FirstFT: Johnson rejects calls to resign after Sue Gray report on lockdown parties

Boris Johnson battled another Conservative threat to his leadership yesterday in the wake of a long-awaited and highly critical report on the party culture at the heart of his government.

The prime minister’s response to the report into the “partygate” affair by Sue Gray, a senior civil servant, rekindled talk of a potential leadership challenge and sparked alarm in Downing Street.

Gray’s report was rewritten at the request of the Metropolitan Police, excising criticism over the most serious allegations of Covid lockdown-breaching parties. Even in its watered-down form, the report slammed “failures of leadership and judgment” in Number 10 and the Cabinet Office.

Here are five things to know about Gray’s findings and our timeline of when the UK government social gatherings were held.

Johnson intended to rally Tory MPs behind him in the House of Commons, but instead he appeared to have the opposite effect. One normally loyal minister called his performance “a total and utter train wreck”.

• Opinion: The prime minister has alienated MPs with a tone of evasion, disingenuousness and bluster, writes Robert Shrimsley.

What’s your reaction to Boris Johnson’s House of Commons appearance yesterday? Do you think he should step down? Share your thoughts at [email protected]. Thanks for reading FirstFT Europe/Africa — Jennifer

Five more stories in the news

1. US plans sanctions against Putin’s inner circle Joe Biden’s administration has drawn up sanctions targeting Vladimir Putin’s inner circle and its ties to the west as Washington broadens the list of financial penalties it and European allies will impose if Russia invades Ukraine.

• Read more: Moscow sent Washington a blistering written response that accused the US of “whipping up hysteria” over Ukraine. Here are the aggressive economic and financial sanctions the US and European allies are preparing.

2. US stock markets endure worst January since 2009 American equities have suffered their worst start to the year since the global financial crisis as the threat of rising interest rates, slowing corporate earnings growth and geopolitical tensions sent stocks stumbling across the board.

3. Ex-BNP banker wins £2mn payout over gender discrimination In one of the largest awards made by a UK employment tribunal, Stacey Macken is to receive £2mn in compensation after BNP paid her significantly less than male colleagues over a four-year tenure at the bank’s London office.

4. Big Tech increases funding to US think-tanks The world’s biggest tech companies are pouring money into US foreign policy think-tanks as they argue that stricter competition rules will benefit China. Total donations to four of the most prestigious research groups have risen from at least $625,000 in 2017-18 to $1.2mn in 2019-20, according to an FT analysis.

5. Vodafone shareholder signals support for activist campaign One of Vodafone’s biggest shareholders has hailed an activist campaign aimed at improving the telecoms company’s performance as “very sensible”, as another investor said the move was “long overdue”.

• Opinion: Cevian Capital, Europe’s largest activist investor which has built an undisclosed stake in Vodafone, will probably push for a shake-up of the FTSE 100 group’s international portfolio, writes Helen Thomas.

Coronavirus digest

• The BA.2 offshoot of the Omicron variant is more infectious and better at evading vaccine protection than the original, according to a Danish study.

• The relationship between airlines and airports has nosedived as aviation losses are forecast to soar into the hundreds of billions of dollars. Air France-KLM is under pressure to repay its state aid packages quickly.

• Spotify is adding content advisory warnings to podcasts that discuss Covid-19 as the streaming service responds to a backlash against presenter Joe Rogan.

• Some of China’s pandemic measures could extend beyond Omicron and the Winter Olympics. Here’s why Xi Jinping is sticking to his zero-Covid policy.

• A senior Hong Kong official has resigned after attending a karaoke birthday bash in violation of the city’s Covid guidelines. Wall Street banks have grown weary of the territory’s punishing quarantine rules, writes Tabby Kinder.

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The days ahead

Ukraine developments Antony Blinken, US secretary of state, and Sergei Lavrov, Russia’s foreign minister, will speak by phone today amid hopes that diplomacy might yield de-escalation over Ukraine. Sir Tony Radakin, UK chief of defence staff, will also brief ministers at the cabinet. Russia assumes the presidency of the UN Security Council.

Manufacturing data The IHS Markit manufacturing purchasing managers’ indices are out for the eurozone, France, Germany, Italy, the UK and the US, which will probably show factory activity grew at a slower pace in January than the month before. (FT, WSJ)

Corporate earnings Google parent Alphabet, chipmaker AMD, video game publisher Electronic Arts, oil major ExxonMobil, automaker General Motors, oil and gas company Lundin Energy, payments provider PayPal, coffee chain Starbucks, service provider Tele2, and delivery company UPS report results.

Costa Book of the Year The 50th winner will be announced in London.

What else we’re reading

How not to deal with labour shortages The UK government last week announced a plan to “get half a million people off welfare and into work”. It was a prime example of how not to solve the shortage of workers by creating a problem that doesn’t exist. Worse, it might exacerbate the problem that does exist, writes Sarah O’Connor.

Ireland’s coalition under strain Apart from the easing of the pandemic, Prime Minister Micheál Martin’s fractious coalition government has little reason for optimism. The taoiseach has lost popularity after scandals and is struggling to show progress on problems such as housing and healthcare.

You don’t need to be a Stem genius to succeed in finance and tech Karina Robinson writes that she was the worst Spanish equities analyst in the City of London, so much so that in 1987, she was fired from Morgan Grenfell after 15 months. But you do not need to be a maths genius, a computer scientist or a PhD holder in physics to succeed.

“Those working behind the scenes who can bridge the understanding gap between leaders in siloed disciplines and roles . . . play a crucial role” — Karina Robinson, chief executive of Robinson Hambro

Who benefits from Japan’s panic over ageing? There is no upbeat discussion to be had on Japan’s declining population, but neither is there a way to avoid discussing it, and particularly how Japanese corporations can function with fewer humans. While outsourcing jobs overseas makes sense, businesses may not be ready.

Nestlé cleans up the chocolate trade The food company plans to triple its cocoa sustainability funding and make direct payouts to African farmers in a bid to remove child labour from its supply chain. There are at least three points that the wider, non-chocolate business world should note, Gillian Tett writes in our Moral Money newsletter. Sign up here.

Fashion

Whether for outdoor swimming, running or kick-boxing, the FT fashion team shares their tried-and-tested activewear picks for cold-weather workout gear.