Sunday newspaper round-up: Bank windfall tax, Octopus Energy, Royal Navy

Two high-ranking sources near to the new Prime Minister and Chancellor gave short shrift to the idea that a new tax might be levied on lenders. Indeed, during his time as Chancellor, Rishi Sunak had looked at ways to bolster the City after Brexit, whereas bankers have been warning Jeremy Hunt that a tax raid would only hamstring such plans. Furthermore, government sources expect that Hunt will lower the current eight per cent tax surcharge on banks' earnings to three per cent, as had also been planned by Sunak, while raising corporation tax from 19 per cent to 25 per cent for a total levy on banks of 28 per cent. - The Sunday Times

Octopus Energy has struck a deal to purchase bailed-out supplier Bulb for an undisclosed sum in a move that could save taxpayers billions of pounds. After being nationalised last year, taxpayers have been footing the bill for keeping the lights on for Bulb's 1.5m customers with the tab now running into the billions. However, under a profit-sharing agreement put in place as part of Octopus's takeover, Bulb's owner would repay that sum over time. - The Sunday Times

Rishi Sunak faces a difficult choice over whom to award a £1.65bn contract to build the Royal Navy's three new Fleet Solid Support vessels, as two of the consortia include foreign builders, including Spain's Navantia alongside Belfast's Harland&Wolff, and India's Larsen & Toubro, which includes the UK's Leidos Innovations. BAE Systems and Babcock are in the running as Team UK but sources close to UK industry are worried as the Spanish bid is the frontrunner. Belfast's Harland and Wolff has highlighted the opportunity to gain access to Spanish shipbuilding skills which the UK could later capitalise on while 60 per cent of the work would land in Britain. A decision may be announced before the March deadline. - Sunday Telegraph

Voters are again of the belief that the Conservatives, led now by Rishi Sunak, can be trusted more to manage the economy, a new poll for the Observer revealed. They face a £40bn fiscal hole left by Liz Truss although new analysis reveals that freezing public service spending would yield £20bn in savings, even if resulting in a return to the austerity of the 2010s. Labour still leads the Tories on the majority of issues, but when it comes to the economy, 33% of those surveyed said they preferred "a Conservative government led by Rishi Sunak" to manage the economy, as opposed to "a Labour government led by Keir Starmer". - Guardian

NatWest Boss Alison Rose pleaded for a return to stability in the wake of weeks of chaos in the political scene and in financial markets. Even as the lender predicted falling house prices and a rise in mortgage rates over the months ahead, Rose said that consumers and companies were desperate for certainty. The uncertainty and instability had led to a "massive drop" in business confidence, she added. The lender, which was scheduled to post its latest results over the coming week, had extended its mortgage early refinance window from four to six months and frozen the level of current account fees for small business clients. - Sunday Telegraph