Rishi Sunak will today announce an emergency multibillion-pound package of support for British households facing spiralling domestic energy bills, partly funded by a windfall tax on energy companies.
Those briefed on the plans said the government support could be worth more than £10bn and will be primarily focused on the poorest households and pensioners, although the “squeezed middle” will also receive help.
Sunak agreed the final package with Boris Johnson, who is desperate to “move on” from the partygate scandal that has dogged his premiership.
Although many Tory MPs will be delighted that Sunak is acting to alleviate the cost of living crisis, some on the right are furious that he is planning a windfall tax raising several billion pounds to help pay for it.
North Sea oil and gas company executives said they were resigned to a windfall tax on profits, a move Sunak had previously rejected, arguing it would hit investment. They also believe a separate levy on electricity generators, which is under consideration in the Treasury, will be too complicated to design in time for Sunak to announce it today.
Thanks for reading FirstFT Europe/Africa. Here’s the rest of the day’s news.
The Behind the Money podcast is back. In our first episode, host Michela Tindera asks: is a crypto vibe shift under way? FT reporter Ethan Wu explains how the effects of bitcoin’s price drop and the collapse of a popular stablecoin have rippled through the crypto universe and why it matters — even for people who aren’t crypto investors.
The latest on the war in Ukraine
Russia: President Vladimir Putin has unveiled double-digit increases to Russia’s minimum wage and pensions, but denied the moves were linked to the war and resulting sanctions.
EU: Brussels is seeking to clear legal blocks impeding the confiscation of Russian oligarchs’ assets to tighten enforcement of its sanctions regime.
The war in maps: Just 25km of terrain remains before Russia completely encircles a fiercely contested pocket of Ukrainian resistance. See the FT’s visual depiction of the war’s progression.
Five more stories in the news
1. Klarna to focus on ‘short-term profitability’ Klarna is shifting away from growth and towards short-term profitability as the Swedish fintech tries to raise fresh capital. Sebastian Siemiatkowski, chief executive, told the Financial Times he was not “convinced” by reports the company would have to raise capital at a valuation below its most recent one of $46bn.
2. US investors play for Premier League with Chelsea sale Todd Boehly’s acquisition of Chelsea is the latest sign of US investors’ interest in owning the Premier League’s top teams. Boehly is leading a £4.25bn takeover backed by Clearlake Capital, Swiss billionaire Hansjörg Wyss and Guggenheim Partners chief executive Mark Walter.
3. UK to review Chinese takeover of chip plant The UK will reconsider the acquisition of the country’s largest semiconductor plant by a Chinese company. The takeover last year of Newport Wafer Fab by Nexperia — a Dutch unit of Wingtech — will be reviewed under the new National Security and Investment Act.
4. Fed officials raised possibility of ‘restrictive’ policy The US Federal Reserve may move to a “restrictive” policy stance to better fight inflation through more aggressive interest rate increases, according to minutes of the most recent Federal Open Market Committee meeting this month. Wall Street stocks extended gains.
5. Vanguard refuses to end new fossil fuel investments The world’s second-largest asset manager Vanguard has refused to stop investments in fossil fuel projects. Chief executive Tim Buckley said the group, which manages $8.1tn and is the largest investor in coal companies globally, was determined to safeguard its clients from climate risks.
The day ahead
Economic data CBI issues its quarterly service sector survey plus official figures are out for 16- to 24-year-olds not in education, employment or training. The US releases first-quarter gross domestic product and consumer spending data.
Corporate earnings Alibaba, Intermediate Capital Group, Johnson Matthey, Ted Baker and United Utilities report fiscal year results, while Baidu, Dell and Macy’s have first-quarter earnings.
Australia National Sorry Day commemorates the forced removal of Aboriginal children from their parents.
What else we’re reading
Disney’s approach to Pride snags on culture wars Companies have long used Pride month — a June celebration for queer people — as a branding exercise. But Disney has come under fire this year from both the left and the right over its stance on a new Florida law restricting discussion of sexuality and gender identity in primary schools, nicknamed the “Don’t Say Gay” law.
No one is ready for the rising tide of climate litigation Litigation risk over climate change is a reality for companies, Helen Thomas writes, and it is no longer simply an energy issue: the London School of Economics has tracked cases against German automotive companies, financial institutions and food and agriculture groups.
On the waterfront: organised crime at the Port of New York Tech and global trade have transformed New York — the busiest port on the US eastern seaboard — from a place of burlap sacks and baling hooks to one of computer-tracked containers borne on ships of once-unimaginable dimensions. Yet organised crime’s barnacle-like presence persists.
Andreessen Horowitz bets on crypto ‘golden era’ Despite the crypto market crash, the Silicon Valley venture capital group has launched a $4.5bn cryptocurrency fund, marking its fourth and biggest bet yet on the future of blockchain technology.
Pfizer warns of ‘constant waves’ of Covid-19 Apathy and politicisation of the coronavirus pandemic will cost lives as the world is hit by new waves of the virus in coming months, Pfizer’s chief executive has warned. “What worries me is the complacency,” Albert Bourla told the FT at the World Economic Forum in Davos, where he noted that few attendees were masked.
The Cannes Film Festival celebrates its 75th year with appearances by Volodymyr Zelensky, Tom Cruise and Sharon Stone. The FT brings you the highlights