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KPMG risks a ban on bidding for public contracts if there is a repeat of recent scandals at the Big Four consultant, the Cabinet Office has warned.
The threat to one of the UK government’s biggest providers of consulting services was made in a letter seeking assurances that there would be no further misconduct at the firm, people with knowledge of the matter told the Financial Times.
KPMG’s reputation has suffered in recent years after a series of fines for misconduct. It is also under investigation over other allegations of malpractice.
The firm was the third-biggest winner of public sector consulting contracts by value in the financial year to March 2021, behind Deloitte and PwC. KPMG was awarded government work valued at £244m in that period, according to data provider Tussell. Its total UK revenues were £2.3bn in the 12 months to September 2020.
Thanks for reading FirstFT Europe/Africa. Here is the rest of today’s news — Jennifer
Five more stories in the news
1. US junk bonds suffer sharpest sell-off in over a year High-yield bonds fell in November by the most in more than a year on fears the spread of the Omicron coronavirus variant will hinder low-rated companies’ ability to repay debts.
2. Meta ordered to sell Giphy The UK’s Competition and Markets Authority has forced the company formerly known as Facebook to sell online image platform Giphy, the first time the regulator has unwound a completed Big Tech deal, which would have been worth $315m had it gone ahead.
3. Fed chair signals support for quicker ‘taper’ Jay Powell signalled his support for a quicker withdrawal of the Federal Reserve’s massive asset purchase programme, comments that raised the spectre of earlier interest rate rises next year and exacerbated a stock market sell-off on Tuesday.
4. MI6 chief warns of China security threat Beijing’s overconfidence and belief in its own anti-western propaganda has put it at risk of “miscalculation”, which could threaten international security, the head of the UK’s Secret Intelligence Service has warned in his first public speech in the role.
5. Holmes defends response to Theranos reporting Prosecutors interrogated Elizabeth Holmes about her response to the investigative article that pierced her rosy image in 2015 as the Theranos founder took the stand for a fifth day of testimony in her criminal fraud trial.
Scientists are racing to stress-test existing Covid-19 vaccines against the new Omicron variant.
Early testing indicates the mutations of Omicron may hamper the effectiveness of Regeneron’s Covid antibody drug, the company said.
Boris Johnson pledged to offer all eligible adults in England a booster jab by the end of January. But Seth Berkley, chief executive of the Gavi vaccine alliance, has urged rich nations to prioritise inoculating people worldwide.
The UK national spending watchdog has warned that NHS England’s waiting lists for patients seeking elective care could be longer in 2025 than it is today.
European populists are casting themselves increasingly as the torchbearers of vaccine scepticism and anti-lockdown libertarianism.
Thank you for the replies to yesterday’s question about your travel plans. Some readers are already rescheduling trips, such as Jean Turmel, who is going back to Canada from the US 10 days earlier than planned.
A London-based reader, however, has a trip planned with two colleagues to see clients in multiple US cities. “As an example of different countries’ reactions to the virus in general and the latest mutation in particular, I had no calls or concerns at all from US clients yesterday. Meanwhile, I had multiple emails from various London colleagues all of whom seemed to assume that the trip would be cancelled,” the reader said.
Keep the comments coming to email@example.com.
The day ahead
UK cuts taper rate for universal credit The amount withdrawn for each pound someone earns will be reduced from 63p to 55p, a controversial move that was announced by Chancellor Rishi Sunak after he cut the £20 uplift in payments made at the start of the pandemic.
EU sets out €300bn infrastructure spend The European Commission will detail draft proposals to mobilise spending on global infrastructure and other projects to counter China’s Belt and Road Initiative.
PMI results IHS Markit PMIs will provide insight into manufacturing conditions in the eurozone, France, Germany, Italy, the UK and the US. The OECD will also release its latest economic outlook, while the Federal Reserve publishes its final Beige Book of 2021.
US Supreme Court to hear abortion case Justices will hear a challenge to a Mississippi law that bans abortions starting at 15 weeks of pregnancy. A ruling is expected by June 2022.
FT and McKinsey Business Book of the Year The winner of the 17th annual award will be revealed at a ceremony in London. Here is the short list of titles chosen by the esteemed panel. The winner of the £15,000 Bracken Bower Prize for young authors will also be announced.
Join more than 100 influential leaders and the FT’s top journalists from across America and around the world for the Global Boardroom conference as they discuss how to build resilient, sustainable, inclusive economies and businesses in a world transformed by crisis. Register for free here.
What else we’re reading
Lessons in ‘levelling up’ from the Basque country How are declining regions to be revitalised? This question arises wherever erstwhile bastions of heavy industry have collapsed in high-income countries. The Basque country in Spain has succeeded in regenerating. Martin Wolf examines how.
Russia’s Arctic ambitions In a remote Siberian port lies the world’s first floating nuclear power plant, a sign of Vladimir Putin’s ambitions to open up a major shipping lane through the Arctic. Could it offer an alternative to the Suez Canal?
UK stock market risks becoming a global backwater Britain is falling behind as US and Chinese markets forge ahead and fund managers obsess over dividends rather than growth. London has largely failed to take part in the global rally that began in 2015, writes Paul Marshall, chair of Marshall Wace.
Inflation always punishes America’s left Inflation hawks are prone to crying wolf, argues Edward Luce. Since they spent the post-2008 years forecasting hyperinflation that never arrived, it was no surprise that few people sat up when they issued the same warnings last year. Now the hawks are right — but for the wrong reasons.
The promise of more sustainable seafood About an hour south of Oslo, hundreds of thousands of salmon swim in cold, dark depths. But they are not in the ocean or in the river. Instead, they survive in huge circular pools at a land-based fish farm, a practice that could herald a green revolution.
Food and drink
High-end hot chocolate can be as nuanced as coffee or wine. Single-origin specialist Cartografie makes four sustainably sourced hot chocolates that spotlight different terroirs. Its Venezuelan is soft and creamy, with notes of Earl Grey. The Tanzanian is fruitier: caramelised banana, pineapple and espresso.