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Calendar of main economic events, 1988.

CALENDAR OF MAIN ECONOMIC EVENTS, 1988 The dates indicate when the events were reported in the Press. All events refer to the United Kingdom unless otherwise stated

January 6 Joint foray into foreign exchange markets by

European and North American banks to boost dollar.

Soviet Union re-enters international public bond

market after 70 years absence. 9 20 Yorkshire coal mines halted by striking miners

over re-deployment of three coal-face workers.

13 White Paper on government financial aid to industry

outlines widespread changes, including ending

regional grants and increasing support for small and

medium-sized companies, and for technology.

15 Unemployment at lowest level for five years in


16 Inflation down to 3.7 per cent. US trade deficit falls

to $13.22 billion, leading to rising dollar and share

prices on world financial markets.

19 France resumes its privatisation programme,

suspended in October after world's stock markets crash.
21 White Paper on Public Spending published.
27 UK holds back 10 million pounds contributions to UN Food

and Agriculture Organisation because it is

dissatisfied with management.

30 Weekend overtime ban followed by 24-hour strike by

pit deputies threatens widespread disruption to coal


February 1 US Congressional Committees begin public

hearings into October's stock market crash. Securities

and Exchange Commission to release its report

about events of October 19.

National strike by Ford workers averted by improved

three-year pay and conditions offer.
 2 Banks' base rates rise to 9 per cent.
 3 US banks cut prime rate to 8.5 per cent.
 4 British Coal end closed shop agreement with pit

deputies union, NACODS. 5 Mr Baker confirms decision to scrap Inner London

Education Authority in 1990.

US budget deficit is forecast to exceed $30 billion.
 9 Total strike of Ford workers at Dagenham.
10 House of Commons vote to allow TV coverage in


12 National Union of Seamen fined 7,500 pounds and

approximately 100,000 pounds costs for failing to call off previous

week's ferry strike.

17 Treasury announces PSBR surplus of 6.9 billion pounds in

ten months of current financial year.

18 Electricity price rise of 15 per cent is criticised in a

report commissioned by the CBI.

19 Midland Bank reports loss of 505 million pounds for 1987

due to bad debts of Third World.

Planned reforms of Civil Service announced by

Prime Minister, involving management by

semi-independent agencies.

24 BP gives go ahead to take control of Britoil, in

exchange for undertakings about development of

North Sea assets and Scottish employment.

25 Barclays Bank makes 713 million pounds charge to 1987

accounts to cover doubtful loans to Third World

countries. Pre-tax profits declared 339 million pounds.

29 Prescription charges increased to 2.60 pounds per item

from April 1.

March 2 British Aerospace in talks to purchase 99.2 per cent

of Rover vehicle group.
 4 Launch of Social and Liberal Democrat party.
 5 South of Scotland Electricity Board announces that it

will buy no more British coal after the end of the

month unless a big price reduction is made. 7 NUM miners vote to end their 6-month national

overtime ban.
 8 Large oil find in North Sea by Enterprise Oil.
10 From midnight, councils to be prevented from selling

assets such as town halls and leasing them back, to

circumvent spending controls.

12 Kuwait Investment Office increases its stake in BP

to 21.28 per cent, despite British government's

imposition of a 20 per cent ceiling.
15 Sharp rise in producer prices in February.
16 Budget: Estimated full year
 effect million pounds

Income tax, basic rate down 2 per

cent to 25 per cent, single top

rate of 40 per cent over 19,300 pounds.

Increase in allowances by double

the inflation rate, including single,

married and age allowances.

Housekeeper, dependent

relative, and daughter's

allowances are abolished -4,735

Capital gains tax; any gains

before March 31 1982 to be

exempt, new base date from

April 6 1988.

Thresholds reduced, gains to be

taxed at marginal tax rates. +70

Inheritance tax, four rates

replaced by flat rate of 40 per

cent, threshold rises from

90,000 pounds to 110,000 pounds. -120

Other tax changes, including

ending of forestry expenditure

deductions, doubling company

car tax, etc. -75

Excise duties:
 Petrol/derv +350
 Tobacco +100
 Alcohol +105
 Other +10

Output forecast to rise by 3 per cent in 1988. PSBR

for 1988/9 set at -3 billion pounds equal to -3/4 per cent of

GDP. Expected net repayment of 3 billion pounds. Zero

PSBR assumed for Medium Term Financial Strategy

up to 1991/2. MO Target range 1-5 per cent.

18 Bank base rate cut to 8.5 per cent. Pounds rises above

DM 10 on foreign exchange markets.

Ford of America abandons plans to build a 40

million pounds electronic components plant at Dundee because

of failure to reach a single-union agreement.
29 Seamen cancel national strike ballot.
31 Halifax and Lloyds reduce mortgage rates by 1/2 per

cent. Pound rises sharply as Chancellor defends

exchange-rate policy.

Leyland Bus sold by buy-out team to Volvo group.

April 6 Serious fraud office launched, to crack down on City

and other complex frauds. 7 Bank of England intervenes in foreign exchange

markets as pounds threatens to breach the DM 3.14 level. 8 New York stock exchange has raised minimum

capital requirements for specialist investors. 9/10 Base rates cut to 8 per cent in attempt to stem rise

of pounds. Wall Street reaches highest level since October


12 Sterling falls against DM as dollar gains.

Confusion over OPEC plan grows as oil prices rise.

14 G7 nations (US, Japan, West Germany, France,

UK, Canada and Italy) restate commitment to close

economic policy co-ordination and stable $.
15 Extension of rebates to the Poll tax announced.
18 National savings made lowest contribution to

government funding (2.03 billion pounds) for ten years.
20 Teachers' pay increased by 4.25 per cent.
21 Nurses' pay to rise by at least 15 per cent.
26 Poll tax bill passes third reading with majority of 63.
27 Nestle launches hostile bid for Rowntree.
28 Concessions worth 100 million pounds announced to

alleviate problems created by changes to housing


May 3 Oil prices drop after OPEC talks fail to produce pact

and cut production. 4 NUS ferry strike continues despite sequestration of

its 2.8 million pounds assets. 5 Government asks Monopolies and Mergers

Commission to investigate implications of Kuwait

Investment Office's 22 per cent stake in BP for British

public interests. 6 Labour increases hold on local councils in England

and Wales, mainly at expense of Social and Liberal


House prices rose by over 20 per cent in last financial

year (biggest rise for almost ten years). 9 Sterling rises against DM despite attempts by Bank

of England to stem its advance.
11 Electricians' Union EETPU to ballot on TUC rules.
12 US banks raise prime rate.
13 Ports blockade by lorry drivers ended, and NUS

orders its members to abandon secondary action.

14 Sterling jumps to highest level for more than two


18 Base rate cut to 7.5 per cent. Mrs Thatcher publicly

supports Mr Lawson's policy on sterling.
21 Inflation rises to 3.9 per cent.
26 Lord Young rules that there are no grounds to refer

the Rowntree case to Monopolies and Mergers


27 Soviet Central Committee proposals to promote

greater democracy with ten-year limit on Communist

Party jobs.

Suchard make hostile counter-bid for Rowntree.

 3 Base rate increased to 8 per cent.
13 President Mitterand fails again to secure Socialist


Plans for five new technical colleges to meet skill

shortages in science and technology.

14 Serious Fraud Office brought in to investigate Barlow

Clowes funds.
15 Dollar surges on sharp cut in US April trade deficit.
16 Peter Clowes of Barlow Clowes appears in court on

fraud charges.
19 14th World Economic Summit opens in Toronto.
22 Treasury to limit effects of VAT on construction.

Bundesbank raises key interest rate to ease inflation.

Committee set up to look at the preparation of the

National Accounts.

23 Brazil and its creditors agree debt rescheduling and

new loans package.

TUC faces split after vote on suspension of EETPU.

24 Rowntree accepted Nestles offer of 2.55 billion pounds for


Dollar closes at eight-month high.

27 Mrs Thatcher restates opposition to creation of

European central bank at Hanover Summit.

29 Base rates rise to 9.5 per cent following higher trade


30 Harland and Wolff shipyard put up for sale by

Northern Ireland Office.

July 4 British university heads agree a pricing system which

could mean charging outside bodies for research. 5 Khomeni calls for war after US Airbus tragedy.

Base rates rise to 10 per cent (fifth rise in five weeks)

7 Explosion and fire on North Sea Piper Alpha rig.

About 190 missing, 73 survivors reported.

British Steel declared 410 million pounds profit. British Rail

declared best year since 1948, with trading surplus

of 291 million pounds. 8 British Telecom to freeze domestic prices until

August 1989.

Proposal by Environment Secretary for government

to have more control over borrowing by authorities.

12 Intervention by central banks fails to halt rise in


16 Dollar rises as US trade deficit rise is less than


19 Banks raise base rates to 10.5 per cent.

Rover group to shut Cowley works at Oxford and

Llanelli Pressings in Wales with loss of 3,400 jobs.

22 Building societies increase home loan rates to 11.5

per cent from August 1.

26 Ministerial re-shuffle announced, Department of

Health separated from Social Security with a Minister

for each.

30 Education Act becomes law, providing for

introduction of national core curriculum and allowing schools

to opt out of local authority control.

August 2 Argentina's banks close as government prepares

to announce new measures to bolster foreign

confidence. 3 Government announces plans to create a market in

short-term Treasury bills denominated in ECUs.
 9 Base rate rise to 11 per cent takes city by surprise.
10 The US Federal Reserve Board moves against

inflation by raising discount rate to 6.5 per cent.

20 Peace agreement ratified between Iran and Iraq.

20/21Inflation rate rises to 4.8 per cent with no sign of

break in upward trend.

26 Rise in base rate to 12 per cent after publication of

Britain's worst ever monthly trade deficit.

31 24-hour national strike by Post Office workers in

protest at pay supplements for recruits in the south


 2 Bank intervenes to brake sharp fall in sterling.
 5 Postal dispute halts much foreign mail.
 6 Sharp rise in UK retail sales adds to inflation fears.
 8 M Delors addresses the TUC.
 9 Mr Lawson opposes tax plans of EEC single market.
12 France joins UK in opposing VAT plan.
13 High borrowing costs fail to slow retail sales.
14 Post Office deal produces sluggish return to work.
15 Sharp cut in US trade deficit prompts rise in dollar

and bond prices.

Abolition of the Training Commission.

23 IMF warns dollar rise may slow US deficit reduction.

24/25Home loans fall shows housing market may have


27 Central bankers act to underline policy by curbing

dollar rise.

30 Mr Kinnock is re-elected as Labour leader.

October 5 Kuwait Investment Office given 12 months to sell half

of its $3 billion stake in British Petroleum. 6 Oil prices drop as oil production reaches eight-year


10 John Smith, Labour Party Shadow Chancellor,

suffers a heart attack.

11 National Westminster and Midland banks announce

plans to become members of both Visa and

Mastercard credit organisations.

12 Transport Secretary announces transport initiatives

involving private sector in roads and rail links.

Government to impose a 15.3 per cent pay award on

487,000 nursing staff without union agreement after

prolonged talks failed.
13 Coal is to be privatised after next election.
18 US offers $3 billion surprise loan package to Mexico.
24 OPEC meeting fails to lead to agreement over

production sharing. 29/30Hill Samuel, city merchant bank owned by TSB, has

foiled a sophisticated 57 million pound fraud.

November 2 Back-bench rebellion over planned introduction of

charges for eye and dental check-ups. 4 House price increases slowed in October rising by

only 1.5 per cent. Fewer new houses being built and

1/3 drop in demand for mortgages.
 9 Mr George Bush wins US Presidential election.
10 Government proposes to make subsidised loans

available to students.

17 Ms Benazir Bhutto's Pakistan People's Party wins

Pakistan election.
19 Inflation rises to 6.4 per cent.
20 State opening of Parliament. Privatisation proposals

for electricity and water, and various smaller bodies,

for example, Girobank, Scottish Bus, Harland and

Wolff and Short Bros.
24 Steel shares offered at 1.25 pounds.
25 Mr Moore, Social Services Secretary, announces

200 million pounds extra benefits for pensioners.

26 Trade deficit for October reaches 2.4 billion pounds, leading

to further rise of 1 per cent in interest rates.

29 US commercial banks raise prime lending rates to

10.5 per cent.

30 Three-day week proposed by British Rail, with shifts

of 13 hours for track maintenance staff.

December 2 British Steel privatisation, heavily over-subscribed.

Preliminary figures show growth rate of 7.75 per cent

for M0. 6 Government announces plans to abolish wages


Government White Paper `Employment for the

1990s' published. 7 Morgan Grenfell announces closure of its UK

securities business, with the loss of 450 jobs, due to

mounting losses. 8 Mr Gorbachev announces unilateral cuts in troops,

tanks, artillery and combat aircraft worldwide.

The closure of North East Shipbuilders confirmed by

the government. This will result in the loss of 2,000

jobs, and follows the failure to find a buyer in the

private sector. 9 Massive earthquake in Armenia resulting in tens of

thousands of deaths.

Talks on world farm reform fail at meeting of trade

ministers in Montreal.
12 Three-train collision in south London.
17 Edwina Currie resigns over salmonella storm.
20 Support of egg industry to cost government 19

million pounds.

22 Pan Am jumbo jet crashes on Lockerbie in Scotland

with loss of 258 lives.

28 US to impose trade sanctions of $100 million on EEC

exports. This is in retaliation for an EEC ban on

hormone-treated US meat. North Sea oil output cut

by 10 per cent after oil-collecting platform broke

loose, causing shut-down of three oil fields.
29 Pay settlements reach 7 per cent as inflation rises.
30 Higher mortgage rates announced, up to 13.75 per


British Rail announces package of pay-related

measures including performance-linked bonuses in

the south east to counteract staff shortages.



Many official British statistics have been rebased on 1985 prices and weights and there have been other changes as well. In so far as possible these have been taken into account. In some cases earlier data, usually prior to 1980, have been estimated by `linking' the previously published (1980-based) figures to the new ones. Our estimates will be replaced by the official ones as soon as the latter become available.

Country groups Unless otherwise stated, country groups are constitued as follows: OECD: Canada, France, Germany, Italy, Japan, United Kingdom, United States and other OECD. Other OECD: Australia, Austria, Belgium-Luxembourg, Denmark, Finland, Greece, Iceland, Irish Republic, The Netherlands, New Zealand, Norway, Portugal, Spain, Sweden, Switzerland and Turkey. (Note: Germany refers to West Germany throughout.) OPEC: Algeria, Ecuador, Gabon, Indonesia, Iran, Iraq, Kuwait, Libya,

Nigeria, Qatar, Saudi Arabia, United Arab Emirates and Venezuela. Centrally planned: Albania, Bulgaria, China, Czechoslovakia, East

Germany, Hungary, Mongolia, North Korea, North Vietnam, Poland,

Romania and the Union of Soviet Socialist Republics. UK=United Kingdom; GB=Great Britain. LDC's: All non-OECD countries excluding OPEC and centrally planned.

Valuation of imports and exports Imports are valued c.i.f. and exports and re-exports f.o.b., unless otherwise stated.

Seasonal adjustments A number of monthly and quarterly series have been adjusted to eliminate the estimated normal seasonal variations. All seasonally adjusted series must be regarded as containing a margin of uncertainty, depending on the extent to which seasonal variations can be shown to have been regular in the past. The statistical appendix contains information available to NIESR up to Feb. 10, 1989.
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Title Annotation:Great Britain
Publication:National Institute Economic Review
Article Type:illustration
Date:Feb 1, 1989
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