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Tuesday's Business and Politics round-up

15 Aug 2017

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Good morning,

The Prime Minister is drawing a fair amount of heat from some corners this morning as her walking holiday enters its fourth week.

Seeing that the PM's last holiday in Wales earlier this year lasted a few days and is credited with triggering her call for the recent general election, hacks and politicos alike now seem to be waiting with baited breath to see what plans a month of Alpine air will bring.

Meanwhile, over in the US, President Donald Trump has condemned the ‘evil’ racism seen on the streets of Charlottesville over the weekend when hundreds of white supremacists clashed with anti-fascism protestors.

The President called the coalition of ‘alt-right’ marchers ‘repugnant’, but his comments come after two members of his business advisory panel stepped down in light of Trump's initial reluctance to single out the fascist elements of the rally. Kevin Plank, the CEO of Under Armour resigned from the panel a day after Kenneth Frazier, the CEO of pharmaceutical giant Merck also quit.

The departures come as Trump attempts to move against alleged Chinese trade abuses, ordering officials to begin an investigation into potential intellectual property breaches. There are suggestions that the move could irritate the Chinese at a time when the US is seeking their support in dealing with the North Korean regime, whose economy depends heavily on China’s patronage.

So, while many people may be taking the opportunity for a bit of time off over the summer, it's clear that on the international stage it's business as usual - the new 'usual', that is.

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Customised Union

The Government is set to publish the first in a series of position papers on the Brexit negotiations later today. The paper - which is being billed as a move to provide businesses with more clarity - will set out the sort of customs arrangement that ministers want to secure with the EU in the future. It will say that the UK wants either a 'partnership' with no customs border at all or a 'highly streamlined' border with the bloc.

In addition, it will lay out plans to establish an interim customs deal with the EU during the transition period - one that would allow the UK to begin negotiating trade deals with third countries. Currently the UK is prevented from negotiating such deals as it remains bound by the common external tariff.

Early responses to the announcement have been a mixed bag, with stakeholder groups welcoming the new level of clarity on the Government’s intentions, as well as the concession that some sort of transitional arrangements will likely be needed (the IoD made a call along these line a couple of weeks ago – our proposals here). However, opposition parties have been more lukewarm, with Lib Dem leader Vince Cable saying ‘the success of this proposal will depend on the agreement of the EU, which is far from guaranteed’.

EU negotiators have so far been adamant that they will not discuss trade arrangements until the two sides have reached agreements on key issues like citizens’ rights and the size of the Brexit divorce bill. Today’s paper could be seen as an attempt to hurry them along a bit.

Ministers are set to publish another paper tomorrow, looking at issues around Northern Ireland.

Tipping point for Uber

Uber is to give users the ability to tip their drivers ‘in app’ for the first time, the firm reported this week. The move which will see ‘100 per cent of the tip go straight to drivers' was included as part of a bundle of changes to the app aimed at improving conditions for drivers.

Customers who keep drivers waiting will now also face a charge of 20p a minute, while the cancellation threshold for users has been reduced from 5 minutes to 2 minutes. The company will no doubt be hoping the changes will help to dampen criticism of the working conditions for drivers.

Indeed the ‘gig’ economy as a whole has been under the spotlight following a report from RSA boss Mathew Taylor. The report was welcomed at the time by IoD Director General Stephen Martin for ‘bringing more clarity to the ambiguous definitions of employment status in the UK’. The IoD Policy Unit has also produced its own paper on the new world of work, titled the Future of Flexible Work.

The changes to Uber will come into effect on August 22nd and at a time when the company is still reeling from the loss of founder Travis Kalanick.

A Bridge Too Far

Plans for a ‘garden bridge’ connecting the north and south banks of the River Thames in central London have been shelved after funds dried up.

The plan for a pedestrian ‘oasis’ spanning the Thames was conceived by actress Joanna Lumley but hit a brick wall when it did not win the support of London Mayor Sadiq Khan. The £200 million project had already been pledged £60 million in public money from then Chancellor George Osborne with the rest intended to come from private backers.

The trust managing the project secured only £69m in private pledges, leaving a £70 million shortfall. It was at this point that Khan intervened and commissioned a report into the public value of the bridge. The damming report from former Commons public accounts committee chair Margaret Hodge recommended the whole thing be scrapped despite £37 million in public money already having been spent on it.

While former Mayor Boris Johnson has been quick to accuse Mayor Khan of killing off the bridge project, critics of the scheme are pleased, pointing to the high cost and abundance of existing bridges in the area.

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