1
00:00:02,440 --> 00:00:10,119
Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

2
00:00:10,200 --> 00:00:13,119
Speaker 1: Daybake You At podcast, available every morning on Apple, Spotify

3
00:00:13,200 --> 00:00:16,000
Speaker 1: or wherever you listen. It's Wednesday, the nineteenth of June

4
00:00:16,120 --> 00:00:18,079
Speaker 1: in London. I'm Caroline Hepka.

5
00:00:17,880 --> 00:00:21,160
Speaker 2: And I'm Stephen Carroll. Coming up today in Nvidia overtakes

6
00:00:21,239 --> 00:00:25,120
Speaker 2: Microsoft and Apple to become the world's most valuable company.

7
00:00:25,320 --> 00:00:29,120
Speaker 1: Jim Ratcliffe, the UK's second richest person, tells Bloomberg that

8
00:00:29,200 --> 00:00:32,080
Speaker 1: Britain's have had enough of Sunac's tories.

9
00:00:31,960 --> 00:00:36,360
Speaker 2: Plus an unintended consequence for low income families. Our exclusive

10
00:00:36,400 --> 00:00:40,680
Speaker 2: reporting finds private schools threatening to cut pupil aid over

11
00:00:40,760 --> 00:00:41,960
Speaker 2: Labour's tax plans.

12
00:00:42,120 --> 00:00:44,279
Speaker 1: Let's start with a roundup of our top stories.

13
00:00:44,400 --> 00:00:47,280
Speaker 2: The chip maker in Nvidia has unseated Microsoft to become

14
00:00:47,320 --> 00:00:50,159
Speaker 2: the world's most valuable company, with a market cap of

15
00:00:50,200 --> 00:00:53,600
Speaker 2: more than three point three trillion dollars. The firm stock

16
00:00:53,640 --> 00:00:55,800
Speaker 2: grows by three and a half percent on Tuesday as

17
00:00:55,840 --> 00:00:59,600
Speaker 2: investors continue to bet on its dominance in AI chip technology.

18
00:01:00,000 --> 00:01:03,520
Speaker 2: Bloomberg's senior equities reporter Bailly Lipshal's says in Vidia's share

19
00:01:03,520 --> 00:01:06,800
Speaker 2: price rise this year is unprecedented.

20
00:01:06,520 --> 00:01:09,119
Speaker 3: It's added two point one trillion dollars in market value

21
00:01:09,160 --> 00:01:11,960
Speaker 3: this year. That's more than Amazon, that's more than Meta,

22
00:01:12,040 --> 00:01:15,320
Speaker 3: that's more than Berkshire Hathaway really crushing expectations and is

23
00:01:15,360 --> 00:01:18,120
Speaker 3: all about AI and what the future could bring and

24
00:01:18,160 --> 00:01:19,480
Speaker 3: how in video is going to take us there.

25
00:01:20,000 --> 00:01:22,640
Speaker 2: Belly Lipshell's says n videos rise is another reminder that

26
00:01:22,680 --> 00:01:25,600
Speaker 2: AI is the top focus of many investors, with the

27
00:01:25,680 --> 00:01:27,720
Speaker 2: chip makers sales up by more than one hundred and

28
00:01:27,800 --> 00:01:31,520
Speaker 2: twenty five percent last year. In Video's surging stock price

29
00:01:31,560 --> 00:01:33,960
Speaker 2: has made co founder and CEO Jensen Hwang one of

30
00:01:34,000 --> 00:01:36,880
Speaker 2: the world's richest people. His net worth is climb nearly

31
00:01:36,920 --> 00:01:39,559
Speaker 2: seventy five billion dollars since the beginning of the year

32
00:01:39,720 --> 00:01:42,880
Speaker 2: to one hundred and nineteen billion on the Bloomberg Billionaires Index.

33
00:01:43,440 --> 00:01:47,240
Speaker 1: To Elections Now, a poll of almost twenty thousand people

34
00:01:47,240 --> 00:01:51,000
Speaker 1: by Ipsos suggests that Kirstarmer's Labor Party will win the

35
00:01:51,040 --> 00:01:55,640
Speaker 1: biggest majority of any post war UK government. It's the

36
00:01:55,760 --> 00:01:59,200
Speaker 1: latest survey to suggest rich Soon Acts Conservatives are on

37
00:01:59,280 --> 00:02:02,400
Speaker 1: course for a five feet of historic proportions in the

38
00:02:02,440 --> 00:02:06,520
Speaker 1: general election. Britain's second richest person, Jim Ratcliffe, has told

39
00:02:06,520 --> 00:02:10,840
Speaker 1: Bloomberg exclusively that the country has had enough of the Tories.

40
00:02:11,120 --> 00:02:13,560
Speaker 4: You know, the Conservatives now, they've had a fairly long

41
00:02:13,600 --> 00:02:16,560
Speaker 4: stint and they've they've put forward a whole series of

42
00:02:16,600 --> 00:02:19,280
Speaker 4: the prime ministers that haven't been terribly successful really to

43
00:02:19,320 --> 00:02:23,359
Speaker 4: be honest the less for so, you know, I think

44
00:02:23,360 --> 00:02:25,680
Speaker 4: the UK, everybody in the UK now you can see

45
00:02:25,720 --> 00:02:28,040
Speaker 4: that the mood in the UK is ready for a change.

46
00:02:28,040 --> 00:02:31,280
Speaker 4: They've had enough. And I've met Kiir Starmer a couple

47
00:02:31,280 --> 00:02:33,840
Speaker 4: of times. I like, ka, I think you'll do a

48
00:02:33,919 --> 00:02:34,760
Speaker 4: very sensible job.

49
00:02:35,680 --> 00:02:39,360
Speaker 1: The billionaire and Manchester United owner Ratcliffe also added that

50
00:02:39,440 --> 00:02:42,639
Speaker 1: he wasn't a fan of changes to the non dom regime.

51
00:02:42,919 --> 00:02:45,919
Speaker 1: His comments come as the seat by seat analysis from

52
00:02:45,960 --> 00:02:49,320
Speaker 1: IPSOS also predicted that Nigel Farage, the leader of the

53
00:02:49,400 --> 00:02:52,560
Speaker 1: right wing Reform UK Party, will become an MP for

54
00:02:52,600 --> 00:02:53,360
Speaker 1: the first time.

55
00:02:54,560 --> 00:02:57,200
Speaker 2: France and Italy are among seven countries that or face

56
00:02:57,240 --> 00:03:00,720
Speaker 2: official EU warnings over their budget Deficitsloomberg has learned the

57
00:03:00,720 --> 00:03:03,880
Speaker 2: European Commission will announce steps against those countries later today.

58
00:03:04,160 --> 00:03:07,200
Speaker 2: They'll require Paris and Rome to submit plans to Brussels

59
00:03:07,320 --> 00:03:10,560
Speaker 2: on how they will bring spending under control or face

60
00:03:10,680 --> 00:03:13,920
Speaker 2: Potential finds the timing of the announcement for France as

61
00:03:13,960 --> 00:03:17,600
Speaker 2: particularly sensitive where the parliamentary election campaign is underway well.

62
00:03:17,639 --> 00:03:20,880
Speaker 1: Speaking of France, the National Rally leader Jordan Bardella says

63
00:03:20,880 --> 00:03:24,240
Speaker 1: that he won't become prime minister unless his party wins

64
00:03:24,240 --> 00:03:28,600
Speaker 1: an absolute majority in the upcoming elections. Bardella told France

65
00:03:28,639 --> 00:03:31,880
Speaker 1: Too television that he needs voters full support.

66
00:03:32,680 --> 00:03:35,120
Speaker 5: I want the power to act. I want to act,

67
00:03:35,160 --> 00:03:37,800
Speaker 5: and I want to govern and to govern. I say

68
00:03:37,840 --> 00:03:41,400
Speaker 5: to the French people, I need you to choose the alternative.

69
00:03:41,680 --> 00:03:45,320
Speaker 5: I need you to give me, alongside our Republican allies

70
00:03:45,360 --> 00:03:47,560
Speaker 5: on the right, a large majority.

71
00:03:48,480 --> 00:03:51,680
Speaker 1: Jordan Bardella, they're speaking through a translator. The last time

72
00:03:51,680 --> 00:03:55,200
Speaker 1: that France saw its National Assembly and presidency controlled by

73
00:03:55,240 --> 00:03:58,480
Speaker 1: different parties was in nineteen ninety seven. In that situation,

74
00:03:58,560 --> 00:04:02,000
Speaker 1: the president typically foreign policy and defense, whilst the Prime

75
00:04:02,000 --> 00:04:06,720
Speaker 1: Minister controls domestic issues, including fiscal policy. According to Bloomberg's

76
00:04:06,720 --> 00:04:10,040
Speaker 1: poll of Polls, the National Rally is expected to win

77
00:04:10,120 --> 00:04:13,320
Speaker 1: almost thirty three percent of the vote in the first round.

78
00:04:13,960 --> 00:04:16,560
Speaker 2: Russian President of Vasimir Putin has arrived in North Korea

79
00:04:16,600 --> 00:04:19,240
Speaker 2: for his first visit there in twenty four years. The

80
00:04:19,279 --> 00:04:22,520
Speaker 2: two countries are set to deepen their military cooperation during

81
00:04:22,520 --> 00:04:26,279
Speaker 2: the trip. Bloomberg's John Herskovitz says that Russia is increasingly

82
00:04:26,400 --> 00:04:29,400
Speaker 2: competing with China for North Korea's friendship.

83
00:04:29,880 --> 00:04:33,760
Speaker 6: It benefits all three eventually in that we'll have a

84
00:04:33,800 --> 00:04:37,560
Speaker 6: stronger North Korea Russia tie along with the already strong

85
00:04:37,640 --> 00:04:42,040
Speaker 6: North Korea China ties. And this triangle relationship is all

86
00:04:42,200 --> 00:04:46,240
Speaker 6: in opposition to the US and as partners, so we're

87
00:04:46,240 --> 00:04:50,039
Speaker 6: seeing a more balanced triangle, and eventually this could really

88
00:04:50,080 --> 00:04:53,120
Speaker 6: cause some problems for whatever administration is in Washington.

89
00:04:54,000 --> 00:04:56,680
Speaker 2: Herskovetz adds that the US and South Korea both say

90
00:04:56,800 --> 00:04:59,880
Speaker 2: Kim has already sent millions of artillery shells to Russia

91
00:04:59,880 --> 00:05:02,760
Speaker 2: for use on the front lines in Ukraine, Moscow and

92
00:05:02,839 --> 00:05:05,920
Speaker 2: Pyongyang have denied this. Now, in a moment, will bring

93
00:05:05,960 --> 00:05:08,400
Speaker 2: you more in our exclusive reporting on how private schools

94
00:05:08,400 --> 00:05:11,240
Speaker 2: in the UK are putting bursaries on the line over

95
00:05:11,360 --> 00:05:15,360
Speaker 2: Labor's tax plans. But first, just reflect for a moment

96
00:05:15,400 --> 00:05:18,200
Speaker 2: on the stock rally that brought in Vidia to that

97
00:05:18,400 --> 00:05:21,200
Speaker 2: place as the world's most valuable company. Our colleagues have

98
00:05:21,200 --> 00:05:24,960
Speaker 2: been crunching the numbers and Vidia has returned five hundred

99
00:05:25,000 --> 00:05:28,520
Speaker 2: and ninety one thousand and seventy eight percent since its

100
00:05:28,520 --> 00:05:32,320
Speaker 2: IPO in nineteen ninety nine, if you include reinvested dividends

101
00:05:32,720 --> 00:05:34,919
Speaker 2: six figure, six figure six very big figures.

102
00:05:35,200 --> 00:05:38,080
Speaker 1: Yeah, I'm glad you said that number. Not maybe because

103
00:05:38,160 --> 00:05:41,280
Speaker 1: it's really quite tricky. It is so long. I mean,

104
00:05:41,360 --> 00:05:44,760
Speaker 1: there has been an absolute wild ride though for in

105
00:05:44,880 --> 00:05:48,720
Speaker 1: Vidia's shares. You know, it's not been smooth at all

106
00:05:48,760 --> 00:05:51,239
Speaker 1: in terms of long term investors. There have been three

107
00:05:51,400 --> 00:05:55,840
Speaker 1: annual collapse collapses. Remember in Nvidia's shares I collapsing at

108
00:05:55,920 --> 00:05:58,560
Speaker 1: least fifty percent, so you would have had to be

109
00:05:58,839 --> 00:06:01,440
Speaker 1: very patient, but the return enormost.

110
00:06:01,640 --> 00:06:03,760
Speaker 2: I mean, look, there's a great series of charts in

111
00:06:03,760 --> 00:06:06,920
Speaker 2: this article by our colleagues Aran Wittenstein and Carmen Runnick

112
00:06:07,080 --> 00:06:09,080
Speaker 2: as well, and definitely worth checking out to take a

113
00:06:09,080 --> 00:06:11,280
Speaker 2: look at how the rise of Nvidia has brought it

114
00:06:11,839 --> 00:06:15,000
Speaker 2: to that title. Of course, questions too over how in

115
00:06:15,160 --> 00:06:17,839
Speaker 2: Vidia sustains itself from here, But in the end, it

116
00:06:17,880 --> 00:06:19,560
Speaker 2: was that three and a half percent rise in the

117
00:06:19,560 --> 00:06:21,760
Speaker 2: share price that push and Video to the milestones, are

118
00:06:21,800 --> 00:06:25,120
Speaker 2: passing Microsoft and Apple to become the world's most valuable firm.

119
00:06:25,200 --> 00:06:27,160
Speaker 2: Let's get more in f Martech editor of Lad's have

120
00:06:27,240 --> 00:06:29,640
Speaker 2: off on the rise and the path ahead for in

121
00:06:29,760 --> 00:06:32,279
Speaker 2: video of LAD, great to have you with us. So

122
00:06:32,520 --> 00:06:34,880
Speaker 2: I mean this is an AI rally, but what's push

123
00:06:34,920 --> 00:06:38,120
Speaker 2: and Video's share price is higher in most recent weeks.

124
00:06:38,920 --> 00:06:41,640
Speaker 7: Well, as you say it is AI, it is enthusiasm,

125
00:06:41,720 --> 00:06:44,839
Speaker 7: especially in the US stock market. And when you look

126
00:06:45,000 --> 00:06:51,279
Speaker 7: toward AI, those top three companies are the titular embodiments

127
00:06:51,279 --> 00:06:53,479
Speaker 7: of it, really, and Video is the one that provides

128
00:06:53,720 --> 00:06:57,599
Speaker 7: the shovels, as people like to say when you're digging

129
00:06:57,600 --> 00:07:00,240
Speaker 7: for gold. Microsoft is the one who's most aggressively doing

130
00:07:00,279 --> 00:07:03,159
Speaker 7: it with its investment in Open AI and putting AI

131
00:07:03,400 --> 00:07:08,039
Speaker 7: into Windows. And now Apple its most recent share price

132
00:07:08,120 --> 00:07:10,840
Speaker 7: urge was built on the same thing, on confidence about

133
00:07:10,840 --> 00:07:14,080
Speaker 7: how it's going to integrate what it calls Apple Intelligence

134
00:07:14,440 --> 00:07:18,200
Speaker 7: into the iPhone and its ecosystem of devices. So yes,

135
00:07:18,360 --> 00:07:21,480
Speaker 7: the answer is as simple as AI is driving all of.

136
00:07:21,400 --> 00:07:26,240
Speaker 1: This, absolutely, and so it means in Nvidia's current market

137
00:07:26,280 --> 00:07:30,080
Speaker 1: cap three point three four trillion dollars, it's a staggering number.

138
00:07:30,320 --> 00:07:33,720
Speaker 1: Jensen one in just one day adding three point nine

139
00:07:33,760 --> 00:07:38,560
Speaker 1: billion dollars, But of course there could well be challenges ahead.

140
00:07:38,640 --> 00:07:41,200
Speaker 1: I mean that the company has managed to deliver kind

141
00:07:41,240 --> 00:07:43,880
Speaker 1: of quarter after quarter. We watched that very closely over

142
00:07:43,960 --> 00:07:46,000
Speaker 1: the last year. What do you think the challenge is though,

143
00:07:46,040 --> 00:07:49,320
Speaker 1: that the company is going to face just in maintaining

144
00:07:49,360 --> 00:07:50,920
Speaker 1: this kind of momentum.

145
00:07:51,440 --> 00:07:53,920
Speaker 7: Well, Jensen was here in Asia. He visited Taiwan for

146
00:07:53,960 --> 00:07:57,240
Speaker 7: the Competext trade show, and it's worth noting he was

147
00:07:57,280 --> 00:08:00,840
Speaker 7: the only major tech CEO from the US who grace

148
00:08:00,960 --> 00:08:03,920
Speaker 7: computext last year. This year, everyone saw the successive in

149
00:08:03,960 --> 00:08:05,480
Speaker 7: video over the past year and they said, you know what,

150
00:08:05,560 --> 00:08:08,040
Speaker 7: we should do the same thing. So the likes of

151
00:08:08,160 --> 00:08:10,920
Speaker 7: AMD Intel for the first time brought its ceo out

152
00:08:10,960 --> 00:08:13,880
Speaker 7: to Computext in Taiwan. And the reason is all of

153
00:08:13,920 --> 00:08:17,280
Speaker 7: the chips, all of the infrastructure that goes into these

154
00:08:17,360 --> 00:08:21,120
Speaker 7: data centers. It has its epicenter in Taiwan. It's where

155
00:08:21,160 --> 00:08:25,480
Speaker 7: TSMC makes in video's critical AI accelerator chips. And the

156
00:08:25,520 --> 00:08:28,120
Speaker 7: big challenge for video in fact me talking to people

157
00:08:28,160 --> 00:08:31,040
Speaker 7: around computext is the fact that if Nvidio could make

158
00:08:31,080 --> 00:08:33,800
Speaker 7: twice as many chips, it would sell twice as many chips.

159
00:08:33,880 --> 00:08:36,640
Speaker 7: It's supply constraints right now, and those are not going

160
00:08:36,720 --> 00:08:39,400
Speaker 7: to go away over the next year, maybe even longer.

161
00:08:40,360 --> 00:08:43,640
Speaker 2: What about the competition vlad does and Video really have

162
00:08:43,720 --> 00:08:45,360
Speaker 2: any competitors in their space?

163
00:08:46,200 --> 00:08:49,679
Speaker 7: Well, returning to computext again, AMD came out. CEO Lisa

164
00:08:49,760 --> 00:08:53,920
Speaker 7: Sou said that AMD is not only competitive on the

165
00:08:53,920 --> 00:08:57,440
Speaker 7: technology front, but it's better because it has an open approach,

166
00:08:57,480 --> 00:09:00,240
Speaker 7: where in video wants to sell you everything in the

167
00:09:00,240 --> 00:09:03,120
Speaker 7: same way that Apple gives you proprietory everything and doesn't

168
00:09:03,120 --> 00:09:05,160
Speaker 7: want to include anybody else. That's the way in videos

169
00:09:05,160 --> 00:09:08,160
Speaker 7: approaching the business. AMD wants to be the Android or

170
00:09:08,160 --> 00:09:13,120
Speaker 7: the Google to Apple, and there was plenty of positive

171
00:09:13,120 --> 00:09:17,360
Speaker 7: reception for that in Taiwan. One of the luminaries, Johnny

172
00:09:17,360 --> 00:09:20,960
Speaker 7: she the chairman of Asus, called Lisa Sue the favorite

173
00:09:21,000 --> 00:09:24,720
Speaker 7: child of Taiwan, which might have heard Jensen Kwang feelings.

174
00:09:24,720 --> 00:09:27,679
Speaker 7: Intel also would say that it has faster accelerators and

175
00:09:27,760 --> 00:09:31,400
Speaker 7: better value. They old pitched their They all made their case,

176
00:09:31,400 --> 00:09:34,840
Speaker 7: they old pitch their products. We'll see if the biggest

177
00:09:34,880 --> 00:09:37,320
Speaker 7: customers are going to buy in, because a big part

178
00:09:37,360 --> 00:09:41,440
Speaker 7: of Video's revenue comes from those biggest US companies Meta, Google, Amazon,

179
00:09:41,480 --> 00:09:43,640
Speaker 7: who are making the multi billion dollar investments.

180
00:09:44,160 --> 00:09:46,960
Speaker 1: Yeah, okay, so that's interesting. What do you think the

181
00:09:47,320 --> 00:09:50,240
Speaker 1: reasoning is then for investors about how high in Video's

182
00:09:50,280 --> 00:09:53,160
Speaker 1: market cap could go then in terms of the future.

183
00:09:52,760 --> 00:09:56,760
Speaker 7: Path, I'm not really sure. I mean, one thing that's

184
00:09:56,800 --> 00:09:59,920
Speaker 7: really worth bearing in mind is as recently as far

185
00:10:00,120 --> 00:10:02,640
Speaker 7: years ago, and Video was a company that made gaming

186
00:10:02,679 --> 00:10:06,240
Speaker 7: graphics cards, which accidentally fell into being used by the

187
00:10:06,280 --> 00:10:09,959
Speaker 7: crypto industry. That was kind of the first trial balloon

188
00:10:10,040 --> 00:10:13,480
Speaker 7: for what happened with AI and how the graphics technology

189
00:10:13,960 --> 00:10:17,640
Speaker 7: showed itself really capable in doing different tasks and just gaming.

190
00:10:18,160 --> 00:10:20,880
Speaker 7: And when it comes to the scale of it, most recently,

191
00:10:20,880 --> 00:10:23,480
Speaker 7: and Video reported two points something billion dollars in gaming

192
00:10:23,520 --> 00:10:27,800
Speaker 7: revenue and then twenty something billion dollars in data center revenue.

193
00:10:28,160 --> 00:10:31,000
Speaker 7: How fast that revenue grows and how far that revenue

194
00:10:31,000 --> 00:10:33,000
Speaker 7: grows is probably goes to determine the share price. It

195
00:10:33,080 --> 00:10:33,840
Speaker 7: just seems to make.

196
00:10:33,720 --> 00:10:37,440
Speaker 2: Sense, okay, I mean, when it comes to gaming, it

197
00:10:37,440 --> 00:10:39,320
Speaker 2: looks like in Video one at least for now. Anyway,

198
00:10:39,480 --> 00:10:41,200
Speaker 2: Lat's have of our tech editor, thank you very much

199
00:10:41,240 --> 00:10:43,600
Speaker 2: for joining us on that news that in Video has

200
00:10:43,679 --> 00:10:46,360
Speaker 2: taken the crown as the world's most valuable company.

201
00:10:47,120 --> 00:10:50,160
Speaker 1: Well, Next, let's go to the UK election campaign and

202
00:10:50,320 --> 00:10:55,040
Speaker 1: a key Labor Party policy to change VAT on private

203
00:10:55,080 --> 00:10:57,560
Speaker 1: school fees. For the first time, Bloomberg has learned that

204
00:10:57,600 --> 00:11:00,319
Speaker 1: some private schools are warning the financial support for low

205
00:11:00,320 --> 00:11:03,559
Speaker 1: income students could be at risk if the plans are implemented.

206
00:11:03,600 --> 00:11:06,880
Speaker 1: Our reporter Tima Adebaya has been delving into this stoy

207
00:11:06,880 --> 00:11:09,360
Speaker 1: and she joins us now, Good morning, Tima. First, he

208
00:11:09,480 --> 00:11:13,240
Speaker 1: just remind us of the Labor Party proposal exactly and

209
00:11:13,280 --> 00:11:15,240
Speaker 1: also why it's come about.

210
00:11:15,520 --> 00:11:19,160
Speaker 8: So Labor are proposing to add a twenty percent VAT

211
00:11:19,360 --> 00:11:23,160
Speaker 8: levy onto private school fees. It's actually crucial to understand

212
00:11:23,360 --> 00:11:25,800
Speaker 8: exactly what they mean by this. They're not seeing it

213
00:11:26,320 --> 00:11:29,239
Speaker 8: as a new tax, but in their language, it's removing

214
00:11:29,280 --> 00:11:33,120
Speaker 8: an existing tax break from parents that send their children

215
00:11:33,160 --> 00:11:36,160
Speaker 8: to private school who don't currently have to pay VAT

216
00:11:36,400 --> 00:11:39,160
Speaker 8: on those fees. And for Labor, what this is all

217
00:11:39,200 --> 00:11:42,360
Speaker 8: about really is kind of leveling the playing field between

218
00:11:42,400 --> 00:11:45,720
Speaker 8: the state and private sectors when it comes to education.

219
00:11:45,880 --> 00:11:48,760
Speaker 8: So they're hoping that this new change could raise about

220
00:11:48,760 --> 00:11:52,280
Speaker 8: one point six billion in government funding. And that's a

221
00:11:52,320 --> 00:11:55,280
Speaker 8: statistic that's also been backed by the Institute for fiscal

222
00:11:55,320 --> 00:11:59,080
Speaker 8: studies and using that money they hope to funnel more

223
00:11:59,120 --> 00:12:02,240
Speaker 8: funding back in to the state education sector. They're looking

224
00:12:02,280 --> 00:12:05,800
Speaker 8: to recruit six five hundreds more teachers, they want to

225
00:12:05,840 --> 00:12:09,839
Speaker 8: improve mental health support for children in schools, so it's

226
00:12:09,880 --> 00:12:13,600
Speaker 8: really all about bolstering that funding into the state sector.

227
00:12:15,080 --> 00:12:17,880
Speaker 2: This is something though that there has been some criticism

228
00:12:17,920 --> 00:12:20,600
Speaker 2: of this proposal. Private schools and parents of children who

229
00:12:20,600 --> 00:12:22,360
Speaker 2: go to them aren't happy about And what have they

230
00:12:22,400 --> 00:12:23,600
Speaker 2: been saying about this idea.

231
00:12:23,840 --> 00:12:27,840
Speaker 8: Yeah, well, it's certainly one of Labour's more polarizing policies.

232
00:12:27,880 --> 00:12:30,360
Speaker 8: It's actually worth mentioning that it's not new. The Party

233
00:12:30,400 --> 00:12:32,880
Speaker 8: have been talking about this since at least the days

234
00:12:32,920 --> 00:12:35,800
Speaker 8: of Jeremy Corbyn and definitely before as well. But part

235
00:12:35,800 --> 00:12:38,240
Speaker 8: of the reason I think for such a strong reaction

236
00:12:38,440 --> 00:12:41,679
Speaker 8: is that this Vaight levee would be unprecedented and it

237
00:12:41,679 --> 00:12:45,160
Speaker 8: actually would set the UK apart in a global context

238
00:12:45,200 --> 00:12:48,720
Speaker 8: in terms of having a consumer tax on education and

239
00:12:48,800 --> 00:12:51,160
Speaker 8: also when you think of sort of the wiser educational

240
00:12:51,240 --> 00:12:54,880
Speaker 8: context of the UK, the independent school sector is used

241
00:12:54,880 --> 00:12:59,120
Speaker 8: to being left alone. Historically. The last government legislation regarding

242
00:12:59,160 --> 00:13:01,679
Speaker 8: the management of independent schools I think was in the

243
00:13:01,720 --> 00:13:04,120
Speaker 8: eighteen hundred, so it's been well over one hundred years

244
00:13:04,120 --> 00:13:08,280
Speaker 8: now of these schools having true independence in name and nature.

245
00:13:08,760 --> 00:13:11,120
Speaker 8: There is also one side of the argument, of course,

246
00:13:11,200 --> 00:13:14,600
Speaker 8: that says we're talking about a very small proportion of

247
00:13:14,640 --> 00:13:17,680
Speaker 8: the country here, so just seven percent of students in

248
00:13:17,679 --> 00:13:21,240
Speaker 8: the UK are privately educated and this change could stand

249
00:13:21,360 --> 00:13:23,480
Speaker 8: to raise a lot of well needed funds for the

250
00:13:23,480 --> 00:13:26,600
Speaker 8: state sector. But there has been backlash from parents. There's

251
00:13:26,840 --> 00:13:30,880
Speaker 8: a lobby group called Education Not Taxation. They've started a

252
00:13:30,920 --> 00:13:33,720
Speaker 8: petition in protest of this move that has more than

253
00:13:33,760 --> 00:13:38,800
Speaker 8: one hundred thousand signatures. And in terms of the representative

254
00:13:38,800 --> 00:13:41,520
Speaker 8: bodies in the sector, I spoke to the Independent Schools Council,

255
00:13:41,559 --> 00:13:45,480
Speaker 8: which represents about one four hundred private schools in the country,

256
00:13:45,520 --> 00:13:48,360
Speaker 8: and they say they're not actually sure how robust the

257
00:13:48,440 --> 00:13:51,199
Speaker 8: sector is and whether they could deal with this sort

258
00:13:51,200 --> 00:13:53,840
Speaker 8: of shock. They think some schools might have to close.

259
00:13:54,160 --> 00:13:56,520
Speaker 8: That just gives you a sense of the anxiety that

260
00:13:56,559 --> 00:13:57,920
Speaker 8: many are feeling within the sector.

261
00:13:58,200 --> 00:14:03,640
Speaker 1: Yeah, okay. Interesting. Also the issue around bursary programs being

262
00:14:03,840 --> 00:14:04,720
Speaker 1: at risk.

263
00:14:05,679 --> 00:14:07,800
Speaker 8: So the head teachers that I spoke to you for

264
00:14:07,880 --> 00:14:12,439
Speaker 8: this story are exploring a number of cost cutting alternatives.

265
00:14:12,480 --> 00:14:15,160
Speaker 8: They don't want to pass on that full twenty percent

266
00:14:15,600 --> 00:14:19,160
Speaker 8: increase to their parents because of anxieties about parents leaving

267
00:14:19,440 --> 00:14:21,560
Speaker 8: the sector, so they are looking at other ways to

268
00:14:21,640 --> 00:14:24,440
Speaker 8: absorb some of that cost, and something that kept coming

269
00:14:24,520 --> 00:14:27,920
Speaker 8: up is bursaries. So at the moment, the Independent Schools

270
00:14:27,920 --> 00:14:31,280
Speaker 8: Council says about one third of all students in private

271
00:14:31,280 --> 00:14:34,440
Speaker 8: schools receive some sort of fee assistance, So that's five

272
00:14:34,520 --> 00:14:37,800
Speaker 8: hundred and sixty thousand pupils and on average they're getting

273
00:14:37,840 --> 00:14:41,000
Speaker 8: about thirteen thousand pounds a year, which is three quarters

274
00:14:41,120 --> 00:14:43,560
Speaker 8: of the average private school fees. So it's a big

275
00:14:43,600 --> 00:14:46,840
Speaker 8: proportion of the cost. And apparently schools are having to

276
00:14:46,920 --> 00:14:50,960
Speaker 8: make difficult choices about whether to continue with that sort

277
00:14:51,000 --> 00:14:54,680
Speaker 8: of fee assistance, and there is anxiety about whether those

278
00:14:54,880 --> 00:14:58,280
Speaker 8: children will be able to remain in these independent schools

279
00:14:58,320 --> 00:14:59,320
Speaker 8: without that assistance.

280
00:15:00,000 --> 00:15:02,680
Speaker 2: The key element of your reporting on this story, Tea,

281
00:15:02,960 --> 00:15:04,880
Speaker 2: talk to us about the big picture, how could the

282
00:15:04,880 --> 00:15:07,760
Speaker 2: policy change affect the wider educational landscape in the UK.

283
00:15:08,440 --> 00:15:11,160
Speaker 8: So the central argument here on behalf of a lot

284
00:15:11,200 --> 00:15:14,320
Speaker 8: of the independent sector is that there will be a

285
00:15:14,400 --> 00:15:17,360
Speaker 8: sort of mass exodus. As the CEO of the Independent

286
00:15:17,400 --> 00:15:20,080
Speaker 8: Schools Council Julie Robinson described to me there'll be this

287
00:15:20,200 --> 00:15:23,960
Speaker 8: huge exit of students from the independent sector into the

288
00:15:23,960 --> 00:15:27,520
Speaker 8: state sector, which could end up overwhelming the state sector.

289
00:15:27,560 --> 00:15:30,560
Speaker 8: For what it's worth, the Independent the Institute for Fiscal

290
00:15:30,600 --> 00:15:33,360
Speaker 8: Studies don't agree with this point, and they think that

291
00:15:33,480 --> 00:15:37,600
Speaker 8: even after accommodating those extra children in the state sector,

292
00:15:37,960 --> 00:15:40,040
Speaker 8: there would still be an extra one point three to

293
00:15:40,080 --> 00:15:43,280
Speaker 8: one point five billion left for the government to spend

294
00:15:43,480 --> 00:15:48,680
Speaker 8: and funnel back into funding classrooms and funding more programs

295
00:15:48,800 --> 00:15:52,720
Speaker 8: for children in the state sector. So that's the real story.

296
00:15:52,720 --> 00:15:56,880
Speaker 8: They're the real anxiety on some people's behalf. But the

297
00:15:57,120 --> 00:15:58,800
Speaker 8: head teachers that I spoke to you, a lot of

298
00:15:58,840 --> 00:16:01,680
Speaker 8: them said that this policy end up making the independent

299
00:16:01,720 --> 00:16:05,840
Speaker 8: section more elitist as well.

300
00:16:06,000 --> 00:16:08,720
Speaker 2: This is Bloomberg Daybreak Europe, your morning brief on the

301
00:16:08,800 --> 00:16:11,840
Speaker 2: stories making news from London to Wall Street and beyond.

302
00:16:12,120 --> 00:16:15,320
Speaker 1: Look for us on your podcast feed every morning, on Apple,

303
00:16:15,440 --> 00:16:18,120
Speaker 1: Spotify and anywhere else you get your podcasts.

304
00:16:18,200 --> 00:16:21,200
Speaker 2: You can also listen live each morning on London Dab Radio,

305
00:16:21,240 --> 00:16:23,960
Speaker 2: the Bloomberg Business app, and Bloomberg dot Com.

306
00:16:24,000 --> 00:16:26,760
Speaker 1: Our flagship New York station is also available on your

307
00:16:26,800 --> 00:16:31,480
Speaker 1: Amazon Alexa devices. Just say Alexa Play Bloomberg eleven thirty.

308
00:16:31,720 --> 00:16:34,400
Speaker 2: I'm Caroline Hipka and I'm Stephen Carroll. Join us again

309
00:16:34,440 --> 00:16:37,000
Speaker 2: tomorrow morning for all the news you need to start

310
00:16:37,040 --> 00:16:43,640
Speaker 2: your day right here on Bloomberg Daybreak Europe