Surveys And Government Plans

The latest growth indicator survey produced by the Confederation of British Industry (CBI) shows that UK private sector activity fell again in the three months to February, at a faster rate than in the quarter to January.  All sectors reported falling business volumes, the CBI says, pulling its growth index down to -27% in February, from -23% a month earlier.

“There are some glimmers of hope in our latest surveys,” said Alpesh Paleja, the CBI deputy chief economist. “Growth expectations have become marginally less negative, driven by a predicted return to growth in the manufacturing sector. But overall, the data still paints a picture of a tough operating environment for businesses, with consumer-facing sectors faring particularly badly.”

BDO also have a new survey reporting today (Monday 3 March – I know, somehow it is March already).  BDO quizzed 500 business leaders at mid-sized companies with turnovers between £10m and £300m, and found that just under half of the 500 want better support from the government to begin or continue exporting abroad. This includes broadening the access to UK Export Finance support to the mid-market, new free trade agreements and simpler customs rules to aid the export of products or services overseas.  And presumably Sir Kier pulling more rabbits from hats, or letters from the King from his pocket, to ensure no tariffs from the US and/or a trade deal.

A quarter of business leaders polled by BDO cited rising workforce costs, such as national insurance contributions (NICs) and the living wage, as a significant worry.  These measures, announced last year, are due to begin early next month.

The government has also announced plans today to give more than one million low-paid workers in the UK the entitlement to 80% of their weekly salary as sick pay from the first day of illness.  Currently, anyone earning less than £123 a week is not entitled to any statutory sick pay.

"No one should ever have to choose between their health and earning a living, which is why we are making this landmark change," said Liz Kendall, the Secretary of State for Work and Pensions.  "The new rate is good for workers and fair on businesses as part our plan to boost rights and make work pay, while delivering our plan for change," Kendall said.

TUC general secretary Paul Nowak said: "This shouldn't be the end of the story.  We urge ministers in future to raise the replacement rate for the lowest earners beyond 80% and undertake a wider review of the statutory sick pay rate."

The government says the changes will mean about 1.3 million people on low wages who fall ill will receive either 80% of their average weekly earnings or the current rate of statutory sick pay which is £118.75 per week – whichever is lowest.

However, in worse news for employees, news broke over the weekend the government would not be including the "right to switch off" for workers in the upcoming reading of The Employment Rights Bill. This measure would have seen a halt to employers contacting staff out-of-hours on phones, emails and texts.

A government source told the Sunday Times that: "The right to switch off is dead. We have to lower business compliance costs as much as possible."