The week’s news included; Apple pays out for slowing down old iPhones, UK gov to make £10bn loss on student loans per year, AI finds new lithium alternative for batteries, Bitcoin ETFs approved by SEC.
Below are our top 10 stories that you need to know about. Be sure to check our twitter page, Facebook page and Instagram Page, for regular posts of important headlines. Get all the important stories and insights straight into your inbox by subscribing to our mailing list here.
Opinion articles of the week:
- BBC News – Where will all the electric cars be charged?
- City A.M. – The Debate: Should London make its public transport free?
- Retail Gazette – 7 big trends that will shape retail in 2024.
- City A.M. – The Debate: Should London make its public transport free?
- BBC News – CES 2024: AI pillows and toothbrushes – is it all getting a bit silly?
1. POSTMASTERS TO RECEIVE JUSTICE
The UK government is creating new emergency legislation to clear the names of wrongly convicted postmasters. Between 1999 and 2015 postmasters were sacked and prosecuted for embezzlement after the Post Office’s system showed missing funds. It transpired that the Horizon IT system, introduced in 1999, was faulty. In these 16 years however, over 900 postmasters were prosecuted. Many were subject to abuse in their communities after being accused of theft. Many have died since and some committed suicide due to the ordeal.
Only 93 convictions have been overturned so far but the government wants to expedite the justice process. With new legislation, they hope to overturn all convictions by the end of 2024. There is an ongoing public inquiry into Fujitsu, the maker of the faulty IT system. If found responsible for the issue, the government has said that it will hold them to account. Those who have their convictions overturned will receive compensation.
2. APPLE PAYS OUT FOR SLOWING DOWN OLD PHONES
Apple is paying US iPhone users as part of a settlement of claims it deliberately slowed down older models. The tech giant admitted in 2017 that it slowed down older models to preserve the battery life of the phone. After this admission Apple offered discounted battery replacements. Many users however, suggested that the performance restrictions were a ploy to force them to buy new models. A settlement was agreed in 2020 and roughly 5.4 million plaintiffs will receive a payout. Apple will pay out a total of $500 million, amounting to roughly $92 per claim.
A similar case against Apple is being heard in the UK. It was brought forward in June 2022 and could go to trial by the end of 2024. The UK lawsuit is seeking £1.6 billion in compensation for 24 million UK iPhone users.
3. STUDENT LOANS TO BRING £10BN ANNUAL LOSS
High interest rates are set to cost the government an extra £10 billion a year to bank roll the student loans system. The heavy expenses of servicing the system mean the government will make a loss on all student loans. This is because interest rates for student loans are pegged to the RPI rate of inflation (currently 5.3%). The government however, borrows money to give out student loans and pays higher interest rates on this debt. Prior to the recent hikes in interest rates, the government made a profit on repaid student loans. Only those loans not repaid within 30 or 40 years and therefore written off, would have seen the government lose out. Now, whether unpaid or paid the government will make a loss, costing an estimated £10 billion a year according to the IFS.
4. AI DISCOVERS NEW LITHIUM ALTERNATIVE FOR BATTERIES
Artificial intelligence has helped discover a new material that could significantly reduce the use of lithium in batteries. Researchers at Microsoft used AI supercomputers to narrow down 32 million potential inorganic materials that could replace lithium in batteries. The systems cut this number down to 18 in just a few days. This process would have taken scientists 20 years to do with traditional research methods. A working battery has now been produced with the material. Researchers say the material has the potential to reduce lithium usage by 70%.
Almost all modern technology uses lithium-ion batteries. With many countries pushing for mass electric vehicle adoption, demand for lithium will skyrocket. It is expected that demand will increase by 900% by 2030. There are, however, real concerns that there is not enough supply to meet this demand. Furthermore, lithium mining is highly controversial. The use of slave labour and other human rights abuses are common in the industry. The mines also devastate local environments with toxic waste and displacement of local ecosystems. A synthetic alternative could prove a game changer and better for the world.
5. HS2 TO COST £65BN
What remains of HS2 is set to cost £65 billion, over £10 billion more than expected. After scrapping the Northern and Eastern legs of HS2, the London to Birmingham network will cost nearly double the original estimate for the entire network. Increased steel and concrete prices, Covid and other factors have contributed to the ballooning costs. In 2009, the entire project was expected to cost £37.5 billion. 10 years later, just the London to Birmingham stretch alone was estimated to cost up to £56.6 billion. Now, this leg is expected to cost £65 billion.
There are also huge logistical problems. Due to the Manchester to Crewe leg being scrapped, fewer seats will be available as trains will need to be shorter to fit on existing platforms. Furthermore, north of Manchester the trains will be slower than existing trains as the HS2 trains are not built for bends. Homes, businesses and land were purchased anticipating construction to begin but now they are not needed. All in all, the process has been a mess.
6. BITCOIN ETFS APPROVED
The US Securities and Exchange Commission has confirmed that Bitcoin ETFs can form part of mainstream investment funds. Bitcoin exchange traded funds (ETFs) are funds that hold Bitcoin and investors can buy shares of the fund (as opposed to buying Bitcoin itself). The share price of the fund is linked to the price of Bitcoin. This means investors can indirectly invest in Bitcoin without going through cryptocurrency exchanges. These ETFs, as the name suggests, are traded on stock exchanges. The SEC had been deliberating over whether to allow Bitcoin ETFs for some time. Now, it has approved them, albeit with a warning that investors should be cautious about investing in crypto. It essentially brings cryptocurrency into the reach of mainstream markets and investors. Huge investment companies can now pour money into the ETFs which would ultimately provide a boost for the market. Bitcoin currently sits at roughly $44000 per coin.
7. ALLEN & OVERY SETTLES WEST HAM STADIUM DISPUTE
Allen & Overy paid £2 million to the owners of West Ham football stadium to settle a dispute. The magic circle law firm was sued for “professional negligence” in drafting the concession agreement for the stadium. West Ham moved into the Queen Elizabeth Olympic Park, owned by E20 Stadium, back in 2016. The concession agreement covered West Ham’s 99-year lease of the stadium but was the root of a number of legal disputes between E20 and the football club. E20 along with London Legacy Development Corporation sued Allen & Overy. They claimed that the poor agreement drafted by Allen & Overy cost them nearly £7,000 in revenue every West Ham home game, roughly £160,000 per season. In August 2022, Allen & Overy agreed to settle but financial statements now show roughly how much was paid as part of the settlement.
8. VOICE ACTORS DISPUTE OVER AI
US voice actors have spoken out against a new deal which could see them replaced by AI. This follows 5 months of strike action in 2023. A deal struck by their union, Sag-Aftra and AI company Replica Studios provides protection for the use of actors’ voices and performances in games. Sag-Aftra confirmed that actors’ consent and compensation is guaranteed. Voice actors have now lashed out saying they weren’t informed about the deal and the deemed the deal to be “garbage”. They argue the deal undermines the very purpose of last year’s strike action. This is because actors do not want to be replaced by AI, but the deal agreed by Sag-Aftra paves the way for this, albeit with compensation. Sag-Aftra claims the deal was approved by members but this has been denied by members. This could be the beginning of another dispute.
9. MISHCON DE REYA BUYS FLEX LEGAL
UK law firm Mishcon De Reya has bought recruitment company Flex Legal. Flex Legal is a platform that connects workers with UK law firms. It also offers a Trainee Scheme to support aspiring solicitors from underrepresented backgrounds through the solicitors qualifying examination (SQE). This marks Mishcon’s first acquisition in the alternative legal services space. Alternative legal services refers to firms that provide ancillary services related to law that do not require a qualified lawyer. These include document review, legal research and, like Flex Legal, resourcing. Flex Legal has hosted 6000 lawyers and paralegals on its platform since its inception in 2016.
10. RETAIL SECTOR SHEDS 120,000 JOBS
2023 saw a huge 119,405 jobs lost in the retail sector. Over 10,000 shops were closed throughout the year as the cost of living crisis and rising interest rates dampened consumer demand. The number of closures in 2023 was 38% lower than in 2022. 2022 however, was the worst year for retail store closures since 2008. Similarly, redundancies also fell 21.3% in 2023 compared to 2022. The outlook for 2024 does not appear much better as from April, business rates for large businesses will rise.