms, and doomed to fail. In the meantime, the public finances are on course for how Elon Musk's SpaceX describes a rocket launch failure – 'a rapid unscheduled disassembly'. As is usually the case, the International Monetary Fund (IMF) pulled its punches in its annual Article IV assessment of the UK economy this week. It even offered the Chancellor a glimmer of hope by giving her cover, should she choose to use it, for yet another change in the fiscal rules. The point the IMF makes is actually a reasonably sound one. As they stand, the rules create significant pressure for frequent changes in fiscal policy. Intense market and media scrutiny surrounds the so-called 'headroom', or discretion in tax and spend policies, that the rules dictate. Small downward revisions by the Office for Budget Responsibility (OBR) to the economic outlook tend to erode any available headroom, and therefore require repeated, often on the hoof, adjustment to fiscal policy so as to stay within the rules. This is obviously not healthy. But nor are the fiscal rules as a whole. These have become almost Kafkaesque in their application and seemingly arbitrary power to influence policy. Certainly they seem to be doing no good at all in their central purpose of putting the public finances back on a more sustainable footing. The first of Reeves's rules require the current Budget to be in balance or surplus from the third year of a rolling forecast period. Sounds good in theory, but the effect of a constantly receding horizon is that it allows debt relative to national income to keep rising even though the rule is technically met by committing to future action that in practice rarely happens. The Chancellor defends the rolling horizon by arguing that it avoids the need to make sharp policy adjustments in response to small changes in the forecast. Yet as Lord King, the former governor to the Bank of England, pointed out in a recent speech in the House of Lords, Reeves did exactly that in her Spring Statement; she promised to cut spending to meet a change in the OBR's point forecast for 2029-30. The extraordinary expenditures of the pandemic are now supposedly behind us, and we have still to see any significant increase in defence spending, yet year after year, debt continues to rise as a proportion of national income. The rules are essentially useless in doing what they are supposed to – putting debt on a downward trajectory. Even as a way of bolstering the Government's credibility in financial markets, they are increasingly impotent. Everyone can see straight through them. The Chancellor insists that her rules are 'iron clad' and non-negotiable. A little while back, she also told the CBI annual conference – after announcing a £40bn tax-raising budget – that she would not be coming back with more tax rises or borrowing. On neither count did anyone believe her back then, and they believe her even less today, with the gamble on growth coming to the rescue self-evidently failing. The current fiscal rules are the 10th such iteration since Gordon Brown introduced his original 'golden rule' back in 1997, and pretty much each set of rules has made it slightly easier for the government to borrow to spend than the previous one. The only way of stopping this treadmill of rising indebtedness is to have a simple overarching rule that growth in spending must always be lower than growth in the economy, subject to the exception of large external shocks. Alternatively, a fixed target date of say five years for debt to be lower than it is today, as recommended by the House of Lords economic affairs committee, might serve equally well. All else is just a game of charades that increasingly fails to convince anyone. We are going bust gradually at the moment, but with steeply rising debt servicing costs, we are perilously close to the point of no return. Meanwhile, the politicians keep on promising more and more. If it wasn't so reckless, it would be laughable. No household or company would get away with managing its finances like this. Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
Yahoo
27-05-2025
- Business
- Yahoo
Applied Intuition Opens UK Office with £50 Million in Planned Investment
Office launch follows swiftly on the heels of Applied Intuition's newest defence offerings LONDON, May 27, 2025 /PRNewswire/ -- Applied Intuition UK has formally launched with the opening of its office in London, with the company already scaling at speed. This is a major step into the defence sector for Applied Intuition, the leading global vehicle intelligence company for automotive, trucking, construction, mining, agriculture and defence. Applied Intuition's commitment to the UK is expected to deliver £50 million worth of foreign direct investment into the UK, bringing jobs, skills, and research and development directly into the market. Building on the foundations of civilian autonomous capabilities, Applied Intuition UK, a fully sovereign subsidiary, will focus on delivering mission-critical autonomy solutions across air, space, land and sea. Applied Intuition's defence offering provides autonomy management and development systems for both existing and next-generation defence platforms. At a time of increasing global insecurity, autonomy offers a dual advantage, reducing reliance on extensive manpower traditionally required for fully crewed platforms, while also minimising risk to life for those operating in hostile environments. "Opening our London office marks a considerable step toward creating a sovereign autonomy capability for the UK. This sizable investment reflects our resolution to provide cutting-edge autonomous systems, and the tools needed to build them for our Armed Forces," said Tristam Constant, head of European Government and Defence at Applied Intuition UK. "We're building a strong team here, tapping into the UK's incredible engineering talent to deliver autonomy solutions to meet the most demanding requirements." Applied Intuition's latest venture marks a significant evolution, delivering cutting-edge autonomy solutions for civilian industries to enabling mission critical capabilities for the Armed Forces. The opening comes swiftly on the heels of the dual releases of two new software-defined product families: Axion, a specialised mission-critical toolchain allowing the development of all-domain autonomous capabilities, and Acuity, which delivers the onboard autonomy necessary to provide a decisive edge to the Armed Forces. As a dual-use technology provider, Applied Intuition is positioned to bridge the gap between commercial innovation and national security needs. The introduction of a UK presence reinforces Applied Intuition's commitment to delivering strategic autonomy at scale and providing serious defensive capabilities, all whilst encouraging growth and investment, and aligning with the British Government's priorities. Commenting on the opening of the office, and echoing the words of the Prime Minister Sir Keir Starmer at London Defence Conference, Minister for Investment Baroness Poppy Gustafsson said, "The UK is open for business, so I'm delighted that Applied Intuition's commitment to the UK is expected to deliver £50 million in foreign direct investment, boosting R&D, creating jobs and putting more money into people's pockets." "With defence being identified as a key growth sector in our upcoming modern Industrial Strategy, we're not only helping to attract and secure investment, but delivering long-term growth that supports skilled jobs and raises living standards across the UK," she added. This new UK presence reflects a long-term commitment from Applied Intuition to industry collaboration, economic growth opportunities and life-saving capabilities. About Applied IntuitionApplied Intuition is the vehicle intelligence company that accelerates the global adoption of safe, AI-driven machines. Founded in 2017, Applied Intuition delivers the toolchain, Vehicle OS and autonomy stacks to help customers build intelligent vehicles and shorten time to market. Major programmes in defence and 18 of the top 20 global automakers trust Applied Intuition's mission-critical solutions to deliver vehicle intelligence. Applied Intuition services the defence, automotive, trucking, construction, mining and agriculture industries. Applied Intuition UK was established in London in 2025 to bring the company's cutting-edge autonomy solutions to the UK and European defence sectors. View original content: SOURCE Applied Intuition, Inc. 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
Times
23-05-2025
- Politics
- Times
Urgent strategy is required to halt the march of tyranny in Europe
On Victory in Europe Day, 1945, Winston Churchill gave an address to an exhausted but jubilant nation from the balcony of the ministry of health. In it, he reminded the British people that 'we were the first, in this ancient island, to draw the sword against tyranny'. Britain's early move to arrest the grotesque ambitions of the Nazi regime rightly remains a source of national pride. Indeed, it partly informs the strong collective UK backing for Ukraine in the face of Russian invasion and atrocities. In his speech at the London Defence Conference on the 80th anniversary of VE day, Sir Keir Starmer drew an explicit line between the 'forces of hatred, tyranny and evil' in the Second World War and the Russian threat to
Yahoo
12-05-2025
- Politics
- Yahoo
Ukraine's former commander in chief warns that modern warfare is 'far from what NATO is now operating'
Ukraine's former top military commander warned that NATO's warfare model is outdated. NATO's tactics need a major overhaul to match Ukraine's battlefield innovations, Valerii Zaluzhnyi said. He also called into question the effectiveness of NATO's principle of collective defense. NATO's current model of warfare is far removed from what is happening on the battlefield today, according to the former commander in chief of Ukraine's armed forces. Valerii Zaluzhnyi, now Ukraine's ambassador to the UK, delivered a warning to the country's Western allies about the rapidly changing nature of modern warfare — amid what he described as the disintegration of the rules-based world order. This isn't just about updating defense industries or "some rearmament," he told the London Defence Conference at King's College London on Friday. "You need a new state policy." This means a root-and-branch refresh of tactics, organization, doctrines, training, and budgeting, Zaluzhnyi said, per a transcript of his comments published by Ukrainska Pravda. "All this requires not only additional resources, but also, most importantly, additional time," he added. Ukraine's Western allies have increasingly seen the war in Ukraine as a laboratory for modern warfare, one that provides a host of lessons. Military experts have told Business Insider that Russia's performance in Ukraine shows that NATO's air dominance could well be tested in a future conflict. NATO and Western defense officials have also said that alongside large-scale, expensive systems central to their capabilities, the alliance needs masses of cheap, expendable weapons like drones. But Zaluzhnyi said that lessons like these aren't being adopted fast enough in the West. Despite drones playing a transformative role in the defense of Ukraine, Zaluzhnyi said that he wasn't just referring to "drones taking over the battlefield." He said that if NATO stopped using tanks in favor of more high-tech means of warfare, it would still take about five years to catch up with Ukraine's abilities. "But technology will move on during this time. And so will the enemies," Zaluzhnyi added. Zaluzhnyi likened what is needed to "the days of nuclear energy mastery or space exploration," and said that the next step is to "build a completely new security architecture for Europe." He also said that Europe needs Ukraine as a shield, since it has the biggest army on the continent, and is the "only one with an army that knows how to wage modern, high-tech warfare." While some countries may have a technological advantage in certain areas, he said, "none of them will be able to secure their own independence in the full range of modern defence technologies." This is also playing out against the backdrop of "destructive trends in the global security system" that have weakened the power of NATO's Article 5, Zaluzhnyi said. His remarks, made in London, came as the UK gears up for a planned overhaul of its defense policy. The UK has pledged to raise its defense spending to 3% of GDP, if economic conditions allow. NATO did not immediately respond to a request for comment. Read the original article on Business Insider
Business Insider
12-05-2025
- Politics
- Business Insider
Ukraine's former commander in chief warns that modern warfare is 'far from what NATO is now operating'
NATO's current model of warfare is far removed from what is happening on the battlefield today, according to the former commander in chief of Ukraine's armed forces. Valerii Zaluzhnyi, now Ukraine's ambassador to the UK, delivered a warning to the country's Western allies about the rapidly changing nature of modern warfare — amid what he described as the disintegration of the rules-based world order. This isn't just about updating defense industries or "some rearmament," he told the London Defence Conference at King's College London on Friday. "You need a new state policy." This means a root-and-branch refresh of tactics, organization, doctrines, training, and budgeting, Zaluzhnyi said, per a transcript of his comments published by Ukrainska Pravda. "All this requires not only additional resources, but also, most importantly, additional time," he added. A fast-changing battlefield Ukraine's Western allies have increasingly seen the war in Ukraine as a laboratory for modern warfare, one that provides a host of lessons. Military experts have told Business Insider that Russia's performance in Ukraine shows that NATO's air dominance could well be tested in a future conflict. NATO and Western defense officials have also said that alongside large-scale, expensive systems central to their capabilities, the alliance needs masses of cheap, expendable weapons like drones. But Zaluzhnyi said that lessons like these aren't being adopted fast enough in the West. Despite drones playing a transformative role in the defense of Ukraine, Zaluzhnyi said that he wasn't just referring to "drones taking over the battlefield." He said that if NATO stopped using tanks in favor of more high-tech means of warfare, it would still take about five years to catch up with Ukraine's abilities. "But technology will move on during this time. And so will the enemies," Zaluzhnyi added. Like space exploration Zaluzhnyi likened what is needed to "the days of nuclear energy mastery or space exploration," and said that the next step is to "build a completely new security architecture for Europe." He also said that Europe needs Ukraine as a shield, since it has the biggest army on the continent, and is the "only one with an army that knows how to wage modern, high-tech warfare." While some countries may have a technological advantage in certain areas, he said, "none of them will be able to secure their own independence in the full range of modern defence technologies." This is also playing out against the backdrop of "destructive trends in the global security system" that have weakened the power of NATO's Article 5, Zaluzhnyi said. His remarks, made in London, came as the UK gears up for a planned overhaul of its defense policy. The UK has pledged to raise its defense spending to 3% of GDP, if economic conditions allow.
