Your commercial news round-up: election, clean energy, economy rebound, Thames Water
updated on 11 July 2024
Reading time: two minutes
Dive into this week’s commercial news round-up following Labour’s success in the general election. The new Prime Minister Kier Starmer has appointed his new cabinet and put together a task force to tackle the climate crisis. Meanwhile, the UK economy rebounded in May while Thames Water faces debt and criticism over sewage discharges and leaks.
- The Labour Party secured a resounding victory, winning 412 seats in last week’s general election. Meanwhile, the Conservative Party faced significant setbacks, securing only 121 seats. Notably, former Prime Minister Liz Truss was among the high-profile casualties within the Conservative ranks. In addition, the Liberal Democrats experienced substantial gains, while the Scottish National Party lost dozens of seats. Following the election, Keir Starmer appointed Angela Rayner as deputy prime minister and Rachel Reeves as the UK’s first female chancellor.
- On this note, the new government has appointed Chris Stark, CEO of the Carbon Trust and former head of the UK’s climate watchdog, to lead the UK’s clean energy task force. Stark will work with businesses, governments and financial institutions to drive positive climate action. Stark previously served as CEO of the UK’s Climate Change Committee, where he provided independent advice on the UK’s net-zero target. Stark said: “Tackling the climate crisis and accelerating the transition to clean power is the country’s biggest challenge, and its greatest opportunity. By taking action now, we can put the UK at the forefront of the global race to net zero.”
- Official figures show that the UK economy rebounded in May 2024 after shrinking in April and March. Data from the Office of National Statistics shows that the economy grew by 0.4% during the month, surpassing the flat growth most economists had expected. The construction sector grew the most (1.9%) and the services sector also saw a rise of 0.3%. The gross domestic product also grew at a rate of 0.9% in the three months leading up to May, which is the quickest rate of growth in over two years.
- Thames Water is facing criticism over sewage discharges and leaks, and is burdened with debts of £15.2 billion. There’s been speculation that, if the financial situation continues, a government takeover could be on the cards. The company has seen an increase in annual profits to £157.3 million for the year ending March. However, managing director Chris Weston explained that strengthening the company’s financial position is still "a critical priority”. But what’s the plan to do this? Currently, Thames Water has funding of £1.8 billion, sufficient to operate until May 2025. The water company also seeks to improve its finances by raising consumer bills by up to 44%. The extent of the bill increase is still undecided but water regulator Ofwat is due to release its draft ruling for the next five years soon. This will determine how much water companies can charge customers.
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