Shares in Capita fell over 6% on Friday after a new government report revealed that it has failed to meet targets recruitment contract for the British Army every year. The outsourcing firm has a £495 million contract with the British Army since 2012, where Capita has been responsible for recruitment. According to the report from the National Audit Office (NAO), Capita has failed to meet targets every year since the deal was awarded and recruitment has been as low as 21% of the British Army’s requirements. The NAO has said that the Army Recruiting Partnering Project has “underestimated the complexity of what it was trying to achieve” and there are “significant problems”. A spokesperson from Capita said: “As the NAO report states, both Capita and the Army underestimated the complexity of this project. Our focus is now on working with the Army to deliver a recruitment process fit for the 21st century.” “We have overhauled governance on the contract and are already seeing improvements, with applications at a five-year high and a reduction in the amount of time it takes candidates to join the Army. We are absolutely committed to getting this partnership right.” The Army and Capita believe the changes to the recruitment approach and the new online system will lead to an increased number of recruits. Recruits have already increased over the past two years. A spokesman from the British Army said: “We are fully committed to improving our recruiting process. Working with Capita we have put in place a plan to address the challenges. The army has developed a range of measures to speed up the recruitment process.” “This includes new measures to reduce the time between applying and starting training, greater access to military role models for recruits and a new IT system.” “The army meets all of its operational commitments to keep Britain safe,” he added. Shares in Capita (LON: CPI) are currently trading down 4.24% at 109,65 (1119GMT).

Richard Branson has warned that a hard Brexit would be “an absolute disaster”. Speaking to the BBC, the Virgin Group founder said that the British people and businesses will suffer in the event of a hard Brexit. “I think Theresa May needs to be 100% honest with the public. She’s admitted that a hard Brexit would be an absolute disaster for the British people,” he said. “From our Virgin companies’ point of view, a hard Brexit would torpedo some of our companies. If British business suffers, British people will suffer, and it’s really really important that people realise that.” Branson went on to say the fall in the pound would particularly affect Virgin holidays, where fewer people would be able to afford to go on holiday due to the poor exchange rates. The Virgin Group boss was speaking from the Virgin Galactic event, where one of his spaceships is set to reach space for the first time. Branson’s space startup hopes that the SpaceShipTwo passenger rocket ship will reach further than 80km, which space is said to start. “Overall the goal of this flight is to fly higher and faster than previous flights. We plan to burn the rocket motor for longer than we ever have in flight before, but not to its full duration. At the end stages of the rocket burn in the thin air of the mesosphere and with the speeds that we expect to achieve, additional altitude is added rapidly,” said the company in a blog post. His comments come during a tough time for the prime minister, who has delayed the Parliamentary vote on the Brexit withdrawal agreement. The new vote will take place in January. Theresa May is currently in Brussels where she is working on the backstop issue with the Irish border with EU leaders.  

Prime Minister Theresa May arrived at the EU HQ on Thursday for the start of the summit. Speaking to reporters, the prime minister spoke of the “difficult” day experienced on Wednesday and how she has no plans to lead the party into the next general election. “Can I just say a word about yesterday, which was a difficult day. And I’m grateful for the significant support I had from colleagues. But I have also heard loud and clear the concerns of those who didn’t feel able to support me. And I know the concerns there are in the House of Commons about this issue of the backstop, that they do not want it to be permanent,” said May, speaking in Brussels. “And what I will be talking to European leaders about here today is what we need to get this deal over the line. I’ve already met Leo Varadkar, I will be addressing the European Council later, and I will be showing the legal and political assurances that I believe we need to assuage the concerns that members of parliament have on this issue.” Ahead of the summit, May said that she did not expect an immediate breakthrough at the meeting. “It’s in the best interest of both sides, the UK and the EU to get the deal over the line, to agree a deal – but I recognise the strength of concern in the House of Commons and that’s what I will be putting to colleagues today,” she told reporters. “I don’t expect an immediate breakthrough, but what I do hope is that we can start to work as quickly as possible on the assurances that are necessary.” This week saw May survive the vote of confidence in her leadership. She won by 200 to 117 with 63% of the vote.  

The European Central Bank (ECB) announced the end to its quantitive easing programme on Thursday, sending the Euro lower. In a widely expected decision, the bank is set to halt its €2.6 trillion bond-buying programme towards the end of this month. However, the central bank will continue to reinvest money from maturing bonds, remaining active in the bond market. The council said the investments would continue: “for an extended period of time past the date when it starts raising the key ECB interest rates, and in any case for as long as necessary to maintain favourable liquidity conditions and an ample degree of monetary accommodation”. Nevertheless, investors still remain concerned that the eurozone economy has more to go in terms of recovery. Christian Jaccarini, senior economist at Centre for Economics and Business Research said: “With Eurozone stability remaining under threat from the slowing growth and heightened political unrest, the ECB’s Governing Council was keen to remain supportive as it announced the end of quantitative easing today. The move to end QE was almost inevitable given the ECB’s credibility was at stake. Still, while clear statements on the prolonged use of reinvestments and low interest rates will provide some reassurances for investors, the backdrop for the announcements will remain concerning for many.” During a speech in Frankfurt on Thursday, ECB President Mario Draghi acknowledged continued concerns about the strength of the Euro economy. Nevertheless, he pointed to domestic economies as key to leading economic expansion. Moreover, Draghi said eurozone growth was expected to be 1.9%, rather than the 2% initially forecast back in September. “The risks surrounding the euro area growth outlook can still be assessed as broadly balanced. However, the balance of risk is moving to the downside owing to the persistence of uncertainties related to geopolitical factors, the threat of protectionism, vulnerabilities in emerging markets and financial market volatility,” Draghi told reporters. GDP for 2019 also revised downwards to 1.7 %, as opposed to to an earlier forecast of 1.8%. Regarding inflation, Draghi said he expects headline euro inflation figures to fall in the coming months. He said: “Measures of underlying inflation remain generally muted, but domestic cost pressures are continuing to strengthen and broaden amid high levels of capacity utilization and tightening labor markets, which is pushing up wage growth.” Draghi also said that the ECB still intend to raise rates in the summer of next year.      

Apple has announced plans to build a new campus in Austin, Texas. Austin is already the biggest base for the tech giant outside of California’s Silicon Valley. Apple hires 6,200 employees in the city. The investment will cost Apple $1 billion (£790 million) for a new 133-acre (0.54 sq km) campus. Texas is a lucrative area for many tech companies. Facebook (NASDAQ: FB), Google (NASDAQ: GOOGL), IBM (NYSE: IBM), Dell (NYSE: DVMT), Amazon (NASDAQ: AMZN) and Samsung (KRX: 005930) are also big employers in the state. Chris Green, an independent analyst said: “There’s a lot of computer chip expertise but Texas is also a massive hotbed for the data-centre industry.” “It also has a reputation for its traditional entertainment media scene as well as social-media development, with lots spurred on by the South by Southwest festival and other technology gatherings that have made Austin their home.” In January, Apple pledged to create 20,000 new jobs in the US. The tech group currently employs 90,000 people. Tim Cook, Apple’s CEO, said: “Apple is proud to bring new investment, jobs and opportunity to cities across the United States and to significantly deepen our quarter-century partnership with the city and people of Austin.” “Talent, creativity and tomorrow’s breakthrough ideas aren’t limited by region or zip code, and, with this new expansion, we’re redoubling our commitment to cultivating the high-tech sector and workforce nationwide,” he added. Jobs on the new campus will range from engineering, R&D, operations, finance, sales and customer support. The tech group also plans to increase employment in San Diego, Pittsburgh, New York, Boulder, Boston and Portland, Oregon. The Texas Governor Greg Abbott said on Apple’s decision to create the new campus: Apple is among the world’s most innovative companies and an avid creator of jobs in Texas and across the country.” “Their decision to expand operations in our state is a testament to the high-quality workforce and unmatched economic environment that Texas offers. I thank Apple for this tremendous investment in Texas, and I look forward to building upon our strong partnership to create an even brighter future for the Lone Star State.” Shares in Apple (NASDAQ: AAPL) are currently trading +0.73% (1438GMT).