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A senior Bank of England official has dismissed pessimistic “Chicken Licken” views about the UK economy – as revised official figures confirmed it had suffered a record-breaking slump.
Andy Haldane, the Bank’s chief economist, warned that “encouraging news about the present” risked being “drowned out by fears for the future”.

“Now is not the time for the economics of Chicken Licken,” Mr Haldane said in a speech – referencing a children’s folk tale about a chicken who believes the sky has fallen.
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Image: Mr Haldane said GDP looked set to grow by a record 20% in the third quarter
He also dampened down speculation about the Bank implementing negative interest rates, saying none of the conditions that could justify such a move had been met.

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The speech came hours after Office for National Statistics (ONS) data showed that UK gross domestic product (GDP) shrank by 19.8% in the second quarter.

That was slightly better than the initial estimate of a 20.4% contraction after the economy was crushed by the coronavirus lockdown.

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But it still meant that, when added to a 2.5% dip in the first quarter – worse than had been estimated earlier – the UK suffered the biggest recession on record.
However, Mr Haldane argued not enough attention had been paid – when the initial GDP figures came out – to a monthly breakdown showing the strength of the economy’s bounce-back following its initial collapse in April.

The detail of Sunak’s ‘mini-budget’

He acknowledged that the UK faced an “unholy trinity of risks from COVID, unemployment and Brexit”.
But the Bank official – who has previously suggested the shape of the recovery is “so far, so V” – said it was important that the strength of the economic revival was not overlooked.
“My concern at present is that good news on the economy is being crowded out by fears about the future,” Mr Haldane said.
“This is human nature at times of stress. But it can also make for an overly-pessimistic popular narrative, which fosters fear, fatalism and excess caution.”
Mr Haldane argued that “pessimism can be as contagious as the disease – and as damaging to our economic fortunes”.
“Avoiding economic anxiety is crucial to support the on-going recovery,” he said.

Track the UK economy’s recovery from lockdown

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Mr Haldane said GDP now looked set to grow by a record 20% in the third quarter, helped by a surprisingly robust bounce-back in consumer spending.
That would still leave the economy 3-4% below pre-pandemic levels, though if such a scenario had been offered earlier in the summer “absolutely everyone would have been a buyer,” he said.
Mr Haldane also suggested that the strength of recovery, as well as the announcement of a jobs support scheme, meant unemployment by the end of the year might not be as high as the 7-7.5%, forecast by the Bank in August – though that could be offset by the impact of new lockdown measures.

A former Audi boss has gone on trial in the first prosecution related to the Volkswagen (VW) “dieselgate” scandal in the company’s home market of Germany.
Rupert Stadler, who headed VW’s Audi division from 2010 until 2018, is accused alongside three other men of fraud offences – charges they each deny.

The case relates to the VW group’s admission in 2015 that it had rigged millions of diesel cars to cheat emissions testing regimes after the software was uncovered in the US.

Image: VW admitted more than 11 million vehicles had been fitted with software designed to cheat emission tests
The German car giant – which includes the VW, Audi, Skoda and Seat brands – revealed that 11 million vehicles worldwide, including almost 1.2 million in the UK, had been fitted with the software.
The scandal has since cost the company more than £27bn in fines and civil settlements – the bulk of which relates to legal action in the US alone, where two executives were also jailed.

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Mr Stadler, who was driven to the Munich court in a Mercedes, was arrested in 2018.

He is alleged to have allowed 250,700 Audi vehicles, 71,600 Volkswagens and 112,100 Porsches to be sold on the US and European markets despite knowing about the deception in September 2015 at the latest.

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These are not the only legal proceedings related to the scandal in Germany.
Volkswagen’s chief executive at the time, Martin Winterkorn, faces two separate criminal proceedings in the country.
He has also been charged by US authorities but cannot be extradited.

Image: Martin Winterkorn quit as chief executive of the VW group shortly after the diesel emissions scandal came to light
The company is also continuing to face a string of class action claims in Europe, including the UK, brought on behalf of car owners who are demanding compensation on the grounds they were mis-sold their vehicles.

Disney has made the “heart-breaking” decision to lay off around 28,000 employees due to the impact of the coronavirus pandemic.
Most of the layoffs will hit those who work at the company’s American theme parks in Florida and California, of which some 67% are part-time staff.

Disney closed its parks across the world earlier this year when COVID-19 started to spread, and those that have reopened have been forced to adhere to enhanced safety measures including limits on capacity.
Its iconic Disneyland park in California has remained completely shut due to tougher restrictions in the state.
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Image: Disneyland in California has not been able to reopen since restrictions were first imposed earlier this year
Josh D’Amaro, chairman of Disney’s parks unit, cited the limited capacity at the other parks and uncertainty about the duration of the coronavirus pandemic, which he said was “exacerbated in California by the state’s unwillingness to lift restrictions that would allow Disneyland to reopen.”

He added: “We have made the very difficult decision to begin the process of reducing our workforce at our parks, experiences and products segment at all levels.

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“Approximately 28,000 domestic employees will be affected, of which about 67% are part-time.
“Over the past several months, we’ve been forced to make a number of necessary adjustments to our business, and as difficult as this decision is today, we believe that the steps we are taking will enable us to emerge a more effective and efficient operation when we return to normal.”
In a letter to employees, Mr D’Amaro called the move “heart-breaking” and said management had tried to avoid the job losses by cutting expenses, suspending projects and streamlining operations.
“However, we simply cannot responsibly stay fully staffed while operating at such limited capacity,” he added.

Image: Masks and temperature checks are the new normal at parks that have reopened
The company had continued to pay health benefits for furloughed workers since April, but furlough works differently in the US than it has done in countries like the UK.
While those on furlough have maintained benefits such as health insurance, they stopped receiving a salary.
Walt Disney World in Florida had employed 77,000 workers before the pandemic, while Disneyland in California employed 32,000 people.
The job losses do not affect Disney’s parks in Paris, Hong Kong, Tokyo and Shanghai, which have all reopened.

Image: Disney’s theme parks are operating at reduced capacity
It comes after the company reported its first quarterly loss in nearly two decades when it lost $4.72bn (£3.68bn) in the three months to 27 June, caused by coronavirus-related setbacks across the business.
Disney has been forced to delay several big-budget cinema blockbusters, including its upcoming suite of Marvel superhero films, while its remake of Mulan skipped the big screen in favour of the Disney+ streaming service.
Mulan’s release ran into further problems when it was met with calls for a boycott because it was shot in parts of China where the government is accused of serious human rights abuses.
Despite the financial downturn, last month Disney reportedly ended the temporary pay cuts handed down to its senior executives. Deadline said the salary reductions for its top brass came to an end on 23 August.

TSB has announced plans to close 164 branches and cut 969 jobs as it accelerates a shake-up launched last year.
The cuts, blamed on the shift in customer behaviour from over-the-counter to online banking – accelerated by the COVID-19 pandemic – will reduce its high street network to 290.

That compares to more than 600 branches when TSB was relaunched in a spin-off from Lloyds Banking Group in 2013.

Image: Chief executive Debbie Crosbie said closures were ‘never an easy decision’. Pic: TSB
The bank said it was registering almost 4,000 customers a day for its digital app, up from 1,200 before the pandemic, while the proportion of transactions made digitally or through automation – already at 90% last year – had risen further during the outbreak.
TSB chief executive Debbie Crosbie said: “Closing any of our branches is never an easy decision, but our customers are banking differently – with a marked shift to digital banking.

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“We are reshaping our business to transform the customer experience and set us up for the future.

“This means having the right balance between branches on the high street and our digital platforms, enabling us to offer the very best experience for our personal and business customers across the UK.”

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The cuts, due to take place next year, add to an ongoing programme of 82 branch closures announced when TSB first launched a three-year turnaround plan last November.
That means that over the period the number of branches will have fallen from 536 before the closures started, though the bank pointed out it would still have the seventh largest network in the UK.

2018: Banks: too old fashioned for online?

It is the latest lender to announce closures, following rival Co-op, which said last month that it was shutting down 18 sites – while bigger lenders such as Lloyds and NatWest have also been chopping back their high street presence.
TSB said it was taking steps to support vulnerable customers in rural locations.
The bank said branches earmarked for closure were on average less than 0.3 miles to the nearest post office – where TSB customers will be able to make deposits and withdrawals.

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It said the vast majority of job losses were expected to come through voluntary redundancies.
A total of 969 “role reductions” will be offset by 120 new roles being created.
Spanish-owned TSB has been attempting to turn around its fortunes after an IT fiasco in 2018, which left nearly two million people locked out of their accounts and led to the then chief executive Paul Pester to step down.
Trade union Unite urged TSB to rethink the plans.
National officer Dominic Hook said: “Not only do these staff deserve more from their employer after showing the utmost loyalty to TSB, customers will be deeply hit by these branch closures.”

US casino giant Caesars has agreed to buy William Hill for £2.9bn – but plans to spin off the UK business shortly after the deal completes.
Caesars is targeting the London-listed firm’s US operations, in which it already has a 20% stake, and will seek new owners for the business in the UK and other parts of the world.
William Hill employs around 8,000 people in the UK, where it operates more than 1,400 betting shops.

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Oil giant Royal Dutch Shell has announced plans to cut up to 9,000 jobs as part of a cost-cutting shake-up.
The restructuring is part of the company’s efforts to adapt to a low-carbon future and becoming more “streamlined”, with the severe impact of COVID-19 – which caused a slump in demand for oil and a collapse in prices – also a factor.

Shell, which had 83,000 employees at the end of 2019, said that the reorganisation will lead to annual savings of up to $2.5bn (£1.9bn) by 2022.

Image: Chief executive Ben van Beurden has set out plans to adapt to a low-carbon future
It said the shake-up was expected to result in 7,000 to 9,000 job cuts – including around 1,500 who have agreed to take voluntary redundancy this year – by the end of 2022.
The company would not give a breakdown of how its workforces in different countries would be affected.

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Shell employs 6,500 people in the UK.

Chief executive Ben van Beurden said it was aiming to become a “simpler, more streamlined, more competitive organisation that is more nimble and able to respond to customers”.

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He said cost-cutting could include areas such as travel, use of contractors and virtual working and that the pandemic had shown the company can adapt to working in new ways but stressed that “a large part of the cost saving for Shell will come from having fewer people”.
The restructuring comes after rival BP in June revealed a shake-up which will see 10,000 jobs go globally, including 2,000 in the UK.

How lockdown measures have squeezed demand for oil

In May, Shell cut its dividend for the first time since the Second World War in the wake of the coronavirus crisis.
Its shake-up plan today was announced alongside a trading update which showed lower oil production in the third quarter due to the pandemic as well as hurricanes in the Gulf of Mexico which have cut output by up to 70,000 barrels a day.
However, there was a recovery in fuel sales from lows hit in the previous quarter as some countries began to emerge from lockdown measures.
Shell, which took a $16.8bn accounting hit in the March-June period due to the slump in output, said it would face another impairment charge for the current quarter, of $1-$1.5bn.

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The company said earlier this year that it was aiming to become a net-zero emissions energy business by 2050.
Setting out its restructuring plans, Mr van Beurden said: “If we want to get there, if we want to succeed as an integral part of a society heading towards net-zero (carbon) emissions, now is the time to accelerate.”
Shell is looking at ways to cut spending on oil and gas production and the latest shake-up will see it reduce its number of refineries from less than 10 from 17 currently – down from 55 in 2005.

Kylie Jenner’s cosmetics firm has warned customers of a “security breach” with Shopify – the firm which runs its e-commerce platform.
In a statement on its website, the company said the incident affected names, addresses, emails, product orders, and even the last four digits of the credit card for potentially impacted customers.

According to reports, Shopify said it was the result of two rogue support team members engaging “in a scheme to obtain customer transactional records of certain merchants”.
The Jenner Cosmetics statement to customers added: “Your trust is so important to us and we wanted to let you know we’re working diligently with Shopify to get additional information about this incident and their investigation and response to this matter.
“Although their investigation is ongoing, Shopify has assured us that they have implemented additional controls designed to help prevent this type of incident from recurring in the future.

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“Based on the investigation to date, we are confident that our customers can continue to shop on our website.”

The breach is believed to have happened between 15 August and 15 September 15, 2020.
Shopify has brought in an outside forensic investigation firm to assist them and has reported the incident to the FBI and other international agencies.

The Hut Group, the online retailer and technology company which floated this month, has struck its first takeover deal since going public with the purchase of a leading international skincare brand.
Sky News has learnt that THG Holdings, which has seen its shares soar since going public a fortnight ago, will announce the purchase of Perricone MD as soon as Wednesday.

If completed, a deal to acquire Perricone MD, which specialises in anti-ageing products, would add the brand to a beauty and wellbeing portfolio which includes Christophe Robin and Myprotein.

Where jobs have been lost in the UK economy

Perricone MD has been owned by Lion Capital, a private equity firm, since 2014.
Founded in 1997, it makes products such as face-lifting serum and neck-firming cream in one of the faster-growing segments of the cosmetics and beauty market.

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The price that THG had agreed to pay for the skincare brand, which it has sold on its platform for many years, was unclear on Tuesday night.

A person close to the transaction said the deal would vindicate the strategy set out by THG’s board at the time of its float this month, as it seeks to position itself as the natural digital home for beauty and wellbeing brands.

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The Manchester-based company’s infrastructure platform, THG Ingenuity, works with global consumer brand-owners such as Nestle, Procter & Gamble and Walgreens Boots Alliance to power their digital operations.
THG Holdings floated at 500p-per-share, and has seen an immediate spike as investors have bought into one of Britain’s biggest homegrown tech ‘unicorns’.
On Tuesday, its shares closed at 603.9p, giving it a market capitalization of £5.83bn.
Founded in 2004 by Matthew Moulding, who continues to run the company, THG operates 200+ localised websites, and sells goods in 169 countries, according to a spokesman.

Track the UK economy’s recovery from lockdown

Last year, it grew sales by 24% to £1.14bn, with two-thirds of sales generated internationally.
In the run-up to the flotation, Sky News revealed that Mr Moulding could land one of the biggest payouts in British corporate history from an incentive scheme that will pay out if THG reaches a market value of £7.25bn by the end of 2022.
If it does, he could receive shares worth more than £700m.
Mr Moulding has led the growth of THG into a giant of Britain’s digital economy employing 7000 people, and already owns a significant minority stake in the company.
THG listed with an unusual structure which included a ‘founder share’, allowing him to veto a hostile takeover bid in the coming years.
Despite the governance arrangements, THG’s shares were in enormous demand ahead of the float.
THG and Lion Capital declined to comment on the Perricone MD deal.

Burger King, the fast-food giant, is preparing to close a number of its UK restaurants as part of a restructuring process triggered by the coronavirus pandemic.
Sky News has learnt that Burger King’s British operations have drafted in advisers from AlixPartners to review options for one of its subsidiary companies, which directly owns approximately 25 of the chain’s outlets.

Sources said the company was examining a company voluntary arrangement (CVA) or, more likely, a pre-pack administration for the subsidiary.

Image: The brand, like rivals, saw sales hit hard by the coronavirus lockdown
The restructuring could entail the permanent closure of up to 10 of its restaurants with a number of potential job losses, they added.
Burger King’s master franchisee in the UK is the private equity firm Bridgepoint, the former owner of Pret A Manger.

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Bridgepoint took on the role in 2017, when it acquired the exclusive rights to the Burger King brand.

In total, the chain trades from roughly 530 restaurants in the UK, with some sites yet to reopen following the UK-wide lockdown.

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The main franchisee directly owns about 118 of the 530 sites.
Insiders indicated that a broader restructuring of the business was a possibility, depending upon further spikes in COVID-19 cases and ensuing lockdowns and enforced closures of restaurants.
Bridgepoint is understood to have been discussing a refinancing of the Burger King business to enable funds to be invested in opening more drive-thru restaurants.
Rival McDonald’s is understood to have traded well since the UK-wide lockdown ended in June, partly as a result of its more substantial drive-thru estate.
Burger King is understood to want to open at least 30 new drive-thru sites in the UK next year.
Alasdair Murdoch, Burger King UK chief executive, has been a vocal critic of policy-making towards the hospitality sector since the start of the COVID-19 crisis.

Where jobs have been lost in the UK economy

In March, he declared that the chain would not be paying its quarterly rent bill, and has called on commercial landlords to work with food and beverage operators to resolve the deepening impasse between them.
“This crisis affects the whole UK economy, which will take time to recover,” Mr Murdoch wrote in an open letter to landlords.
“The hospitality industry is especially important to the UK economy. It is the third-largest private sector employer, employs 3.2m people and is [twice as large as] the financial services sector”.
Britain’s casual dining and wider restaurant industries have been dealt a devastating blow by the pandemic.
This week, Cote, the French restaurant group, became the latest business to succumb to the financial pressure caused by coronavirus when it was sold through a pre-pack administration to new investors.
A number of other burger chains have also changed hands, including Byron, which saw hundreds of jobs wiped out in a pre-pack deal during the summer.
GBK is also in the process of changing hands.
The Burger King brand is owned globally by Restaurant Brands International, a New York-listed company.
Burger King and Bridgepoint declined to comment on Tuesday evening.

The disputed $14.5bn (£12.6bn) takeover of jeweller Tiffany & Co by LVMH is heading for a bloody court battle in the US.
The French luxury goods firm announced earlier this month that it was abandoning the deal agreed in November last year.

It cited the COVID-19 crisis and a French government request to delay the purchase until 2021 on the grounds it could result in additional US tariffs on French products in a trade dispute with President Donald Trump.

Image: The US jeweller was made famous by the 1961 film Breakfast at Tiffany’s starring Audrey Hepburn
The decision to pull out prompted Tiffany to launch a lawsuit against the company in Delaware.
On Tuesday, LVMH confirmed it had counter-sued Tiffany, claiming financial mismanagement during the pandemic.

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The jewellery firm argues LVMH – run by French billionaire and Europe’s richest man Bernard Arnault – should be forced to complete the deal on the terms agreed.

A four-day hearing has been set for January, but the judge in the case has urged both sides to settle before an expensive court battle begins.

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The deal had been expected to complete before summer this year, but the timetable was pushed back by the coronavirus crisis.

Image: French luxury group LVMH chief executive Bernard Arnault
LVMH, which includes the Louis Vuitton, Christian Dior, Givenchy and Moet & Chandon brands, had said at the time of the agreement that the addition of Tiffany would boost its presence in the US market.
The company’s complaints against Tiffany include its decision to maintain dividend levels at a time when it was “burning cash and reporting losses” during the lockdown.
“No other luxury company in the world did so during this crisis,” LVMH said.
Tiffany described the claims as “baseless and misleading”.
“Tiffany has acted in full compliance with the merger agreement, and we are confident the court will agree at trial and require specific performance by LVMH,” its chairman Roger Farah said in a statement.