FirstFT: Sunak banks public finances windfall for pre-election tax cut

Rishi Sunak yesterday offered pain relief to households facing a crippling cost of living crisis, but he banked most of a £50bn windfall in the public finances as the UK enters dark economic times.

The chancellor hopes to use some of that money for pre-election tax cuts, but his allies expect he will have to offer a much bigger household rescue package in the autumn, as runaway inflation and higher energy bills bite.

Labour claimed the tax cuts contained in Sunak’s Spring Statement were nowhere near enough to offset a fall in living standards not seen since comparable records began in 1956, and some Tory MPs privately agreed. The announcement confirms a grim political and economic situation.

Opinion: Rishi Sunak is a low-tax chancellor in the same way that people who play air guitar in their bedrooms are rock stars. He tried his best, writes Henry Mance. Robert Shrimsley argues that the chancellor’s most political move resurrected the old notion of the deserving and the undeserving.

Share your thoughts with us at firstft@ft.com and we may feature them in the newsletter. Here’s the rest of today’s news — Jennifer

Five more stories in the news

1. US: Russia has committed war crimes The US said it had made a formal determination that Russia’s military has committed war crimes in Ukraine, pointing to atrocities including “indiscriminate attacks deliberately targeting civilians”. The accusation came after Nato announced it would provide Kyiv with defences against chemical and nuclear weapons. Follow our live blog for the latest.

More news on Ukraine

2. DeFi projects rife with hidden ‘risks’ The global umbrella organisation for securities regulators has warned that decentralised finance contains myriad hidden conflicts and risks, as authorities begin circling one of the fastest growing corners of cryptocurrency markets.

3. Chelsea to be allowed £30mn cash injection The football club’s parent company is to be allowed to inject up to £30mn to help the Premier League side “resolve any cash flow or liquidity issues”.

4. Taliban to bar teenage Afghan girls from secondary school The Taliban has said students from grade 7, or about age 13, will not be allowed to return to classes. The U-turn has sparked international condemnation and left desperate students stranded outside campuses.

5. Evergrande bondholders threaten legal action A group of bondholders is moving closer to formal legal action against the world’s most indebted property developer after it made a surprise disclosure that mystery lenders to one of its subsidiaries claimed more than $2bn in cash.

Coronavirus digest

The day ahead

World leaders meet in Brussels Nato heads of state will discuss the next steps in the Ukraine conflict one month after Russia began its invasion. Boris Johnson, UK prime minister, is expected to urge leaders to double down on economic sanctions against Vladimir Putin’s regime and intensify defensive lethal aid, as he unveils a £25mn financial package for Ukrainian armed forces alongside 6,000 defensive missiles. US president Joe Biden and European leaders fear that Putin might resort to weapons of mass destruction.

• Elsewhere in Nato: Leaders will discuss extending the term of Nato secretary-general Jens Stoltenberg beyond his planned departure this summer. The move coincides with a European Council meeting of EU member state leaders.

Moscow stock exchange partially reopens Trading will resume on 33 stocks, including Sberbank, Rosneft and VTB, but only between 9.50am and 2pm.

Toshiba shareholders meeting The meeting will be the climax of a four-year battle between Toshiba and shareholders who believe they can force the conglomerate to reopen buyout talks with private equity.

P&O chief faces MPs Peter Hebblethwaite will appear at a special joint sitting of the transport and business, energy and industrial strategy parliamentary committees after Boris Johnson accused the ferry company of breaking the law by firing almost 800 staff without notice last week.

Economic data Purchasing managers’ index reports for the eurozone, France, Germany, the UK and US are expected to show a modest slowdown in activity in March, after Russia’s invasion of Ukraine. (FT, WSJ)

What else we’re reading

Roman Abramovich’s yachts sail into Turkish squall The superyacht Eclipse, just one of the billionaire’s ocean-going vessels, arrived in the port of Marmaris this week, its 163-metre hull epitomising western concerns about Turkish reluctance to sign up to sweeping sanctions against Russia.

The pendulum of globalisation is swinging back Powerful investment themes emerge in a link between seemingly unconnected events. The breakout of war in Ukraine has revealed such a theme, and Howard Marks, co-founder of Oaktree Capital, believes it is one that investors should heed.

Global food crisis is the prisoners’ dilemma of trade The rush to get more crops in the ground goes against the decades-long direction of European agricultural policy and subsidies. It is in everyone’s interest to keep exports flowing, writes Alan Beattie.

Iran’s enemies in the Middle East are closing ranks Efforts to renew the 2015 nuclear deal may be in danger, writes David Gardner, as the possibility of the US removing Tehran’s Revolutionary Guard from its foreign terrorist list causes alarm in the region.

We need to come clean about dirty money In trying to impose sanctions on Russian oligarchs, western governments are being forced to peer into the shadows, writes Gillian Tett. For example, Roman Abramovich’s $50mn Aspen villa is listed in his own name, a rarity among oligarchs’ assets.

Film

Writing with Fire follows the all-female staff of Hindi news portal Khabar Lahariya. This “observational documentary” is not just about journalism, but also reveals the complexities of caste and class inequalities. Here’s how a film about fearless Indian female reporters made it to the Oscars.