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Theresa May’s speech: five things we learned

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The UK prime minister’s Brexit details have been vague and limited to the “Brexit means Brexit” soundbyte – until she stood up at Lancaster House and made what is expected to be the only major policy explanation before Article 50 is triggered.

 

1: Brexit means out of the single market

“I want to be clear – what I am proposing cannot mean membership of the single market,” May confirmed: here comes the hard Brexit.

2: And no more Customs Union

“Full Customs Union membership prevents us from negotiating our own comprehensive trade deals,” she also said. “I do not want Britain to be part of the Common Commercial Policy and I do not want us to be bound by the Common External Tariff. I do want us to have a customs agreement with the EU.”

3: Ireland will get special treatment

What to do about the UK’s only land border – with the Republic of Ireland – has been unclear to this point. “We will work to deliver a practical solution that allows the maintenance of the Common Travel Area with the Republic, while protecting the integrity of the United Kingdom’s immigration system,” May announced. “Nobody wants to return to the borders of the past, so we will make it a priority to deliver a practical solution as soon as we can.”

4: Parliament will vote on the deal

“I can confirm today the government will put the final deal… to a vote in both Houses of Parliament before it comes into force,” May announced. Brexit minister David Davis has predicted that this will be a rubber-stamp operation: “They won’t vote it down. This negotiation will succeed,” he said.

5: Reaction: the pound rises, Europe laughs and the opposition are angry

Markets like certainty, and sterling enjoyed its biggest one-day jump since 1998, to $1.23, although the FTSE dropped significantly. The political reaction, on the other hand, has been mixed. The European media was hostile, with Die Welt just one of the outlets that interpreted the speech as “leading Great Britain into isolation”. Back in the UK, Labour and the Liberal Democrats went on the attack.

How many of your staff want to be their own boss?

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A new report suggests 10% of Britons want to start their own business this year

Research commissioned by cloud accounting software firm FreeAgent found that 10% of respondents plan to start their own business in 2017. With 31.76 million people currently working in the UK, according to recent Office for National Statistics (ONS) figures released in Decemberthat means 3.2 million more Brits are expected to become their own boss by 2018.

Even more employees dream of being their own boss on a longer time scale, with 54% saying they would like to go out on their own at some point in their career.

More females seem to have been bitten by the entrepreneurship bug, with 11% of women, versus 8% of men, wishing to be business owners, with female respondents citing a need for a better work/life balance as their motivation, while  27% of women, in comparison with 16% of men, are in pursuit of fitting work around their family commitments.

Male respondents were more focused on increased earning potential; increased earnings is one of the key drivers for setting up their own business for 41% of men, in comparison with 34% of women.

Other reasons for striking out alone included wanting to choose what work they do (51%), earning more money (37%), following their passion (36%) and having a greater sense of achievement (35%).

Age also appears to be a factor, with the 18-24 age category more keen to be self-employed; 67% of respondents in this age group wish to work for themselves, the largest percentage of any generation.

Ed Molyneux, CEO and co-founder of FreeAgent, said: “Starting your own business can be an extremely rewarding, if daunting, move for people to make with their career – and it’s clear from our research that a significant number of British workers are considering taking this leap into self-employment in 2017.

“However, while it’s very pleasing to see so many would-be entrepreneurs thinking about going solo, it’s important for any new business owner to make sure they are fully prepared before they start up. One of the main reasons that new businesses fail is because they cannot maintain a healthy cash flow, so drawing up a detailed business plan and staying on top of your finances is key if you want to make your venture a success.”

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UK supermarkets report positive Christmas trading results

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There is good news for Tesco, M&S and Morrisons as Christmas sales figures and Kantar market share data have been released.

Tesco has reported a 0.7% rise in the UK, as CEO Dave Lewis explained: “We are very encouraged by the sustained strong progress that we are making across the group. In the UK, we saw our eighth consecutive quarter of volume growth and delivered a third successful Christmas.

“Our fresh food ranges proved particularly popular, outperforming the market with great quality, innovative new products and even more affordable prices.”

Marks and Spencer is also celebrating, as its sales for the 13 weeks to the end of the year have risen by 4.5% in the UK; 1.3% on a like-for-like basis. I am pleased with the customer response we have seen to the changes we are making in line with our plan for the business,” said CEO Steve Rowe.

In Clothing & Home, better ranges, better availability and better prices helped to improve our performance in a difficult marketplace. We also continued to substantially reduce discounting, including over Black Friday.

Our Food business continues to grow market share, with customers recognising our product as special and different. Our Simply Food store pipeline remains strong.

As we look forward, our Q4 reported numbers will be adversely affected by sale timing and a later Easter.”

Morrisons and Sainsbury’s have also reported better-than-expected news for the period.

Meanwhile, analysts Kantar have revealed the latest market share for the supermarket sector, headed again by Tesco (28.2%, down 0.1%), Sainsbury’s (16.7%, down 0.3%) and Asda (16.2%, down 15.5%).

Year-on-year market growth has been helped by comparisons to a weaker Christmas in 2015, but sales were also buoyed by strong consumer appetite for festive celebration after a turbulent year, explained Fraser McKevitt, head of retail and consumer insight. “Shoppers spent £480 million more at the tills than in 2015, leading to record sales for the Christmas period.”

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“She only makes the tea”: 10 reasons why employers don’t pay the minimum wage

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The Department for Business, Energy & Industrial Strategy has published a list of the most bizarre excuses why businesses refuse to pay the minimum wage.

It is topped by “The employee wasn’t a good worker so I didn’t think they deserved to be paid the National Minimum Wage,” followed by “It’s part of UK culture not to pay young workers for the first three months as they have to prove their ‘worth’ first,” and in third place was “I thought it was ok to pay foreign workers below the National Minimum Wage as they aren’t British and therefore don’t have the right to be paid it”.

The move comes as the government launches a £1.7m awareness campaign aimed at educating workers regarding their entitlements.

“There are no excuses for underpaying staff what they are legally entitled to,” explained Business Minister Margot James. “This campaign will raise awareness among the lowest paid in society about what they must legally receive and I would encourage anyone who thinks they may be paid less to contact Acas as soon as possible.

“Every call is followed up by HMRC and we are determined to make sure everybody in work receives a fair wage,” she said. The National Living Wage will increase to £7.50 per hour this spring, with the National Minimum Wage ranging from £4.05 to £7.05.

That list in full:
  1. The employee wasn’t a good worker so I didn’t think they deserved to be paid the National Minimum Wage.
  2. It’s part of UK culture not to pay young workers for the first 3 months as they have to prove their ‘worth’ first.
  3. I thought it was ok to pay foreign workers below the National Minimum Wage as they aren’t British and therefore don’t have the right to be paid it.
  4. She doesn’t deserve the National Minimum Wage because she only makes the teas and sweeps the floors.
  5. I’ve got an agreement with my workers that I won’t pay them the National Minimum Wage; they understand and they even signed a contract to this effect.
  6. My accountant and I speak a different language – he doesn’t understand me and that’s why he doesn’t pay my workers the correct wages.
  7. My workers like to think of themselves as being self-employed and the National Minimum Wage doesn’t apply to people who work for themselves.
  8. My workers are often just on standby when there are no customers in the shop; I only pay them for when they’re actually serving someone.
  9. My employee is still learning so they aren’t entitled to the National Minimum Wage.
  10. The National Minimum Wage doesn’t apply to my business.

Mirror and Express groups in media merger talks

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The owners of the Daily Mirror and Daily Express parent companies have resumed deliberations after two-year break.

Trinity Mirror has confirmed that it is in fresh talks with Richard Desmond’s Northern & Shell group, which owns Express Newspapers.

“The board of Trinity Mirror PLC notes the recent media speculation and confirms that it is at an early stage of discussions towards taking a minority interest in a new company comprising certain of Northern & Shell’s assets,” said Trinity Mirror in a London Stock Exchange statement. “No offer has been made and there is no certainty that any agreement will be reached.”

Trinity Mirror is the UK’s biggest newspaper group, with a portfolio that includes the Daily Mirror, Sunday Mirror, the Scottish Sunday Mail and Daily Record, and a vast array of regional titles acquired from its takeover of Local World in 2015. It now employs over 6,000 people and is home to around 260 titles.

Express Newspapers, meanwhile, is a subsidiary of Richard Desmond’s Northern & Shell group. It played a key role in the Brexit referendum, taking a staunch Eurosceptic line. Northern & Shell is also home of the OK! and New! celebrity magazines, and Desmond bought the Express portfolio in 2000 having built up a proprietorship of adult media titles in the 1980s and 1990s. He sold Channel 5 to Viacom for around half a billion pounds three years ago.

The merger discussions come amid an industry-wide move towards consolidation driven by a decline in print circulation and advertising sales.

 

 

 

 

Five things you need to know about the new UK ambassador

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The appointment of Sir Tim Barrow as the UK’s ambassador to the EU comes as Theresa May’s government attempts to move on from the fallout over his predecessor’s departure.

But who is Sir Tim Barrow, and what are the implications of the furore?

  1. Sir Tim is not Sir Ivan

The resignation of Sir Ivan Rogers earlier this week saw the government scramble to limit the damage. Rogers, the UK’s senior diplomat in the EU, quit over “muddled thinking” and a need to “speak truth to power” as the UK prepared for Brexit, and he warned that “serious multilateral negotiating experience is in short supply in Whitehall”. His resignation was jumped upon by the anti-Brexit side, and Theresa May’s first priority will have been to appoint a figure her government can work with.

  1. Sir Tim Barrow is an EU-experienced diplomat

Warwick- and Oxford-educated Barrow joined the Foreign & Commonwealth Office in 1986 and has served in Kiev, Moscow and Brussels. He has also been first secretary at UKRep, effectively the UK’s Brussels embassy – his strong EU experience making him an obvious candidate for the new role.

  1. He was knighted as ambassador to Russia

Barrow served as UK ambassador to Russia from 2011-2015, and was knighted in the 2015 new year honours for services to British foreign policy and interests in Russia.

  1. His appointment came through the normal civil service route

As the anti-Brexit side saw the Rogers controversy as evidence of the government’s mismanagement, May’s supporters saw Rogers as half-hearted towards Brexit and raised questions about the non-political status of the civil service. As a career diplomat, Sir Tim Barrow has come up through the ranks as usual, in a manner that suggests that the furore over civil service impartiality will recede.

  1. His appointment has largely been welcomed

Reaction to Barrow’s elevation to ambassador has mainly been calm. Sir Simon Fraser, former head of the Foreign Office, told the BBC: “I think what we need in Brussels is somebody who has experience, who’s going to be a real professional negotiator, who will be sitting in a room with lots of other very experienced and knowledgeable negotiators, and who will be able to hold his or her own in that negotiation.” Meanwhile, UKIP figures have criticised the appointment.

Shock as UK’s ambassador to EU resigns

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EU expert Sir Ivan Rogers steps down from his post months early

The Foreign Office today confirmed that Sir Ivan Rogers, the UK’s ambassador to the EU, has announced that he will resign early from his role. He was scheduled to finish his tenure in November.

“Sir Ivan Rogers has resigned a few months early as UK permanent representative to the European Union,” a spokesperson for theForeign Office  said. “Sir Ivan has taken this decision now to enable a successor to be appointed before the UK invokes article 50 by the end of March. We are grateful for his work and commitment over the last three years.

Among the expressions of shock, former deputy prime minister Nick Clegg called the resignation a “body blow” to the government’s Brexit plans.

“I worked for Ivan Rogers in the EU 20 years ago – then he worked for me and the rest of the coalition government several years later,” Clegg said. “Throughout all that time Ivan was always punctiliously objective and rigorous in all he did and all the advice he provided.

“If the reports are true that he has been hounded out by hostile Brexiteers in government, it counts as a spectacular own goal. The government needs all the help it can get from good civil servants to deliver a workable Brexit.”

Former permanent secretary Sir Nicholas MacPherson took to Twitter to express his views, calling Rogers’ resignation a “huge loss” and the “wilful&total destruction of EU expertise [sic]”.

 

Do they know it’s Christmas? Thousands will file tax returns on Christmas Day

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Over 2,000 business owners submitted Self Assessment tax returns to HMRC on Christmas Day last year

More than 2,000 people spent Christmas Day submitting their online tax returns to HM Revenue and Customs last year.

A total of number of 2,044 business owners proved the adage that you never get a day off when you run your own business, as they spent the holiday finishing the essential admin last Christmas Day. Last year’s figures were a record, up 13% from the previous year.

Traditionally the busiest filing time on Christmas Day is just before lunch, from midday to 1pm.

For anyone missing the 31st January deadline, HMRC will automatically issue a £100 penalty, and will charge interest on any unpaid tax. You may also be able to ask HMRC to waive your penalty, if you have what they consider a “reasonable excuse” for not filing your return.

Meanwhile, 600 people rang the new year in by submitting their tax return between midnight and 10am on New Year’s Day.

 

 

Latest survey predicts strong labour market in 2017

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A strong labour market will see job growth continue to rise in 2017, according to the latest CBI/Pertemps Network Group Employment Trends Survey

The underlying strengths of the UK’s labour market will see jobs growth continue into 2017, according to the latest CBI/Pertemps Network Group Employment Trends Survey.

The annual survey – in its nineteenth year, with 353 respondents employing nearly 1.2 million people – found that four in ten (41%) firms across the UK will grow their workforce in the year ahead.  For the fourth year running, the survey shows that growth in permanent job opportunities will outstrip temporary recruitment.

The survey, carried out between August and October 2016, found that while the pace has slowed by comparison to last year’s survey, the positive balance of firms expecting to add employees over those expecting to shed jobs stands at +28%. This continues the optimistic trend we have seen every year since 2011.

Shaken confidence

However, uncertainty about the UK’s future relationship with the EU has shaken overall business confidence in the labour market. Overall, the balance of respondents expecting the UK to be a more attractive place to employ people in the next five years has flipped from +16% in our 2015 survey to -21% in the year’s results.

Josh Hardie, CBI Deputy-Director General, said: “With record employment levels, more people than ever are now in work and the strengths of the UK labour market look set to yield positive results over the course of 2017.

“Businesses are 100% committed to making the best of Brexit. However, this year’s survey does show a greater sense of concern about the UK’s long-term attractiveness as a place to create jobs. Getting our industrial strategy right and understanding what the UK’s future relationship with the EU will be, will help ensure that this worry does not negatively impact the future performance of the labour market.

“The Government should build on the positive moves it has already made to dispel uncertainty by drawing up plans for a smooth transition, giving firms both the time to adapt to new regulations and the confidence to invest beyond 2019.”

Carmen Watson, chair of Pertemps Network Group, said: “2016 may have been a year of uncertainty for businesses but what we are seeing, looking ahead to 2017, is renewed optimism with employers continuing to invest in their workforces leading to jobs growth across the UK.

“It appears also from the survey that the majority of businesses are now working hard to push diversity and inclusivity to the fore, as it is proven to bring benefits including increased talent and improved attraction and retention levels. However, skills gaps remain a concern for employers as having the right people with the right skills is crucial for any organisation’s performance.”

Other highlights from the survey include:
  • 33% of survey respondents expect to create permanent positions, while 14% expect lower, giving a balance of +19%
  • 14% of companies expect to create temporary roles, while 12% expect a reduction in roles, giving a balance of balance, +2%
  • 30% of firms expect to create apprenticeship positions, while 4% expect lower levels of recruitment, giving a balance of +26%
  • 20% expect to expand graduate roles, with 4% plan to see fewer roles, giving a balance of +16% – the same balance as 2015
  • The majority of firms (77%) report positive employee relations and a similar proportion (76%) anticipate this continuing into 2017
  • Businesses are aware of the value of employee engagement, pointing to benefits including improved productivity and performance (73%), increased customer and client satisfaction (57%) and improved employee retention (44%)
  • In the coming year, the top workforce priorities for businesses are achieving and maintaining high levels of employee engagement (48%), retaining talent (41%) and improving leadership skills (37%)
  • Survey respondents emphasised that the future migration system must be responsive to economic need (45%) and provide access to both labour (46%) and skills (40%).
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Murdoch Sky takeover gains momentum

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Deal agreed by 21st Century Fox valued at £11.7bn

Media mogul Rupert Murdoch’s bid to take over Sky via his 21st Century Fox has reached another milestone, with terms being agreed by both sides.

The proposed deal, if completed, will see 21st Century Fox offering £10.75 per share to Sky shareholders, in an acquisition that is expected to complete by the end of 2017 according to the American company’s Nasdaq statement.

“As the founding shareholder of Sky, we are proud to have participated in its growth and development,” 21st Century Fox said. “The strategic rationale for this combination is clear. It creates a global leader in content creation and distribution, enhances our sports and entertainment scale, and gives us unique and leading direct-to-consumer capabilities and technologies. It adds the strength of the Sky brand to our portfolio, including the Fox, National Geographic and Star brands.”

The deal is valued at £11.7bn in order to acquire the 61% of Sky not yet owned by 21st Century Fox. It has already sparked intense political debate, five years on from the phone-hacking scandal that ended Murdoch’s previous attempt to fully acquire the broadcaster.

Sky’s deputy chairman, Martin Gilbert, added detail to the proposal. “The Independent Committee, which was formed with the express purpose of protecting independent shareholders’ interests in relation to the proposal from 21st Century Fox, has given full consideration to the fundamental value and prospects for the Sky Group,” he explained.

“While the Independent Committee remains confident in Sky’s long-term prospects, as laid out in detail at our recent investor day in October, we, supported by our advisers, believe 21st Century Fox’s offer at a 40% premium to the undisturbed share price will accelerate and de-risk the delivery of future value for all Sky Shareholders. As a result, the Independent Committee unanimously agreed that we have a proposal that we can put to Sky shareholders and recommend.

“The Independent Committee also notes 21st Century Fox’s track record in growing businesses and its ability to continue the development of Sky across Europe, in a world where entertainment and distribution are converging. 21st Century Fox’s ownership will support the delivery of Sky’s strategy and long-term growth, ensuring that it remains at the forefront of Europe’s creative industries.”