Political monitor uk may 12th 2025 edition 160355425509
Published: 12-May-25 | By APSCo UK
Public Policy
Political Monitor UK | May 12th, 2025 Edition
Today Starmer unveiled a tougher immigration policy with more challenging English language tests for applicants and dependants, a longer route to settled status and a promise to cut recruitment of overseas care workers. Read the press release published yesterday here and APSCo’s Press Release.The White Paper will be introduced in Parliament later today.
Last week, Donald Trump announced a major new US-UK trade deal, hailed as “historic” by both Trump and Prime Minister Starmer, with provisions for tariff-free UK exports, expanded US agricultural access, and the promise of deeper technology ties — while further negotiations with China and other countries are forthcoming.
Cavendish has distributed a briefing note on the trade deal which can be accessed here.
The UK also secured a landmark trade deal with India that slashes tariffs on key British exports — including whisky, cosmetics, and medical devices — unlocking £4.8 billion in added GDP and £2.2 billion in annual wage growth, while boosting bilateral trade by £25.5 billion and giving UK firms a major edge in one of the world’s fastest-growing economies.
Other Key News
The Bank of England has cut interest rates to 4.25% amid sluggish economic growth and fears over Trump’s trade war, signalling cautious easing ahead despite inflation concerns and projecting near-stagnant UK growth through 2025.
Yvette Cooper hasannouncedthat Government reforms will restrict skilled worker visas to positions requiring graduate-level qualifications, while employers will be granted only short-term access to visas for lower-skilled roles - and only where there are workforce shortages alongside clear strategies to train and hire domestic UK staff.
Northern Irish Economy Minister Dr. Caoimhe Archibald has unveiled plans for a major update to employment law, focusing on improved worker protections, fair wages, and modernized frameworks to benefit both workers and employers.
Welsh First Minister Eluned Morgan has said she is “losing patience” with UK Labour and will shift her Government further to the left ahead of next year’s Senedd elections, urging Keir Starmer to reconsider welfare cuts and respect Welsh devolution as Labour faces historic polling lows in Wales.
Reform UK madesweeping gains in England’s 2025 local elections—winning 10 councils, topping the vote share, and securing both new mayoralties—while Labour and the Conservatives suffered historic losses, and the Liberal Democrats and Greens made significant advances.
Cavendish has distributed a briefing note on the results of the local elections and what this means for businesses which can be accessed here.
Parliament & Regulation
Thursday 15 May: Business Questions to the Leader of the House, and Oral Questions on the potential value of the global market for creative content from the UK for use in training artificial intelligence models, led by Lord Black of Brentwood (Conservative).
The Bill has moved to the Committee Stage in the Lords, which began on Tuesday 29th April. The full list of proposed amendments to the Bill as they currently stand can be found here.
The Guardian reports that the Bill could improve the party’s standing among voters, though low awareness of the reforms remains a challenge.
The Bill passed its Report stage in the House of Commons on Wednesday 7th May.
Ministers are reconsidering their plans for changes to UK copyright law, including the controversial opt-out system, after criticism from creators and artists, with a focus now on finding solutions that balance AI development and protection for copyright holders.
The National Institute of Economic and Social Research (NIESR) warns that weak domestic growth and persistent inflation will derail Chancellor Rachel Reeves’ budget plans, potentially triggering further tax rises and spending cuts this autumn.
Demand for AI and green jobs in the UK is accelerating a shift from traditional degrees to skill-based hiring, with employers increasingly valuing practical competencies over academic qualifications to fill high-growth, high-wage roles.
The Health and Social Care Committee warns that failure to reform adult social care imposes immense hidden human and financial costs and urges Government to properly measure and address these inaction costs to enable meaningful, value-driven reform.
Germany
Germany's mainstream parties (CDU, SPD, and CSU) have signed a coalition agreement, with Friedrich Merz having become Chancellor on May 6, 2025, inheriting significant economic and political challenges, including reviving the economy and managing security concerns amidst global instability.
The coalition agreement between CDU, CSU, and SPD outlines key reforms in tax policy, labour market, infrastructure, energy, and technology aimed at boosting Germany's economic competitiveness, with a focus on reducing bureaucracy and investing in green technologies, though its effectiveness will depend on successful implementation.
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