A new initiative backed by the Government and funded by the City will develop a new payments company amid concern that systems owned by Mastercard and Visa could be compromised. A meeting this Thursday will bring together a group of City funders, led by Barclays’ UK chief executive, Vim Maru, that will front the costs of the new payments company. The Guardian is framing the rationale for the move as stemming from fears that President Trump could “turn off US-owned payment systems” with some finance chiefs in the EU and the UK issuing such warnings. But former Nationwide chief executive Joe Garner told the paper: “Regardless of any political developments, the UK needs to do this. We needed to before, we need to now…I don’t think that’s changed by recent events.” The new payments initiative is known as DeliveryCo and Visa and Mastercard will be among the funders group, alongside major UK banks and payments companies. The Bank of England will develop infrastructure blueprints and the new payment rails will be in place by 2030. BoE documents published last year reveal plans to deliver the next generation of UK retail payments infrastructure, outlining the need to accommodate stablecoins and tokenised deposits, improve competition and security.

The Chartered Institute of Personnel and Development (CIPD) reports that new employment rights may deter hiring. Over 37% of businesses plan to reduce permanent staff due to these measures. The CIPD’s quarterly labour market outlook surveyed over 2,000 employers, revealing that 74% expect increased employment costs and 55% foresee more workplace conflict. Ben Willmott, head of public policy at CIPD, said: “There is a real risk that the Employment Rights Act measures will act as a further handbrake on job creation.” The Act will introduce changes in January, including a reduced qualifying period for unfair dismissal rights.

Mustafa Suleyman, Microsoft’s AI chief, predicts that most white-collar jobs could be fully automated within 12 to 18 months. He stated that AI is nearing “human-level performance” in tasks like law, accounting, and project management. Suleyman noted that AI-assisted coding is already common in software engineering. The potential job losses could be severe, with estimates suggesting up to 80% of entry-level positions might be at risk.

Consumer confidence in the UK has reached its lowest point in two years, according to the UK Consumer Sentiment Index survey by S&P Global. The index recorded a reading of 44.8 in February, indicating a decline in consumer sentiment. Maryam Baluch, an economist at S&P Global Market Intelligence, noted that households are increasingly concerned about rising debt and the availability of credit. The survey revealed that all age groups, except those aged 18 to 34, are accumulating debt, with the most significant increase seen among 18 to 24-year-olds. Baluch stated: “There’s more going on here than just bad weather.”

The Trades Union Congress (TUC) is urging the Bank of England to reduce interest rates to stimulate economic growth. TUC General Secretary Paul Nowak said: “The Bank of England has a crucial role to play here. Last year they were overly cautious and too slow to act. They should go for growth with a sequence of quick-fire cuts this year.” He stressed that lower rates would benefit households and businesses. The Guardian notes that recent data shows UK consumer demand has lagged behind 32 of 37 OECD countries, contributing to stagnant economic growth. The Bank’s monetary policy committee recently voted 5-4 to maintain rates, but a cut is anticipated in March.

Sir Keir Starmer has indicated a desire to increase UK defence spending to 3% of GDP by 2029, prompting concerns over potential tax hikes. Paul Johnson, former director of the Institute for Fiscal Studies, warned that higher taxes may be necessary to fund this increase, especially ahead of the next general election. He commented: “On current forecasts, I think this probably just means higher taxes than currently planned.” The UK currently spends 2.3% of GDP on defence, above NATO’s 2% guideline, but further increases could lead to significant cuts in other public spending.

A partner at KPMG Australia has been fined $10,000 (£7,200) for using AI to cheat on an internal training exam on AI. The unnamed partner uploaded training materials to an AI platform to answer questions, violating company policy. Over two dozen KPMG Australia staff have been caught using AI tools to cheat on internal exams since July, according to the firm. Andrew Yates, chief executive of KPMG Australia, said: “Like most organisations, we have been grappling with the role and use of AI as it relates to internal training and testing. It’s a very hard thing to get on top of given how quickly society has embraced it.”

Families flying from Heathrow may face increased flight costs of up to £250 if the proposed £33bn third runway expansion goes ahead, according to airline executives. The expansion is expected to add £60-£65 to average ticket prices due to rising landing charges, which are already the highest globally. Executives from British Airways’ parent company, IAG, recently voiced their concerns about the expansion’s economic implications in a meeting with government officials. Heathrow claims that expansion will ultimately lower airfares and stimulate economic growth despite pushback from airlines.