Two frantic days of votes led to the Government winning the right to overturn amendments made by the House of Lords to the Brexit bill. That victory only came after inserting a clause giving Parliament ‘backstop’ control over a final Brexit agreement. The wording of that deal was then changed at the last minute, which Tory rebels objected to- setting up another pivotalweek in Westminster which may well decide whether the Government or Parliament has the final word on the terms of the negotiation for Brexit.
Sections of UK industry face extinction unless the UK stays in the EU customs union, the CBI said. The employers’ organisation president Paul Dreschler said car firm bosses had come to him saying the industry would suffer unless we get “real frictionless trade”. Dreschler also said there was “zero evidence” that trade deals outside the EU would provide any economic benefit to Britain. Meanwhile the Trump administration’s trade policies are likely to hurt the US economy and undermine the world’s trade system, the IMF warned. IMF Director Christine Lagarde said a trade war would lead to “losers on both sides” and could have “serious” impact.
The pound fell sharply following data suggesting a sluggish economy. Manufacturing output fell 1.4% in April, the biggest fall for nearly six years, according to the ONS. Another ONS report showed only a modest rebound in construction output, after a sharp contraction in March.The pound fell three quarters of a cent after the data was released to $1.3350. Analysts said the data has eased pressure for a rise in interest rates.
The Financial Reporting Council (FRC) delivered its largest fine of £10m to accountants PriceWaterhouseCoopers (PwC) and £500,000 to PwC audit partner Steve Denison in relation to the 2014 audits of BHS and the Taveta Group (Taveta).PwC and Steve Denison have admitted misconduct and accepted accepted substantial fines and non-financial sanctions. A condition that PwC monitor and support its Leeds Audit Practice and provide detailed annual reports about that practice to the FRC for the next three years is a major step. So is an undertaking by PwC to review and amend its policies and procedures to ensure that audits of all non-listed high risk or high-profile companies (including private companies which employ at least 10,000 individuals in the UK) are subject to an engagement quality control review.
Legal and General Investment Management (LGIM) has said it will take action against companies that are not addressing the risks of climate change. LGIM, one of the biggest investment funds in Europe, said it would exclude offending firms from its Future World index fund. Where those firms featured in its other equity funds, it would vote against re-electing the chairs of their boards. Where this places corporates, such as oil companies, faced with the potential for stranded assets- that are valued on the balance sheet but may never be extracted because of climate changes fears- becomes an interesting question. It was a point raised in Financial Director‘s explosive interview with BP’s CFO Brian Gilvary on Friday- that you can see this week.