Royal Mail to cut 2,500 head office and support jobs by end 2027
Royal Mail plans to cut up to 2,500 jobs by the end of next year, as it struggles with a slump in letters being sent and seeks to compete in the cutthroat parcel delivery market.
To simplify its processes and save money, Royal has carried out a review of its head office and support functions, and will reduce them by “up to 2,500” – less than 2% of its workforce of more than 131,000 people, it said.
The company, owned since April 2025 by the Czech billionaire Daniel Křetínský, hopes to achieve the reductions through “natural attrition” (people leaving anyway) and voluntary redundancies, without the need for compulsory redundancies.
It stressed that its frontline roles in delivery and processing, including posties and drivers, will not be affected.
Royal Mail said it needs to adapt to a rapidly-changing market: Letter volumes have declined by more than 70% since their peak, whilst customer demand for faster and more convenient parcel delivery services continues to grow.
Royal Mail has briefed its unions, the Communication Workers Union (CWU) and Unite CMA, on the proposals and formal consultation with both unions is now underway.
Alistair Cochrane, the chief executive, said:
We have been working hard to reduce costs and simplify processes across all areas of the business as we transform to win in a very competitive market. These proposed changes remove duplication and allow us to invest further in the service we deliver for our customers.
We are committed to treating everyone fairly and respectfully throughout this process, working closely with our trade unions. The proposed changes will not be easy, but they are an important part of building a stronger, simpler and future-ready Royal Mail for our customers and colleagues.
Key events
Here’s our full story on UK house prices flatlining.
O2 signs record £200m deal to keep London venue’s naming rights
O2 has struck a record deal thought to be in the region of £200m to retain the naming rights to the London venue the O2 in the largest renewal of its kind in UK history.
The 10-year agreement will extend O2’s relationship until at least 2038. It cements the sponsorship as the second longest-running UK stadium naming rights deal after Arsenal’s partnership for the football club’s London ground,
Under the deal with Anschutz Entertainment Group (AEG), which bought the site of the ill-fated Millennium Dome five years after it was shut following the millennium celebrations, O2 is thought to be paying about £20m a year in the wide-ranging partnership.
This is an almost 50% increase on the annual amount under the existing deal which was due to expire at the end of next year. It is more than triple the £6m a year O2 paid in its initial 10-year deal when the future success of the O2 and surrounding site was far from certain.
Apparent exodus of super-rich suggests UK is no longer billionaires’ playground
If recent complaints are believed, London and the UK are no longer welcoming for ultra-high net worth individuals.
London was once globally renowned as the “billionaires’ playground”, where the world’s super-rich could relax in the Georgian townhouses of Mayfair undisturbed by the grasping hand of the state.
But if recent complaints by fleeing ultra-high net worth individuals are to be believed, the city is no longer as welcoming for those who consider themselves to be Britain’s most-persecuted minority.
They complain of Labour’s stricter tax regime and the antipathy of others towards those with extreme wealth. One even suggested that he was leaving the country because of London’s low-traffic neighbourhoods. The financier Ben Goldsmith said:
If I want to organise a gathering now, I have to take into account a lot of my friends are not here any more,” said . “How the hell are we supposed to pay for health services and everything if we are driving out the highest rate taxpayers?
Poland’s ‘solidarity’ push for EU energy resilience in face of Russian aggression
Also on the energy front, our economics correspondent Richard Partington travelled to Gdansk, to look at Poland’s ‘solidarity’ push for EU energy resilience in face of Russian aggression.
Two miles off the coast of Gdańsk, the white steel piles of Poland’s first offshore gas terminal rise from the slate-grey Baltic. Installed at a height eight metres above the waves, the floating cranes and construction vessels here are on the frontline of Europe’s push for energy security.
Since the taps were turned off on Russian gas after Vladimir Putin’s invasion of Ukraine four years ago, Poland has turned to the global energy market for supplies. But while conditions are far from ideal as the Middle East war drives oil and gas prices to stratospheric levels, strengthening the diversity of the country’s energy mix remains a top priority for Poland, its Baltic neighbours, and the EU at large.
Looking out to sea from the windswept beach backed by pine forest, Maciej Wawrzkowicz, the offshore project manager at the national gas company Gaz-System, and the construction manager Krzysztof Polatynski say the Baltic is not an easy place to build.
Before work could start, Polish navy minesweepers were called in to torpedo unexploded mines and bombs from the second world war. Construction is halted by storms, while the sea froze over last winter. But speed is important in this project of international significance.
Shell expects refineries to almost double the profit from every barrel of fuel made
Shell’s refineries are expected to make almost double the profit from every barrel of fuel produced owing to record prices caused by shortages around the world.
In a market trading update, the energy supermajor forecast profit margins of $42 a barrel in the July to September period, far above the $24 a barrel of the second quarter and the previous high of about $28 in mid-2022.
The margins reflect the steep increase in the price of refined fuels, including diesel, relative to the cost of crude oil, as the shutdown of war-damaged refineries in the Middle East and Russia squeezes supplies.
The Middle East crisis helped Europe’s biggest oil and gas company to a profit of almost $10bn (£7.5bn) for the second quarter of 2026, more than double the figure for the same period last year and its second highest quarterly earnings on record.
Today, Brent crude, the global oil benchmark, has risen $1.27 or 1.3% to $101.84 a barrel.
Royal Mail to cut 2,500 head office and support jobs by end 2027
Royal Mail plans to cut up to 2,500 jobs by the end of next year, as it struggles with a slump in letters being sent and seeks to compete in the cutthroat parcel delivery market.
To simplify its processes and save money, Royal has carried out a review of its head office and support functions, and will reduce them by “up to 2,500” – less than 2% of its workforce of more than 131,000 people, it said.
The company, owned since April 2025 by the Czech billionaire Daniel Křetínský, hopes to achieve the reductions through “natural attrition” (people leaving anyway) and voluntary redundancies, without the need for compulsory redundancies.
It stressed that its frontline roles in delivery and processing, including posties and drivers, will not be affected.
Royal Mail said it needs to adapt to a rapidly-changing market: Letter volumes have declined by more than 70% since their peak, whilst customer demand for faster and more convenient parcel delivery services continues to grow.
Royal Mail has briefed its unions, the Communication Workers Union (CWU) and Unite CMA, on the proposals and formal consultation with both unions is now underway.
Alistair Cochrane, the chief executive, said:
We have been working hard to reduce costs and simplify processes across all areas of the business as we transform to win in a very competitive market. These proposed changes remove duplication and allow us to invest further in the service we deliver for our customers.
We are committed to treating everyone fairly and respectfully throughout this process, working closely with our trade unions. The proposed changes will not be easy, but they are an important part of building a stronger, simpler and future-ready Royal Mail for our customers and colleagues.
Chancellor plans major intervention to help poorer UK households with rising energy bills
John Healey is planning a major intervention to cut energy bills for poorer households in this month’s budget, after ministers became alarmed at forecasts that show bills rising by hundreds of pounds in January, the Guardian has revealed.
The chancellor is working on plans to spend more than £1bn to help energy consumers, the bulk of which is likely to go towards increasing the discount given to households on certain benefits.
Sources say final decisions have not been made, but Healey is set to rebuff a call from the energy secretary Miatta Fahnbulleh to spend billions more on removing levies from bills altogether.
Energy officials are working up more radical changes to bills, however, which could be implemented after the budget and would change how much companies could charge customers, rather than subsidising their bills.
If approved, the energy discount will form a major plank of the budget, which government sources say will be low-key but focused on reducing voters’ cost of living.
The chancellor is facing a cash crunch as he looks for money to fund an additional £4.7bn in defence spending and rebuild his fiscal buffer, which has been eroded by higher borrowing costs.
He is likely to raise taxes to pay for the additional spending, and is rumoured to be looking at higher bank taxes in particular.
Government sources had previously insisted the VAT cut to electricity bills which Andy Burnham announced soon after becoming prime minister would be the last support to be offered this year.
Rob Davies
The UK gambling sector is in crisis mode, lobbying hard to stave off a rise in slot machine duty, rumoured to be in chancellor John Healey’s plans for the upcoming Budget.
So today’s announcement from the Gambling Commission could not have come at a worse time. Grosvenor Casinos, owned by Rank Group, has been fined £5m for a series of failings relating to money laundering and safer gambling controls.
In one case, a customer cycled £85,000 in cash through the casino in less than three months. In another, the casino watched a customer blow £250,000 of winnings, quietly making its money back without once stepping to be sure the gambler was in control.
Rank, which makes 44% of its revenue from slot machines, has warned that increasing machine games duty (MGD) on this cash cow, from 20% to 40%, would force it to close venues and cut jobs.
The wider industry has stressed that punishing the licensed sector only drives customers into the evil clutches of the unscrupulous illicit market. So the last thing the industry needs is a timely reminder that licensed operators are capable of shoddy behaviour too.
Frasers Group buys stake in US brand Under Armour
Billionaire Mike Ashley’s Frasers Group has snapped up a stake in the US sportswear brand Under Armour.
The owner of Sports Direct acquired an 8.8% stake in the Baltimore-based company, adding to its portfolio of investments in underperforming sportswear brands.
Frasers now holds about 16.6m shares in Under Armour, according to a 1 October filing with the US Securities and Exchange Commission. The stake is worth around $80.1m, based on Under Armour’s closing share price on Tuesday.
Frasers recently disclosed a stake of almost 6% in the German brand Puma, and also acquired the struggling Norwegian sporting-goods retailer XXL last year.
Ashley’s company built its business by snapping up struggling independent sporting goods chains and bumped up its profits by getting the UK rights to ailing sportswear brands – from Head to Slazenger – and using them to decorate its own products.
The acquisitions are part of the entrepreneur’s modus operandi – picking up bargains during tough times and finding the value where he can, from sportswear to luxury brands.
Frasers bought Harvey Nichols, the upmarket department store in London’s Knightbridge, out of administration in August. It sits beside a large slice of Hugo Boss, a chunk of Mulberry, a snippet of Burberry, the remains of Agent Provocateur and the entire Flannels and House of Fraser chains.
French bond yields jump, euro falls; UK and US yields also rise
French government borrowing costs have jumped, reversing Tuesday’s drop, while US and UK bond yields also rose this morning amid higher oil prices, which add to inflationary pressures.
The yield, or interest rate, on the benchmark 10-year French bond (known as OAT – Obligations assimilables du Trésor) rose as much as 12 basis points to 4.85%, after falling about 11bps on Tuesday.
Not surprisingly, the euro is under pressure again, falling 0.6% against the dollar below $1.12, to $1.1192.
The 10-year UK gilt yield is up 4.6bps at 5.42% after touching 5.44%, but still some way off the 19-year peak of 5.51% hit last week. Bond auctions of two-year and five-year gilts later this morning will test investors’ appetite.
US Treasury yields rose by 4bps to 5.31%.
On Tuesday, the UK chancellor John Healey met economists employed by primary dealers – known as gilt-edged market makers or GEMMs – to gauge market sentiment ahead of his first budget on 28 October.
Economists at Bank of America are forecasting that the budget will lead to a £15bn increase in public borrowing for both the current financial year and the next year, with less room to hit longer-term budget goals.
European stock markets are down, with the UK’s FTSE 100 index falling 41 points, or 0.4%, to 10,500. Germany’s Dax and Spain’s Ibex both lost 0.8%, France’s CAC is down 0.6% and Italy’s FTSE MiB slid 1.3%.
HSBC to make sweeping job cuts in UK wealth management
HSBC reportedly plans big job reductions in its UK wealth management division, slashing the ranks of financial advisers and other specialists as it uses AI to serve its wealthy clients.
Half the business’s management and specialist roles are expected to go, along with 70% of financial advisers, the Financial Times reported, citing anonymous sources.
One source described the cuts as “deep, wide and brutal”, adding that almost entire teams would be made redundant, with a consultation underway.
HSBC is thought to have hundreds of relationship managers across the UK. Affected staff are expected to leave the bank at the end of the month.
The bank said:
HSBC UK is a long-established, leading UK wealth manager and premium banking provider. We’re continuing to evolve to deliver more digitally enabled products and journeys to support our best-in-class wealth service and meet the changing needs of our customers.
Georgieva warns of AI risks but says if done right, technology could boost global growth
Turning to the AI boom, where investment as a share of GDP is likely to exceed that of railroads, electricity grids or telecommunications infrastructure, Georgieva said market disappointment could turn into a “far-reaching shock”.
AI companies are under pressure to deliver productivity and profit gains to justify their sky-high valuations, she said.
She added, though, that if done right, AI could add half a percentage point to global growth a year, according to IMF research.
Regulatory oversight is important to
help manage AI’s substantial perils, which including large-scale labour market fallout, serious cyber and stability risks and frontier models threatening to escape human control and run amok.
IMF chief calls for ‘decisive action’ in high-debt advanced economies including rate hikes
Ballooning government debt will be discussed by the International Monetary Fund’s 191 member countries in Bangkok next week.
In her speech this morning, the IMF’s managing director Kristalina Georgieva said the growing public debt burden is sapping growth and adding to inflationary pressures. The IMF says public debt is at the highest level since World War II and is forecast to exceed 100% of global GDP before 2030.
Governments can no longer rely on higher growth rates alone to solve fiscal problems, she said.
Some very tough political choices stare us in the face. My message to the world’s economic policymakers next week will be this: we cannot keep delaying necessary policy action — you have the tools, now have the wisdom to use them.
She singled out advanced economies in particular, as reported earlier.
And yet we don’t see decisive action in the high-debt advanced economies where the need of the hour is for credible medium-term fiscal consolidation plans, supported in some cases by upfront fiscal measrues, including to take some pressure off monetary policy.
After five and a half years of above-target inflation, Georgieva said inflationary pressures are persisting, from the AI investment boom, energy and food price shocks, trade tariffs, higher defence spending and higher debt service costs.
Now may be a good time for a prudently hawkish bias in many countries’ monetary policy.
She said recent interest rate hikes by the US Federal Reserve, the European Central Bank and the Bank of Japan were “highly appropriate”. The Bank of England has so far left borrowing costs unchanged, but is expected to raise its base rate at its November meeting.
UK housing market comes to standstill
The UK housing market has come to a standstill, ahead of the introduction of the government’s Your First Home scheme targeted at first-time buyers.
The latest figures from Lloyds Banking Group show prices flat last month, following a 0.3% dip in August. The average property now costs £298,441, while annual growth was also flat.
Andrew Asaam, mortgages director at Lloyds, said:
While the market overall has been fairly subdued, property prices have so far proved resilient during a period of higher mortgage rates, which has been driven by changing expectations around the future path of Base Rate. That’s mirrored in wider economic data, with household spending holding up better than many expected despite energy and other cost pressures arising from the Middle East conflict.
Whether that picture continues is likely to depend on how confident consumers feel that the latest cost‑of‑living pressures will prove temporary. Confidence has long been a key driver of housing market activity, and will play an important role in shaping demand over the remainder of this year and into 2027.
For now, the housing market appears to be balancing buyer caution with continued underlying demand. While higher mortgage rates and wider economic uncertainty are encouraging some people to take a more measured approach, new enquiries from prospective buyers are now at their highest since February. That should help sustain activity in the near term, with any movement in house prices likely to remain modest.
Equinor warns UK could become ‘uninvestable’ without North Sea fields approval
Meanwhile,, the energy giant Equinor has warned it may stop investing in the UK if new oil and gas fields at Rosebank and Jackdaw are not approved.
Anders Opedal, boss of the Norwegian state oil company which part-owns the sites, told the BBC:
The question will be: is the UK investable in the future? I hope it will not come to that.
He said the company would “have to take a hard view about it” if the UK government decides against new drilling.
It has to decide whether to give final approval to extract oil and gas at Rosebank and Jackdaw, despite a ban pledged in Labour’s election manifesto.
Opedal said he is confident that prime minister Andy Burnham’s talk of a “pragmatic approach to oil and gas” suggests both projects will get approved but he said the current limbo is “an uncomfortable position to be in”.
He said that the UK could produce more of its own oil and gas.
It’s a political choice. The North Sea oil and gas industry started on the UK side. We learned from the UK and it’s actually the same geology on both sides of the border – several fields actually cross it.
Introduction: IMF chief warns energy shock, public debt and AI investment boom threaten global growth
Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.
The global economy is under threat from the energy price shock, record public debt and the AI investment boom, according to the International Monetary Fund’s managing director Kristalina Georgieva.
In a speech ahead of the IMF and World Bank annual meetings in Bangkok next week, she said the world is being pulled in two directions – a negative energy supply shock from the Middle East war and a positive demand shock from artificial intelligence that is also driving inflation higher.
The combined impact of these two forces is highly uneven across the world,
she said, noting that the AI boom is bypassing many countries.
Growing government debt is another major worry. Georgieva singled out advanced economies, led by the United States, as the “worst offenders” on debt burdens, with debt to GDP ratios higher than in emerging markets and low-income countries.
Asian shares are down, while on Wall Street, the S&P 500 and the Nasdaq both finished at new all-time highs. The S&P 500 rose nearly 0.6% to 7,818.93 while the Nasdaq closed at 27,599.886.
MSCI’s broadest index of Asia-Pacific shares excluding Japan fell 0.3%. Japan’s Nikkei lost 0.6%, Hong Kong’s Hang Seng fell 0.5%, the Singapore market was down 1.3% and South Korea’s Kospi tumbled nearly 2%.
Oil prices have risen back above $100 a barrel again. Brent crude is up 0.66% at $101.19 a barrel, while US crude is 0.5% ahead at $89.86 a barrel.
Investors are weighing up supply constraints from a storm heading for North American oil-producing regions and Houthi attacks on Saudi Arabia, against higher supplies of oil from the Middle East
Around 12m barrels per day (bpd) of crude oil and 2m bpd of refined oil products have left the Middle East on tankers in the last seven to 10 days, according to commodities trading giant Vitol, Reuters reported.
After last week’s selloff in government bond markets, bonds rallied on Tuesday, pushing their yields (or interest rates) lower. Ten-year French yields fell more than 11 basis points and the spread between French and safer German bonds, which hit almost 160 basis points last week, narrowed to 132bps. The euro recovered from its declines over the past week and stabilised just above $1.1250.
ANZ economists said:
A sense of calm returned to European bond markets with French, Italian and Greek bonds outperforming amid a broad rally.
This morning, French 10-year yields rose nearly 5bps to 4.796%, while US Treasury yields rose 4.5bps, to 5.31%. UK gilt yields meanwhile are down a smidgen to 5.37%.
The Agenda
