William Hill has announced its chief executive is leaving as it shifts its focus to online and international markets.

The departure of Philip Bowcock comes after it said 700 betting shops would close because of the reduction of the maximum stake on fixed-odds betting terminals (FOBTs) to £2.

Ulrik Bengtsson, chief digital officer, replaces him on 30 September.

Mr Bowcock said it had been an “intense period” within the industry.

He said the business, which he had run for four years, had experienced “significant structural and regulatory change”.

“After all the work the team has done, I believe the business is now well placed to take advantage of the opportunities presented in the US market, as well as continued growth in digital,” said Mr Bowcock, who had originally joined as finance director in November 2015.

The company has previously warned that government’s decision to cut the maximum stake on FOBTs from £100 to £2 could knock its sales by £100m a year.

These gaming machines allow players to bet on the outcome of various simulated games and events, such as roulette, blackjack, bingo and horse races, sparking concerns that large sums can be lost quickly by customers.

Its plan to close around 700 shops could put 4,500 jobs at risk.

The company said Mr Bowcock’s departure was “part of William Hill’s succession planning and consistent with the group’s strategy of becoming a digitally-led and internationally diverse gambling company”.

Mr Bengtsson, who was recruited by Mr Bowcock in April 2018, said he saw a “great opportunity” to seek growth online and internationally.

He will have a £600,000 salary – in line with that received by Mr Bowcock – as well as bonuses while his pension contribution will be 5% of salary, rather than the 20% received by Mr Bowcock.

Ireland will try to ensure checks in a no-deal Brexit will be done away from the border, Tánaiste Simon Coveney has said.

He added Ireland would have to work to protect its place within the EU single market.

Doing this without the backstop will lead to “unpalatable decisions”, the Irish deputy prime minister said.

Mr Coveney was speaking at an event in Dublin geared at preparing businesses for a no-deal Brexit.

“These are difficult choices,” Mr Coveney said.

“We do recognise the reality that Ireland will have a responsibility to protect its own place in the EU single market and that will involve some checks.

“But I can assure you that we will try to do that in a way that limits the risk, and we will try and do it, obviously, away from the border.”

Ireland’s latest contingency plan, published in July, said no deal would mean cross-border trade could not be as frictionless as it is now.

But it does not elaborate on where and how such checks would take place.

The Revenue Commissioners, Ireland’s tax authority, has suggested that while all customs declarations could be filed electronically, up to 8% of consignments would still need to be physically checked for customs purposes.

It says it is exploring ways of doing this at traders’ premises or at designated warehouses.

The Irish government has said it is giving its no-deal Brexit contingency plans “top priority”.

The cabinet met on Tuesday night to discuss the latest developments in Westminster, and said it noted that a no-deal Brexit is “increasingly likely”.

The legal default position is that the UK is due to leave the EU on 31 October, unless an extension is granted.

The Irish government said it has issued an additional “call to action” to ensure that businesses are ready for the new regulatory requirements in the event of a no-deal Brexit.

Mr Coveney said the Irish government would not allow the country to be “dragged out of the EU single market by default as a result of Brexit”.

“If we’re not careful, we won’t take the necessary action to protect the integrity of the single market, and therefore, our goods will be checked on the way into France, Germany or Belgium,” he said.

“That would be hugely damaging to our business model and we cannot, and will not, allow that to happen.

“That is why we will face difficult choices in the context of how we introduce a checking system, somewhere, away from the border, for obvious reasons, that can protect the integrity of the single market and reassure other EU countries that share the single market with us that we don’t have an open back door into the single market through Northern Ireland, if it’s unguarded.”

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The government has declared it has “turned the page on austerity” as it set out plans to raise spending across all departments.

Chancellor Sajid Javid outlined £13.8bn of investment in areas including health, education and the police in what he said was the fastest increase in spending for 15 years.

The plans cover one year and come amid intense political turmoil over Brexit.

Labour criticised the spending plans as “grubby electioneering”.

Mr Javid said: “No department will be cut next year. Every single department has had its budget for day to day spending increased at least in line with inflation.

“That’s what I mean by the end of austerity.”

But the shadow chancellor, John McDonnell, accused Mr Javid of “meaningless platitudes”.

“Do not insult the intelligence of the British people,” he said.

He accused the government of “pretending to end austerity when they do nothing of the sort”.

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Is this really the end of austerity?

Mr Javid is not first chancellor to claim that austerity is on the way out.

His predecessor Philip Hammond said that the “era of austerity is finally coming to an end” in his autumn Budget last year, when he promised a £30bn boost in public spending by 2024.

The director of the Institute for Fiscal Studies, Paul Johnson, said Mr Javid’s plan signalled a “real change in direction on spending but most areas of public service spending were still much below 2010 levels”.

“Health is the big exception,” he said.

Overall, the IFS said spending would still be 3% below its level a decade ago, and more than 9% lower in per person terms.

“Non-health budgets have also lost out to rising NHS funding: real spending outside the Department of Health will still be 16% lower (21% lower in per person terms) next year than in 2010−11,” it added.

Mr Johnson also warned that the current weakness in the UK economy could weigh on the government’s declaration of the end of austerity.

“We of course live in a time of extreme economic uncertainty and I think the big risk in saying that austerity is over is that the economy starts to do significantly worse, which it might if we have a no-deal Brexit,” he said.

“Then the deficit and debt will start rising and we are in danger of having another dose of austerity to get that over with for a second time.”

What were the big announcements?

  • £13.8bn in extra day-to-day spending for 2020-21, representing a 4.1% uptick
  • NHS funding increase of £6.2bn next year, most of which was already announced under Theresa May’s government
  • Education spending increase of £7.1bn by 2022-23 compared to the current fiscal year
  • Secondary schools to be allocated a minimum £5,000 per pupil, primary schools will get £3,750
  • £750m for 20,000 police officers including £45m to hire 2,000 police by March next year
  • Home Office day-to-day spending to increase by 6.3%
  • Ministry of Defence funding to increase by £2.2bn or 2.6%
  • Confirmation of an additional £2bn in Brexit preparation funding, on top of £2.1bn already announced.

Won’t Brexit change the plans?

This was a spending round not a review.

The difference is that Mr Javid’s plans are only for one year and not the usual three-year strategy set out by the chancellor because of the ongoing uncertainty over the impact of Brexit.

Mr Javid’s was also a very political speech.

He laid out the spending plans against the possibility that the UK is heading for another general election – the country’s third in five years.

Prime Minister Boris Johnson said Britain will go to the polls if he is forced to request an extension to the 31 October deadline for the UK to leave the European Union.

Mr Javid was criticised twice during his speech by the Speaker of the House of Commons John Bercow for talking about a bill – which MPs will vote on later today – that would force Mr Johnson to ask the EU for a delay in Britain’s exit, instead of focusing on the spending round.

Mr Bercow said that it was “very, very unseemly”, adding: “It bothers me greatly that the right honourable gentleman in the course of a statement seems to be veering into matters, not even tangential but unrelated to the spending round upon which he is focused.”

What does the government’s independent watchdog say?

The Office for Budget Responsibility (OBR) hasn’t said anything because this is a separate spending round and has been sperated from the Budget.

As a result, there are no new forecasts from the independent fiscal watchdog which means the chancellor’s spending plan is based on predictions published back in March by the OBR.

Under those forecasts, the government had around £15bn to borrow within its self-imposed overdraft limit of 2% of the value of the national economy.

Since then, the UK’s gross domestic product (GDP) shrank by 0.2% during the second quarter.

If it contracts again between July and September, the country will officially be in recession, which is defined as two consecutive quarters of negative growth.

On Wednesday, data measuring activity in the UK’s dominant services sector, which accounts for nearly three quarters of GDP, showed that growth slowed in August following poor figures from both manufacturing and construction during the same month.

If the UK falls into recession, it would mean that the government would break its own fiscal rules.

Although Mr Javid said on Wednesday that ahead of the Budget later this year he will review its fiscal framework: “To ensure it meets the economic priorities of today not of a decade ago”.

Separately, Bank of England governor Mark Carney said on Wednesday that the worst case hit to the economy of a no-deal Brexit is now “less severe” thanks to preparations made since the end of last year.

In a Treasury Select Committee hearing, Mr Carney said if the UK left the EU with no deal, the economy would shrink by 5.5% rather than the 8% slump it had predicted in November.

UK-based Ryanair pilots have voted for seven further days of strikes as part of a row over pay and conditions.

The British Airline Pilots Association (Balpa) said it wanted to settle the dispute, but Ryanair has refused to seek conciliation.

Pilots are currently on strike after also walking out from 22-23 August.

Ryanair said the strikes were “pointless” as the industrial action had not resulted in any flight cancellations.

The next rounds of strikes will be:

  • 18-19 September for 48 hours
  • 21 September for 24 hours
  • 23 September for 24 hours
  • 25 September for 24 hours
  • 27 September for 24 hours
  • 29 September for 24 hours

Balpa said its members want the same kind of agreements that exist in other airlines on pensions, loss of licence insurance, maternity benefits, allowances and pay.

“While this action has considerably disrupted Ryanair, forcing them to engage contractors and bring in foreign crews to run its operation, it has had limited impact on the public’s travel plans,” said Balpa’s general secretary Brian Strutton.

“Ryanair should stop dragging its feet and get back to the negotiating table.”

Ryanair said most of its pilots had flown during the strike action in August and early September.

“These latest Balpa strikes are pointless given that during five days of Balpa strikes [on] 22,23 August and 2,3,4 September all Ryanair flights to and from UK airports operated as scheduled – with zero cancellations – thanks to the efforts of over 95% of our UK pilots who flew as rostered and did not support these failed Balpa strikes.

“We again call on Balpa to return to talks as these failed strikes have not achieved anything.”

In August Ryanair said job losses were coming following a 21% fall in quarterly profits after higher costs for fuel and staff, and reduced ticket prices.

On 31 July, Ryanair boss Michael O’Leary told staff in a video message the airline has 900 too many pilots and cabin crew members.

He said the two weakest markets are the UK, where there were Brexit uncertainties, and Germany, where Ryanair faced fierce competition on price.

A no-deal exit from the EU would probably see the economy shrink by less than previously estimated, Bank of England Governor Mark Carney has said.

Mr Carney told MPs that preparations made since the central bank’s last estimate in November have softened its worst-case scenario.

A disorderly Brexit will now probably see the economy shrink by 5.5% rather than the 8% forecast before.

He said more time to prepare could cut the damage further.

Better border preparations, a temporary deal for financial services companies to access UK markets, and a deal on the market for financial insurance products, have all been put in place since November, he told the Treasury Select Committee.

“The impact of that has been to reduce the worst case scenario.”

Food prices

As well as a 5.5% drop in economic output, the UK can expect unemployment to rise to 7% and inflation peak at 5.25% – estimates which are less than one percentage point lower than the November estimates.

He also said the economy was slowing to a snail’s pace as companies shun new customers, hiring and investment ahead of Brexit.

The impact on food prices will also be less hit than previously estimated.

In November, a weaker pound and tariff costs were assumed amount to a 10% rise in food costs, under the worst-case scenario. This may now be 5-6%.

Fire TV-branded 4K TV sets will be sold on the UK high street by Currys PC World, it has been revealed.

The sets, made by manufacturer JVC, will be powered by Amazon’s smart TV software.

They will start at £349 and will also be available to buy online, on Amazon’s own website.

One industry commentator said it was a “significant” move, because video-streaming was increasingly being associated with hardware products.

News of the partnership between the retailers was first published on a now-deleted page at tech site TechCrunch. However, the news has since appeared online elsewhere.

Amazon’s Fire TV software includes digital channels, video-streaming services, apps and skills for the Alexa smart speaker.

“It is significant,” said Andy Clough at What Hi-Fi. “Obviously Amazon has made big inroads into the TV and video market with Amazon Prime, its streaming service.

“Having hardware associated with that is a logical step,” he told the BBC. “I think it’s very much a sign of the times.”

The BBC has asked Amazon and Currys PC World for comment.

The move could help Amazon’s Prime Video service compete against Apple’s iTunes Store and forthcoming TV subscription service. Both are made available via an app recently introduced to recent Samsung televisions.

It also acts as an alternative to Google’s Android TV service on Sony TVs, and LG’s WebOS – both of which have media stores of their own.

Amazon had previously announced Fire TV Edition televisions made by Toshiba for the US market.

It is also expected to reveal further models made by Germany’s Grundig at a press event this evening, ahead of the start of Berlin’s Ifa tech expo.

Dixons Carphone – the owner of the UK retail chain – already stocks other Amazon products including its Echo smart home speakers and Kindle ebook readers, as well as products from rival tech manufacturers.

“Turning the page on austerity” with “no departmental spending cuts” – the purely political promise of what should have been one of the landmark economic days in the parliamentary calendar.

At 4.1% real terms growth next year in day-to-day spending, not only had the pattern of three spending plans over nine years of shrinking spend reversed, it was the highest average annual rate of growth in a review such as this for 15 years.

The funding now pouring into those public services was most visibly problematic for the Conservatives in the 2017 General election, ahead of yet another fairly imminent visit to the polls.

Courting voters

Health, education, and the police boosted just in time. Total departmental spending rising for the first time since before the crisis.

The political strategy will be clear: neutralise the toxicity of visible spending cuts made to shrink the deficit since the crisis, to help win over Leave voters in traditionally Labour seats.

And the good news for the Chancellor and the First Lord of the Treasury, the PM, is that there was some space for this spending.

Borrowing costs are low. And deficits have not been lower for 17 years too. So we will hear a lot about the phrase “fiscal headroom”.

This was not extra money that can be spent, it is extra borrowing. It is room to borrow more within the Government’s self-imposed overdraft limit of 2% of the value of the national economy.

On the buses

The magic number is £15bn. It had been £27bn, but there have been some changes in the way student loans are accounted, that have served the purpose of helping the Treasury apply at least some limits.

So £15bn it is, and £13.4bn was used in announcements to fund schools, further education, defence, policing, and buses.

Bus funding was the key tell. It proved a potent selling point for Labour at the 2017 General election.

But this was not the ordinary three year spending review. That has effectively been delayed until after Brexit.

This is a one year spending round. It is also being separated from the Budget.

This had the happy coincidence that there are no new independent fiscal forecasts from the Office of Budget Responsibility.

If there had been, it turns out that both because the economy has slowed since March, and also because the deficit is running larger than forecast, that £15bn number could be considerably smaller, perhaps more than halved.

On top of that, one has to note that the headroom was left by the previous Chancellor to help deal with the consequences of a No Deal Brexit.

The OBR said in July that even in a modest scenario that could mean a £30bn annual hit to the public finances.

Chasing votes

Whitehall sources say the Treasury had £50bn of spending bids from departments, which they filtered down to £13.8bn including some new capital spending.

The plan is not to just to spend the headroom that might not exist, but to go further in the coming weeks and cut taxes on fuel, housing and beyond.

Small wonder that the Chancellor confirmed at the next Budget the government’s tax and spending constraints – its fiscal rules – will be reviewed. Generally speaking a new Chancellor wants to establish fiscal credibility in their first fiscal events.

The very point of the fiscal framework that has been created over the past few decades was to try to inject some long term thinking, some stability, and avoid the temptation to rig forecasts to enable unsustainable pre election giveaways.

A pre-election spending round risks undermining that. But that’s a small price for the greater prizes sought by politicians within weeks of a possible election.

It can be afforded. But it is a significant shift in the framing of politics.

It is designed by the vote Leave government to recreate that winning coalition of voters again – especially in English Labour seats.

And the real question is whether the voters that matter give credit for the fact the UK is at a turning point and there will be more buses, policeman and teachers, or whether instead this is seen as a minor reversal from the significant cuts over the past decade.

The UK is at risk of slipping into recession, according to a closely watched survey of industry managers.

The dominant services sector grew only slightly in August, the purchasing managers’ index (PMI) from IHS Markit/CIPS suggests.

“The lack of any meaningful growth… raises the likelihood that the UK economy is slipping into recession,” said IHS economist Chris Williamson.

The construction and manufacturing sectors also shrunk in August.

The services sector accounts for 80% of the UK economy.

According to IHS’ survey, the sector barely expanded in August, achieving a score of 50.6 – down from 51.4 in July. Anything above 50 marks growth, while a lower number indicates a contraction.

However, the figure including manufacturing and construction was 49.7, the second contraction for the private sector in three months.

IHS Markit said Brexit uncertainty and higher business costs were to blame.

“While the current downturn remains only mild overall, the summer’s malaise could intensify as we move into autumn,” added Mr Williamson.

Between April and June the UK’s economy contracted for the first time since 2012. A recession occurs when the economy contracts in two consecutive quarters.

According to IHS Markit, UK firms are hiring and taking on new clients at a slower pace as they try to gauge whether the government will quit the European Union without a deal at the end of October.

Service-based firms, which include hotels, restaurants, banks and insurers, are also seeing profit margins squeezed by rising staff wages , fuel costs and utility bills, the survey found.

‘Pinch of salt’

This measure also slipped into negative growth in 2016 following the Brexit referendum and in 2012, around the time of the European sovereign debt crisis.

The numbers should be taken with a pinch of salt, said Samuel Tombs, chief UK economist at Pantheon Macroeconomics.

“PMIs are excessively influenced by business sentiment and have given a misleadingly weak steer during the past 12 months of heightened political uncertainty. Note too that they exclude the retail and government sectors, which still are growing,” he said.

He expects a 0.4% gain for the economy in the July to September period, assuming a deal is struck with the EU ahead of the UK’s departure.

Are we now in recession?

When official estimates were published last month showing the economy contracting in the second quarter of the year, it didn’t yet indicate a recession.

For that, according to convention, you need two consecutive quarters where the economy shrinks.

Optimists hoped that the second quarter had been artificially depressed: as companies ran down stocks they had built up ahead of the cancelled March 29 Brexit deadline, they had less need to buy new supplies and that meant less economic activity.

The hope was that once that stockpiling effect was in the past, the economy would show a bounce-back.

The latest figures from purchasing managers (the finance directors and senior managers who watch their new orders and buy new supplies) – suggest activity in production and manufacturing shrank sharply in August.

Today’s figures suggest the services sector which makes up about 80% of the economy is growing, but only just: perhaps not enough to compensate for contractions in the rest of the economy.

Taken together, they suggest the economy shrank in the third quarter of the year by 0.1%. The figures are by no means the final word on economic growth in the third quarter. But the concern that we may already be in recession no longer looks fanciful.

RBS says its profits could fall by a third this year after a surge of last-minute claims for mis-sold payment protection insurance ahead of the August deadline.

The bank said it expects to take an additional charge of between £600 and £900m after receiving a “significantly higher” amount of claims last month.

It is a blow for the bank which only recently returned to profitability.

The state-owned lender had previously forecast profits of £2.7bn for 2019.

PPI was designed to cover loan repayments if borrowers fell ill or lost their job, but many were sold to people who did not want or need them.

Banks and other providers sold millions of the policies, mainly between 1990 and 2010.

The deadline to seek compensation was 29 August, prompting a surge of last minute claims from consumers.

Santander was forced to extend its deadline for claims until 20:00 on 30 August after its online complaints form stopped working on 28 August.

Nat West, which is owned by RBS, also experienced issues online and there were long waits to get through to its phone lines.

Mounting compensation

RBS has set aside £5.3bn in total to cover PPI compensation, £4.9bn of which has already been spent.

However, the latest charges have come as a surprise for the bank which is still 62% owned by the taxpayer.

In 2018 it posted its first annual profit in a decade, after struggling to recover from the impact of the 2008 financial crisis.

And in its half-year results this year, it reported a 130% jump in earnings to £2bn – its best half-year performance for a decade – as well as a special dividend of 12p a share.

An astonishing £36bn in compensation has been paid out so far, with the typical payout amounting to £2,000.

In May Lloyds Banking Group set aside a further £100m as compensation in May, bringing its total provision to £19.5bn.

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