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“Rachel Reeves talks about growth – but her tax policies still punish the entrepreneurs driving it,” says FFT Chartered Accountants
Business

“Rachel Reeves talks about growth – but her tax policies still punish the entrepreneurs driving it,” says FFT Chartered Accountants

by July 9, 2025

A leading Manchester accountancy firm has accused the government of sending “mixed messages” to Britain’s entrepreneurs, warning that tax policy is undermining the very business owners driving growth.

Adam Caplan, Partner at FFT Chartered Accountants, said that despite Chancellor Rachel Reeves’ rhetoric around supporting small businesses and fostering innovation, the reality for many SMEs was rising tax burdens, more red tape, and increased financial risk.

“Politicians love to talk about supporting entrepreneurs, but the numbers tell a different story,” Caplan said. “Personal tax thresholds are frozen, Corporation Tax has risen, and accessing R&D relief – which is supposed to incentivise innovation – has never been more complex or uncertain.”

Caplan warned that the government’s approach is actively discouraging enterprise, with small business owners facing disproportionately high tax bills and ever-tightening compliance rules.

“Entrepreneurs take all the risk, create employment, and drive innovation – yet they are the ones left footing the bill while the government chases headlines,” he added. “It’s no wonder many are questioning whether Britain is still a good place to run a business.”

The firm said its clients frequently cite R&D tax relief as an area of concern. Once seen as a key support for innovation, recent rule changes and a surge in HMRC scrutiny have made many business owners wary of claiming at all.

“R&D tax relief should be a straightforward incentive,” Caplan said. “Instead, it’s become a fragmented, risk-laden process. We have clients who are genuinely innovating, but they’re reluctant to claim for fear of a costly and stressful investigation.”

The government has said it is working to simplify and combine different R&D relief schemes, but FFT argues that the damage has already been done – particularly to SMEs without large in-house finance teams or expensive consultants.

Despite the challenges, the firm continues to help its SME clients navigate the landscape, offering strategic tax planning and advice.

“We can’t rewrite government policy,” Caplan noted, “but we can help business owners plan around it – whether that’s smarter remuneration strategies, Corporation Tax planning, or getting ahead of the next Budget U-turn.”

He urged entrepreneurs not to wait for government clarity before taking action.

“The sad reality is that tax policy is increasingly driven by politics, not economics,” he said. “Business owners need to act now to protect what they’ve built – because waiting for common sense from Westminster could be an expensive mistake.”

FFT Chartered Accountants is now calling on the government to match its pro-business rhetoric with meaningful reforms – starting with a simplification of R&D tax relief, a review of Corporation Tax for SMEs, and a renewed focus on certainty and fairness in the UK tax system.

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“Rachel Reeves talks about growth – but her tax policies still punish the entrepreneurs driving it,” says FFT Chartered Accountants

July 9, 2025
Red Bull shock: Christian Horner sacked as team principal after 19 years in charge
Business

Red Bull shock: Christian Horner sacked as team principal after 19 years in charge

by July 9, 2025

In a stunning development for the world of Formula 1, Christian Horner has been dismissed as team principal of Red Bull Racing, bringing an end to a 19-year tenure that oversaw six constructors’ championships and eight drivers’ titles.

The announcement was made on Wednesday morning via a brief Red Bull statement thanking Horner for his “exceptional work” and confirming that Laurent Mekies – formerly team principal at sister team Racing Bulls – will take over the role with immediate effect.

No specific reason was given for Horner’s sudden departure, though speculation will inevitably focus on the internal scandal that rocked the team earlier this year. Horner, 51, was accused by a female Red Bull employee of “inappropriate behaviour”, with leaked messages dominating headlines. Although an independent investigation cleared him of wrongdoing and an appeal was dismissed, the incident cast a long shadow over Red Bull’s early 2025 campaign.

Red Bull CEO Oliver Mintzlaff said in a statement: “We would like to thank Christian Horner for his exceptional work over the last 20 years.

With his tireless commitment, experience, expertise and innovative thinking, he has been instrumental in establishing Red Bull Racing as one of the most successful and attractive teams in Formula One. Thank you for everything, Christian, and you will forever remain an important part of our team history.”

Horner’s wife, former Spice Girl Geri Halliwell, had publicly stood by him during the controversy, appearing at the Bahrain Grand Prix in a show of support that briefly quelled media speculation. However, Red Bull’s recent dip in performance – with Max Verstappen winning only two of the first 12 races this season – may have added pressure behind the scenes.

The team’s poor showing at Sunday’s British Grand Prix, where Verstappen finished fifth, now marks Horner’s final race in charge – a muted end to a career that saw Red Bull rise from mid-field debutants to F1 titans.

Laurent Mekies now faces the considerable challenge of steadying a team amid internal upheaval and an increasingly competitive grid. His appointment is likely to raise questions about stability within the Red Bull camp, with potential implications for Verstappen’s long-term future and the team’s broader leadership structure.

More details are expected in the coming days, as the F1 paddock absorbs one of the sport’s most significant leadership shakeups in recent memory.

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Red Bull shock: Christian Horner sacked as team principal after 19 years in charge

July 9, 2025
Begbies Traynor profit surges on lucrative large-scale failures
Business

Begbies Traynor profit surges on lucrative large-scale failures

by July 9, 2025

Insolvency specialist Begbies Traynor has posted a near doubling of its pre-tax profits, driven by a rise in higher-value corporate failures and sustained demand for advisory services across the UK.

The firm, which is listed on AIM, reported pre-tax profits of £11.5 million for the year to 30 April 2025, up from £5.8 million a year earlier. Revenues rose by 12% to £153.7 million, from £136.7 million in 2024.

Executive chairman Ric Traynor said the results marked the company’s tenth consecutive year of profit growth, adding that the performance was “driven by strong levels of organic growth delivered across our broad range of advisory services”.

The firm said its business recovery division, which accounted for more than half of total revenue, benefited from several large, complex insolvency appointments. These included Speciality Steels, part of Sanjeev Gupta’s struggling GFG Alliance, and Caskade, a major KFC franchisee operating more than 1,000 outlets.

Though the total number of corporate insolvencies slightly declined year-on-year — from 25,408 in 2024 to 23,969 in 2025 — volumes remained high by historical standards. Begbies’ experience reflected a shift toward fewer but more substantial cases.

Revenues from the business recovery division rose 5% to £83.7 million. The group expanded the unit through strategic acquisitions during the year, including Brighton-based White Maund and Midlands firm West Advisory.

Meanwhile, the firm’s advisory division saw a 40% jump in revenue to £23.6 million, supported by a robust pipeline of restructuring work and an uptick in M&A fees.

Investors were rewarded with an 8% increase in the group’s dividend, now 4.3p per share — the eighth consecutive annual rise. In addition, Begbies Traynor announced a new share buyback programme, aiming to repurchase 1 million shares at 5p each. The buyback will be funded from existing reserves, with the group maintaining capacity for further acquisitions and organic investment.

Jamie Murray, research analyst at Shore Capital, said: “The outlook remains positive, with a buoyant insolvency market and continued investment in fee earners expected to support growth. Shares currently trade at a discount to their five-year average and peer group, which we believe is unwarranted given Begbies’ market position.”

He added that the firm’s investment in business recovery and financial advisory capabilities was driving higher-quality mandates and improving margins.

Government insolvency data continues to indicate a challenging landscape for UK businesses, with elevated failure rates providing favourable conditions for firms like Begbies.

Looking ahead, Traynor said: “Activity levels are encouraging, with positive momentum across the group. We expect revenue to be at the upper end of market expectations and another year of profit growth in line with guidance, as we continue to scale and invest in the business.”

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Begbies Traynor profit surges on lucrative large-scale failures

July 9, 2025
SMEs warned as AI drives rise in CV fraud
Business

SMEs warned as AI drives rise in CV fraud

by July 9, 2025

Small and medium-sized businesses are being urged to tighten their recruitment checks as new research reveals a sharp rise in AI-driven CV fraud — with SMEs among the most exposed.

According to a study commissioned by degree verification provider Hedd (Higher Education Degree Datacheck), part of Jisc, over two-thirds (67%) of large companies reported a surge in fraudulent job applications, fuelled by generative AI tools that fabricate or embellish academic and work credentials.

However, awareness appears to lag among smaller firms. Just 37% of small businesses recognised AI as a contributing factor in increased CV fraud, compared to 64% of medium-sized employers — raising concerns that many SMEs may be underestimating the risk or lack proper detection tools.

Qualification fraud — including falsely claiming a degree or inflating grades — is a growing threat. While 45% of large organisations said they had caught candidates lying about their academic background, only 20% of small businesses reported similar discoveries, suggesting that such cases may be going unnoticed due to weak verification practices.

The disparity in checks is stark. Only 29% of small firms say they verify all qualifications, and over a quarter (26%) admit to checking none at all. By contrast, more than half (52%) of large companies conduct full verification of academic credentials.

Chris Rea, who leads Hedd’s qualification fraud service, warned that relying on physical or digital certificates alone is no longer sufficient. “AI is changing the hiring landscape,” he said. “It offers benefits, but it also makes it easier for dishonest applicants to create convincing fake CVs and forged qualifications.”

With tens of thousands of recent graduates entering a competitive job market, Hedd is urging SMEs to integrate qualification checks into their standard recruitment policies — particularly given that each new hire in a small business can have a disproportionately large impact.

The findings follow earlier research from Prospects (also part of Jisc), which revealed that 43% of students are using AI to edit CVs and cover letters, and 35% use it to create job applications from scratch. A further 26% are using AI to answer application form questions — making it even harder for recruiters to distinguish between genuine and fabricated submissions.

Despite the growing risks, only 39% of small firms use secure methods — such as contacting the awarding institution, using a background screening agency, or employing a qualification verification platform — to validate applicant credentials. This figure rises to 76% among medium-sized businesses and 85% among large employers.

Rea added: “Qualification fraud isn’t just a problem for big corporations. Hiring someone with false credentials can lead to serious compliance issues, reputational harm and even financial loss. For SMEs, who often operate with leaner teams and smaller margins, the consequences can be particularly damaging.”

Hedd recommends that SMEs use services like hedd.ac.uk or partner with reputable background screening providers to ensure academic qualifications are legitimate — and urges small businesses to audit their current recruitment practices before the next hiring cycle begins.

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SMEs warned as AI drives rise in CV fraud

July 9, 2025
Google and UK Government announce landmark deal to ditch legacy tech and train 100,000 civil servants in AI
Business

Google and UK Government announce landmark deal to ditch legacy tech and train 100,000 civil servants in AI

by July 9, 2025

The UK Government has today announced a landmark strategic partnership with Google Cloud aimed at modernising core public services, phasing out legacy IT infrastructure, and upskilling up to 100,000 civil servants in emerging technologies by 2030.

Unveiled by Technology Secretary Peter Kyle at Google Cloud Summit London, the agreement will help central and local government bodies replace outdated systems that have long been described as the “ball and chain” of the public sector, while delivering an estimated £45 billion in efficiency savings.

Under the agreement, Google Cloud will provide technical support and training to help government departments and public agencies—including the NHS, councils, and tax services—transition away from legacy IT contracts, many of which are vulnerable to outages and cyberattacks.

More than one in four public sector systems currently run on legacy infrastructure, with some police forces and NHS trusts reporting figures as high as 70%. These outdated contracts often leave departments locked into inflexible systems with high maintenance costs and limited interoperability.

The new initiative is a key part of the Prime Minister’s Plan for Change and digital government blueprint, which aims to transform the delivery of everyday services—from bin collections and healthcare to tax returns—by making them faster, more secure, and easier to use.

As part of the wider effort, Google Cloud will also launch a dedicated training programme to equip up to 100,000 civil servants with the skills needed to manage and apply emerging technologies, including artificial intelligence. This aligns with the Prime Minister’s target to have one in ten civil servants working in digital or tech roles by 2030.

“Britain will be using more technology, in more areas and more than ever before,” Kyle said. “My message to the big technology companies is clear: bring us your best ideas, your best tech, and your best price. When I negotiate with tech companies, I do so on behalf of the British taxpayer.”

Google DeepMind will also work with government scientists and engineers to explore the use of AI in accelerating public sector innovation and scientific research, while Google Cloud will support the potential development of a unified cybersecurity platform to improve response times and resilience to growing digital threats.

Tara Brady, President of Google Cloud EMEA, said the partnership would help “build a truly modern, secure and efficient digital future, delivering tangible benefits to citizens and driving significant economic value.”

The government hopes the deal will reduce procurement fragmentation by allowing departments to negotiate collectively rather than independently—something Kyle described as a move to “give government better bargaining power” in securing public sector technology deals.

By enabling faster adoption of cloud and AI solutions, the government aims to break free from outdated tech models, defend against cyber threats, and modernise the services that millions of Britons rely on every day.

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Google and UK Government announce landmark deal to ditch legacy tech and train 100,000 civil servants in AI

July 9, 2025
FTSE leaders and CBI urge stamp duty removal to boost UK stock market
Business

FTSE leaders and CBI urge stamp duty removal to boost UK stock market

by July 9, 2025

Some of the UK’s most influential corporate leaders have joined the CBI in calling for the removal of stamp duty on share purchases and greater flexibility on executive pay, as part of a sweeping set of proposals to revitalise London’s equity markets.

In a new report issued ahead of next week’s Mansion House speech by Chancellor Rachel Reeves, the Confederation of British Industry warned that the UK is at a critical crossroads, with its capital markets facing an “existential challenge” amid rising competition from the US and a decline in public listings.

The proposals have been developed in consultation with more than 30 FTSE 100 leaders and investors, including executives from Anglo American, Shell, HSBC and AstraZeneca. They argue that the time has come for “bold action” to restore London’s position as a leading global financial hub.

Key among the measures is the call to scrap or reform the 0.5% stamp duty levied on share transactions, which the report claims “disproportionately penalises” retail investors and discourages broader participation in UK equities. The CBI suggests alternative tax collection methods could be explored to maintain revenue while reducing the burden on investors.

The report also pushes for reforms to annual reporting requirements, more incentives for overseas companies—particularly from Asia—to list in London, and renewed efforts to build an “equity investment culture” among British retail investors.

Rupert Soames, CBI president and chairman of medical firm Smith & Nephew, said: “This is a moment of huge change. We face an existential challenge to the UK’s public markets, and we must ensure we are not sleepwalking into long-term decline.”

Soames acknowledged that the Treasury might be reluctant to forgo stamp duty revenues but argued that a more equitable system could still deliver similar returns without deterring participation.

The CBI is also urging the government to review UK remuneration rules to allow companies to compete globally for executive and non-executive talent. This follows a series of high-profile boardroom pay rows and a growing number of London-listed firms adapting US-style incentive schemes to attract international leaders.

The London Stock Exchange’s chief executive, Dame Julia Hoggett, welcomed the report, calling it a “timely and vital contribution” to the debate on the future of UK capital markets.

She added that while the government has taken steps to modernise the regulatory framework, “we have still not seen the turning point in terms of flows of risk capital into the UK”.

The appeal follows recent announcements that UK firms including CRH, Flutter, and Arm Holdings have either shifted their listings to New York or opted to list there, citing deeper capital markets and higher valuations.

The EY IPO Eye report released this week shows that just nine companies listed in London in the first half of 2025, raising £183 million—a 64% drop year-on-year. Analysts believe activity may pick up in late 2025 or early 2026, but sentiment remains fragile.

With public listings declining and private capital on the rise, the CBI warns that without decisive reform, the UK risks falling further behind in the global race for investment.

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FTSE leaders and CBI urge stamp duty removal to boost UK stock market

July 9, 2025
UK Government unveils £92bn transport overhaul to drive growth and connect communities
Business

UK Government unveils £92bn transport overhaul to drive growth and connect communities

by July 8, 2025

The UK Government has announced a record £92 billion investment in more than 50 major road and rail upgrades across England and Wales, promising to boost economic growth, create tens of thousands of jobs, and significantly improve journey times for commuters and businesses.

Part of the government’s “Plan for Change”, the funding represents the largest transport infrastructure commitment in a generation. It aims to unlock 42,000 new jobs, support the delivery of 39,000 homes, and provide faster, more reliable journeys nationwide.

Major road projects include critical schemes across the North and Midlands. These include improvements to the A66 Northern Trans-Pennine route, the M54 to M6 link road in Staffordshire, and Greater Manchester’s Simister Island interchange – all intended to ease congestion, improve freight logistics, and provide better access to jobs and housing.

On the rail network, significant upgrades are also planned. The government has approved the long-awaited reinstatement of passenger services between Portishead and Bristol city centre – reconnecting communities for the first time in over 60 years.

Three brand new railway stations – Wellington and Cullompton in the South West, and Haxby near York – will extend the reach of the rail network to thousands more people, supporting access to regional growth hubs like Exeter, Leeds, and York.

The Midlands Rail Hub, the region’s most ambitious rail scheme to date, will receive major backing. It promises faster, more frequent services for more than 50 destinations, expanded capacity into Birmingham, and nearly 13,000 construction jobs.

In the North East and Scotland-bound corridors, digital signalling will be introduced on the East Coast Main Line, reducing delays by up to 33% and improving reliability, while supporting the creation of almost 5,000 skilled jobs across the supply chain.

These investments are expected to play a vital role in achieving the UK’s long-term housing and productivity goals. The enhanced connectivity and capacity improvements are designed to support the government’s pledge to deliver 1.5 million new homes by 2029 and to stimulate regional growth beyond London and the South East.

Blake Richmond, Chief Operating Officer at Resonate Group, welcomed the announcement, saying: “It’s encouraging to see increased investment in the UK’s rail infrastructure, particularly in long-overdue regional upgrades and new connections that promise to bring more people and places into the network.”

He added that the success of these infrastructure projects would be maximised by pairing them with smart, real-time digital systems. “By combining physical upgrades with intelligent operational technologies, we can build a rail network that truly meets the needs of a modern, connected Britain.”

The UK’s latest round of transport investment is framed not just as a response to current bottlenecks and infrastructure gaps, but as a future-focused move to boost productivity, cut emissions, and level up regional opportunity. As implementation begins, the focus will shift to ensuring delivery matches ambition, especially as regions await tangible economic and connectivity benefits from the transformative £92 billion plan.

Speaking about the announcement, John Phillipou, Managing Director of SME Lending at Paragon Bank and Chair of the Finance & Leasing Association. said: “Today’s announcement from the DfT is promising news for manufacturing and construction SMEs, as well as regional communities across the UK, presenting a valuable opportunity to stimulate much-needed new housing, regional growth and job creation.

“As a specialist lender providing finance to thousands of SMEs, many of which rely on a fluid transport network, we see firsthand how critical connectivity is for regional communities and particularly SMEs. These improvements promise to accelerate development and bring opportunities to the areas that need it most.

“A welcome step forward for the UK’s growth and productivity agenda – but of course the devil will be in the detail, and ensuring SMEs have fair access to contracts and planning processes will be crucial in making these transformational plans a reality.”

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UK Government unveils £92bn transport overhaul to drive growth and connect communities

July 8, 2025
Monzo fined £21m after fraudsters open accounts using ‘Buckingham Palace’ as home address
Business

Monzo fined £21m after fraudsters open accounts using ‘Buckingham Palace’ as home address

by July 8, 2025

Monzo has been fined £21 million by the Financial Conduct Authority (FCA) after fraudsters were able to open bank accounts using clearly fake or implausible addresses — including Buckingham Palace and 10 Downing Street.

The FCA said Monzo’s financial crime controls were “completely inadequate”, allowing thousands of suspicious accounts to be opened between 2018 and 2022. In one instance, an account holder even gave Monzo’s own business address in London as their residential address.

“Banks are a vital line of defence in the collective fight against financial crime,” said Therese Chambers, joint executive director of enforcement at the FCA. “Monzo fell far short of what we, and society, expect.”

Monzo is one of the UK’s fastest-growing digital banks, with more than 12 million customers. But according to the FCA, its systems failed to keep pace with rapid growth — particularly in vetting new customers, assessing risk and monitoring suspicious transactions.

In one major breach, Monzo opened 34,000 accounts for high-risk customers for almost two years after it had been banned from doing so by the regulator. It also allowed some customers — whose accounts had been closed over financial crime concerns — to simply open new accounts.

Among the catalogue of failings identified by the FCA were:
• Customers using high-profile or clearly false UK addresses such as royal residences and government buildings;
• Use of PO Boxes, mail-forwarding services and addresses linked to previously banned customers;
• Accounts opened with invalid or non-UK addresses falsely listed with UK postcodes;
• Card orders redirected overseas shortly after UK-based accounts were opened;
• Multiple accounts linked to the same address, often without proper checks on criminal risk.

The watchdog said the majority of breaches occurred between October 2018 and August 2020, with violations of the high-risk account ban continuing until June 2022.

Monzo has since reformed its controls and says it has invested significantly in improving its financial crime defences. Chief executive TS Anil said the bank had learned from past mistakes and had made “substantial improvements”.

“The FCA’s findings relate to a historical period that ended three years ago,” Anil said. “We’ve since invested heavily in our systems and controls. I’m pleased the FCA acknowledges our progress.”

The £21 million penalty makes Monzo the latest in a series of banks fined for money laundering and onboarding failures. Nine UK banks have faced similar action in the past four years.

While the regulator welcomed Monzo’s remedial actions, it said the failures highlighted serious weaknesses in the UK’s fintech sector when it comes to fighting financial crime.

With high-profile fraud and scams continuing to rise across the banking industry, the FCA is expected to increase scrutiny of challenger banks and digital-first financial institutions.

Monzo’s distinctive coral cards and slick app-based banking have helped it grow rapidly since its full banking licence was granted in 2017. But today’s fine is a reminder that even fast-growing disruptors must uphold the same anti-money laundering standards as traditional banks.

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Monzo fined £21m after fraudsters open accounts using ‘Buckingham Palace’ as home address

July 8, 2025
PPE Medpro delivers scathing closing in DHSC case, accusing government of buyer’s remorse and scapegoating
Business

PPE Medpro delivers scathing closing in DHSC case, accusing government of buyer’s remorse and scapegoating

by July 8, 2025

The High Court trial between PPE Medpro and the Department of Health and Social Care (DHSC) drew towards its conclusion today, with a blistering set of closing submissions from the defence that portrayed the government’s £122 million claim as a desperate attempt to deflect attention from its own pandemic procurement failures.

Describing the case as “no more than opportunistic,” PPE Medpro’s legal team argued that the DHSC had never needed the 25 million surgical gowns in question, and that its claim was built on weak evidence, flawed assumptions, and a refusal to accept responsibility for a chaotic PPE stockpile that had spiralled out of control.

“This is a textbook case of buyer’s remorse,” the defence said, “where the DHSC is looking for ways to escape from a contract it wished it had never made.”

The closing submissions highlighted that by December 2020, the government had amassed around 500 weeks’ worth of surgical gown stock—close to a decade’s supply—according to its own witnesses. Rather than putting the PPE Medpro gowns to use, the DHSC simply warehoused them across the UK, including in open-air container parks and fields, where they remained for more than 18 months.

Despite the oversupply, the DHSC made no attempt to repackage, reclassify or resell the gowns, even as non-sterile PPE—an option experts said could have recovered up to £85 million. This, PPE Medpro said, was a deliberate decision not to mitigate its losses.

“The DHSC made no attempt to minimise or mitigate its loss… because by December 2020 it had already obtained 500 weeks’ worth of gowns stock,” the defence stated.

Medpro also pushed back hard on the DHSC’s key claims regarding gown compliance and sterility. The government had alleged that the gowns lacked the proper CE marking and failed to meet the EN 556-1 sterilisation standard. But, Medpro said, both points had been debunked during the trial.

The CE mark box was never ticked on the government’s own order form, and witnesses confirmed that the gowns had been approved by the DHSC’s own Technical Assurance team without CE certification. If the government had required more information at the time, it could—and should—have asked.

“PPE Medpro never provided a valid CE mark in respect of the gowns and its offer was approved on that basis,” the defence asserted.

On sterility, Medpro said the government’s claims were equally unsustainable. Testing took place more than 500 days after delivery, and only 60 gowns were tested out of 25 million. The gowns had been stored in unknown and uncontrolled conditions, and the microorganisms discovered on them—including strains found in the Pacific Ocean, the Mojave Desert, and even space—were more consistent with environmental contamination after delivery.

“The DHSC has not provided a credible explanation as to how all these bacteria were present in the factory in China,” said the defence.

In a marked shift, the DHSC has now pivoted its case to argue that none of the seven sterilisation plants used by Medpro—one operated by a global US firm—had properly validated processes, a claim described in court as relying on “fantastical assumptions.”

The defence also lambasted the DHSC for its failure to produce basic documentation or witnesses who could explain what happened to the gowns during their time under government custody.

“The DHSC has failed to call a single witness who could provide any evidence relating to the transportation, storage and handling of the gowns,” the submission noted.

This lack of transparency was compounded by repeated changes to the government’s case during the trial—particularly its shifting position on inspection dates, sterility criteria, and its abandonment of an earlier claim about improper gown packaging.

In a final flourish, PPE Medpro accused the government of attempting to make the company a scapegoat to deflect criticism of its own procurement strategy during the height of the pandemic.

“PPE Medpro has been made a fall guy for government failings… to shield others from criticism and distract from the vast over-ordering of gowns.”

The defence also noted that the company had faced “seemingly endless investigations” by the National Crime Agency (NCA), which they argued had had a chilling effect on Medpro’s ability to gather documents for its defence.

“The Damoclean threat of criminal proceedings” had cast a long shadow over the case, they said.

The High Court will now deliberate, with a judgment expected in due course. If the court sides with PPE Medpro, it could prove to be a significant setback not only for the DHSC’s attempts to recoup pandemic spending, but for the credibility of its procurement practices under emergency conditions.

For now, one thing is clear: after nine days of testimony and cross-examination, the DHSC’s case rests on a fragile foundation—much like the container parks in which its surplus stock was left to sit.

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PPE Medpro delivers scathing closing in DHSC case, accusing government of buyer’s remorse and scapegoating

July 8, 2025
Trump’s tariffs send UK borrowing costs soaring, forcing Reeves to rethink economic roadmap
Business

Trump’s tariffs send UK borrowing costs soaring, forcing Reeves to rethink economic roadmap

by July 8, 2025

Chancellor Rachel Reeves has been warned that her economic roadmap may need to be “ripped up” as a global market shock triggered by Donald Trump’s new wave of tariff threats drives up UK government borrowing costs and rattles investor confidence.

The yield on 10-year UK gilts surged to over 4.63%, as global markets reacted to the US President’s aggressive protectionist rhetoric. The tariffs, aimed at reshaping global trade relationships, have fuelled a flight to the US dollar and driven up borrowing costs across Western economies — including Britain.

Trump’s move comes just as Reeves had begun implementing Labour’s fiscal agenda, which includes a commitment to ramp up public investment. But the sudden tightening of fiscal conditions could derail those ambitions.

“Trump rants and the world pays,” said Ken James, Director at Contractor Mortgage Services. “We’ve seen gilt yields jumping and borrowing costs are up — will mortgage rates be next? Reeves’ roadmap may have to be ripped up.”

The impact of Trump’s tariffs is colliding with domestic fiscal vulnerabilities. A new report from the Office for Budget Responsibility (OBR) warned that Reeves’ recent U-turns on spending restraint had left the UK more exposed to future economic shocks, with Britain’s debt-to-GDP ratio projected to skyrocket to 270% by the early 2070s.

The OBR’s alarm bells come amid broader market anxiety. Investors are demanding higher returns to lend to the UK, reflecting both Trump-driven uncertainty and scepticism over the country’s ability to balance spending and debt.

“The pound is down against all major currencies,” said Tony Redondo, founder of Cosmos Currency Exchange. “Gilt yields are now spiking above Liz Truss levels — this is serious. The Chancellor’s fiscal headroom is shrinking by the hour.”

The repercussions are already being felt closer to home. With gilt yields rising, banks face higher wholesale borrowing costs — which could soon be passed on to consumers in the form of rising mortgage and loan rates.

“Higher gilt yields push up the cost of borrowing for lenders, which ultimately affects consumers,” said John Woolfitt, Director at Atlantic Capital Markets. “If inflation expectations rise due to global supply shocks, the Bank of England could even delay rate cuts.”

That leaves the Bank of England in a dilemma: support growth or tame inflation. Neither option is pain-free, particularly if trade disruption drags down GDP while pushing prices up.

Reeves’ immediate challenge is now fiscal: the higher cost of borrowing could add billions to the UK’s annual debt servicing bill. Each additional basis point on gilts translates to roughly £5 billion in extra annual costs.

“Just as Labour needs every penny for its promised reforms, each Trump-induced tweet is adding billions to Reeves’ tab,” said Kundan Bhaduri, entrepreneur at The Kushman Group. “It’s like watching your mortgage rate climb while someone else holds the ladder.”

Others warned of broader implications. David Stirling, Director at Mint Mortgages & Protection, said the rise in gilt yields could further weaken the housing market.

“Trump tweets, gilts jump, and Rachel Reeves winces. Mortgage rates could follow suit — bad news for anyone trying to get on the ladder before it’s pulled up.”

While some, like Samuel Mather-Holgate of Mather and Murray Financial, believe Trump may not follow through on his full list of tariff threats, the current volatility is already reshaping market expectations.

“Trump thrives on chaos, but his policies often fizzle. Still, this spike might be temporary — lenders may wait it out,” Mather-Holgate said. “But holidaymakers beware: the pound is falling fast against the euro.”

Meanwhile, Reeves must weigh the costs of sticking to her economic plans against the realities of market turbulence.

“Trump has created another fly in Labour’s inkwell,” said Ken James. “Her plans may now be unaffordable in the short term.”

As Trump’s tariff sabre-rattling ripples across global markets, the UK finds itself exposed. The combined pressures of higher borrowing costs, shrinking fiscal space, and a jittery bond market have delivered a clear warning to the Chancellor: this is not the environment she planned for.

With Labour only just in office and a fragile economy underfoot, the weeks ahead may force a fundamental rethink of Reeves’ economic ambitions — whether she likes it or not.

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Trump’s tariffs send UK borrowing costs soaring, forcing Reeves to rethink economic roadmap

July 8, 2025
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