UK markets: The FTSE 100 index opened up 8.49 points, 0.1%, at 7,657.47. The FTSE 250 was up 103.00 points, 0.5%, at 19,359.96, and the AIM All-Share was up 0.69 of a point, 0.1%, at 738.53.
European markets: The CAC 40 in Paris was up 0.2%, while the DAX 40 in Frankfurt was up 0.4%
US markets: The Dow Jones Industrial Average closed up 0.4%, the S&P 500 up 0.3% and the Nasdaq Composite up 0.2% on Thursday evening.
Asian markets: The Nikkei 225 index in Tokyo closed up 0.9%. In China, the Shanghai Composite closed down 0.6%, while the Hang Seng index in Hong Kong was up 2.4%. The S&P/ASX 200 in Sydney closed up 0.9%.
Emerging markets: MSCI’s index for developing nation stocks trimmed losses after falling as much as 0.9%, while the gauge of currencies fell 0.3%, the lowest level since November 17 on a closing basis.
Bank holds interest rates but cuts unlikely any time soon
Yesterday The Bank of England held interest rates at 5.25%. It’s the third time in a row the Bank has decided to leave the rate unchanged. Six members of the nine-person Monetary Policy Committee – which makes the decision – voted for no change.
The other three wanted an increase to 5.5% Higher interest rates are intended to lower inflation by reducing people’s spending power. Bank governor Andrew Bailey says “we’ve come a long way” in bringing down inflation this year, but there is “still some way to go”.
Another hold may bring some relief to homeowners who have seen mortgage rates rise but savers are unlikely to see a boost. The Bank rate is currently at its highest level for 15 years. The theory is that raising interest rates makes it more expensive to borrow money, meaning people have less to spend, reducing demand and inflation.
Rates had risen 14 times in a row since December 2021 as the Bank tries to bring inflation closer to its target of 2%.
Inflation rose by 4.6% to October, according to the Office for National Statistics (ONS). This was slower than the increase a month earlier and also down from the peak of 11.1% in October 2022. Although that is still more than twice the Bank’s target, falls have influenced the decision to pause the run of Bank rate rises.
Policymakers will keep a close eye on the “core inflation” rate – a measure which strips out volatile factors such as food and energy. The chances of rates actually starting to fall again look slim before next summer. At one point, UK rates were expected to rise above 6%, but that peak is now expected to be lower, even if there is a rise at a later date.
The Bank has to balance the risk of damaging the economy, which has shown little sign of growth, with the need to slow price rises. Its Monetary Policy Committee meets 8 times a year to decide interest rates.
Jersey’s States Assembly approves 2024-2027 budget
Jersey’s States Assembly has approved the 2024-2027 budget, after a debate lasted three-and-a-half days Politicians voted 33-13 in favour of ministers’ proposals, as amended by backbenchers. The government intends to raise £1.2bn and spend £1.15bn on public services in 2024.
Chief Minister Kristina Moore said the plan would “provide some stability”, but the leader of Reform Jersey Sam Mezec said it lacked “any coherent vision for solving the big crises that Jersey faces”.
Under the measures agreed by politicians in 2024: The first-time buyer stamp duty threshold will rise from £500k to £700K, a £10M shared equity scheme will help up to 60 families on to the property ladder, and tax allowances will increase.
A scheme through which children receive free GP appointments will be extended to all full time students and work will begin on a “substantial redevelopment” of Jersey’s drainage network.
Ministers intend to introduce a new tax to fund ongoing work to drains potentially by 2026. Government departments will be asked to make £13m of savings, of which £3m will be used to increase support for the industries.
Meanwhile, alcohol duty will rise by 4.5%, and fuel duty will be frozen but concerns have been raised about a lack of funding for the Police which will receive £27.4m in the years 2024-2027. Politicians rejected calls for £2m earmarked for government IT systems to instead be used to increase teachers’ pay amid strikes by members of the National Education Union.
Speaking ahead of the vote to approve the amended plan, Ms Moore said: “What we have learned in our first 18 months in office is that delivery is difficult. The greatest way to achieve the most is actually by focusing and by considering very carefully where the greatest impact can be delivered and how that can be achieved. We all have a huge list of things that we would like to do but long lists very rarely are delivered in their entirety”.
Ms Moore said the government plan needed to provide focus and stability.
She said: “[It needs] to start to correct the wrongs of the legacy that we have encountered, to stabilise our budgets and put us on a strong footing so that we can now move forward with our ambitious plans for the island. “With our wind farm opportunity with our future economy programme – which is the government’s answer to preparing for the demographic challenges that we see ahead of us; by focusing on our desire for economic growth.”
Crown Dependencies commit to more ‘transparency’ to help combat financial crime
All three of the Crown Dependencies published a joint commitment saying they want to “increase transparency and accessibility” with the information held on their registers of beneficial ownership to help combat financial crime around the world.
Each jurisdiction already shares data with law enforcement and tax authorities, but this new pledge would see data being shared by businesses that are required to conduct customer due diligence.
In addition, any media or civil society organisations that can prove they’re accessing the information to combat financial crime will also be given access. But the islands’ governments say this will only be possible if a balance is struck between “protecting human rights and combatting financial crime” following recent decisions made about public access to information by courts in Europe.
The three islands say “substantial” work has started to enable access to the information and this should be available before the end of 2024.
In a statement released shortly before he was deposed as Chief Minister Deputy Peter Ferbrache said: “Guernsey is pleased to announce today its next steps for enhanced transparency and accessibility of information on its register of beneficial ownership. The islands share the vital global objective of all responsible jurisdictions to combat financial crime in all its forms”.
While Jersey’s Chief Minister, Deputy Kristina Moore added: “Jersey continues to encourage other jurisdictions around the world to raise their own standards, particularly for the obtaining, verifying and providing appropriate access to ownership information and effective regulation of the financial services sector.”
Guernsey’s Chief Minister Peter Ferbrache sacked
Guernsey’s Chief Minister Peter Ferbrache has been sacked after his committee lost a vote of confidence today. States Members voted 23-16 in favour of the motion against the island’s Policy and Resources Committee.
It marks the end of office for Deputy Ferbrache who had held the island’s top political job since 2020, when he took over from Deputy Gavin St Pier. The vote was brought to the House by Deputy Charles Parkinson last month after Policy and Resources – the island’s top committee – failed to get its funding plans, which included a goods and services tax, approved.
Former chief minister Deputy Lyndon Trott was later elected as the new president of the committee and the island’s chief minister.
Survey raises ‘red flags’ over household debts in Jersey
Surging levels of debt in the Island have been revealed in an annual study – raising “red flags” about the financial struggles some households are facing.
Around 1,500 people took part in Statistics Jersey’s latest Opinions and Lifestyle Survey in June and July, answering questions across a range of topics including personal finance, health and employment. Almost a quarter of households (23%) reported having borrowed more money or used more credit in comparison with last year.
The figure was higher among households with children than those without, standing at 39% and 18% respectively. Those living in social rental accommodation were also more likely to have borrowed more.
Overall, one in seven households had used their overdraft to fund day-to-day purchases in the last year, while 15% of households were not paying off their credit card in full every month. The survey was published amid a backdrop of price hikes and eye-watering living costs seen in the last 12 months.
Home owners have been hit hard after the Bank of England hiked interest rates 14 times in two years in a bid to stem rampant inflation.
Currently, someone with a 25-year, £400,000 mortgage – using a five-year fixed-rate at 5.69% – is paying around £2,500 a month, nearly £1,000 more than they could have been paying for a similar mortgage product last year.
And rents have risen by about 3% in the last 12 months, with many one-bed flats now being touted for around £1,300 a month. Jersey’s inflation rate hit a 40-year high of 12.7% at the end of last year, although it has since been reducing slowly – with the most recently published figure standing at 10.1%.
However, Condor’s plans for a 18.76% freight cost hike next year could see the cost of goods rise at a faster rate. The borrowing figures documented in Statistics Jersey’s report have been described as a “concerning trend” by Community Savings, which provides financial advice as well as loans and grants to those who are struggling to access funding from other sources.
Waiting time for MRI scan cut from 54 weeks to 7 weeks
The waiting time for an MRI scan at the Hospital has been cut from more than a year to seven weeks after a second scanner was brought into operation a few months ago. The second machine was previously being used as a back-up, but following the recruitment of specialist locum staff, both of the Hospital’s MRI scanners are now running concurrently.
In September, patients had been waiting 54 weeks for a scan to be carried out following a rise in demand, but that has been cut to seven weeks and is expected to be further reduced to six before the end of the year.
Dr Salman Zaman, a consultant radiologist who has worked in Jersey for more than a decade, explained that the rise in demand was due to improvements in healthcare and technology – including treatments – over the years, that meant more people were being referred for an MRI scan.
He continued: “The detail we can provide our clinical colleagues to help them diagnose and treat disease is exponentially increasing. So the demand for that, year on year, is going up 7% at least. Since we actually got the waiting list down in the past two, three months, that demand has surged to a 12% increase every year.”
He added that the drive to start utilising the back-up scanner was partially prompted by a “difficult” conversation between one of his colleagues and a patient, who had been told that they faced a wait time of more than a year.
“The situation became for me, personally – and for my colleagues – untenable. We just couldn’t really countenance having patients waiting more than a year for MRI scans”. He explained that £150,000 was allocated to make the necessary changes, most of which was used to pay three specialist locum employees. “Some of it was also utilised to get staff who were already here to work overtime, so there was a two-pronged approach”.
However, Dr Zaman added that the “substantial” number of private patients in the Island had since generated £230,000 in fees that the Hospital would otherwise have missed out on.
He said: “People say ‘oh, private patients supplant States patients who have to wait longer’, but this is actually an example where that income has actually subsidised and brought down the waiting list – so it’s a win-win situation”.
The department is planning to make permanent staff appointments to bolster the radiology team in 2024, while a business case has also been put forward to increase the scanners’ capacity, so they can be used 24 hours a day.
Financial recovery director and change team finance lead, Obi Hasan, said: “We have managed to cut the waiting lists for the MRI scanners by 61%, which is an incredible achievement. It is testament to the hard work and dedication of the team and perfectly illustrates the ethos of our financial recovery plan.”
As an average, one MRI scanner is capable of scanning around 150 patients per week. The scanners are used by both public and private patients, with a split of around 70% public, 30% private .Storm Ciarán meant the scanners were out of action for two weeks, as some necessary parts could only be brought over by boat.
Jubilee Sailing Trust closes amid financial struggles
Jubilee Sailing Trust – the company which operates the tall ship Tenacious – has closed following years of financial difficulties. In a statement, the company said that despite fundraising appeals, it has continued to struggle to meet costs.
“The last four years have seen two large-scale funding appeals, refinancing, several restructures, and a reduction in fleet size to one ship – and of course a pandemic. With much internal and external consultation we have tried different funding models, most of which have been heavily reliant on fundraising, or, trying to attract partners willing to pay full price to charter the ship.
For the last 15 months we tried a funding strategy that was more reliant on income from our voyage crew paying for 75-80% of the cost of a voyage (or using bursary funding secured for this purpose).
Unfortunately neither our voyage sales nor our fundraising efforts have been successful in meeting the c.£150k/month required to operate Tenacious and keep her legally compliant to deliver our voyages, nor to repay the historic debt (c.£477k) accumulated prior to the September 2022 change in strategy.”
The company added: “Whilst we have been investigating several options to change our situation, including loans and alternative business plans, we recently learned we were also unsuccessful in being able to raise the full amount required to put Tenacious through her regulatory dry docking in time to deliver our planned Atlantic crossing.
If we were to attempt to re-start the programme in the Caribbean, sailing as a ‘delivery voyage’ (without voyage crew having paid to sail and meet the voyage costs) to the Caribbean would incur significant new expenditure that we would not be able to meet with the rest of the winter voyage programme.
This means there is no viable way to fulfil our Caribbean voyages, and as such all voyages up to April 2024 needed to be cancelled.
Without the funds from the balance payments for those winter voyages (of which almost £100k would be due now), and knowing we would be unable to refund the voyage crew whose voyages have been cancelled, we initiated emergency talks with our Board, financial and legal advisors, and other key persons with long-term connections to the JST history.”
Fraudsters impersonating police officers to obtain bank details from Islanders
Islanders are being warned that fraudsters are impersonating UK police officers in a bid to obtain bank details. The States police has received reports that scammers are phoning Jersey residents and claiming that their bank cards have been cloned.
In a statement, the force said: “It appears that this is an attempt to obtain card details from the ‘victim’ who believes they are speaking to a real police officer. In an attempt to lend some legitimacy to their claim, the scammer will advise the person to ‘google’ the telephone number for the police force they say are calling from, which will match the telephone number showing on the phone. This is because scammers can make calls appear to come from any number, including official agencies.”
Islanders are being warned not to assume that a call is legitimate based on the number of the caller and never provide personal details. Instead, they should hang up and locate the number for the relevant police force and contact their bank to check for any suspicious activity on their account.
Jersey restaurant ranked in UK’s top 100
Bohemia has been ranked as one of the best restaurants in the British Isles. The St Helier eatery – Jersey’s only Michelin-starred restaurant – has been placed 52nd in Harden’s 100 Best UK Restaurants, nine places higher than last year.
It is the only Channel Islands restaurant to make the top 100.Callum Graham, Bohemia’s head chef, said:
“I’m absolutely delighted for the team who work endlessly with real dedication to delight our guests. To be one of the top 100 in the country and in such illustrious company is a real honour and a testament to our commitment to quality, impeccable service and excellence. As well as the team, we’d like to thank all our customers who voted for us and look forward to welcoming returning and new guests in 2024.”
Lawrence Huggler, managing director of Huggler Group, which runs The Club Hotel & Spa and Bohemia, added:
“We are delighted to have not only kept a place in the prestigious top 100 list but to move up nine places is testament to the amazing work over the last year by the team led by Callum in the kitchen and Dimitri front of house. The fact that it’s voted for by diners recognising and appreciating the quality of our food and service makes it a particularly special accolade.”
Bohemia maintained its Michelin-star for the 19th consecutive year in 2023. Harden’s UK restaurant guide was first published in 1998.