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This is a City AM Studios production.
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Hello and welcome to Business as Usu, brought to you by Workday.
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I'm Matt Kenyon and today we're going to be talking all about Andy Burnham.
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He seems to want to undo a lot of the work of the 1980s, and does that mean he wants to bring us back to the 1970s?
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Plus, for a man who is being compared to Blair pretty often, is he really the new Corbyn instead?
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Well, joining me to discuss this, we've got Alice Denby.
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Hello.
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Our opinion and featured editor, I'm sure we'll have some strong opinions on this.
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And also Simon Hunt, our city editor.
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You keep telling me not to call you the city supremo anymore and come up with more original uh monikers, and I promise I will later in the week.
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I thought it was business boffin.
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I like that actually.
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That's not bad.
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Yeah, there was talk of uh business boffin, business babe, and business boy.
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Uh but we'll we'll we'll workshop that uh because that we'll have to feel how we can look in the comments.
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Yeah.
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So let's talk about this speech.
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I mean, we're we're sort of dealing with the aftershocks of what is being described as probably one of the most rhetorically effective conference speeches in years.
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I think Did you shed a tear?
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You know what?
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I I I did I mean, at risk of sounding mawkish, I did feel sort of hairs on the back of my neck stand up a bit.
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When you are confronted with someone like Andy Berner, who clearly is very effective in his grasp of language, you can't help but be taken along by it.
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I think when we get into the finer points of what he was actually talking about, it might feel quite different.
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I I was struck by something you were saying earlier, Alex, about how it's actually quite reminiscent of the Corbyn years in opposition.
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Some of the things he's actually, some of the content of what he's actually talking about.
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Yeah, it's frankly Bolshevik, some of it.
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I mean, look, apart from I think we should we should get it on the table that scrapping the triple lock is uh a great thing to do.
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It's something we've all been uh calling for for a long time, it's something many, including those on the right, were too cowardly to do.
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So I think he deserves a lot of credit for his courage in confronting that unsustainable spending commitment.
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But my worry is that all he's done is move all that spending just into a different column on the spreadsheet because he wants to create uh a national social care system, basically an NHS for social care because the NHS is so effective and brilliant.
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Um so I think I'm very worried about that.
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I think that'll be a disaster, and I think it will also demand yet more tax rises.
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This speech didn't include anything at all about uh business, he didn't mention it, he didn't talk about wealth creators, um, he was pretty vague on wealth on cuts to welfare spending.
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He sort of said he wants to do it, but very little detail on how.
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Uh, and of course, he wants to renationalise pretty much every major industry.
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So, you know, this really is back to the 70s socialist stuff.
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Uh, and we all know where the 70s left us.
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It was three-day weeks, it was bins piling up in the streets, it was power cuts, um, and uh Britain having to get bailed out by the IMF.
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So I think that's where we're headed.
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Oh, I was struck too that even though there were multiple mentions again of John Healy's tie and the story with uh Gordon Brown, there wasn't really any mention of the reason that John Healy, when he was defence secretary, quit then PN Keir Starmer's cabinet.
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Nothing on defense, which is surely crucial.
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Um, Simon, are you ready for us to take a time warp back to 1976?
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You've sort of dressed for it.
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I suppose I have, yeah, yeah, I'm ready for it.
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No, it it was this strange narrative arc that Burnham had during the speech where uh you know Britain rebuilt itself in the late 40s, uh, and then mysteriously everything undid itself in the 80s, and now we now we are where we are.
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It's a very patchy account of history.
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And actually, I mean, I don't think any of us here uh were alive uh during the 70s, but actually, you know, you ask people who were, and they don't have terribly fond memories of Britain in that era.
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It is not as though things were paradise and then that you know there was this rapid descent afterwards.
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Actually, the 70s was an era of you know strikes every day, three-day work weeks, power outages, um, you know, an IMF bailout.
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Britain was not in a good way at that time.
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Yeah, by a by a then-Chancellor Healy.
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So it is quite a combination of Labour's own record.
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Because if you're taking us back 50 years, you're wiping out presumably a record they're quite proud of in the Blair and Brown governments.
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Uh, I was struck to you, and this is not an original observation of mine, other people have said this, but he made these points to say he noted about sort of 1945, 1964, 1997, and then skipped to now, sort of forgetting the fact that obviously Keir Starmer won a majority, uh, and actually Andy Burnham is not a newly elected Labour PM at all.
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No, he was part of Blair's cabinet.
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Um I think what that is about is factionalism within the Labour Party.
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I think um you I think that the kind of original sin of Keir Starmer was his purge of the Corbynites, um, which I think was the right thing to do for the country.
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You know, I think I think that um that sort of very left-wing uh uh end of wing of the Labour Party um has a huge problem with anti-Semitism, which Keir Starmer really did grapple with, but in doing so disgruntled a large a large number of his own MPs, and I think that that's what undid him ultimately.
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Um and I think what Beard uh Beer Beer Beer Burnham is uh is He'd like to be Bernham.
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He'd like to be Bierham.
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Um I think what he's doing with trying to repudiate Blairism is speak to uh that very left-wing faction of the Labour Party, which never got on with Blair.
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Another thing which has been the undoing of uh Prime Ministers, albeit Tory ones, maybe not Labour, is is the issue of Europe and and the EU.
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He has uh as of Wednesday morning um opened the door to what what he's described as like the whole shebang of actually rejoining the EU.
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That is an absolutely enormous issue to consider relitigating at this point, and potentially one which is just explosive.
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And and it, to my mind, uh offers the prospect of having to go in on really compromised terms, cap enhance the EU.
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Would is there any chance that there'd be a rejoin option that doesn't involve the Euro, AI alignment, huge regulatory compromises?
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Well, what do you make of this, Simon?
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Um, I think this is another case of what I'm calling Eccles cakeism, which is the phrase I coined a couple of weeks ago that I've not got anyone else in the media to adopt so far.
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But I will say it at some point in the show.
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Um I think, yeah, but again, he talks about this being something that he would do in a you know a future parliament.
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In other words, he wants to appease the uh Europhiles in the party by saying, you know, net in the next part I'm going to really strengthen our relationship, but he can also at the same time tell the Eurosceptics in the party uh you know that he just wants stronger relations, he doesn't actually want to rejoin.
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So it's again, he's he's walking a bit of a tightrope, but it's definitely he's definitely sounded uh warmer notes on the EU than Stalmer does.
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I think that this is really uh a bad idea for a number of reasons.
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But I think you know, people c say that leaving the EU has cost us something like 4% of GDP.
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Lots of people dispute that figure.
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But really, what businesses want and what I hear from all the business leaders that I speak to is certainty.
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They want a at least 10-year horizon where they know what they're doing, they can adapt to anything, but they need to know what it is.
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And I think this would be yet more upheaval, yet more uncertainty.
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Uh, but politically and democratically, I think it's really dangerous because I think it's just overturning a democratic result, which is several subsequent general elections to reinforce the Brexit.
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Exactly.
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And I think all of this does is reopen those fault lines, which I think have you know really damaged our politics, led to the rise of populist parties.
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I don't know, I don't get a strategy that looks at how well reform have done in Labour heartlands and thinks, oh, the answer to this is undoing Brexit.
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It doesn't make any sense to me.
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I'm surprised that he's also reaching for another um cakist approach to electoral reform.
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They're not saying that will presumably be on the manifesto.
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I mean, historically, the British public do not really care about that sort of like level of constitutional voting change.
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It's not it's not a great vote winner.
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We had a referendum on it on AV uh in 2011.
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Uh, but it seems striking that a a party which has relied on majority government and has never really had to do a a coalition since the days of the national government, um almost a hundred years ago, is is is now reaching to the idea of electoral reform.
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So it's a clear sock to the Liberal Democrats, isn't it?
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They are anticipating a hung parliament.
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They know that that is one thing that the Liberal Democrats will definitely have on the table for any coalition agreements.
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Uh surely you at least wait until you're actually in the negotiating table.
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Clearly not.
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I do wonder whether the fact that virtually every single policy announcement that Burnham has made the past couple of weeks has all been about things that might happen in a future parliament.
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Is that the clearest sign that he wants to call an early election?
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Yes, it could well be.
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Yeah, we've we've speculated about this.
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I would be shocked.
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And also I might be wrong, and please feel free to clip this up, uh, anyone if if I am wrong, but I there's no way that election happened in 2029, surely.
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I don't know.
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I think that this is as good as it's gonna get for Burnham, and I think it would be quite sensible to call a snap election.
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But we i uh i assuming that doesn't happen, we should talk about like what such policy meet that there was in here.
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Um, because we are uh a few weeks away from a budget.
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Um and it's pretty certain that there's gonna be some tax changes at least.
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Capital gains tax, we're anticipating uh possibly reduction in the threshold for the mansion tax.
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What else are we thinking?
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Taurus tax, tourist tax, which is now being sort of whispered about as just a sort of new lever for borrowing.
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Something on inheritance tax, maybe.
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Yeah, it's that that's possible.
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I mean, Burnham's team uh and and Healy's uh treasury are far less leaky than uh what we were used to from Starmer and Reed.
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So I think there's it is possible just from the way that he's been operating as comms, that there is the genuine prospect of a rabbit in the hat.
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He just doesn't really have much option.
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And there's a big question, too, about how much headroom we're gonna be left with.
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Yeah.
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Are they gonna be a position where actually it's so squeezed that we're looking at less than 10 billion?
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I just don't know if that feel realistic sort of week.
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Well, there has been chatter about whether Healy might try and uh reduce the headroom uh in order to spend more.
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That is something that uh Rachel Reeves uh dabbled with at the beginning of her term as chance that it didn't end very well.
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Yeah, I was gonna say, didn't we go down to about four billion headroom under Reeves?
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And that was a disaster.
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Yeah, yeah.
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Well, obviously, we're not gonna harp on about Andy Burnham too much.
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He wants to end uh politics as usual, as he says, but we are still business as usual.
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So after the break, we're gonna be talking about some actual businesses.
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And I'm of course we'll be uh making huge amounts of reference to the budget too.
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We'll be talking about uh some of the difficulties going on at Greg's, Shepherd Neme, and in Brighton News potential for a FinTech IPO.
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Don't go anywhere.
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That's after the break.
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Guessing is for game shows, not your business, especially when your margin for error is zero.
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It's a new workday.
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Welcome back to Business as Usual.
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So we promised we would talk about some business and not just politics, and we're gonna be talking about some big retail brands.
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Uh, first of all, Greg's, uh, the very popular chain bakery, which uh is loved by Andy Burnham, but I'm gonna stop talking about Andy Burnham, not everything for Andy Burnham.
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Uh it's Grim News over at Greg's, so it looks like as many as uh 740 jobs are on the line.
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Simon, what's going on?
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It's an insight, isn't it, into how the sausage is made.
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God, and to tell us all about how that sausage ends up within that pastry and then served to you.
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Well Simon.
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Yeah, Greg's staff have been burnt in this, I think.
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Um so it seems as though uh Greg's is going to shut up uh four of its factories, four of its sausage roll-making uh uh sites.
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That's in North Lakes in Cumbria, Kelso in Scotland, uh County Durham, and uh up in North London Enfield.
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Um, they say that's to make their operations more efficient.
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They're going to divert some production elsewhere, they're going to outsource um some uh production to third parties.
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And I think this is a the latest sign of um, you know, a big manufacturing crisis for the UK at the moment.
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Energy costs have soared, um, you know, there's other costs involved as well, including higher taxes, uh higher employment costs.
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And businesses are looking at their cost base and seeing about you know, exploring ways they can try and outsource stuff as much as possible uh to try and boost their margins.
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Uh and this comes as Greg says actually been on a roll retail-wise, sales sales are up, it's opening a lot of new stores.
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Yeah, well, exactly.
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I mean, not normally when when a um you know a food allow a food outlet will increase the number of sites, that you would assume that means they need more plants to manufacture more.
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Um, but actually they've decided that you know the sort of um front-facing stores is where they're going to make their money.
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A lot of the back, the back office, a lot of the manufacturing stuff can be outsourced elsewhere.
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Um think there might be any impact on the quality of the products.
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Your consumers will be worried about it.
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I do wonder about that because um, yeah, it's very very much up until now, there's been a very integrated model by Greg's.
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They are they are in all parts of the sausage making process, as it were, from from you know the sourcing of the quite literally, yeah.
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Yeah, and so that a lot of that is going to go.
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Um, but the shares did actually react positively.
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Uh the stock was up about um uh seven percent, I think, on Wednesday morning.
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A sign that investors are warming to the idea of them having to them cutting a lot of their back office costs.
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Shepard Neem, too, you've been looking into the uh the big brewer also uh reviewing uh some closures.
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What's going on?
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Yeah, this did this did make me a bit sad because uh I mean, for those that don't know Sheppard Neem, it's not the biggest uh brewer in the country, but it is the oldest.
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Uh it actually dates back to the 1600s, uh, this company.
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Uh and if you ask locals in Faversham, the town in Kent, uh, in which the beer is brewed, there is actually historical records that there has been brewing in that area since about the 1500s.
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So it's a very old, very established beer.
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Um, but the brewer behind it has um decided it's going to conduct what they're calling a strategic review um of the brewing operations, so that places its future uh in doubt.
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Um I spoke to the chief executive, Jonathan Neim, of the Neem family that's been running this country.
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Oh well, so that's that must be so many generations back.
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Very much so.
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Uh, and he would not rule out the possibility that they might end up closing that brewery altogether.
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Um so that's very sad news for a very old uh tradition in British business of brewing.
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It's a sort of double assault, isn't it?
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And it's the assault on family businesses and on the hospitality industry in general that's leading to this brewery.
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Yeah, it's it's a similar story to Greg's.
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It's you know, energy costs going up massively, it's uh taxes going up, employment costs going up.
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Um, and at the same time, there has been a wider uh trend in the brewing industry away from ale, which is what Sepanem is known from.
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I think their volumes were down about 10% over the last year, which is do they broadly make ales as opposed to Spitfire logic?
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So they are in the log business.
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I'm I'm showing myself to actually be very ignorant here.
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Uh Master Brew is their is their biggest ale, I think.
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Um they have moved into stout more recently because it's so popular.
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Um but yeah, they are a very traditional ale brewer.
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I always question whether a challenger stout can can really thrive.
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I know there was a brew dog stout for a while.
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I can't remember.
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Everyone's had a go.
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It never quite felt um authentic.
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I have a very fond memory of Sheppard Nim.
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So it was the 2015 election, my favourite election.
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And uh I was I was there at this brewery.
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Favourite election.
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And then I was there at this brewery when David Cameron came to visit and was forced to drink a pint at sort of 11 in the morning.
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Uh great day.
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You didn't leave your children in the pub or something to be.
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Um my my favourite um Sheppard Nim beer is one called Bishop's Finger.
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Uh, and it's so called because the brewery is near Canterbury, and all of the signposts in the area point towards Canterbury uh Cathedral, which are known as Bishop Bishop Fingers.
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Oh, great.
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So yeah, it's a shame because it's such a storied.
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Absolutely storied.
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To introduce a bit more levity into the discussion, um, Zilch could be lighting up our flagging IPO market in some essentially quite good news.
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Yeah, it's uh a tale as old as time.
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I mean, I've been writing about the possibility of a Zilch IPO uh since early 2022.
00:15:43.519 --> 00:15:44.799
So it's been a long time coming.
00:15:45.039 --> 00:15:54.240
And that was back in the day where it felt like every FinTech could just have their Series E and was being absolutely inflated and it didn't seem like anything would ever go wrong.
00:15:54.559 --> 00:15:57.120
Yeah, but it looks like finally some action is actually happening.
00:15:57.279 --> 00:16:01.919
Uh Zilch, which for those who don't know it, is a sort of binal pay later firm, a bit like Klarna.
00:16:02.240 --> 00:16:09.919
Um, they have reportedly um hired bankers, or at least are speaking to potential uh bankers who could uh run this IPO.
00:16:10.000 --> 00:16:16.159
So it looks like they're in the advanced stages now of getting this uh in process after a four-year-long uh hiatus.
00:16:16.399 --> 00:16:17.759
And we're hoping that will be in London.
00:16:18.000 --> 00:16:22.480
That's it looks as though London is the um is the front runner to be the venue for this.
00:16:22.639 --> 00:16:31.679
Um Zilch, the Zilch chief executive is also also runs what's called the Unicorn Council, a sort of council of some of the biggest tech firms in Britain.
00:16:31.840 --> 00:16:36.000
And so if he didn't choose London, it would be a bit of a humiliation since.
00:16:38.399 --> 00:16:39.200
And this, I mean, it's interesting.
00:16:39.279 --> 00:16:45.759
We were talking about this just the other day about Klarna and that what now looks like it was quite an ill-advised listing in New York.
00:16:46.000 --> 00:16:55.039
Um, could this be the year that a lot of homegrown fintechs look around and think, okay, there could be more liquidity in New York, but actually we know this market.
00:16:55.200 --> 00:17:00.559
There's a lot of interest in this market from the British public and the broader European uh market.
00:17:00.879 --> 00:17:02.799
And actually, this is the most sensible place to list.
00:17:03.120 --> 00:17:03.759
You'd hope so.
00:17:03.840 --> 00:17:07.039
I mean, we we spoke last week about the uh Airtel money float.
00:17:07.279 --> 00:17:14.799
Again, that is a sort of global fintech business that decided to choose London as a venue because there is a lot of fintech expertise.
00:17:14.880 --> 00:17:16.960
Uh, that's a real specialism of London.
00:17:17.119 --> 00:17:25.039
And so you'd hope that there are there are a lot of you know big billion dollar uh fintechs in London for whom London should be the appropriate venue.
00:17:25.279 --> 00:17:25.920
Can I ask you both?
00:17:26.000 --> 00:17:27.759
Are you uh by now pay later users?
00:17:27.920 --> 00:17:30.079
Do you do you have a pay it, pay it forward, pay it backward?
00:17:30.319 --> 00:17:31.440
No, I don't trust myself.
00:17:31.599 --> 00:17:34.079
No I'm always amazed those companies make money, really.
00:17:34.640 --> 00:17:35.599
I suppose there is a market for it.
00:17:35.759 --> 00:17:36.880
I'd be I'd be terrible at that.
00:17:37.839 --> 00:17:47.519
I find them really interesting because actually they're used by a lot of female consumers both to buy sort of fashion items but also for kind of household purchases like washing machines and so on, though they use quite a lot for that.
00:17:47.599 --> 00:17:55.039
Um I did buy a computer on a I think that was a z a 0% 12-month contract rather than a BMPL deal.
00:17:55.119 --> 00:17:57.039
But so yeah, I don't know if I've done that.
00:17:57.359 --> 00:17:58.799
Well, that's all we've got time for today.
00:17:58.880 --> 00:18:03.519
So thank you very much for listening to or watching Business as Usual brought to you by Workday.
00:18:03.759 --> 00:18:07.920
And don't forget to subscribe to our newsletters and download the Free We City AM app.
00:18:08.160 --> 00:18:11.599
This episode was produced by Joey Creator Needer and Joe Lee.
00:18:11.759 --> 00:18:15.440
Thank you very much for listening again, and we'll be back in your podcast feeds tomorrow at 6.
00:18:15.599 --> 00:18:16.079
Bye.
00:18:16.319 --> 00:18:17.279
Goodbye.
00:00:00.000 --> 00:00:02.799
This is a City AM Studios production.
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Hello and welcome to Business as Usu, brought to you by Workday.
00:00:08.880 --> 00:00:12.480
I'm Matt Kenyon and today we're going to be talking all about Andy Burnham.
00:00:12.640 --> 00:00:19.039
He seems to want to undo a lot of the work of the 1980s, and does that mean he wants to bring us back to the 1970s?
00:00:19.280 --> 00:00:25.359
Plus, for a man who is being compared to Blair pretty often, is he really the new Corbyn instead?
00:00:25.519 --> 00:00:28.480
Well, joining me to discuss this, we've got Alice Denby.
00:00:28.640 --> 00:00:28.879
Hello.
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Our opinion and featured editor, I'm sure we'll have some strong opinions on this.
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And also Simon Hunt, our city editor.
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You keep telling me not to call you the city supremo anymore and come up with more original uh monikers, and I promise I will later in the week.
00:00:42.799 --> 00:00:44.079
I thought it was business boffin.
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I like that actually.
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That's not bad.
00:00:45.520 --> 00:00:48.719
Yeah, there was talk of uh business boffin, business babe, and business boy.
00:00:48.799 --> 00:00:53.039
Uh but we'll we'll we'll workshop that uh because that we'll have to feel how we can look in the comments.
00:00:53.200 --> 00:00:53.359
Yeah.
00:00:54.320 --> 00:00:56.000
So let's talk about this speech.
00:00:56.159 --> 00:01:03.200
I mean, we're we're sort of dealing with the aftershocks of what is being described as probably one of the most rhetorically effective conference speeches in years.
00:01:03.280 --> 00:01:04.719
I think Did you shed a tear?
00:01:04.959 --> 00:01:05.359
You know what?
00:01:05.439 --> 00:01:10.079
I I I did I mean, at risk of sounding mawkish, I did feel sort of hairs on the back of my neck stand up a bit.
00:01:10.959 --> 00:01:17.920
When you are confronted with someone like Andy Berner, who clearly is very effective in his grasp of language, you can't help but be taken along by it.
00:01:18.079 --> 00:01:22.560
I think when we get into the finer points of what he was actually talking about, it might feel quite different.
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I I was struck by something you were saying earlier, Alex, about how it's actually quite reminiscent of the Corbyn years in opposition.
00:01:28.719 --> 00:01:31.439
Some of the things he's actually, some of the content of what he's actually talking about.
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Yeah, it's frankly Bolshevik, some of it.
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I mean, look, apart from I think we should we should get it on the table that scrapping the triple lock is uh a great thing to do.
00:01:38.400 --> 00:01:43.840
It's something we've all been uh calling for for a long time, it's something many, including those on the right, were too cowardly to do.
00:01:43.920 --> 00:01:48.879
So I think he deserves a lot of credit for his courage in confronting that unsustainable spending commitment.
00:01:49.200 --> 00:02:01.280
But my worry is that all he's done is move all that spending just into a different column on the spreadsheet because he wants to create uh a national social care system, basically an NHS for social care because the NHS is so effective and brilliant.
00:02:01.439 --> 00:02:03.200
Um so I think I'm very worried about that.
00:02:03.280 --> 00:02:07.760
I think that'll be a disaster, and I think it will also demand yet more tax rises.
00:02:08.080 --> 00:02:18.240
This speech didn't include anything at all about uh business, he didn't mention it, he didn't talk about wealth creators, um, he was pretty vague on wealth on cuts to welfare spending.
00:02:18.319 --> 00:02:21.840
He sort of said he wants to do it, but very little detail on how.
00:02:22.319 --> 00:02:26.159
Uh, and of course, he wants to renationalise pretty much every major industry.
00:02:26.319 --> 00:02:31.199
So, you know, this really is back to the 70s socialist stuff.
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Uh, and we all know where the 70s left us.
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It was three-day weeks, it was bins piling up in the streets, it was power cuts, um, and uh Britain having to get bailed out by the IMF.
00:02:42.800 --> 00:02:43.840
So I think that's where we're headed.
00:02:44.080 --> 00:02:56.879
Oh, I was struck too that even though there were multiple mentions again of John Healy's tie and the story with uh Gordon Brown, there wasn't really any mention of the reason that John Healy, when he was defence secretary, quit then PN Keir Starmer's cabinet.
00:02:57.280 --> 00:02:59.360
Nothing on defense, which is surely crucial.
00:02:59.520 --> 00:03:03.039
Um, Simon, are you ready for us to take a time warp back to 1976?
00:03:03.439 --> 00:03:04.319
You've sort of dressed for it.
00:03:04.719 --> 00:03:06.639
I suppose I have, yeah, yeah, I'm ready for it.
00:03:06.800 --> 00:03:19.120
No, it it was this strange narrative arc that Burnham had during the speech where uh you know Britain rebuilt itself in the late 40s, uh, and then mysteriously everything undid itself in the 80s, and now we now we are where we are.
00:03:19.280 --> 00:03:21.039
It's a very patchy account of history.
00:03:21.120 --> 00:03:30.800
And actually, I mean, I don't think any of us here uh were alive uh during the 70s, but actually, you know, you ask people who were, and they don't have terribly fond memories of Britain in that era.
00:03:30.879 --> 00:03:35.199
It is not as though things were paradise and then that you know there was this rapid descent afterwards.
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Actually, the 70s was an era of you know strikes every day, three-day work weeks, power outages, um, you know, an IMF bailout.
00:03:44.240 --> 00:03:45.680
Britain was not in a good way at that time.
00:03:45.919 --> 00:03:47.759
Yeah, by a by a then-Chancellor Healy.
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So it is quite a combination of Labour's own record.
00:03:50.960 --> 00:03:57.039
Because if you're taking us back 50 years, you're wiping out presumably a record they're quite proud of in the Blair and Brown governments.
00:03:57.120 --> 00:04:14.319
Uh, I was struck to you, and this is not an original observation of mine, other people have said this, but he made these points to say he noted about sort of 1945, 1964, 1997, and then skipped to now, sort of forgetting the fact that obviously Keir Starmer won a majority, uh, and actually Andy Burnham is not a newly elected Labour PM at all.
00:04:14.639 --> 00:04:16.240
No, he was part of Blair's cabinet.
00:04:16.399 --> 00:04:21.120
Um I think what that is about is factionalism within the Labour Party.
00:04:21.279 --> 00:04:29.040
I think um you I think that the kind of original sin of Keir Starmer was his purge of the Corbynites, um, which I think was the right thing to do for the country.
00:04:29.120 --> 00:04:47.279
You know, I think I think that um that sort of very left-wing uh uh end of wing of the Labour Party um has a huge problem with anti-Semitism, which Keir Starmer really did grapple with, but in doing so disgruntled a large a large number of his own MPs, and I think that that's what undid him ultimately.
00:04:47.439 --> 00:04:52.720
Um and I think what Beard uh Beer Beer Beer Burnham is uh is He'd like to be Bernham.
00:04:52.879 --> 00:04:53.839
He'd like to be Bierham.
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Um I think what he's doing with trying to repudiate Blairism is speak to uh that very left-wing faction of the Labour Party, which never got on with Blair.
00:05:02.160 --> 00:05:08.959
Another thing which has been the undoing of uh Prime Ministers, albeit Tory ones, maybe not Labour, is is the issue of Europe and and the EU.
00:05:09.360 --> 00:05:17.839
He has uh as of Wednesday morning um opened the door to what what he's described as like the whole shebang of actually rejoining the EU.
00:05:18.079 --> 00:05:24.560
That is an absolutely enormous issue to consider relitigating at this point, and potentially one which is just explosive.
00:05:24.720 --> 00:05:31.759
And and it, to my mind, uh offers the prospect of having to go in on really compromised terms, cap enhance the EU.
00:05:32.000 --> 00:05:40.639
Would is there any chance that there'd be a rejoin option that doesn't involve the Euro, AI alignment, huge regulatory compromises?
00:05:40.720 --> 00:05:41.759
Well, what do you make of this, Simon?
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Um, I think this is another case of what I'm calling Eccles cakeism, which is the phrase I coined a couple of weeks ago that I've not got anyone else in the media to adopt so far.
00:05:49.759 --> 00:05:51.600
But I will say it at some point in the show.
00:05:52.079 --> 00:05:57.439
Um I think, yeah, but again, he talks about this being something that he would do in a you know a future parliament.
00:05:57.519 --> 00:06:12.480
In other words, he wants to appease the uh Europhiles in the party by saying, you know, net in the next part I'm going to really strengthen our relationship, but he can also at the same time tell the Eurosceptics in the party uh you know that he just wants stronger relations, he doesn't actually want to rejoin.
00:06:12.560 --> 00:06:19.519
So it's again, he's he's walking a bit of a tightrope, but it's definitely he's definitely sounded uh warmer notes on the EU than Stalmer does.
00:06:19.839 --> 00:06:23.680
I think that this is really uh a bad idea for a number of reasons.
00:06:23.759 --> 00:06:28.800
But I think you know, people c say that leaving the EU has cost us something like 4% of GDP.
00:06:28.879 --> 00:06:30.399
Lots of people dispute that figure.
00:06:30.560 --> 00:06:34.720
But really, what businesses want and what I hear from all the business leaders that I speak to is certainty.
00:06:34.800 --> 00:06:40.639
They want a at least 10-year horizon where they know what they're doing, they can adapt to anything, but they need to know what it is.
00:06:40.720 --> 00:06:43.759
And I think this would be yet more upheaval, yet more uncertainty.
00:06:43.920 --> 00:06:54.319
Uh, but politically and democratically, I think it's really dangerous because I think it's just overturning a democratic result, which is several subsequent general elections to reinforce the Brexit.
00:06:54.879 --> 00:06:55.199
Exactly.
00:06:55.279 --> 00:07:02.639
And I think all of this does is reopen those fault lines, which I think have you know really damaged our politics, led to the rise of populist parties.
00:07:02.800 --> 00:07:10.399
I don't know, I don't get a strategy that looks at how well reform have done in Labour heartlands and thinks, oh, the answer to this is undoing Brexit.
00:07:10.560 --> 00:07:11.519
It doesn't make any sense to me.
00:07:11.759 --> 00:07:16.720
I'm surprised that he's also reaching for another um cakist approach to electoral reform.
00:07:16.959 --> 00:07:19.360
They're not saying that will presumably be on the manifesto.
00:07:19.519 --> 00:07:25.839
I mean, historically, the British public do not really care about that sort of like level of constitutional voting change.
00:07:26.000 --> 00:07:27.439
It's not it's not a great vote winner.
00:07:27.600 --> 00:07:31.360
We had a referendum on it on AV uh in 2011.
00:07:31.439 --> 00:07:43.920
Uh, but it seems striking that a a party which has relied on majority government and has never really had to do a a coalition since the days of the national government, um almost a hundred years ago, is is is now reaching to the idea of electoral reform.
00:07:44.240 --> 00:07:46.160
So it's a clear sock to the Liberal Democrats, isn't it?
00:07:46.319 --> 00:07:48.160
They are anticipating a hung parliament.
00:07:48.240 --> 00:07:53.120
They know that that is one thing that the Liberal Democrats will definitely have on the table for any coalition agreements.
00:07:53.199 --> 00:07:57.199
Uh surely you at least wait until you're actually in the negotiating table.
00:07:58.160 --> 00:07:58.639
Clearly not.
00:07:59.279 --> 00:08:06.879
I do wonder whether the fact that virtually every single policy announcement that Burnham has made the past couple of weeks has all been about things that might happen in a future parliament.
00:08:07.040 --> 00:08:09.600
Is that the clearest sign that he wants to call an early election?
00:08:09.839 --> 00:08:10.560
Yes, it could well be.
00:08:10.959 --> 00:08:12.319
Yeah, we've we've speculated about this.
00:08:12.399 --> 00:08:13.360
I would be shocked.
00:08:13.439 --> 00:08:20.720
And also I might be wrong, and please feel free to clip this up, uh, anyone if if I am wrong, but I there's no way that election happened in 2029, surely.
00:08:21.199 --> 00:08:21.680
I don't know.
00:08:21.759 --> 00:08:26.160
I think that this is as good as it's gonna get for Burnham, and I think it would be quite sensible to call a snap election.
00:08:26.240 --> 00:08:31.519
But we i uh i assuming that doesn't happen, we should talk about like what such policy meet that there was in here.
00:08:31.600 --> 00:08:34.960
Um, because we are uh a few weeks away from a budget.
00:08:35.200 --> 00:08:39.600
Um and it's pretty certain that there's gonna be some tax changes at least.
00:08:39.840 --> 00:08:44.639
Capital gains tax, we're anticipating uh possibly reduction in the threshold for the mansion tax.
00:08:44.720 --> 00:08:45.519
What else are we thinking?
00:08:45.759 --> 00:08:50.799
Taurus tax, tourist tax, which is now being sort of whispered about as just a sort of new lever for borrowing.
00:08:51.120 --> 00:08:52.799
Something on inheritance tax, maybe.
00:08:53.039 --> 00:08:54.240
Yeah, it's that that's possible.
00:08:54.320 --> 00:09:01.360
I mean, Burnham's team uh and and Healy's uh treasury are far less leaky than uh what we were used to from Starmer and Reed.
00:09:01.519 --> 00:09:07.279
So I think there's it is possible just from the way that he's been operating as comms, that there is the genuine prospect of a rabbit in the hat.
00:09:07.440 --> 00:09:08.639
He just doesn't really have much option.
00:09:08.720 --> 00:09:11.360
And there's a big question, too, about how much headroom we're gonna be left with.
00:09:11.440 --> 00:09:11.600
Yeah.
00:09:11.840 --> 00:09:16.559
Are they gonna be a position where actually it's so squeezed that we're looking at less than 10 billion?
00:09:16.639 --> 00:09:19.120
I just don't know if that feel realistic sort of week.
00:09:19.279 --> 00:09:25.200
Well, there has been chatter about whether Healy might try and uh reduce the headroom uh in order to spend more.
00:09:25.360 --> 00:09:31.200
That is something that uh Rachel Reeves uh dabbled with at the beginning of her term as chance that it didn't end very well.
00:09:31.440 --> 00:09:34.720
Yeah, I was gonna say, didn't we go down to about four billion headroom under Reeves?
00:09:34.799 --> 00:09:35.840
And that was a disaster.
00:09:36.000 --> 00:09:36.559
Yeah, yeah.
00:09:36.879 --> 00:09:40.559
Well, obviously, we're not gonna harp on about Andy Burnham too much.
00:09:40.720 --> 00:09:44.399
He wants to end uh politics as usual, as he says, but we are still business as usual.
00:09:44.480 --> 00:09:47.200
So after the break, we're gonna be talking about some actual businesses.
00:09:47.279 --> 00:09:50.559
And I'm of course we'll be uh making huge amounts of reference to the budget too.
00:09:50.639 --> 00:09:58.559
We'll be talking about uh some of the difficulties going on at Greg's, Shepherd Neme, and in Brighton News potential for a FinTech IPO.
00:09:58.720 --> 00:09:59.440
Don't go anywhere.
00:09:59.519 --> 00:10:00.240
That's after the break.
00:10:00.480 --> 00:10:05.120
Guessing is for game shows, not your business, especially when your margin for error is zero.
00:10:05.279 --> 00:10:13.279
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00:10:13.519 --> 00:10:21.519
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00:10:21.679 --> 00:10:22.799
It's a new workday.
00:10:23.120 --> 00:10:24.799
Welcome back to Business as Usual.
00:10:24.879 --> 00:10:31.519
So we promised we would talk about some business and not just politics, and we're gonna be talking about some big retail brands.
00:10:31.679 --> 00:10:40.000
Uh, first of all, Greg's, uh, the very popular chain bakery, which uh is loved by Andy Burnham, but I'm gonna stop talking about Andy Burnham, not everything for Andy Burnham.
00:10:40.159 --> 00:10:45.840
Uh it's Grim News over at Greg's, so it looks like as many as uh 740 jobs are on the line.
00:10:46.080 --> 00:10:47.039
Simon, what's going on?
00:10:47.360 --> 00:10:50.159
It's an insight, isn't it, into how the sausage is made.
00:10:50.559 --> 00:10:56.240
God, and to tell us all about how that sausage ends up within that pastry and then served to you.
00:10:56.399 --> 00:10:56.960
Well Simon.
00:10:57.200 --> 00:10:59.360
Yeah, Greg's staff have been burnt in this, I think.
00:10:59.519 --> 00:11:07.759
Um so it seems as though uh Greg's is going to shut up uh four of its factories, four of its sausage roll-making uh uh sites.
00:11:07.919 --> 00:11:15.360
That's in North Lakes in Cumbria, Kelso in Scotland, uh County Durham, and uh up in North London Enfield.
00:11:15.519 --> 00:11:18.720
Um, they say that's to make their operations more efficient.
00:11:18.799 --> 00:11:25.440
They're going to divert some production elsewhere, they're going to outsource um some uh production to third parties.
00:11:25.600 --> 00:11:31.840
And I think this is a the latest sign of um, you know, a big manufacturing crisis for the UK at the moment.
00:11:32.000 --> 00:11:39.440
Energy costs have soared, um, you know, there's other costs involved as well, including higher taxes, uh higher employment costs.
00:11:39.519 --> 00:11:49.120
And businesses are looking at their cost base and seeing about you know, exploring ways they can try and outsource stuff as much as possible uh to try and boost their margins.
00:11:49.360 --> 00:11:56.080
Uh and this comes as Greg says actually been on a roll retail-wise, sales sales are up, it's opening a lot of new stores.
00:11:56.399 --> 00:11:57.039
Yeah, well, exactly.
00:11:57.200 --> 00:12:06.240
I mean, not normally when when a um you know a food allow a food outlet will increase the number of sites, that you would assume that means they need more plants to manufacture more.
00:12:06.320 --> 00:12:11.840
Um, but actually they've decided that you know the sort of um front-facing stores is where they're going to make their money.
00:12:12.000 --> 00:12:16.159
A lot of the back, the back office, a lot of the manufacturing stuff can be outsourced elsewhere.
00:12:16.320 --> 00:12:19.279
Um think there might be any impact on the quality of the products.
00:12:19.440 --> 00:12:20.720
Your consumers will be worried about it.
00:12:20.960 --> 00:12:27.679
I do wonder about that because um, yeah, it's very very much up until now, there's been a very integrated model by Greg's.
00:12:27.840 --> 00:12:35.039
They are they are in all parts of the sausage making process, as it were, from from you know the sourcing of the quite literally, yeah.
00:12:35.120 --> 00:12:37.600
Yeah, and so that a lot of that is going to go.
00:12:37.759 --> 00:12:40.879
Um, but the shares did actually react positively.
00:12:40.960 --> 00:12:45.200
Uh the stock was up about um uh seven percent, I think, on Wednesday morning.
00:12:45.360 --> 00:12:51.200
A sign that investors are warming to the idea of them having to them cutting a lot of their back office costs.
00:12:51.600 --> 00:12:57.519
Shepard Neem, too, you've been looking into the uh the big brewer also uh reviewing uh some closures.
00:12:57.600 --> 00:12:58.000
What's going on?
00:12:58.480 --> 00:13:05.679
Yeah, this did this did make me a bit sad because uh I mean, for those that don't know Sheppard Neem, it's not the biggest uh brewer in the country, but it is the oldest.
00:13:05.759 --> 00:13:09.120
Uh it actually dates back to the 1600s, uh, this company.
00:13:09.200 --> 00:13:18.399
Uh and if you ask locals in Faversham, the town in Kent, uh, in which the beer is brewed, there is actually historical records that there has been brewing in that area since about the 1500s.
00:13:18.480 --> 00:13:21.039
So it's a very old, very established beer.
00:13:21.120 --> 00:13:32.639
Um, but the brewer behind it has um decided it's going to conduct what they're calling a strategic review um of the brewing operations, so that places its future uh in doubt.
00:13:32.799 --> 00:13:37.919
Um I spoke to the chief executive, Jonathan Neim, of the Neem family that's been running this country.
00:13:38.480 --> 00:13:41.120
Oh well, so that's that must be so many generations back.
00:13:46.399 --> 00:13:47.120
Very much so.
00:13:47.279 --> 00:13:52.000
Uh, and he would not rule out the possibility that they might end up closing that brewery altogether.
00:13:52.159 --> 00:13:57.360
Um so that's very sad news for a very old uh tradition in British business of brewing.
00:13:57.600 --> 00:13:58.960
It's a sort of double assault, isn't it?
00:13:59.039 --> 00:14:04.080
And it's the assault on family businesses and on the hospitality industry in general that's leading to this brewery.
00:14:04.399 --> 00:14:05.840
Yeah, it's it's a similar story to Greg's.
00:14:06.000 --> 00:14:10.960
It's you know, energy costs going up massively, it's uh taxes going up, employment costs going up.
00:14:11.039 --> 00:14:18.960
Um, and at the same time, there has been a wider uh trend in the brewing industry away from ale, which is what Sepanem is known from.
00:14:19.039 --> 00:14:26.480
I think their volumes were down about 10% over the last year, which is do they broadly make ales as opposed to Spitfire logic?
00:14:27.279 --> 00:14:28.240
So they are in the log business.
00:14:28.320 --> 00:14:30.399
I'm I'm showing myself to actually be very ignorant here.
00:14:30.639 --> 00:14:33.519
Uh Master Brew is their is their biggest ale, I think.
00:14:33.679 --> 00:14:36.879
Um they have moved into stout more recently because it's so popular.
00:14:37.039 --> 00:14:38.879
Um but yeah, they are a very traditional ale brewer.
00:14:39.120 --> 00:14:41.840
I always question whether a challenger stout can can really thrive.
00:14:41.919 --> 00:14:43.679
I know there was a brew dog stout for a while.
00:14:43.759 --> 00:14:44.080
I can't remember.
00:14:44.639 --> 00:14:45.200
Everyone's had a go.
00:14:46.799 --> 00:14:48.559
It never quite felt um authentic.
00:14:48.879 --> 00:14:51.200
I have a very fond memory of Sheppard Nim.
00:14:51.279 --> 00:14:53.919
So it was the 2015 election, my favourite election.
00:14:54.000 --> 00:14:55.919
And uh I was I was there at this brewery.
00:14:56.639 --> 00:14:57.200
Favourite election.
00:14:57.360 --> 00:15:03.360
And then I was there at this brewery when David Cameron came to visit and was forced to drink a pint at sort of 11 in the morning.
00:15:03.440 --> 00:15:04.080
Uh great day.
00:15:04.320 --> 00:15:06.240
You didn't leave your children in the pub or something to be.
00:15:06.639 --> 00:15:10.720
Um my my favourite um Sheppard Nim beer is one called Bishop's Finger.
00:15:10.879 --> 00:15:20.799
Uh, and it's so called because the brewery is near Canterbury, and all of the signposts in the area point towards Canterbury uh Cathedral, which are known as Bishop Bishop Fingers.
00:15:21.120 --> 00:15:21.679
Oh, great.
00:15:21.759 --> 00:15:23.759
So yeah, it's a shame because it's such a storied.
00:15:24.159 --> 00:15:24.799
Absolutely storied.
00:15:25.360 --> 00:15:34.559
To introduce a bit more levity into the discussion, um, Zilch could be lighting up our flagging IPO market in some essentially quite good news.
00:15:34.960 --> 00:15:37.600
Yeah, it's uh a tale as old as time.
00:15:37.679 --> 00:15:43.440
I mean, I've been writing about the possibility of a Zilch IPO uh since early 2022.
00:15:43.519 --> 00:15:44.799
So it's been a long time coming.
00:15:45.039 --> 00:15:54.240
And that was back in the day where it felt like every FinTech could just have their Series E and was being absolutely inflated and it didn't seem like anything would ever go wrong.
00:15:54.559 --> 00:15:57.120
Yeah, but it looks like finally some action is actually happening.
00:15:57.279 --> 00:16:01.919
Uh Zilch, which for those who don't know it, is a sort of binal pay later firm, a bit like Klarna.
00:16:02.240 --> 00:16:09.919
Um, they have reportedly um hired bankers, or at least are speaking to potential uh bankers who could uh run this IPO.
00:16:10.000 --> 00:16:16.159
So it looks like they're in the advanced stages now of getting this uh in process after a four-year-long uh hiatus.
00:16:16.399 --> 00:16:17.759
And we're hoping that will be in London.
00:16:18.000 --> 00:16:22.480
That's it looks as though London is the um is the front runner to be the venue for this.
00:16:22.639 --> 00:16:31.679
Um Zilch, the Zilch chief executive is also also runs what's called the Unicorn Council, a sort of council of some of the biggest tech firms in Britain.
00:16:31.840 --> 00:16:36.000
And so if he didn't choose London, it would be a bit of a humiliation since.
00:16:38.399 --> 00:16:39.200
And this, I mean, it's interesting.
00:16:39.279 --> 00:16:45.759
We were talking about this just the other day about Klarna and that what now looks like it was quite an ill-advised listing in New York.
00:16:46.000 --> 00:16:55.039
Um, could this be the year that a lot of homegrown fintechs look around and think, okay, there could be more liquidity in New York, but actually we know this market.
00:16:55.200 --> 00:17:00.559
There's a lot of interest in this market from the British public and the broader European uh market.
00:17:00.879 --> 00:17:02.799
And actually, this is the most sensible place to list.
00:17:03.120 --> 00:17:03.759
You'd hope so.
00:17:03.840 --> 00:17:07.039
I mean, we we spoke last week about the uh Airtel money float.
00:17:07.279 --> 00:17:14.799
Again, that is a sort of global fintech business that decided to choose London as a venue because there is a lot of fintech expertise.
00:17:14.880 --> 00:17:16.960
Uh, that's a real specialism of London.
00:17:17.119 --> 00:17:25.039
And so you'd hope that there are there are a lot of you know big billion dollar uh fintechs in London for whom London should be the appropriate venue.
00:17:25.279 --> 00:17:25.920
Can I ask you both?
00:17:26.000 --> 00:17:27.759
Are you uh by now pay later users?
00:17:27.920 --> 00:17:30.079
Do you do you have a pay it, pay it forward, pay it backward?
00:17:30.319 --> 00:17:31.440
No, I don't trust myself.
00:17:31.599 --> 00:17:34.079
No I'm always amazed those companies make money, really.
00:17:34.640 --> 00:17:35.599
I suppose there is a market for it.
00:17:35.759 --> 00:17:36.880
I'd be I'd be terrible at that.
00:17:37.839 --> 00:17:47.519
I find them really interesting because actually they're used by a lot of female consumers both to buy sort of fashion items but also for kind of household purchases like washing machines and so on, though they use quite a lot for that.
00:17:47.599 --> 00:17:55.039
Um I did buy a computer on a I think that was a z a 0% 12-month contract rather than a BMPL deal.
00:17:55.119 --> 00:17:57.039
But so yeah, I don't know if I've done that.
00:17:57.359 --> 00:17:58.799
Well, that's all we've got time for today.
00:17:58.880 --> 00:18:03.519
So thank you very much for listening to or watching Business as Usual brought to you by Workday.
00:18:03.759 --> 00:18:07.920
And don't forget to subscribe to our newsletters and download the Free We City AM app.
00:18:08.160 --> 00:18:11.599
This episode was produced by Joey Creator Needer and Joe Lee.
00:18:11.759 --> 00:18:15.440
Thank you very much for listening again, and we'll be back in your podcast feeds tomorrow at 6.
00:18:15.599 --> 00:18:16.079
Bye.
00:18:16.319 --> 00:18:17.279
Goodbye.
