The Burnham Plan

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0:43That's O-D-O-O dot com. Wake Up To Money from BBC Five Live. Hello, morning. Welcome to Wake Up To Money. Andy Burnham will set out his vision for the economy in a speech in Manchester later on this morning. We'll take a look at what we might hear from the man who looks pretty set to be our next Prime Minister. and we'll also be asking businesses what they would like to hear. Also on the programme this morning, from stories to reels, Instagram has helped make vertical video the norm on social media. So why is it trying to get us to watch horizontal videos on our TV? We will be exploring that. And also on the programme today.

1:25Yeah, as you may have just heard in the trail, it's time for Pimms, strawberries and cream and a row about prize money. As Wimbledon gets underway, We'll find out why some of the top players aren't happy about the prize pot on offer this year. Wake Up To Money with Will Bane. Morning, welcome to Wake Up To Money on Monday the 29th of June. Just gone five o 'clock in the morning. We're with you this morning. Great to have you as we kick off another week on the programme. Yes, busy on the sporting front, isn't it? The World Cup knockout rounds and Wimbledon. There's a business spin on that, though, as we were just saying.

1:55So we'll be chatting later on in the programme about why some of the top players in the world are going to be cutting short their press conferences during the first week of Wimbledon to protest about what's going on with prize money. But also here, as we say, a speech in Manchester later today from Andy Burnham, supposedly setting out his economic proposals. And also we'll be taking a look about how the markets might react to kick off the week again with still that ceasefire looking pretty fragile around the straightforward moves between the US and Iran. And also everything, the volatility that's been going on to end the week or right through last week on stock markets, particularly around AI investments.

2:33So as usual, loads for you to get your teeth into. Should you wish to join the conversation this morning, 85058 is the text number to get in touch with us. 08085 909693, the WhatsApp, if you'd prefer to get in touch that way. Plenty for our panel to get to as well. And Zoe Gillespie is one half of that. She's back with us. Zoe is wealth manager at RBC Bruin Dolphin. Zoe, morning. Great to have you back on the programme. Good morning. Thank you. It was a wild old week. We'll perhaps get into it in a bit more detail a bit later. But can you put your finger on where we've kind of got to through the weekend and what maybe we can expect from a market's perspective this week?

3:10Yeah, as you say, I think the AI story hasn't been far away from headlines and it dominated again last week. We had obviously news about Apple, potentially cost increases around chips led a bit of volatility in the share price there. and again I think certainly the SpaceX IPO has still been front and centre and they've obviously come out, they've issued a£25 billion bond issue as well which gave a bit of jitter. So plenty to digest there and then as you say the continued uncertainty around the Middle East has also been an undercurrent to market. So we'll have to see how it plays out this week.

3:48Yeah and as we stand this morning just on those kind of markets, oil in particular, I guess. That has, though, not much reaction at all, really, despite the sort of rocket fire through the weekend again. Yeah, I think we've seen that play out. But again, oil has, we've seen intraday moves as well. So I think the general feeling is hopeful that it can and we will see the ceasefire continue. But I think until the Strait of Hermes is fully open, then there's always that potential for the oil price to react. Yeah, absolutely. Up a smidge, looking at the screen to my left right now, but way down on what we were talking about, obviously, over the last few months.

4:26$72 a barrel right now, Brent crude. Alongside Zoe for the next hour, Kevin Brundish back with us on the programme as well. Kevin, you might remember, is the chief exec at Lionvolt, battery scale-up company focused on developing the next generation of battery technologies. Morning, Kevin. Great to have you back on the programme as well. Yeah, morning, Will. How's business going at the moment? Yeah, very good, thank you. Yeah, yeah. As a business, we're just sort of bringing a new product to market, actually. So we're in the space of drones. Well, tell us a bit about that. Yeah, so, well, you know, batteries are in everything, as you know.

4:57So one of the key markets that we're seeing is the drone space. And, of course, it's very typical for Ukraine. And, of course, you've seen it in the Iran and the Straits of the US. So drones are playing a military role as well. But I think it's not just that. We've got last mile delivery. We had some, I think this year we had some at Amazon. I think it was the last mile delivery in the UK using drones. So it's a very buoyant market. And they want to fly farther and carry more. And that's where the next generation batteries come in, such as what Lion Vault's doing. Yeah, presumably. Is it a bit like with cars?

5:33Is the battery a sort of key part to bringing the price and the weight and everything down of something like a drone, a delivery drone, for example? Absolutely, yeah. I mean, obviously, you can fly it further or carry more. Then, of course, they're more effective. They're more cost efficient to run and they can do more. So for one asset, you can get more out of it. So it's absolutely the same in that respect. Been some interesting news around battery tech as well. We're going to talk about it a little bit later on in the program. And Adam Bell is going to join us as well. But just give us a kind of sort of headline thought, I suppose, on the government and what it's been doing, Kevin, around.

6:10well it's actually off gem really isn't it the regulator last week looking at trying to get more storage capacity onto the grid so this will be a problem that regular listeners will be aware of where if we and politicians have been wading in on it where if we're creating a lot of energy somewhere perhaps where you guys are in scotland for example and not being able to move it around to where it's needed having that storage capacity to store it and move it more quickly to where UK business needs it. Absolutely. I mean, it's intermittency. We've got a fantastic renewable source. As you say, Scotland is very, very strong in that respect.

6:47But we need to store it so that it's available all the time and, of course, available where it's needed, not just where it's generated. So longer-term storage, which is what we're talking about here, not just the response to when wind doesn't blow. So this is about longer-term storage. And there's been 16 projects, I mean, something past, looking at different mechanisms to store that energy so that it's available on a longer-term basis. Yeah, you're right. I should have been more accurate about that. We're talking about massive-scale storage here, aren't we? We're not talking about holding a little bit for every now and again for a day as backup.

7:25We're talking about having this sort of there as another power source, really, for a lot of the time. So not just that it's there in times of fluctuation, but hopefully that it gives us a more kind of balanced long-term price right as well yeah exactly and of course it's all part of the energy security mix which is super important as we've seen both with the conflict uh in ukraine and the impact of the states of most so yeah it is a very important point zoe as i say we'll chat a bit more about this in the second half of the program when adam bell is going to join us and break it down a little bit as well but just that that consistency of price of energy as well as bringing down the overall cost is something big businesses have been talking about a lot in the last two years or so really yeah i mean i think certainly at a local level the uk the higher energy inputs are it's harder for businesses manufacturing businesses compete as well uh so you've got it here and then obviously um on a global scale, we've seen the impact of higher energy costs and inflation.

8:28And that can also have a detrimental impact. If we see rates going up, it can starve growth. So having consistent energy is really, really important. And having a supply that, as you say, energy security is also vital as well. Yeah. One of the other big areas that's been talked about a lot in recent months has been what's going on in the jobs market. We're going to get a slew of stuff today. So it seems like from the government and various sort of reviews that they have commissioned about so-called needs so people not in education or training or a job of course as as well um the resolution foundation think tank kind of left of center think tank has got a report out on that as well talking about in their view actually tax breaks not being the right kind of answer to get employers to hire more young people, but sort of subsidies to encourage people to try and hire more young people.

9:22I mean, from the businesses you talk to or hear or look at, is hiring really, I mean, what is shifting it from your perspective? How much of it is AI? How much of it is tax burden, I suppose? How much would a subsidy, I guess, as a result, make any difference? I think there's so many things. I think we've seen youth unemployment now over a million. and certainly it's if you look at the unemployment rate for 16 to 24 versus the national average it's 16 % versus just over five so it is a problem but you're right it's whether we're going to see subsidies helping employers to take on more more apprenticeships and I think they're looking at what schemes are going to be most effective but you're right I think things like the increase in minimum wage has impacted things like the Saturday job and I think it's just trying to get the balance right to get people and have the jobs available there because if there's not the jobs then it's harder for people to get the training and and get onto the actual ladder of employment yeah it should be clear kevin as well to the resolution foundation they go on in their report to say the government should also pause its convergence with the national living wage that's for younger workers until youth unemployment begins so the government's been on that kind of step-by-step basis to kind of converge those two together.

10:41What's your sense about what's going on as a business leader in terms of hiring? Yeah, well, obviously the national wage has always been a very difficult balance to make sure that the employment side, the employer side, obviously increasing that makes it harder to employ people, particularly when we've seen also alongside that some of the national insurance increases. that we had. So there's always been a squeeze on that. But what we've got to remember is that in particular the sort of 16 to 23 years are the future of our skill base and we need to make sure that they are in employment because we do not want that to be a challenge on a sort of social welfare system as we go forward.

11:28We really want people to do work. So what's stopping you hiring more people, say, for example, at Lionball? What goes into the kind of consideration matrix if you like? Yeah, so, well, obviously cost. That's one balance. Skills. And we do go through the apprenticeship scheme and we are looking at sort of engaging early and making sure that skill base is there. We actually pay them as a real wage, not the main wage, so that raise wasn't so significant in that respect. But for us as a company. But, yeah, I think it's just a balancing act, isn't it? Of course, always a business where you want the employer base to do the right number of people, the right skill level.

12:14But you've got to watch the cockerel. So what about this scheme then? Perhaps you first, Kevin, and then Zoe, give us your take on this. Again, in the Resolution Foundation report here, Youth Jobs Grant, which is something the government kind of already has as a scheme. They're basically saying that they should try and beef that up. So the Youth Job Grant offers firms £3 ,000 to hire an 18 to 24-year-old who's been on universal credit for six months or more. They reckon that's going to create a couple of thousand, nearly 3 ,000 extra jobs at a cost of around£36 ,700 each job guarantee, which funds six months part-time employment for those out of work, or at least 18 months, comes in at roughly£38 ,000 per additional job, making it three and a half times cheaper than scrapping employer NIC.

12:58So whilst those numbers sound expensive, that's, I guess, what their argument is there, sort of across the board. Don't chop back on some of those things that, as you say, have been added to the cost, Kevin, but do something instead. I mean, what do you make of that? Yeah, we've actually had schemes like that, in particular Scotland, where we've been supportive in bringing new people on. I think what it does is it eases that burden when people are fresh into employment in particular, where their productivity is perhaps lower as a consequence and they've got to go through training. it does provide a stable support base and lowers the cost base for your business.

13:36So we've got a live experience of that and have felt that was a very positive impact in bringing employment into the company. So I'm a bit of a fan in that respect. Of course, it will be different businesses, but in particular in airspace where training is important in that first instance, where the productivity needs to go up. I think it's a good offset and makes that an affordable approach. Yeah. Zoe? Yeah, I think anything at this, any new ideas and initiatives are worth trying because I think if you can get younger people into work, get skills, because I think that's the important part. A lot of it's they don't have the opportunity for a job because they don't have the skill set.

14:20And it's a difficult thing because you don't get the skills unless you have employment. So I think anything that can get certainly younger people into the employment space, because I think it's right, we have to, the next generation of, are there going to be employed? As you say, the labour force is going to drop off with older people. So you need to try and do something. So I think any scheme, see what happens and hopefully it does, because it is becoming a concern if you have youth unemployment continuing to rise. You're absolutely right. It's become one of the kind of the big issues, hasn't it, going forward?

14:55Going to be one of the big issues for Andy Burnham, if he is indeed the next prime minister, to be right at the top of his intro, I think, in terms of tackling. We'll be chatting more about his speech on the economy a little bit later on in the morning here on Wake Up To Money. Wake Up To Money with Will Bade. Away from radio, TV. Apps like Instagram have helped Vertical Video take over our phones and our iPads, haven't they? Now they want to take over our TV screens too. Perhaps not a surprise given the success of YouTube in that space. Alongside Kevin and Zoe, we're joined by Ruth Fox Blader, Ruth Managing Partner at Citrine Venture Partners, New York-based venture capital firm.

15:33Evening to you, Ruth. Morning from us. Thanks for being back on the program. Good morning. So not a surprise, surprise. Meta decided they wanted to get into a space that Google and YouTube were. Absolutely, yeah. They are moving fast and furious towards streaming. And so how is this working then? Is it exactly the same as how it's working with YouTube? I've seen it's being rolled out on a couple of, is it Samsung? I've started offering it as an app you can download if you've got a Samsung, Tele, etc. Is it working the same way? Yeah, they've done some experimentation in the past. And certainly what Meta tends to do is do some experimentation and then roll out more fully.

16:13this looks like the biggest rollout so far of this horizontal long-form media. And definitely they'll be dipping a toe in, but eventually they will be allowing streaming of the feed and this long-form video across television. There's not, or am I being very ignorant here, there's not as much though, right, longer-form stuff there yet. does that mean that there's going to be a change in in instagram that you'll sort of see you know traditionally people have tried to make it what a minute max haven't they and the similar kind of tiktok its shortness has been the most important part are we likely to see a change to that then yes absolutely and partly this is um this launch of long form horizontal content is in response to demand from creators.

17:04Creators want to make longer content. And creators wanted to make shorter content. You're absolutely right. In 2020, Meta launched Reels to compete with TikTok. That's their short form content. And, you know, in a way, this was a problem for Meta. Reels are really engaging, but they're less profitable for Meta than the same amount of time spent scrolling on the Instagram feed. So Meta is really struggling with competition on its own platform right now between the feed and reels, and maybe this is why we're seeing this move. Interesting. Zoe, it has been a kind of explosion, hasn't it? We've talked about it a lot here on the programme in terms of the challenge that YouTube's thrown down to people like us at the BBC and traditional TV, if you like, another player kind of wading into what's become a kind of crowded new space by the look of things.

17:52Yeah, I think it's just a different way. I think from an Irish younger, the options are limited, but I think we're just now seeing that and as you say, YouTube was one of the first movers here so it feels like the space is getting more and more crowded and I think it'll be interesting to see who the winners and losers are in a decade or so and what the direction of travel is going to be. Yeah, we might not be the best judges necessarily given the three of us's age demographic I'm guessing here but how much are you kind of, or people you know Zoe kind of watching of stuff on Instagram, I suppose consuming of stuff on Instagram like that?

18:30I'm probably a dinosaur with these things. But yeah, I mean, you know, I think it's like everything. I think I flick it a little bit, but I don't fully use that. I think I'm still very much a traditional user. I think a lot of it's the next generation. I don't even think some of the younger audiences watch much live television. I think most of it's done through, as you see, social media. So I think it is a shift and it's whether it will continue in that direction or whether there'll be a change. Wait and see. What about you, Ruth? Anything you're sort of consuming on Instagram that you think, oh, I would love to see that in longer form as well?

19:05I think the platform is going to change tremendously. And, you know, the streaming market is huge business. It was just under$160 billion in 2025. It's projected to reach$873 billion by 2035. So, you know, this is, it makes sense. I think from Meta's perspective, they recognize that TV advertising pays more than mobile advertising. And so, you know, yes. So by competing with these streaming platforms for these advertising budgets, they're hoping to grow the pie and offset the cannibalization of the feed that, you know, they've seen with shorter form content like Reels. Kevin, are you a consumer of this?

19:46I also have a sort of teenager in the house. And you're right, he doesn't really watch live television. It is a very much a streaming approach. So we are used to that. Yeah, absolutely. And of course, that's on the small screen, the mobile devices, as well as then onto the sort of more television-based screens. So you're very familiar with what's going on there. And you can see it, right, Zoe? There are things that are on Instagram. I'm thinking of, you know, I don't know, people reviewing, and there's loads of them on there, people reviewing products, people reviewing clothes, people like Topjaw, you know, the people who review restaurants and bars and that kind of stuff.

20:22you've seen when they've done younger longer form stuff they've ended up going to youtube and presumably if you're meta you're sat there watching people who are sort of kind of stars of your platform reasons for customers to land on your site you're starting to worry about them sort of migrating somewhere else yeah i think that's always going to be the competition for these things too and but i think with a lot of the content creators they're innovative and i think they've taken it to a different level too. So I think it's, as you say, the increased competition and how it's going to play out and whether more people are going to join in and how it's going to look.

20:59So, yeah. Ruth, don't worry if the answers we don't know yet, but have you seen any of it on screen, the Instagram stuff? Have you seen it on a big screen yet? And does it still, does it fill the screen then? Does it sort of unformat itself? Does the, I'm guessing, does the vertical kind of system of it work? Because it's sort of famously vertical in a way that YouTube obviously wasn't? So it is adapted for that horizontal picture. And I think that, you know, because of that adaptation and all the things that we're all saying, the one thing that we shouldn't discount and which will be a big change is that there will be professional studios and sort of more professional content creators that move to the platform.

21:36And so, you know, perhaps the streaming that we're talking about on, you know, where it's really replacing television, it's going to look a lot more like that. I think that this is going to really dramatically change Instagram. Really interesting. While we've got you, Ruth, we chatted with Zoe very briefly at the top of all of this. I thought perhaps the three of you would be well-placed as well about everything that's kind of going on. The market volatility that you kind of saw in the U.S. last week, what did you put your finger down to on why? Was it sort of concerns about geopolitics and chip supply, or was it just about this AI spending full stop?

22:16Where did you come down? It feels like we've just been having this conversation in the markets for, you know, I would say months, but probably it's really years about ROI on AI investment. And in some ways, the SpaceX, you know, IPO has sort of laid all of those questions bare. I feel like, you know, in some ways, SpaceX has sort of become a meme stock and it's hard to ignore. And at the same time, we have this enormous amount of geopolitical tension. And then we can't ignore the potential rise in interest rates. And so you've got this perfect storm for some of these very intense questions about, you know, how valuable AI will make these companies in the short term just sort of, you know, exploding into the markets and creating this roller coaster.

23:01Zoe, anything you wanted to expand on? Yeah, I think we've seen volatility in the last few months. It feels as if this is just a normal cycle, though. And I think we're seeing that the SpaceX story certainly has dominated news. But you're right, I think a lot of the concerns for markets is going to be whether we are going to see interest rates rising. And we've got some job data out this week. So I think it's going to be a difficult one for the Federal Reserve, whether we decide whether inflation is rising and whether they're going to need to raise rates to try and, I think, cool it. and on the other side you've got the jobs market as well.

23:39So there's plenty to digest for the markets and I think volatility may continue as a result. And that's before you chuck the political pressure in on those two things as well in the US in a big election year too. Kevin, watching on the SpaceX story in particular that the guys have just mentioned, as someone kind of adjacent to the space I guess, what did you make of, because I chatted to someone in kind of space engineering about this saying, you know they've kind of opened so many doors for that industry people taking it more seriously in terms of somewhere to invest but that actually bundling it in with the ai they were kind of a bit worried that investors in particular who they would like to take a closer look at kind of what's going on in space technology and satellite technology were just focusing on the on the ai bit yeah yeah and we've seen we've seen this in particular with um elon moss companies where ai has been a sort of core part and it's there with other parts of his businesses as well.

24:38And I suppose it is a little confusing. I mean, but AI is a fundamental part everywhere. It is used everywhere. We use it in our industry. And so it is a fundamental part of every business. So associating it isn't incorrect, but the core business is opening up that sort of lower cost, higher volume throughput into space. And I think that is its core business and the AI side. It's a little confusing, but it's fundamental in every business, so it's not surprising. Ruth, to that point, is it then just a matter of time actually for OpenAI? Before it does, we've had all this noise, haven't we, that they might not now go forward with their IPO this summer as expected and hold the fore a little bit.

25:26Is it still when, not if, though, for that? You know, listen, nobody knows. But I think what we're seeing is the intersection of venture capital, which is the world that I come from, and, you know, public equities where there's an enormous amount of scrutiny and there's, you know, a lot more data-driven investing and analysis. And it's a little bit less sort of hopes and dreams about the upside and a little bit more, you know, staring into the face of downside protection and risk. Zoe perhaps then a moment of calm a few months of calm but actually this is going to be the area of the market that people like you guys are going to want to be in yeah I think because of the nature of it and I think the scale of the spending in AI and the size of the companies it's now dominating the world's largest company so certainly it's going to continue to be an area of focus and I think you're right open AI and if and what rather than when but a lot of it will be determined on and I think they're going to be looking at the valuation they can bring it to the market as well.

26:28Yeah, interesting. Going to be something absolutely obviously that we will continue to talk about lots here on the programme. Ruth, always appreciate your time. Thanks for staying up so late for us as well. Thank you. Ruth Fox-Blader there, Managing Partner at Citrine Venture Partners, joining us from New York. The ultimate cookout starts with the ultimate ingredients. At Whole Foods Market, no antibiotics ever, burgers and kebabs are prepped and ready to throw on the grill. Fire up a juicy ribeye, grab creamy potato salad and savory flatbreads from the prepared foods department, and round it all out with 365 brand condiments, chips and dips at everyday low prices.

27:08Whole Foods Market, make your summer sizzle. This episode sponsored by We Feed Raw. Now more than ever, people are thinking carefully about what goes into their own bodies. more starting to ask the same question about their dog's bowl. At We Feed Raw, meals are made with the highest quality meat, nutrient-rich organs, and complete and balanced nutrition formulated by animal nutrition experts. Minimally processed, the highest quality protein, no fillers. And when dogs eat better, pet parents notice it in things like more excitement at mealtime, better energy, softer coats, more healthy years together.

27:48Feeding real food used to feel complicated. WeFeedRaw makes it simple. Visit WeFeedRaw.com to get started and see today's best offer. Wake Up To Money with Will Bain. Morning, welcome to Wake Up To Money on Monday the 29th of June. Our panel this morning are Kevin Brundish, the Chief Exec of Lionvolt, the battery scale-up company, and Zoe Gillespie, wealth manager at RBC Bruin Dolphin. And for the second half of the programme, we're also going to be joined by Emma Thackery. Emma is the co-founder of Hip Hop Makes Functional Soft Drinks, based in Manchester. And we're joined by Emma as well because we're going to chat about that speech that we're expecting a little bit later on this morning from Andy Burnham.