EQ Weekly Roundup: Jun 26, 2019

This week’s roundup includes news of Tory rivals clashing over Brexit as the leadership race continues, Neil Woodford facing pressure from regulators over investor fees and soaring second home ownership hitting young people’s hopes of getting on the property ladder.

This week’s roundup includes news of Tory rivals clashing over Brexit as the leadership race continues, Neil Woodford facing pressure from regulators over investor fees and soaring second home ownership hitting young people’s hopes of getting on the property ladder.

Tory leadership race: Rivals in BBC debate clash over Brexit deadline

Tory leadership rivals have clashed in a live BBC TV debate on whether the UK can leave the EU, no matter what, by the 31 October deadline.

When asked for a guarantee he would do this, Boris Johnson described the deadline as “eminently feasible”.

Sajid Javid said it “focused minds”, but Michael Gove and Jeremy Hunt said extra time might be needed.

Rory Stewart accused his colleagues of lacking realism and “staring at the wall and saying, ‘believe in Britain'”.

The five men vying to be Conservative Party leader – and the UK’s next prime minister – were taking part in a live debate on BBC One on Tuesday (18 June) night.

The third round of voting will take place later today (Wednesday 19 June), between 15:00 and 17:00 BST. The result is expected at 18:00 BST and the MP with the lowest number of votes will be out of the race.

Former Brexit Secretary Dominic Raab was eliminated in the second round when Conservative MPs held a secret ballot.

Neil Woodford faces regulator pressure over fees

The head of the UK’s City watchdog has added to calls for the suspended Woodford Equity Income Fund to waive the management fees it bills investors.

Andrew Bailey of the Financial Conduct Authority said Mr Woodford “should consider his position” about the fees.

This came after MP Nicky Morgan said Mr Woodford was taking “a huge amount of money” – reportedly £100,000 per day.

Investors have been unable to put money in or take money out of the fund for more than a week after the suspension.

FCA chief executive Mr Bailey told BBC Radio Four’s Today programme that while Mr Woodford should “very seriously” consider his position about the fees, “we need him to manage these assets now more than ever”.

“His job now is to get this fund back into a position where there can be orderly trading, so he has his work cut out now,” Mr Bailey added.

Well-known stockpicker Neil Woodford suspended his flagship fund on Monday 3 June after increasing numbers of investors asked for their money back.

Mr Woodford said he had taken the step to protect investors’ interests.

Soaring second home ownership hitting young people

The number of British people who own a second home, buy-to-let or overseas property has doubled since 2001, says think tank the Resolution Foundation.

Whilst the number of millennials who own a home continues to fall, one in 10 people now own an additional property. Just 37% of people born in the 1980s managed to buy a home at the age of 29, compared with half of those born in the 1960s.

Wealth from owning a second home has risen since 2001 to almost £1 trillion. Buy-to-let property is now the most common form of property wealth, having grown by 58% since 2006-08, the report found.

However, when looking at the number of people who can afford an additional property, millennials match the property ownership rates of other generations. This suggests that only younger people who are rich can afford a second home – a sign, according to the foundation, that property wealth is not distributed fairly across the country.

Firms face pressure to improve zero-hour contracts

An estimated five million people in the UK are on zero-hour contracts, but some of these workers are set to be offered greater security under a new Living Hours programme.

It will require organisations to pay the Living Wage and give workers with at least four weeks’ notice of shifts.

Under the programme – created by charity The Living Wage Foundation – workers will also get a contract that accurately reflects hours worked, and a guaranteed minimum of 16 hours a week.

Commitments to the programme have already been made by major Living Wage employers including Richer Sounds, SSE and Standard Life Aberdeen, who will receive Living Hours accreditation.

Julian Richer, Founder and Managing Director of Richer Sounds, said, “If you treat the people who work for you well, you’re going to have happier, more motivated staff, and ones that stay with you for years.

“Offering Living Hours is a great way to provide workers with security, but it’s also going to help businesses in the long-run.”