Election fallout

25:36So we'll chat World Cup in the second half of the programme as well. Just in terms of those shows, that was kind of a very British show you did, didn't it, in Manchester? Yeah, on Saturday, yeah. Do you think the boxing world in sort of business of sport terms, is it becoming, because it had been very international, hadn't it, for a while, and particularly with the money from Saudi Arabia, a lot of big British fights going out there. Is it becoming more domestic again? I think so, and also sport. They talk about all the football leagues in the world, but it always comes back to the premiership.

26:04There's many, many sports, obviously, all the different, the golf's going to change. the football's going to change. But, yeah, most certainly with the boxing at the moment, certainly there's a big crop of great British heavyweights that are based in Britain. So long may it continue. And we've talked a few times about the co-op live. I remember being on the programme quite a bit in its very early days where it was having a lot of trouble with the roof and all that kind of stuff. But what did you think of it as a venue for sport? We've talked about it a lot for music. Yeah, for a sporting venue, it's superb.

26:35yeah so throughout the UK now I think it's the biggest attendance so yeah it's a great venue as a place to work yeah absolutely yeah even on Saturday we did a show there and you've got Man City at home and you got the old MEN the AO arena got a show on as well so logistically so you got 60 ,000 next door at the Etihad and then you got 20 ,000 at the boxing so it all worked Anna, no, you were, well, not you, your household was as excited as I was about the flip to Istanbul coming up. Your wife supports the right football team in the Midlands, unlike you. Unfortunately so. Plenty more from me and plenty more from Anna in the second half of the programme.

27:13As I say, we're going to talk a bit World Cup later on, so Anna can fly the flag for Scotland there for us as well. But we are going to zoom in a little bit more on those results as well. We've kind of done the big UK economic picture. I know a couple of you have been in touch on text about this, so don't worry, we're going to zoom in a little bit about running those councils, what's going on in Wales and Scotland as well. So plenty more from us here to come. Hurry into Menards right now and save big money. Miracle-Gro raised bed soil helps you grow bigger, more bountiful plants. It provides the right foundation your plants need to thrive with a 100 % organic formula that requires no mixing.

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28:40Morning. Welcome back to Wake Up to Money on Monday, the 11th of May. We're our panel this morning. Ian McAllister here in the studio with me, the chief exec of the security firm The Man Group, and Anna McDonald, investment strategy director at Hargreaves Lansdowne. Now, pro-independence governments are set to rule in both Wales and Scotland following last week's elections. The Scottish National Party will be forming the next government at Holyrood. Here's the BBC's Scotland correspondent, Katie Hunter. The SNP won this election by a mile. John Swinney's party finished with 58 MSPs. That's short of the 65 needed for a majority.

29:17But the electoral system in Scotland makes that a very high bar. The pollsters said it was going to be tight for second and they were right Scottish Labour and Reform UK both returned 17 MSPs That was Scottish Labour's worst result at a Scottish Parliament election but the party's leader Anas Sarwar has said he'll stay on Remember back in February he called for the Prime Minister to resign and he's standing by his comments The Scottish Tories also recorded their worst results at a Holyrood election they'll only have 12 MSPs this time round. In 2021, they returned 31. In contrast, the Scottish Greens are celebrating a record 15 MSPs, while the Lib Dems have 10.

30:01The combination of SNP and Green MSPs means there will, once again, be a pro-independence majority at Holyrood. Meanwhile, in Wales, historic elections there. The devolved government will be led by someone other than the Labour Party for the first time since the Senedd's formation in 1999. Kemlyn Davis from BBC Wales has more on that. As the dust settles on an historic election, Wales' future is becoming clearer. Plaid Cymru leader Rhina Piorwerth looks set to be confirmed as the first non-Labour First Minister of Wales tomorrow. That's after his party won the most seats in Thursday's election, ending Labour's unbroken grip on power in Wales.

30:43In this newly expanded Senedd of 96 seats, Welsh Labour have been left with just nine members and over the weekend the party installed an interim leader after Elinad Morgan lost her seat. With 34 seats, reform will be the official opposition, an impressive achievement for a party that took only 1 % of the vote five years ago. The election also saw the Greens win their first ever seats in Cardiff Bay, whilst the Lib Dems remain on one. Discussions will continue now around how Plaid Cymru will govern after the party fell six seats short of a majority. So, Ian and Anna here. Joshua Miles also joining us this morning.

31:24Joshua, the Chief Executive of the Federation of Small Businesses Wales as well. Morning to you, Joshua. Morning, Dad. Good morning. Good morning. Ian, can I start with you actually for a bigger picture, I suppose, because we'll zoom in on Wales and Scotland and perhaps some of those English election results. But it's the kind of the overarching message here being kind of really kind of like right around the UK, like fury, like frustration. I think so. And they mentioned coalition. I can't see how that's going to work out when you've got opposite polls with reform and the Greens. Yeah. Well, let's put a pin in that for a moment because I really want to get to that.

32:03I think that's one of the things that's really interesting. And Anna will have a good view on that, too, about what that does to the kind of the overall kind of economic backdrop, perhaps more complicated decision making at some of these levels as well. But Joshua, what was your kind of top line takeaway, I suppose, from what happened in the Senedd? Yeah, well, obviously, it's a momentous election for us here in Wales. We've gone from a situation where we've had the same party in charge for 27 years since we've had devolution. And now we're looking at something completely different. I think the main thing people would have taken away from the weekend would be the sort of conclusiveness of that result.

32:40Plaid Cymru are quite close to having a majority, even though they are short. And I think what we'll get now is a slightly more stable government, perhaps, than we would have envisaged before. And that's obviously going to be really critical for business confidence in Wales in the next period to come. As I say, I want to come to how decisions get made, because that's obviously really important for companies right around the country. These councils have a lot of say over a lot of the things that are, Ian, you're nodding, that set the rails for how you work, basically. Yeah, I've definitely seen it, certainly in the West Midlands.

33:13I've seen it when we've had great leaders over the last couple of years, where people have been very interested in business because they're from a business background. And it's massively important because certainly local councils, etc., they need to keep the businesses on side. I just want to get a sense of some of the issues, though. Anna, I'm going to lean on you in a moment for what you thought was kind of going on in Scotland and a bit of a national perspective. But Joshua, just in terms of that response, were there things, were there things, you know, you're chatting to your members all the time, I'm guessing, about what you would like, what they would like you, sorry, to raise with political leaders in Cardiff Bay?

33:50What was it that was most frustrating to them? I think the biggest issue by far at the moment in Wales is confidence. So when we speak to our members, we find that they're pretty confident in their own business and their future prospects. But the confidence in the Welsh economy and the UK economy more generally is really, really low. So we've got a small business index that runs every quarter. And we've had eight consecutive quarters of negative confidence now. So really, really difficult environment. And I think the main thing that's driving that is costs. It's been discussed on the show this morning, but high costs and rising costs are a real driver of issues at the moment, in particular driven by labour costs, by tax costs and utilities, as we know, is a major issue that's coming down the track as well with the war in Iran.

34:41So a perfect storm really. Yeah. And from a purely Welsh perspective, then, how much can Rhynap Jorwerth, as presumably we expect him to become First Minister, actually do about some of that? Yeah, well, the Welsh government actually has quite broad powers in a lot of areas. I'd say the biggest area would be business rates for us. So we've got a separate business rates system in Wales. and the last Welsh Government made a decision on retail hospitality and leisure in particular to end the relief there, which meant that some businesses saw a 40 % increase in their bill April this year, which was really significant.

35:18It's interesting, all of the parties running into the election were making promises on business rates. There's quite a strong consensus that something needs to change there. But Plaid Cymru in particular were very firm on the idea that they needed to reduce the burden on retail, hospitality and leisure. So we'd expect that to be an early policy emerging in the next Welsh Government budget in the autumn. The issue, presumably looking at the results through the weekend, Joshua, though, as well, is that I hear what you're saying in Applied, winning relatively decisively in the end, but yet there was a significant, significant vote for reform who obviously see very different issues and how to tackle them in a very different way to Applied.

36:01Is that potentially an issue down the track for that sort of clarity of policymaking? It could well be. It's interesting, I think, to have a strong opposition in any parliament, isn't it? So I think we're going to be in a position where we have quite a clear government and quite a clear opposition, which is where we've been in the past. So, you know, my hope would be that that leads to a better political debate in the institution and organisations like ours are able to play our issues into that debate. Anna, more as a resident, really, because often we're speaking to you when you're in Edinburgh.

36:35What was your kind of sort of takeaway from people you were chatting to as well about what the big issues at play in Scotland were? Well, like in Wales and in the local elections, the big story is how fragmented Scottish politics has become. The SNP did win again, but on a much lower share of the vote. I think what's going to be interesting for anyone to be looking at when they're looking at what happens in Holyrood is now that we've got actual significant representation, for example, from reform in the parliament, you've got people standing up and talking in a very visible way. So when people are thinking about how that might translate into a general election perspective, you can, you know, you do probably at the current rate of polling expect a much higher proportion of reform MPs than the single digit numbers we have just now in Westminster.

37:30So I think what we're going to see from the Synod and what we're going to see from Hollywood is actual real life examples about how fragmented parties and outcomes, sorry, not fragmented parties, fragmented parliament and outcomes, how that really works in practice. does it slow down decision making does it temper decision making that otherwise might be seen as as um as more extreme so it will be i think it's it's going to be both are going to be quite interesting examples for for for us to observe and about how it might affect the the westminster elections in years to come and that's going to be true about councils too not just these national elections i mean i'm looking at the results for for our um uh neck of the woods ian here birmingham City Council.

38:16I mean, you look at the spread of that. It's just like absolutely every colour there with sort of 10 plus in there. It's going to be all sorts of coalition building. I mean, this is politics that we haven't really done. This is Dutch kind of style politics that's going to be needed in some of these places to actually get anything done at all. Joshua, is that one of the worries, a potential paralysis? And then also, we've had a text in from Brian in Buckinghamshire this morning saying, we need to get business leaders' opinions on reform policies. They seem to be mostly against Brexit but did we discover that until we had left the European Union?

38:50I mean, not just with reform actually in the Senate but am I right in saying it's 70 plus of these MS's in the Senate, they're now going to be brand new. We're going to learn a lot about a lot of them, aren't we? And their policies and what they really think. Yes, absolutely. It's a huge change for us here in Wales so not only have we got two new parties with, not new parties, but two parties growing significantly in terms of their number of politicians. The number of politicians in Wales is going up anyway from 60 to 96. So we're going to have a lot of new faces in the institution come Tuesday, which means a lot of work for organisations like ours to make sure they know about the key issues businesses face.

39:28But on that question of, you know, coalitions and deals, we've never actually had a majority in the centre. So we've got 27 years of parties having to do deals to get stuff done. And so I'm pretty confident that's what's going to happen here. And already the mood music from the other parties, Labour, for example, have a new leader in Kent's gates, and he's been pretty clear they're going to be quite proactive and make sure budgets pass so we don't have any long term issues with budgets and those sorts of things. And just to round this out, we often focus a lot, don't we, on Westminster and the Westminster kind of impact on everything.

40:03But actually, perhaps Anna lead us off and we'll go around everybody. But is it underrated, underplayed a bit to what Ian was saying earlier about how much difference, particularly local authorities around the UK can play now in actually a lot of the things that a lot of our companies deal with day to day are actually being dealt with by the local authority, not by Westminster at all? Yes. And I mean, I think you see that when don't you when you think about things like planning applications, you might the we were talking earlier about supply side moves and and it's very much been Labour Party policy to try and encourage more house building to try and encourage more development.

40:47And then at the local authority level, that's when it really has to be pushed, has to go through. And that's where you can find issues and delays. Local authorities can do a lot, particularly. And then if you think about mayoralties as well, they can, you know, Burnham has been praised for for doing a lot of good work in Manchester. So on local levels, you can make a significant difference. Scotland sets itself apart, I suppose. Also, we do have some separate tax-raising powers, which has an impact, some would say, on our ability to attract talent. And yes, so I mean, there's lots that happens at the local level that makes a difference.

41:26And it also just makes a difference about how people feel about the quality of their lives, better transport, better roads, easier planning. All these kind of things make a difference. What does a good local leader look like, Ian? What do they do from a chief exec's perspective? do? Certainly get involved with businesses, certainly get involved with the people that are making the decisions within the business. Like before we came on air, you were talking about Andy Street and say, what did he do that impressed you? And what did he do that actually helped businesses? Well, he was from a business background.

41:58So he's obviously CEO of John Lewis. So he'd done a big part throughout the Midlands. He was somebody who listened. But even since he's not been the mayor, he's continued to be of the same level, even campaigning last week. And from his point of view, he had a big input because he worked closely and he was out there all the time listening to the ear of people. Obviously, when you're in business, you're employing people and et cetera, becoming wealth creators. It's so important to have the ear of the business owners. and a lot of work Joshua it sounds like for the new cabinet to do in Wales then to appease some of those concerns that you listed off for members it's all not going to happen all in one go is it in a click of the fingers where do you think they should start is it with that rates issue yeah there's a lot to go on isn't there absolutely rates for the first budget but I think there are other things they can do as well so economic strategy in Wales is a little bit of a mess at the moment.

42:56I think they could give a bit more clarity around where we're going as a country, what we want to achieve economically. And the other big untapped opportunity, I think, is around public sector spend. So the Welsh Government itself spends about£8-9 billion in Wales with suppliers every year. And they do very little of that with smaller businesses. There's a huge opportunity to open that up and get more Welsh companies pitching into the the procurement process. And infrastructure again, I'm guessing. I mean, I feel like I've covered that for the entirety of my career, infrastructure in Wales concerns, but particularly in some of those places that screeched the loudest, I suppose, at the weekend in terms of how much pressure they were feeling in terms of the real seismic flips in some of those areas, thinking in the South Wales Valleys and in North Wales as well, in particular, infrastructure concerns.

43:46And again, those issues that the Welsh Government does have control over. Yes, absolutely. Welsh Government has quite firm control over a lot of those areas and we'd love to see them spent a lot more. It's difficult, budgets are tight, but making that a priority is going to be really, really key. It's what drives productivity, it's what gets people around, gets staff around and makes a real difference when you get those things right. Appreciate your time this morning. Thanks so much. Thank you. Joshua Miles there, Chief Executive of the Federation of Small Businesses Wales. Just coming up to 11 minutes to six here on Five Live.

44:21Still time to get your text in on 85058. Should you wish to join the conversation? Ian Norrie tied this up for us a bit earlier, didn't he? It's about a month to go almost exactly to the World Cup kicking off in the US, Mexico and Canada. But 80 % of accommodation providers tracking bookings are finding numbers lower than they expected, according to the head of the accommodation trade body. Rosanna Mietta is the president and chief executive of the American Hotel and Lodging Association, represents tens of thousands of clients from major hotel chains to small bed and breakfast operations. And she told me some of the reasons why bookings were lower than expected.

44:58Some of that depends on cities. Some of the larger cities with larger supplies certainly are having a harder time filling those rooms. Some of that is also because FIFA has canceled a significant number of room blocks around the different markets in the country. And that has had an impact right now. All of a sudden, this massive inventory is released. And so hotels are scrambling a little bit to fill those rooms. The good news is that means that consumers who are sort of late to the game, so to speak, in terms of planning their trips should do so now. Now is the time to pick up those rooms and make those plans.

45:39What if your members, I mean, does it work like that, the survey? What have they been telling you as some of their thoughts, their reasons, I suppose, for what's going on with this demand? Sure. I think there's a lot of factors that we're looking at, right? Some of that is especially outside of the U.S. I think there are some unclear communication, perhaps, or misinformation around what it takes to get to the U.S., depending on what country you reside in. you know, what visa requirements you have, how long it might take to get a visa, whether there are costs associated with that. There's for sure been some misinformation around whether or not your social media will be reviewed in the U.S., which it won't.

46:19And so I think there is certainly some of that happening. And of course, with what's happening, you know, in Iran and, you know, know, the cost of air tickets here in the States, we're looking at the price of gas. I think some of those considerations are perhaps making people pause. The other, you know, the other unique factor with this year's Games is that, you know, it's taking place across three countries, right? That's a little bit uncharted territory for us. So not really understanding from a consumer perspective, are people just waiting to see where their teams will end up before they make those bookings?

47:02And is that part of the shorter booking window that we're seeing? Right. So quite a few factors at play. And that's Rosanna Mayetta there, the president and chief executive of the American Hotel and Lodging Association. You can hear more of that interview on the World Business Report podcast with me a little bit later on this week, too. But Anna, we went on to talk about that. I mean, it's also fans feeling like they're being fleeced at the moment isn't it they're feeling like they're under pressure from absolutely everywhere at the moment with this world cup that looks like it could be the most expensive ever yes i mean it's it's certainly going to set you back a considerable amount of money to to go and i suppose there's always the uncertainty um perhaps not so much if you're a scott scottish fan about when you might be returning as well no no we don't have that negativity yet one month out sorry sorry sorry no no absolutely we the tartan army they i mean we're we're all very excited after what is it 28 years away um about what might happen it is one of the quirky things about sport isn't it in one of my wife's friends with it was around our house at the weekend and was saying so you're going to Istanbul and you're spending all this money and it might like if i if i'm spending all this money on going to a concert at least i know it's going to be good whereas you're spending it and we might lose and i said that's the game and and that's football.

48:17The World Cup, you were talking about how it's just bumper time for you guys as well. Yeah, and also it's just mad this time with the three different countries and the three different opening ceremonies. If people are going to go there, obviously it's the travelling between the matches. Huge distances and getting bigger and bigger at some of these tournaments. It used to be the great thing about some of the Euros and things, didn't it? You're nipping around France or whatever, it'd be an easier thing to do. Well, it all feeds in, hopefully, perhaps to a bumper summer for hospitality businesses here.

48:47And Matt Snell runs one of those that, well, I'm sure you'll have seen it even if you're not a big football fan because it tends to go viral, Matt, your venues every time there's a big football tournament. Morning. Morning. Matt, the chief executive of the street food and pop-up retail company, Box Park, with those sites across London, including right in the shadow of Wembley Stadium as well. How's it looking then? You excited a month out? And how much planning has to go in from your perspective? So, yes, very excited. Very excited as an England fan I'm very excited as someone who works in hospitality and is going to pick up some much-needed sales.

49:21Yeah, I was going to say my eye was drawn in your notes with your chat with Olivia, our producer, saying that this is bigger than Christmas for you guys. Yes, for the six-week period, it absolutely is. Every single game adds a huge amount of profitability for us. As you've just been chatting about, there is an unknown to it, and that is how far England go, how deep England go. If we get to the final, I think it will be bigger than Christmas from a profitability point of view. So it gives you a real sense of how important this is, not just for Box Park, but for our entire community of traders as well because everybody picks up sales from it.

50:05Well, it's the other uncertainty with that, and I was talking to a publican about this the other day, Matt, as well, just the times of the games? We haven't actually had one in a time zone like this at World Cup, have we, for a while? And now given with the heat pushing these games later and later as well, is that a bit of a wild card from a hospitality perspective? For sure. I mean, look, the timings of the group games are okay. And so that will feel like normal trading, but there is a potential of a 1am kickoff. I was going to say, for something like Scotland-Haiti, that would be big for your venues, I'm guessing, as well.

50:43A huge number of, obviously, Scots living in London and near your venues. I mean, what would you do around that? Isn't that a 1am kick-off, 2am kick-off that game? Yeah, 1am, yeah. We'd get a temporary events notice and we will trade through. But clearly there is an unknown to that in terms of how many people want to come out at that time. Have they had too much to drink before they come out? So that's all the stuff you have to take into consideration. But look, these are good problems to have for hospitality, right? These are good things to be thinking about. So we're very positive about it. Well, here's the man who knows all about that, Man Group, one of the biggest security companies in this country.

51:20Have you been having calls from pubs already about that? And we've done many shows at Box Park as well, certainly at Wembley with all the big fights and that. So we know what a great venue that is. But yeah, absolutely. And as I said, if you start doing one... So you're getting sort of extra stuff, you know, for those late kickoffs as Matt's talking about, and also that people have had more of a run-up. We know what football fans are like anyway. And they normally do fan zones as well. And then there's going to be a lot. Certainly you start getting kickoffs at 1am and that could be interesting.

51:48And Anna, we have heard, haven't we, quite a lot of negativity in the run-up to the World Cup because of what we were just hearing from the American side of things with, you know, incredibly expensive transport costs there, ticket prices from FIFA's end, the price of those hotels, et cetera, as well. But as Matt was saying, not just hospitality, but actually wider, there's a whole sector of retail as well that always sees, I remember getting, we always talk to curries around this time of year, TV sales, you'll start seeing all the kind of delivery business, the restaurant delivery business as well.

52:16This is more than, you know, we're talking about it on a business programme. Yes, of course, people are excited about it as a cultural event, but actually it's a big business phenomenon, full stop. And the fact that there's two home nations there could really be a bit of kind of bright business and economic news in a programme where we've talked about a lot of gloom. Exactly. And it is something that, you know, that we can all get ourselves excited about. Even if you're not a diehard football supporter, you can get swept up in the atmosphere of all these things. And yes, I mean, if you can't make it across to the World Cup and it is unbelievably expensive and perhaps quite a lot of travel chaos, then, you know, buying yourself a big TV or going out and having a fun night at a 1am kickoff, I mean, that'll be quite something.

53:04And I'm pretty sure quite a lot of Scottish people will try and do that. Absolutely. Matt I've always wondered with yours as well I mean you're doing tickets again this year because you've drifted into doing tickets over the last few years particularly for England is that going to be the case again this time? Yes it'll be ticketed so we introduced tickets because there was such demand to get into the venues people were left disappointed when the venues were full so we've introduced tickets huge huge demands so we had just in terms of pre-register we had nearly 5 ,000 people pre-register in trust We sold 2 ,000 tickets in under five minutes when we released our first set of group games.

53:44So the demand is huge. And you've got to remember, Box Park is a different viewing experience to your local pubs. We create and curate a bunch of entertainment around the England games. I think I've been to one of yours where you've had Atomic Kitten there singing the Gareth Southgate song. You've got it. And all that kind of stuff will be happening again. We always try to make it bigger and better and learn from the last time. So you can guarantee this time. Go on, sorry. I was just going to say, is it nerve-wracking at this kind of time, like getting all that kind of stuff right? You know, everybody turning up, not getting stuck in traffic, the smoke cannon going off, the beer pumps working right.

54:23If my only worry is the smoke cannon not going off, then we'll be okay. I'm not sure nerve-wracking is the right way. We've been planning this since early January. and my team are absolute experts at curating entertainment around big cultural events. So we're just really, really excited about it, really excited for England, the actual squad, the football team, but also excited from a business point of view. Are they both getting out of the group, do you think, England and Scotland, quickly? I think England 100%, I think we will go deep. Scotland, maybe. It would be good news hospitality-wise, wouldn't it, if they would?

54:59So we'll cross our fingers for you on that. Fingers crossed. Matt, really appreciate your time. I'm Matt Snell, the Chief Executive of Boxpark. Big thanks to Ian McAllister and to Anna McDonald, who've been with us this morning on Wake Up To Money. And of course, to all of you for listening to us.