LABOUR’s pension tax raid is set the ditched after warnings it would hammer up to a million teachers, nurses, and public sector workers.

Chancellor Rachel Reeves had planned to raise funds by reducing tax relief on those earning £50,000 or more per year.

1

But Treasury officials reportedly told her any move to cut the 40 per cent tax relief on pensions would unfairly punish state employees on modest incomes, like a nurse earning £50,000 who could face an extra tax bill of £1,000 a year.

One Government insider blasted the idea as “madness,” especially after public sector workers just received a pay rise.

Former Pensions Minister Steve Webb told The Times: “I don’t think this is something that Reeves will want to do, not least because it will infuriate public sector unions just weeks after the government agreed pay settlements with them.”

Union leaders are also understood to have cautioned the Treasury against moving forward with the proposal.

Chair of the British Medical Association pensions committee Vishal Sharma said: “Attacking our pensions in this way would completely reverse this progress by once again taking money away from doctors in a different way.

“‘Not only would this negate the recent hard-won pay rises but it would likely reignite the recent pay disputes that have been seen across the NHS.”

The plan has been compared to Labour’s earlier disaster of a proposal to bring back a lifetime cap on pension savings, which was ditched during the election campaign after backlash over its impact on junior doctors.

With Labour still desperate to plug a £22 billion hole in the public finances, Treasury officials are now hunting for other ways to rake in cash.

The Government has repeatedly cautioned the Budget on October 30 will involve “difficult decisions” on tax and spending.

A range of options for generating tax revenue have been touted, including increasing capital gains tax.

CGT is a tax on the profit made when you sell or dispose of an asset, like property or shares, for more than you paid for it.

You only pay tax on the gain, not the total amount received from the sale.

There may also be a temptation to make changes to inheritance tax to target the most wealthy.

TWO people were killed in a massive blast near a major airport in Pakistan after rebels targeted ‘foreign investors’ in a bomb attack.

The Baloch Liberation Army claimed responsibility for the deadly attack that targeted a convoy with Chinese nationals in the port city of Karachi.

5

5

Advertisement

5

At least ten people have been injured in the Sunday night explosion that the Chinese embassy in Pakistan branded a “terrorist attack” targeting Chinese engineers working on a power project.

Horrific footage shows cars engulfed in flames as thick black smoke rises.

The attack came a week before Pakistan is to host a summit of the Shanghai Cooperation Organization, a security grouping founded by China and Russia to counter Western alliances.

The spokesman for the separatist group, Junaid Baloch, said that one of their suicide bombers targeted the convoy of Chinese engineers and investors as they left the airport.

The Baloch Liberation Army is mainly based in the restive southwestern Balochistan province but it has also attacked foreigners and security forces in other parts of Pakistan in recent years.

The Chinese embassy said a convoy from the Port Qasim Electric Power Company was attacked near the airport.

“The Chinese Embassy and Consulates General in Pakistan strongly condemn this terrorist attack, express deep condolences to the innocent victims of both countries and sincere sympathies to the injured and (their) families,” the statement said, adding the Chinese side has been working with Pakistani authorities in the aftermath.

Pakistan’s Prime Minister Shehbaz Sharif said a Chinese national was also injured and that an investigation was underway.

“Pakistan stands committed to safeguarding our Chinese friends,” he said in a statement on X.

“We will leave no stone unturned to ensure their security and well-being.”

Pakistan’s Prime Minister Shehbaz Sharif said he was shocked and saddened by the attack.

He said the attackers were enemies of Pakistan and promised the perpetrators would be punished.

“I strongly condemn this heinous act and offer my heartfelt condolences to the Chinese leadership & the people of China, particularly the families of the victims,” he wrote on the social media platform X.

Pakistan stands committed to safeguarding our Chinese friends,” he added. “We will leave no stone unturned to ensure their security & well-being.

The Sunday night attack followed deadly attacks in August that killed more than 50 people in Balochistan.

Sharif at the time said the attackers sought to harm Chinese-funded development projects.

In March, in northwestern Pakistan, a suicide bombing killed five Chinese engineers and their Pakistani driver as they headed to the Dasu Dam, the country’s biggest hydropower project.

5

5

Advertisement

Unlock the Editor’s Digest for free

Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

Southern Water, the heavily indebted utility controlled by Macquarie, has turned to investors for nearly £4bn in borrowings over the next five years at a time when water companies are under increasing pressure in debt markets because of the crisis at Thames Water.

Thames Water, which itself was formerly owned by Macquarie, was last week downgraded to the lowest reaches of junk because of its dwindling cash position, increasing further scrutiny on other utilities in the sector with strained finances.

While Southern is not in the same degree of financial peril as Thames Water, its investment-grade rating and its debt covenants have both come under pressure as the group’s total debts have exceeded £6bn, according to its most recent group accounts. Of that total, liabilities related to derivatives have ballooned past £1bn.

The yield on Southern’s short-dated bonds, due in 2026, has more than doubled over the past six months to reach 13.5 per cent, as investors now require a hefty premium to hold debt that would usually offer far smaller returns due to its near maturity.

The water monopoly, which serves 4.7mn customers in the south-east of England, met bond investors in recent days to update them on its credit situation and business plan.

In a presentation to debt investors published on its website, it revealed it planned to raise £3.8bn of debt over the next five years, telling them it had a “proven track record of capital raising”, having raised £550mn of fresh equity from Macquarie in the last financial year.

The utility also needs to raise £650mn in equity as pressures mount on its credit ratings and operating business, which is struggling with sewage pollution and potential water shortages.

The investor presentation comes after Moody’s in July put Southern’s credit rating on review for downgrade, putting it at risk of losing its investment-grade status with one of the major agencies.

Despite Macquarie having already injected hundreds of millions of pounds, “there is no certainty that it would make further contributions if the final determination makes continued low returns likely”, Moody’s said.

Southern’s chief financial officer Stuart Ledger said at the time of the downgrade that the utility had “an excellent liquidity position”.

However, in August 2023, the company’s lenders had to waive a loan covenant breach after its credit ratings and its interest coverage ratio, a measure of a company’s ability to pay its debt, fell below key thresholds.

Lenders agreed to waive these conditions until 2035, meaning Southern can continue to draw down all of its available borrowing facilities and raise new financing, while also allowing the utility to increase the limit on its gearing — a critical measure of debt-to-equity — from 74 to 75 per cent.

Within Southern’s complex structure, the regulated operating company, a “ringfenced” group that is supposed to be protected from stress at the holding companies above, is nevertheless running with gearing of about 70 per cent.

While lower than Thames Water’s gearing of about 80 per cent, the £4.7bn debt pile at Southern’s operating company, which makes up the group’s reported debt-to-equity ratio, leaves out almost £1.2bn of liabilities relating to its inflation-linked swaps.

These are not reported in the utility’s regulatory numbers, but if included, they would take the company’s gearing level to more than 85 per cent. Were the company’s creditors to demand a payment acceleration upon a default, Southern Water’s inflation-linked swaps would rank ahead of principal and interest on its senior debt.

The presentation also shows that Southern is asking water regulator Ofwat to allow it to increase the average annual household water bill to £734 by the end of the next regulatory period, higher than Thames Water and three other water companies cited as comparisons.

Thames Water, which saw investors backtrack on a commitment to provide £500mn of equity in March, became the first regulated water utility to lose its investment-grade rating when both Moody’s and S&P cut its credit rating.

While an equity injection at Southern Water from Macquarie could ease pressure on its operating company, its holding company also has £300mn of debt maturing next year. Representatives of Macquarie told investors at the meeting that it might need to negotiate an extension on this debt, according to one person who attended.

Thames Water’s holding company Kemble, which itself was established by Macquarie during its 2006 buyout of London’s water company, defaulted on its own debt in April, after its present shareholders backtracked on a pledge to put in fresh equity into the business.

Southern Water said the group had strong liquidity and was working towards a positive regulatory settlement. Macquarie declined to comment.

Dynamic Planner has announced a new CRM integration with Adviser Cloud.

Financial advisers who use the new integration will be able to “seamlessly transfer client records easily, efficiently and securely” between Dynamic Planner and Adviser Cloud.

Data is passed between the systems, with Adviser Cloud validating all data, removing the need for rekeying, which minimises manual errors and saves time.

Dynamic Planner chief revenue officer Yasmina Siadatan said: “The Dynamic Planner ecosystem is continuously expanding and today we are pleased to announce another two-way integration, this time with Adviser Cloud. This will be a game changer for anyone using Adviser Cloud and Dynamic Planner, providing a seamless user experience.

“As the latest in our growing suite of strategic partners, this new CRM integration with Adviser Cloud will continue to transform the processes of financial planning firms and drive significant efficiencies.  Integrations are fundamental for our clients and we are committed to our long-term strategy of continuously enhancing the flow of information to and from Dynamic Planner as the system of record.”

Adviser Cloud tech lead Ewan Humphreys added: “Our integration with Dynamic Planner is designed to make financial planning simpler and more efficient. Adviser Cloud has always focused on providing intuitive, user-friendly software for financial advisers, and this integration continues that mission by eliminating data rekeying and enhancing workflows. This partnership enables advisers to deliver even better client experiences while saving time and reducing operational costs.”

Adviser Cloud specialises in intuitive and easy-to-use software for IFAs, designed to reduce costs, increase efficiency, and deliver an exceptional client experience.

SEOUL, South Korea (AP) — A 70-year-old South Korean woman sued her government, an adoption agency, and an orphanage Monday over the adoption of her daughter, who was sent to the United States in 1976, months after she was kidnapped at age 4.

The damage suit filed by Han Tae-soon, whose story was part of an Associated Press investigation published last month, could ignite further debate on the dubious child-gathering practices and widespread falsification of paperwork that tarnished South Korea’s adoption program, which annually sent thousands of kids to the West during the 1970-80s.

It was the first known case of a Korean birth parent suing for damages against the government and an adoption agency over the wrongful adoption of their child, said Kim Soo-jung, one of the lawyers representing Han.

Han searched for her daughter, Laurie Bender, for more than 40 years before they reunited through DNA testing in 2019. Speaking to reporters in front of the Seoul Central District Court, Han argued that the South Korean government was responsible for failing to prevent the adoption of Bender.

Han had reported to police that her daughter was missing and desperately searched for her, frequently visiting police stations, government offices and adoption agencies and even going on Korean media. She had her daughter’s picture displayed everywhere — in subway stations, on lamp posts, on bags of snacks that advertised missing children, the Korean version of American milk cartons.

Han accuses Holt Children’s Services, South Korea’s biggest adoption agency, of facilitating Bender’s adoption without checking her background. Her lawyers said the Jechon Children’s Home made no effort to find the parents after Bender was placed at the facility by police in May 1975, a day after Han reported her as missing.

In her adoption papers, Bender, named Shin Gyeong-ha at birth, is described as an abandoned orphan with no known parents. Under a new Korean name made by the orphanage, Baik Kyong Hwa, she was sent to the United States in February 1976.

“For 44 years, I wandered and searched for my child, but the joy of meeting her was only momentary and now I am in so much pain because we can’t communicate in the same language,” Han said, fighting back tears.

“It turns out they didn’t make an effort to find her clearly existing parents and instead disguised her as an orphan for adoption abroad. I want the government and Holt to explain to us how this happened.”

Kim, the lawyer, said the government is at fault for the botched child search that led to Bender’s adoption, saying she could have easily been found if missing child information was properly shared between police stations or if officers had tried to search orphanages.

“While the state bears the large responsibility for not fulfilling its duty to help find missing children and reunite them with their families, we also believe that the (orphanage) and adoption agency cannot be spared from responsibility as well,” Kim said.

“We suspect that these child protection institutions failed to carry out their ethical obligation to help find the child’s parents, even when the child was saying (she) had a family and had parents.”

Jeon Min Kyeong, another lawyer representing Han, said she is seeking about 600 million won ($445,000) in damages. The lawsuit lists Han, her husband and two of her younger children as plaintiffs, but not Bender, Jeon said.

South Korea’s Justice Ministry, which represents the government in lawsuits, and Holt didn’t immediately comment on the suit.

In an earlier interview with AP, Bender said she was approached by a strange woman while playing near her home in the city of Cheongju. She remembers the woman saying her family didn’t want her any more because Han had another baby. Distraught, Bender went with the woman, who, after taking her on a train ride, deserted her in Jechon, a city 50 miles away.

After failing to find her daughter for four decades, Han registered her DNA with a nonprofit group called 325 Kamra, which helps Korean adoptees reunite with their families through genetic information. In the United States, Bender took a DNA test because her own daughter was curious about their heritage and 325 Kamra connected them in 2019.

Just weeks after finding her mother, Bender and her daughter flew to Korea to meet Han. Recognizing Bender immediately, Han ran to her, screaming, moaning, running her fingers through Bender’s hair.

“It’s like a hole in your heart has been healed, you finally feel like a complete person,” Bender said. “It’s like you’ve been living a fake life and everything you know is not true.”

The AP investigation, which was also documented by Frontline (PBS), described how the South Korean government, Western nations and adoption agencies worked in tandem to place around 200,000 Korean children in the United States and other Western nations, despite years of evidence that children were being procured through dubious or dishonest means. Western nations ignored these problems and sometimes pressured South Korea to keep the kids coming as they focused on satisfying their huge domestic demands for babies.

In 2019, Adam Crapser became the first Korean adoptee to sue the South Korean government and an adoption agency for damages, accusing them of mishandling his adoption to the United States, where he faced legal troubles after surviving an abusive childhood before being deported in 2016.

After four years of hearings, the Seoul Central District Court last year ordered Crapser’s adoption agency, Holt, to pay him 100 million won ($74,000) in damages for failing to inform his adopters they needed to take separate steps to obtain his citizenship after his adoption was approved by a state court.

However, the court dismissed Crapser’s accusations against the Korean government over alleged monitoring and due diligence failures. The case is now with the Seoul High Court after both Crapser and Holt appealed.

___

AP writer Claire Galofaro in Louisville, Kentucky, contributed to this report.