Will tanks set up Ukraine for a spring offensive?

Ukrainian soldiers will face a steep learning curve when they clamber into a Leopard 2 tank for the first time next month. But the new tanks will be a serious upgrade from the Soviet-era models they have been fighting in over the past year.

“It’s like you have a car from the 1950s and then you sit in a Porsche,” says a person involved in organising training for Ukrainian troops.

The German government’s decision this week to send Leopard 2 tanks to Ukraine — and allow other European capitals to do the same — will give the Ukrainian army vital new firepower as it sets out to liberate its country from Russian occupation.

With Ukrainian forces having made some decisive advances before winter set in, Kyiv and its allies are now racing to establish the new tank force in time for a possible offensive later this spring.

However, it could take several months for the bulk of the force to arrive, and it could be considerably smaller than Kyiv had hoped. Some military analysts fear that western tanks may not prove to be the game changer that many Ukrainians and their supporters imagined — even if the Ukrainians are talking up the potential.

“The question is whether 100, 150 is enough. Well, it’s enough to make a big difference,” says Andriy Zagorodnyuk, a former Ukrainian defence minister.

For months, Berlin and other western capitals had rebuffed Kyiv’s pleas for western main battle tanks, saying they were too difficult for Ukrainian forces to maintain and risked provoking Moscow. After prevaricating for weeks in the face of mounting pressure from allies, German chancellor Olaf Scholz acquiesced after securing a US promise to send Kyiv some of its own M1 Abrams tanks.

The policy shift was another pivotal moment for Ukraine’s allies as they reassess Ukraine’s changing military needs and adjust their own calculations about escalatory risk. It prompted celebrations in Kyiv where the slogan “freeing the Leopards” — the most widely available modern battle tank — has become a proxy for the west’s willingness to stand behind Ukraine all the way to victory.

Ukrainian president Volodymyr Zelenskyy hailed the German and US moves to unlock an international tank coalition as a historic achievement. But he immediately questioned the scale of the commitment.

“The key thing now is speed and volume,” he said.

Ukraine says it needs 300 western heavy tanks to seize back its territories. It needs them fast to conduct a widely expected offensive this spring and to help fend off a possible Russian attack before then.

US President Joe Biden
Joe Biden: ‘To liberate their land, [Ukrainian soldiers] need to be able to counter Russia’s evolving tactics and strategy on the battlefield in the very near term’ © Andrew Caballero/AFP/Getty Images

US president Joe Biden laid out the reasons why Ukraine needed modern tanks as he confirmed plans to send 31 M1 Abrams on Wednesday.

“To liberate their land, they need to be able to counter Russia’s evolving tactics and strategy on the battlefield in the very near term. They need to be able to improve their ability to manoeuvre on open terrain,” he said. “And they need an enduring capability to deter and defend against Russia’s aggression over the long term.”

Tactical knowledge

The Abrams may be the fastest mass-produced heavy tank in the world, but it will be slow to arrive in Kyiv. The contingent of 31 is coming directly from the manufacturer using a US government funding facility and could take several months, if not longer, to be deployed. That gives plenty of time for training and potentially a long-term commitment of US armour in Ukraine. But it will count little in the battles of 2023.

In the meantime, Ukraine will receive two battalions of Leopard 2s and one company of British Challenger 2s, making a total of about 100 tanks.

German defence minister Boris Pistorius, who is now leading the effort to assemble a fleet of Leopard 2s from multiple European armies, says they will be delivered to Ukraine in two phases: a first battalion of 40 Leopard 2s, including 14 from Germany, in about three months and a second batch of an older version of Leopard 2s, including 14 from Poland, later on. Spain could end up being one of the largest contributors to this second group, but it intends to draw on older Leopard 2s that have been mothballed and kept in storage for 10 years.

Graphic describing the main specifications of four main battle tanks from different countries

Finland, the Netherlands, Portugal and Canada are also expected to contribute.

Before they can take to the battlefield, there needs to be substantial training not just for tank crew but also for repair, maintenance and sustainment units. Logistical support and supply chains also need to be put in place.

A tank crew will require a minimum of five to six weeks of basic training, according to the International Institute for Strategic Studies. But Ukrainian forces have shown they can adapt quickly to multiple weapons systems provided by the west.

“Ukrainian soldiers are known as fast-learners,” says Oleksiy Melnyk, co-director of the Razumkov Centre think-tank in Kyiv. After a year of war, Ukraine now has some of the most experienced tank operators in the world.

A demonstrator holds a sign reading ‘Free Leopards now!’
‘Freeing the Leopards’ has become a proxy for the west’s willingness to stand behind Ukraine all the way to victory © TNN/dpa

However, making use of the new tanks is not just about acquiring the technical knowhow. It will also require tactical training — learning how to exploit the advantages of western battle tanks such as their superior armour, firing range and targeting.

To make the most of the firepower and to offset their vulnerabilities, tanks need to integrate with infantry, artillery, air defence and electronic warfare systems — so-called combined arms manoeuvre. The US began combined arms training for Ukrainians at its Grafenwoehr training area in Bavaria this month.

“There are some units of land forces which are already operating as combined arms groups,” says Zagorodnyuk. “So it’s not like Ukraine will start completely from scratch. But there is a lot of learning that needs to take place.”

Ukraine’s allies are not just donating tanks but hundreds of infantry fighting vehicles, self-propelled howitzers and other artillery pieces. This gives Ukraine the opportunity to learn how to integrate all this new equipment into offensive operations — assuming it can spare enough troops from frontline duties.

“It means we can train coherent units at the same time,” says Yohann Michel, of the IISS. “We need to make sure the Ukrainians can make the best use of it.”

German Chancellor Olaf Scholz in front of the battle tank Leopard
German chancellor Olaf Scholz this week acquiesced to send Leopard 2 tanks to Ukraine after securing a US promise to send Kyiv some of its own M1 Abrams tanks © David Hecker/Getty Images

Coordinating donations of tanks, artillery, armoured vehicles and the training to combine all three would require a “very, very heavy lift” by Ukraine and its allies, according to Mark Milley, America’s top general.

Ukrainian officials have been vocal about their desire to launch a spring offensive while it has momentum and before Russia has a chance to regroup and train the hundreds of thousands of troops it has mobilised.

Avenues of attack

Western officials and many analysts expect Kyiv to try to regain the initiative and exploit the heavy losses that Russian forces appear to have suffered in the fierce battles around Soledar and Bakhmut in eastern Ukraine. However, it is unclear how many casualties Ukrainian forces have also sustained in the fighting around Bakhmut and how many additional troops Kyiv has kept back for a counter-offensive. Military experts contends that for an offensive to succeed, attacking troops need to outnumber defensive ones by three to one.

One place where Ukraine could try to attack is along the Svatove-Kreminna line, a stretch of the front in the Luhansk province. A major breakthrough there could threaten Russia’s north-south supply routes to its forces trying to seize the rest of Donetsk province — one of Vladimir Putin’s main objectives for the war.

A much bigger prize for Kyiv would be to push southwards into Zaporizhzhia province all the way to the Azov sea, severing Russia’s so-called land bridge to occupied Crimea.

Either of these directions would be through open terrain, where mechanised force would be indispensable, as opposed to the more urbanised Donetsk province.

Ukrainian servicemen fire a mortar toward Russian positions on a frontline near the town of Soledar in Donetsk region
Ukrainian forces in action near Soledar. Western officials expect Kyiv to exploit the heavy losses that Russian forces appear to have suffered in the battles around this town in eastern Ukraine © Radio Liberty/Serhii Nuzhnenko via Reuters

But the Russian defensive lines along both of these axes are likely to be more formidable than anything that Ukraine has so far overcome. In the meantime, it could be the Russians who attack first. Moscow has been holding back about half of the 300,000 troops that it mobilised in the autumn and, having given them some training, they could be more effective than the first 150,000 thrown into the fight.

“Heading into 2023, Ukraine no longer has a manpower advantage and difficulties lie ahead,” says Michael Kofman, director in the Russian studies programme at CNA, a think-tank. “This will require large numbers of armoured fighting vehicles and to a much lesser extent tanks. Consequently it is a numbers game, where more is more.”

Mykola Bielieskov, an analyst at Ukraine’s National Institute for Strategic Studies, says tanks integrated with artillery and infantry would be vital to any Ukrainian offensive or defensive operation. How many western tanks Ukraine needs depends on the sequence of events on the battlefield, he says. If Russia attacks first and is then weakened, giving Ukraine a counter-attacking opportunity, Kyiv will need fewer. If Ukraine embarks on its own offensive, it would need more because it would first need to break through enemy lines and then conduct a second phase of enveloping and destroying Russian troops.

Seizing a defensive position ultimately involves getting infantry into trenches, says Rob Lee, senior fellow at the Foreign Policy Research Institute, adding that the key is getting your soldiers across open terrain protected from artillery fire. “It hasn’t really changed that much in warfare since the second world war or before that.”

“In some ways the deliveries of Bradleys, or Marders or Strykers and those types of [infantry fighting] vehicles may be even more significant,” says Lee. The upgrade in Ukrainian capability from a Soviet-era armoured vehicle to a US-supplied Bradley may be greater than that from a shift from T-72 to Leopard tank.

“We shouldn’t jump to conclusions that tanks by themselves will win this war,” he says. “But they are an important contribution, and they’ll give Ukraine a better chance of success in 2023 and in 2024.”

Business complains Hunt’s UK growth plan lacks new policies

Business lobby groups on Friday criticised a keynote speech by chancellor Jeremy Hunt about the government’s plan to boost economic growth, complaining it offered no new policies.

Hunt used the speech to highlight the government’s “plan for growth”, and its focus on the “four Es” of enterprise, education, employment and everywhere — a reference to reducing regional inequalities.

He also signalled that the Budget on March 15 would not contain big tax cuts, despite calls from some Conservative MPs, because of the need to focus on curbing high inflation.

With the UK braced for recession, Hunt acknowledged the country had major weaknesses including poor productivity, a skills gap and low business investment.

But he said talk of “declinism about Britain is just wrong”, adding the UK had big opportunities to use regulatory freedoms stemming from Brexit to boost sectors including technology, life sciences, clean energy, creative industries and advanced manufacturing.

Speaking to executives from companies including Meta, Microsoft, Amazon, Apple and Google, Hunt said: “I want to ask you to help turn the UK into the world’s next Silicon Valley.”

He went on to say the government recognised the need for lower taxes in the medium to long term.

He also indicated he was focused on solutions to UK labour shortages, saying he wanted people who retired early during the Covid pandemic to return to work. “Britain needs you,” he said.

But Kitty Ussher, chief economist at the Institute of Directors, complained Hunt did not have any new policies to announce, saying the speech was “E for empty”.

She said there was a “gap in the chancellor’s rhetoric”, adding: “While of course we should seek to ensure that firms operating at the frontier of new technology can come to Britain and thrive, our future growth path also depends on the many millions of individual decisions taken by leaders of smaller businesses across all sectors.”

Shevaun Haviland, director-general of the British Chambers of Commerce, said that beyond some existing pledges — including using reform of EU-era insurance regulations known as Solvency II to unlock infrastructure investment — “there was very little meat” in Hunt’s speech.

Stephen Phipson, chief executive of Make UK, which represents manufacturers, said there were some “hugely damaging big-picture issues caused by the absence of an industrial strategy, which are impacting on some of our strategic sectors”. 

Craig Beaumont, chief of external affairs at the Federation of Small Business, suggested the test for Hunt would be whether the ideas in his speech turned into policies in the March Budget, “when we hope he follows today’s bark with a bite”.

Tony Danker, CBI director-general, said Hunt had rightly “shifted gear to renew his focus on growth”.

“And we hope the Budget in less than two months will show strong actions to move us forward,” added Danker.

After the speech, Hunt met with a group of tech founders and investors to talk about ways to boost innovation in the UK.

Romi Savova, chief executive of PensionBee, a financial tech group, said that while “fintech was acknowledged as a top priority, actions speak louder than words”.

“We have yet to see concrete next steps on the UK’s data protection approach, open banking is falling behind on an international scale and the lack of a pension switch guarantee continues to keep the pensions sector in the dark ages,” she added.

Tim Pitt, partner at Flint Global and a former adviser to Philip Hammond as chancellor, said Hunt’s speech was a “refreshing balance of realism and optimism”, “identifying areas [of] policy [that] can make a difference”.

Hunt insists HS2 rail line will terminate in central London

Chancellor Jeremy Hunt has insisted the High Speed 2 railway will finish in central London as officials at the project connecting the capital and northern England examine measures to prevent a further surge in costs.

The estimated price tag for Britain’s biggest infrastructure scheme has soared from £33bn to more than £100bn since it was first conceived a decade ago, prompting alarm within the Treasury where ministers are determined to prevent further cost escalation.

As a result, senior figures inside the Department for Transport and HS2 have discussed solutions ranging from dropping the surviving stretch of the eastern second leg of the project or axing the redevelopment of Euston station in central London, where costs have risen by more than £1bn in just two years.

“Clearly there are inflationary pressures . . . and that means the government is having to work through those challenges,” said one person involved in the project.

The Sun reported on Friday that HS2 executives were considering terminating the line at Old Oak Common on the outskirts of London, instead of Euston. Commuters would have to use the Elizabeth Line to travel into central London to finish their journey, reducing the advantage of a high-speed service.

But Hunt rejected that idea in media interviews on Friday morning, saying: “I don’t see any conceivable circumstances in which that would not end up at Euston.”

Redeveloping Euston is crucial to the controversial 225mph project, which was first sold as an alternative to a third runway at Heathrow or an extension to the existing high-speed link to Europe, but now has no direct connection to either.

The state-funded scheme, which has faced protests and criticism since its inception, has been repeatedly scaled back and is now planned to run from London to Birmingham in its first phase and then to Manchester airport, Wigan and Crewe in the north-west.

In 2021, Boris Johnson’s government announced it was axing most of the eastern second leg of the project — from East Midlands Parkway, just south of Nottingham, to Leeds — to find cost savings.

Now, however, some senior government figures have discussed killing the remaining part of the eastern leg, from Birmingham to East Midlands Parkway, to cut costs even further.

Euston also remains a potential target for savings because, despite significant preparatory work, the design has yet to be completed.

Estimated costs for the Euston redevelopment have risen from around £2.8bn to nearly £4bn in 2019 prices, according to an internal document presented last year to HS2’s board by Sir Jon Thompson, the former head of HM Revenue & Customs who became deputy chair of the project in April 2021.

That report also warned that HS2 was running “billions of pounds” over budget in its first phase, which began in 2020 and is due to be completed between 2029 and 2033.

Henri Murison, chief executive of the Northern Powerhouse Partnership lobby group, said a London terminus for HS2 should be “centrally located”, adding: “Even for the north of England, not going to Euston has a number of significant disadvantages.”

More than £4bn of improvements to other parts of the UK’s railway system have already been axed because of a governmental decision to focus spending on the high-speed line.

The DfT said: “The government remains committed to delivering HS2 to Manchester, as confirmed in the Autumn Statement.”

US stocks tick upwards as core inflation edges higher

Wall Street stocks rose on Friday after the Federal Reserve’s preferred measure of inflation inched higher in line with expectations, while consumer spending declined for the second consecutive month.

Wall Street’s benchmark S&P 500 added 0.4 per cent and the tech-heavy Nasdaq Composite gained 0.7 per cent.

Shares in Intel fell 7.5 per cent after the chipmaker said revenue in the current quarter was forecast to come in about $3bn below analysts’ expectations. Oil major Chevron slipped 4 per cent despite announcing record earnings for 2022, dragged lower by cooling fourth-quarter profits, while credit card company American Express jumped by a tenth after it reported a 25 per cent jump in full-year revenue to a record of almost $52.9bn.

The moves in equity markets came as December’s core personal consumption index, which omits energy and food inflation, increased 0.3 per cent as expected after rising 0.2 per cent month on month in November. Yet real consumer spending fell 0.3 per cent following a 0.2 per cent decline the previous month. Paul Ashworth, Capital Economics’ chief North America economist, said this suggested the US was “on the precipice of a recession and may already have fallen off the ledge”.

Although still near a multi-decade high, headline US inflation fell to its lowest level in more than a year in December. Yet Fed chair Jay Powell has insisted core inflation “often gives a more accurate indicator of where overall inflation is headed”.

US government bonds remained under pressure, with the yield on the 10-year US Treasury 0.04 percentage points higher at 3.53 per cent after the inflation figures were published. Bond yields move inversely to prices.

US equities had rallied on Thursday after gross domestic product for the fourth quarter of 2022 came in ahead of projections, rising at an annualised pace of 2.9 per cent. That was above the 2.6 per cent economists had forecast, marking a milder slowdown from 3.2 per cent in the previous quarter.

“With inflation well above target, this fully justifies ongoing interest rate increases from the Federal Reserve,” said James Knightley, chief international economist at ING.

“Dig a little deeper,” however, and it seemed “we have good growth but not for great reasons”, Knightley added. Consumer spending rose less than expected, residential investment fell sharply and non-residential fixed investment, “basically business capex”, grew just 0.7 per cent.

Instead, much of the rise in GDP reflected “increasingly involuntary” inventory building by mining, construction and manufacturing groups as consumer demand continued to soften, he said.

Investors firmly expect the Fed to raise rates by a quarter percentage point next week, marking a slowdown from the 0.5 percentage point move implemented in December. Powell’s forward guidance and the language he adopts during a press conference after the rate decision is announced are therefore likely to be the focus of attention.

A measure of the dollar’s strength against a basket of six currencies was up 0.2 per cent on Friday, while prices for Brent crude, the international oil benchmark, fell 1 per cent to $86.54 a barrel, erasing earlier gains.

In Asia, Hong Kong’s Hang Seng index rose 0.5 per cent, Japan’s benchmark Nikkei 225 increased almost 0.1 per cent and South Korea’s Kospi gained 0.7 per cent. Markets in China are closed for the lunar new year holiday.

Europe’s region-wide Stoxx 600 closed 0.3 per cent higher, Germany’s Dax gained 0.1 per cent and London’s FTSE 100 added 0.05 per cent.

Adani sell-off hits $52bn after short seller targets group

Indian billionaire Gautam Adani had more than $50bn wiped from the value of his business empire this week after a US short seller alleged fraud, threatening the success of a key share sale designed to attract international investors.

Shares in the Adani Group’s flagship company plunged 19 per cent on Friday, leading steep declines in the Mumbai-listed groups that make up a collection of businesses spanning ports to energy to airports.

Adani, one of the world’s richest men, has faced intense scrutiny since short seller Hindenburg Research on Wednesday accused the Adani Group of engaging in stock price manipulation and accounting fraud over the course of decades. The group has denied the allegations.

Hindenburg launched the critique just days before Adani Enterprises embarked on a share sale to raise Rs200bn ($2.4bn) and showcase the wider appeal of the Adani Group, which is closely held by related entities and opaque Mauritius-based funds.

Adani Enterprises stock closed 18.5 per cent lower at Rs2,761 on Friday, an almost 16 per cent discount to the Rs3,276 that a group of institutional investors anchoring the share sale have agreed to pay.

Jupiter Asset Management, BNP Paribas, Société Générale and Goldman Sachs are among the institutions that were already allocated shares before the fraud allegations were made public.

The steep sell-off in Adani Enterprises threatens to dent demand from retail investors in India, who were permitted to start bidding for the shares on Friday. The sale is expected to complete on Tuesday.

Deepak Shenoy, chief executive of CapitalMind Wealth in Bangalore, said that the extent of the fallout on retail demand would not be clear until next week. “Monday and Tuesday are when any real demand will come in,” Shenoy said.

Adani Group has vowed to press ahead with the share sale despite the 60-year-old billionaire facing the biggest challenge of a career that has turned him into one of India’s most powerful moguls.

After starting life as a commodities trader, Adani built India’s largest private infrastructure group and has been growing his empire at a rapid pace. The expansion has left the combined Adani companies with $24bn of debt, prompting CreditSights, part of Fitch Solutions, to warn last year that the group was deeply “overleveraged.”

The company has denied the allegations from Hindenburg, calling the report “a malicious combination of selective misinformation and stale, baseless and discredited allegations”.

On Friday, Adani released an 18-page presentation called “Myths of Short Seller”, saying that “accounting (or fraud type assertions) ‘investigation’ [were] devoid of facts”.

As shares in the Adani companies tumbled, India’s opposition Congress party called for the country’s securities regulator and central bank to investigate the allegations.

Jairam Ramesh, a Congress MP and the party’s general secretary for communications, said the Hindenburg report “demands a response” because Adani Group is “closely identified with Prime Minister Narendra Modi”. Modi was previously chief minister of Gujarat, Adani’s home state and his biggest base of operations.

The turmoil engulfing Adani companies has also hit broader sentiment in India, with the benchmark Nifty 50 stock index down almost 3 per cent since market close on Tuesday.

Analysts said the selling on Friday was intensified by traders playing catch-up following a national holiday in India on Thursday.

Other Adani companies also endured steep losses, with Adani Green Energy and Adani Transmission each sliding 20 per cent. The declines took the total drop in the market capitalisation of Adani groups to $52bn, down about a fifth from Tuesday.

One of the investors involved in the share sale said: “They [Adani Group] probably can’t raise that by Tuesday unless the share price goes up.”

Adani, a self-made tycoon, owns substantial stakes in all the group’s listed companies, including roughly three-quarters of Adani Enterprises. A spokesperson for Adani Enterprises declined to comment on the fall in its shares on Friday, adding that the company is “confident of the fundamentals”.

Adani has said it is considering legal action against Hindenburg. A subsequent response from Hindenburg said the group “would welcome it”.

“If Adani is serious, it should also file suit in the US, where we operate,” the short seller said. “We have a long list of documents we would demand in a legal discovery process.”

Bill Ackman, the billionaire hedge fund manager, on Thursday described Hindenburg’s report as “highly credible” and “extremely well researched”.

MPs demand changes to sweeping UK national security bill

MPs from across the political spectrum are preparing to work with members of the House of Lords to amend government secrecy reform legislation amid concerns that it poses substantial risks to press freedom and whistleblowers’ rights.

Civil society groups have also warned that provisions inserted into the national security bill late in its passage through the House of Commons could present them with significant legal threats.

Robert Buckland, the Conservative former justice secretary; Dame Margaret Hodge, the veteran Labour MP; and Stuart McDonald, the Scottish National party’s justice spokesperson, are among the MPs voicing concern.

“We’ve got to protect responsible journalism and freedom of speech,” Buckland said.

McDonald said many MPs were worried that the bill, which seeks to modernise a patchwork of laws dating back to 1911, was too broadly written and that some of the offences created in it potentially criminalised an excessive range of activities. These include journalists possessing “protected information” leaked by whistleblowers.

MPs and the media have also warned that some prohibitions in the bill apply both to official information that is classified and information that it was “reasonable to expect” would have been classified.

Several crimes created in the bill are defined as applying when someone has acted in a way “prejudicial to the safety of interests of the United Kingdom” — a definition that has been criticised as potentially applying to people who merely disagree with government policies.

“I think a lot of us are concerned that there’s no public interest defence and suitable protection for whistleblowers,” McDonald said.

The News Media Association, a trade body for news publishers, has warned that the bill creates a “blueprint for authoritarian governments around the world to threaten journalists, activists and whistleblowers”.

Critical MPs plan to work on amendments with peers worried about the legislation, which is currently in the House of Lords. Several peers have indicated that they intend to add significant new safeguards to the legislation. The MPs hope to pressure the government into accepting the Lords amendments when the bill returns to the Commons for final approval.

If approved, the legislation will also create a foreign influence registration scheme, intended to control the activity of organisations operating in the UK funded by hostile foreign governments.

However, the section of the bill detailing the working of the proposed register was added to the bill only after its Commons committee stage. MPs consequently had no opportunity to seek expert advice on its potential effects.

“I think that’s going to be absolutely crucial for the House of Lords to look at,” McDonald said.

Bond, a network of groups working in international development, has said the bill could make it a criminal offence for any group with foreign funding to possess leaked government documents. The proposed law could also force foreign-based groups making representation to UK politicians to go through the registration process.

Buckland said many media outlets were “pretty concerned” about the freedom of speech implications of the sections dealing with the handling of secret documents.

An open letter signed by 40 international media organisations, organised by the News Media Association, has warned that clauses in the bill intended to target spies acting on behalf of foreign states could also bring into the bill’s scope individuals working for international media and charity organisations.

“This could have a chilling effect on the legitimate flow of public interest information to the UK general public and create a blueprint that could be used by authoritarian governments around the world as a means to threaten journalists, activists and whistleblowers with lengthy prison sentences,” the letter said.

Buckland said he hoped the insertion of a public-interest defence for media organisations and whistleblowers in the House of Lords could alleviate some of the problems.

The Home Office insisted that the bill contained safeguards and that there were specific requirements in the definition of each offence that ensured they avoided targeting “legitimate activity such as investigative journalism or whistleblowing”.

“Freedom of the press is a cornerstone of our democracy and journalists must be able to do this job,” the department said.

US braces for protests over video of Memphis police beating Tyre Nichols

Authorities across the US are braced for protests ahead of the release of video footage showing the events leading to the death of black motorist Tyre Nichols at the hands of police in Memphis, Tennessee, earlier this month.

On January 7, five police officers attempted to arrest Nichols, 29, after pulling him over while driving just before 8.30pm. The incident escalated into a physical altercation that resulted in Nichols’s hospitalisation, state investigators said. He died three days later.

The five officers involved, who were fired following Nichols’s death, were indicted by a grand jury in Memphis’s Shelby County on Thursday for second-degree murder, among other charges relating to the killing.

“They beat my son to death,” Nichols’s mother, RowVaughn Wells, told CNN.

Footage of the incident is expected to be released publicly on Friday evening, and demonstrations are expected in cities throughout the country in response.

“In a word, it’s appalling,” said David Ranch, director of the Tennessee Bureau of Investigation, of the footage of the assault. “Let me be clear: what happened here does not, at all, reflect proper policing. This was wrong. This was a crime.”

US attorney-general Merrick Garland told reporters on Friday morning he had been briefed on the video, calling it “deeply disturbing . . . horrific, from the descriptions I’ve been given”. Garland urged the public to be “peaceful and nonviolent” upon the release of the footage.

Christopher Wray, FBI director, said all FBI field offices had been told to “work closely” with partners, particularly in Memphis, “in the event of something getting out of hand”.

US president Joe Biden said in a statement on Friday that he joins “Tyre’s family in calling for peaceful protest. Outrage is understandable, but violence is never acceptable.”

For Memphis, a majority-Black city of 630,000, the incident has revived memories of the infamous assault of Rodney King by Los Angeles police in 1991. It is also one of the most high-profile police killings in the US since the deaths of George Floyd, Breonna Taylor and others triggered nationwide protests three years ago.

On Thursday, the five now-former Memphis police officers involved in Nichols’ arrest, Tadarrius Bean, Demetrius Haley, Emmitt Martin III, Desmond Mills, Jr, and Justin Smith, who are all black, were charged on seven counts: second-degree murder, aggravated assault, two forms of aggravated kidnapping, two forms of official misconduct, and official oppression.

Bond was set for each at between $250,000 and $350,000.

Memphis police department chief Cerelyn Davis said in a video statement that “this incident was heinous, reckless, and inhumane” and that the public would see this for themselves when the video is released.

“I expect you to feel what the Nichols family feels. I expect you to feel outrage in the disregard of basic human rights,” she said.

Nichols’s death is being investigated by city, state, and federal officials, while the Department of Justice is conducting a civil rights investigation.

Goldman’s David Solomon takes near-30% pay cut to $25mn

Goldman Sachs paid chief executive David Solomon $25mn for 2022, down almost 30 per cent compared to a year before, after the Wall Street bank reported a steep drop in profits, cut thousands of jobs and slashed employee bonuses.

In a regulatory filing on Friday, Goldman disclosed that Solomon received a base salary of $2mn, and $23mn in variable compensation.

Goldman said its compensation committee based its decision in part on “the firm’s 2022 performance, both on an absolute basis and relative to peer results, as well as in comparison to the record performance delivered in 2021”.

Solomon’s pay for 2022 had been the subject of speculation among Goldman’s rank and file in recent weeks, with many expecting a sizeable cut given the bank’s financial performance and a far-reaching review of expenses at the company.

The cut to Solomon’s pay is larger than that taken by Wall Street peers and reflects a challenging year for Goldman. However, it is still less than the cut to the bonus pool for the firm’s senior partner ranks, which is roughly 40 per cent, according to people familiar with the matter.

Last year, Goldman’s net profits plunged almost 50 per cent from record earnings in 2021 and the bank fell short of a key profitability target. Its investment banking business suffered from an industry-wide dearth of dealmaking activity, resulting in a cut to bonuses for employees in that unit.

Goldman was also hit by sharp markdowns in public equity holdings at its asset management division and reported $2bn in losses for 2022 at its fledgling “Platform Solutions” unit, which houses part of its retail banking business that has been pared-back following disappointing performance.

The bank this month cut about 3,200 jobs, equivalent to roughly 6.5 per cent of its workforce, as part of its biggest cost-reduction exercise since the 2008 financial crisis. Goldman has also embarked on a review of spending across the bank, the Financial Times has reported.

The $35mn Solomon earned for 2021 made him the highest-paid big bank chief executive alongside Morgan Stanley boss James Gorman. In 2022, Gorman’s compensation was cut 10 per cent to $31.5mn. 

JPMorgan Chase chief executive Jamie Dimon was paid $34.5mn in 2022, unchanged from the prior year, while Wells Fargo CEO Charlie Scharf’s pay was also flat at $24.5mn. 

Goldman’s overall spending on compensation and benefits for 2022 was down 15 per cent year on year at $15.1bn.

Solomon’s compensation for 2022 is his lowest since the $17.5mn he earned in 2020 when his pay was hit by Goldman’s involvement in the 1MDB corruption scandal.

UK farmers stop recruiting Nepalese workers after exploitation warning

British farms have stopped recruiting workers from Nepal following warnings that the UK’s immigration system was exposing the south Asian migrants to exploitation.

All five of the recruitment companies licensed to bring farm labourers to the UK on temporary visas have publicly announced or told the Financial Times that they are not hiring workers from the country this year.

Not all the UK-based agencies had recruited from Nepal but the abrupt halt to recruitment from the nation, where almost a 10th of seasonal workers came from in 2022, risks exacerbating the acute labour shortage on British farms.

Last summer, tens of millions of pounds’ worth of fresh produce was left to rot because there were not enough workers to harvest the crops.

In 2022, the number of Nepalese workers arriving through the UK’s seasonal worker scheme more than quadrupled to 2,472 after Brexit and the Ukraine war left farms more dependent on workers from outside Europe.

But the surge in Nepalese arrivals sparked warnings from campaigners, who said workers from Asia were routinely charged excessive recruitment fees by job-finding agencies in their home country. They added that many migrants had struggled to pay off their debts and afford accommodation and food.

Last month, investors with £800bn in assets called on big food retailers to work with suppliers to ensure seasonal workers were repaid the millions that they were estimated to have collectively spent to secure jobs in Britain. They also called on the UK government to bring the seasonal worker scheme into line with its commitments on labour rights.

The rapid expansion of the scheme, launched in 2019, had raised concerns about the difficulty of maintaining oversight in countries where UK regulations were not enforced. A report last month by the Independent Chief Inspector of Borders and Immigration found that the Home Office “did not act promptly or seriously” when workers in the UK reported “serious concerns”. 

Despite the move by the recruitment companies, Nepali workers remain eager to travel, lured by the hope of higher wages. One Facebook group called “UK Seasonal Work — Nepal” has more than 41,000 members.

Andy Hall, a labour rights campaigner in Asia, warned there were still “so many fake” social media posts encouraging Nepali workers to seek job opportunities in the UK.

Lucila Granada, chief executive of the charity Focus on Labour Exploitation, said that it was important that recruiters did not simply move from one country to the next “until there is a new scandal”.

She added, “We need proper mapping of the supply chains and a careful process to work with the relevant authorities in each country the UK aims to bring workers from before operations start.”

Retailers, recruiters and growers have been holding talks on combating worker exploitation, according to activists. After concerns were raised about debt-burdened workers arriving in the UK only to find little work, recruiters want the government to set out visa allocations earlier each year to enable more time for planning.

The Home Office said it “takes workers’ concerns very seriously”, adding that improvements had been made each year “to stop exploitation and clamp down on poor working conditions”.

It said it encouraged people to report abuses and would take action when an offence was proven, but any compensation would be a matter for the worker and their recruiter to resolve.

Safe haven? How the asylum system lost vulnerable children

Alarms began ringing among local politicians from the moment in July 2021 that the first group of teenage asylum seekers was dropped off at a Brighton hotel on England’s south coast from which dozens have since disappeared.

Brighton and Hove council, which in normal circumstances would have been responsible for their care, said it received no prior warning of their arrival from the Home Office. After harrowing journeys across Europe and the sea some of the children were in severe distress. Covid restrictions complicated things further.

“It’s hard to explain in words what I saw,” said Labour’s Peter Kyle, the local MP for Hove.

Kyle is among those who from day one have been seeking answers from the government after visiting the hotel which, in an unrelated twist, is owned by a company whose directors include children of notorious property magnate and ex-convict Nicholas Van Hoogstraten.

Labour MP Peter Kyle said safeguarding measures at the Brighton hotel were inadequate © Charlie Bibby/FT

The furore over Home Office handling of unaccompanied minors among migrants arriving by sea from France has been limited until now. That changed this week after reports, first carried in the Observer newspaper, that hundreds of child asylum seekers had disappeared from the hotel in Brighton and others like it, potentially at the behest of criminal gangs.

Not for the first time, the government finds itself on the back foot over its handling of migration, accused by more than 100 charities of being in breach of its obligations to safeguard children, forced to admit in parliament that many have gone missing and at pains to counter a portrayal of wider chaos in the asylum system.

Six hotels along England’s south coast were initially commissioned as a temporary Home Office measure in 2021 to accommodate children seeking asylum. This was part of a national transfer scheme introduced when reception centres in Kent became overwhelmed by the number of migrants arriving in small boats.

But the charities, in a letter to Prime Minister Rishi Sunak, said it was no longer possible “to justify the use of hotels as being ‘temporary”.

Reports of disappearances from them are not new. They were flagged last October in a report by the independent border watchdog, and earlier freedom of information requests by Ecpat, the children’s rights organisation. But sinister tales from Brighton have galvanised government critics.

Sussex Police confirmed that of 137 unaccompanied asylum seekers aged under 18 reported missing from the hotel in Brighton, 76 have yet to be found.

The coastline at Brighton and Hove
The bustling coastline at Brighton and Hove © Gibson Blanc/Alamy

In parliament, Robert Jenrick, the immigration minister, acknowledged that of 4,600 such minors seeking asylum who have been accommodated in hotels since July 2021, 440 had at some point disappeared. Of these 200 are still unaccounted for, 13 of them under 16.

The charities contend that these teenagers’ care is outside the government’s obligations under the 1989 Children’s Act and thus made them vulnerable to the criminal gangs suspected of involvement in disappearance cases.

Hannah Allbrooke, chair of the children, young people and skills committee at Brighton council, said more than 1,000 refugee children had passed through the city under the Home Office transfer scheme. The Home Office, she said, had regularly conceded that the council, which would usually have legal responsibility for taking unaccompanied minors into care, did not in this case.

“Vulnerable children and young people who have come to the UK to be safe are being left in legal limbo with government failing in its statutory duty to ensure they are given a corporate, legal parent to look after them,” said Enver Solomon, chief executive of the Refugee Council charity.

Kyle said safeguarding measures at the Brighton hotel were inadequate, and teenagers there were left in the dark as to their fate.

One Iranian boy he met had lost both his parents back home. On arrival in Brighton he had been separated from the friend, who had tested positive for Covid, with whom he had journeyed with from Iran.

“He was in a state of such anxiety his face was pinched and his legs were buckling. He didn’t know where his friend had gone,” he said.

This fits the wider picture of uncertainty painted by non-governmental organisation workers monitoring the children.

Ellen Tansey, safeguarding manager at the Refugee Council, said the children in the Brighton hotel, as in others she visited, appeared to have no designated social worker and none of the usual access to services. They were mentally affected by the haphazard way in which some among them were moved swiftly into care while others were stuck in the hotel for more than a month, she said.

This state of uncertainty made them more open to exploitation, she said: “You can appreciate if someone turns up and says to a child without any knowledge of how the UK asylum and child protection systems work, ‘you could be deported, or I could drive you to London and give you a job in a car wash’, even though it’s a risk, they might take it,” she said.

Maddie Harris
Maddie Harris: ‘The children going missing from hotels is really due to a lack of support being provided to understand the needs and individual risks that relate to each of them’ © Charlie Bibby/FT

In one case last year, when a bystander had reported two boys being driven off from outside the Brighton hotel, Sussex Police intercepted the vehicle on the motorway. Two men were arrested and are under investigation for human trafficking.

There has been widespread speculation that children like them who have gone missing, more than 80 per cent of whom are Albanian according to the Home Office, have been drafted into the criminal underworld.

But Maddie Harris, who runs the NGO Humans for Rights network, and has worked with hundreds of unaccompanied minors seeking asylum, said it was misleading to portray this as “random kidnapping”.

“It’s children coerced, exploited and trafficked,” she said, adding that some of them would already have had contact with trafficking networks to get to the UK.

“The children going missing from hotels is really due to a lack of support being provided to understand the needs and individual risks that relate to each of them,” she said.

The Home Office said that as part of efforts to phase out the use of the hotels, it was offering £15,000 to local authorities taking children seeking asylum into care.

“Robust safeguarding procedures are in place to ensure all children and minors are safe and supported as we seek urgent placements with a local authority,” it said, adding: “Any child or minor going missing is extremely serious, and we work around the clock with the police and local authorities to urgently locate them and ensure they are safe”.