(qlmbusinessnews.com via news.sky.com– Mon, 18th Feb 2019) London, Uk – –
The Rail Delivery Group says some prices would rise and others would fall under the plan to set fares “more flexibly”.
Train operators are calling for a major shake-up of fares that would throw out current rules governing peak and off-peak pricing and also end the need for so-called split-ticketing.
The Rail Delivery Group (RDG) says it wants to simplify the system under the principle that customers “only pay for what they need and are always charged the best value fare”.
It said some fares would go up and some would go down under the plan though claimed that overall it would be “revenue neutral”.
The RDG said updating regulations on peak and off-peak travel “would mean ticket prices could be set more flexibly, spreading demand for a better customer experience”.
It said current rules resulted in under-used and more expensive services at natural peak times and overcrowded trains at the “shoulder peak” – immediately before and after the peak time.
The body, which represents Britain's train operating companies, said however that it recognised concerns about protecting “affordable access to the walk-up railway” and was proposing for some services to have a cap on the overall level of revenue that can be raised.
It said its plan for passengers to always be charged the best value fare would also remove the need for “split ticketing”
That is where savvy travellers have worked out that they can save money by paying for multiple tickets for different sections of the same journey.
For example, the £150 cost of a journey from Manchester to Edinburgh would currently be reduced to £92.20 by buying two tickets: one from Manchester to York, and a second from York to Edinburgh.
Another part of the RDG plan would see commuters benefit from the kind of weekly capping system currently available for journeys within London.
Pay-as-you-go pricing and a “tap-in, tap-out” system would allow those who currently buy weekly season tickets to save money when they travel fewer than five days or are able to travel off-peak.
That could benefit the increasing numbers of people who work part-time.
RDG chief executive Paul Plummer said: “Reconfiguring a decades-old system originally designed in an analogue era isn't simple, but this plan offers a route to get there quickly.
“Ultimately, it is up to governments to pull the levers of change.
“So this report is a call on them to work with us to update the necessary regulations and subsequently the system of fares.”
The “easier fares for all” plan has been submitted to the government's Williams Review, which is evaluating all aspects of the rail network.
Lilian Greenwood MP, chair of the Commons transport select committee, said the proposals showed a “welcome recognition that things need to change”.
But she added: “The devil will be in the detail, and my committee… will be keeping a close eye on this work to ensure it develops in ways that are fair, transparent, recognise the needs of passengers, and take account of the vital contribution that the railway makes to our society and economy.
“In the meantime, passengers still require reassuring that enough trains will turn up – on time and fit to run – particularly after the timetabling chaos in May 2018.”
(qlmbusinessnews.com via bbc.co.uk – – Fri, 15th Feb 2019) London, Uk – –
Millennium & Copthorne Hotels has blamed a shortage of workers due to Brexit uncertainty for contributing to falling profits.
The hotel chain reported a 28% fall in pre-tax profits to £106m for the 12 months to 31 December 2018, compared with the same period in 2017.
It said Brexit concerns had affected its UK hotels, particularly in London.
The hotel chain also blamed the US-China trade war, minimum wage and competition from Airbnb for its woes.
For the fourth quarter of 2018, pre-tax profits dropped 76% to £7m.
In particular, revenue per available room in London dropped 7.4%, partly due to the closure of its Mayfair hotel for refurbishment.
“Concerns about Brexit have affected the Group's UK hotels especially in London, where the hotels started to face difficulties in recruiting EU workers which currently comprise more than half of the London workforce,” it said in a statement.
The hotel chain also said that it had been affected by the increase in the minimum wage, which came into force last year.
“The shortage of talent-from rank and file to senior management-is intensifying with many new hotels being built around the world, not to mention the growth of Airbnb and serviced apartments,” said chairman Kwek Leng Beng.
He stressed that all hospitality businesses would “need to evolve and embrace” changes in the industry in order to remain relevant and profitable.
(qlmbusinessnews.com via bbc.co.uk – – Wed, 13th Feb 2019) London, Uk – –
UK inflation fell to 1.8% in January, the lowest in two years, the Office for National Statistics said.
This is down from 2.1% the previous month.
A fall in electricity, gas and other fuels drove the decline, the ONS said.
Head of Inflation Mike Hardie said: “The fall in inflation is due mainly to cheaper gas, electricity and petrol, partly offset by rising ferry ticket prices and air fares falling more slowly than this time last year”.
It means that rises in pay are now now outpacing inflation.
The rate of inflation is now below the Bank of England's 2% target and has fallen from the five-year peak of 3.1% in November 2017 in the wake of the Brexit referendum vote.
Energy prices fell because of Ofgem's energy price cap which came into effect from 1 January 2019, the ONS said.
(qlmbusinessnews.com via theguardian.com – – Thur, 7th Feb 2019) London, Uk – –
Ofgem’s decision on default tariffs and prepayment meters down to rising wholesale costs
Around 15m households will see their energy bills increase by more than £100 a year from April after the regulator Ofgem said it was lifting two price caps because of rising wholesale costs.
Big energy suppliers are expected to increase their prices by £117 for 11m customers on default tariffs to a new ceiling of £1,254 a year for a home with typical use, leaving many consumers paying more for their electricity and gas than before the flagship policy took effect on 1 January.
Consumer groups said the rise was “eye-watering” and would be a shock for people who thought the cap would stop their bills from rising.
The significant increase, which wipes out the average saving of £76 from the cap, will be embarrassing for ministers, who promised that people would save money under the flagship policy.
The rise is one of the worst increases in years and on a par with the largest by the big six energy suppliers over the past two years, many of which the government claimed were unjustified.
Comparison sites, which are opposed to the cap, branded the increase “brutal”, “jaw-dropping” and the “worst possible start for the energy cap”.
Ofgem also announced a rise of £106 a year to £1,242 for a further 4m households on prepayment meters, who are typically more vulnerable customers.
Together, the increases in the two caps will add a collective £1.71bn to consumer bills, according to the auto-switching site Look After My Bills.
Ofgem insisted consumers were paying a fair price for their energy despite the increases. The regulator said it had to raise the caps because wholesale costs facing energy firms had increased by 17% and other costs had climbed, too.
“We can assure these customers that they remain protected from being overcharged for their energy and that these increases are only due to actual rises in energy costs, rather than excess charges from supplier profiteering,” the regulator’s chief executive, Dermot Nolan, said.
The regulator said its analysis suggested without the cap people would be “paying significantly more even after the increase” of the cap in April.
The government said the higher caps reflected sharp increases in electricity and gas costs.
Claire Perry, the energy minister, said: “We were clear when we introduced the cap that prices can go up but also down.”
Gillian Guy, the chief executive of Citizens Advice, a consumer group that backs the cap, said: “As unwelcome as this news is, it’s likely that prices would be higher still without the cap and there are steps people can take to ease the strain on their bills.”
Industry body Energy UK said suppliers of all sizes were facing “drastically rising costs”.
One of the big six companies, npower, last week blamed 900 job cuts on the cap and competition.
The caps dictate the maximum suppliers can charge per unit of energy and for a standing charge, so higher energy users will pay more.
(qlmbusinessnews.com via uk.reuters.com — Tue, 5th Feb 2019) London, UK —
LONDON (Reuters) – Britain’s economy risks stalling or contracting as Brexit nears and the global economy slows, with firms in the dominant services sector reporting job cuts for the first time in six years and falling orders, a survey showed on Tuesday.
A closely watched gauge of the world’s fifth-biggest economy, the IHS Markit/CIPS UK Services Purchasing Managers’ Index, fell to 50.1 in January from 51.2 in December — its lowest level since July 2016 and barely above the 50 mark that separates growth from contraction.
A Reuters poll of economists had expected a reading of 51.0.
Britain’s economy defied forecasts from some economists that it would go into recession after the 2016 referendum vote to leave the European Union. But growth slowed sharply in late 2018 as worries mounted about an abrupt, no-deal Brexit.
Overall, the survey suggested Britain’s economy is flat-lining after losing momentum late last year.
Tuesday’s figures are likely to worry Bank of England officials ahead of their latest interest rate decision announcement and new forecasts for the economy on Thursday.
“The latest PMI survey results indicate that the UK economy is at risk of stalling or worse as escalating Brexit uncertainty coincides with a wider slowdown in the global economy,” said Chris Williamson, chief business economist at survey compiler IHS Markit.
The report adds to other signs that Brexit, scheduled in less than two months’ time, is taking its toll on businesses and consumers.
Prime Minister Theresa May, under pressure from her own Conservative Party, wants to reopen her withdrawal agreement with the European Union to replace a contested Irish border arrangement, something Brussels has rejected.
Investors are urging the government to ensure an orderly exit from the club Britain joined in 1973.
On Monday, a Deloitte survey of chief financial officers showed appetite to take on financial risk had fallen to its lowest level in nearly a decade due to fears of “the hardest of Brexits” and rising U.S. protectionism.
That caution was evident in Tuesday’s survey, covering the bulk of Britain’s private sector economy.
New orders fell for only the second time since the financial crisis, while employers cut jobs for the first time since late 2012 — around the last time Britain flirted with recession.
“The survey results indicate that companies are becoming increasingly risk-averse and eager to reduce overheads in the face of weakened customer demand and rising political uncertainty,” Williamson said.
New export orders contracted at the fastest pace since records for this part of the PMI began in September 2014.
The composite PMI for December, combining the manufacturing, construction and service sectors, fell to 50.3 from 51.5 in November, the lowest level since July 2016.
(The story corrects Reuters poll figure in 3rd paragraph to 51.0 from 51.1.)
(qlmbusinessnews.com via theguardian.com – – Mon, 4th Feb 2019) London, Uk – –
Carmaker will not build new X-Trail in UK, saying uncertainty about future is affecting firms
Nissan has confirmed it is abandoning plans to build a new model of one of its flagship vehicles at its Sunderland plant, as it warned that uncertainty over Brexit was affecting businesses.
The Japanese car manufacturer announced in 2016 it would be making the new version of the X-Trail SUV at the factory in north-east England after receiving assurances about Brexit from the government, but on Sunday it said it would be produced in Japan.
Nissan said it had taken the decision “for business reasons” but warned that Brexitwas having an impact, saying: “The continued uncertainty around the UK’s future relationship with the EU is not helping companies like ours to plan for the future.”
It acknowledged in a letter to workers: “Today’s announcement will be interpreted by a lot of people as a decision related to Brexit.” The X-Trail is produced in Japan currently and Nissan said keeping production there would reduce “upfront investment costs”. The slump in the European diesel car market also played a role in the decision, with the Sunderland plant originally earmarked for the diesel version of the X-Trail.
Greg Clark, the business secretary, made no attempt to hide his disappointment at Nissan’s decision and said it was not surprising that business were holding back on spending decisions given the ongoing political impasse over Brexit.
“People are keen to invest but all motor companies and others across the economy point to the fact they don’t know what our trading relationship will be with our most important trading partner, and that is a source of uncertainty they want resolved and I want it resolved too, because it is hampering investment that would otherwise be made,” Clark said.
The minister hopes that Nissan’s announcement will help concentrate minds in cabinet and Westminster, and believes MPs in his own party and elsewhere will need to switch to supporting Theresa May’s Brexit deal to avoid similar decisions being taken by other multinational companies shortly.
The Labour leader, Jeremy Corbyn, said: “The Conservatives’ botched negotiations and threat of a no-deal Brexit is causing uncertainty and damaging Britain’s economy.” The party added it would press the government to spell out in detail what Brexit reassurances May had given the carmaker in 2016, when she met its former chief executive Carlos Ghosn before the original decision to manufacture the X-Trail in Sunderland. At the time the government said the assurances covered research and development, training and supporting the local supply chain.
Clark will give a statement about Nissan in the House of Commons on Monday, although a government insider added: “There’s no conspiracy about the reassurances; if they were any good, they’d have worked”.
Sunderland voted 61% to leave, although several of the MPs in the north-east want the UK to stay in the European Union. Phil Wilson, the Labour MP for nearby Sedgefield, said that Nissan had originally invested in the UK because “we were in the single market, the customs union and the EU”. He added: “If companies like this are starting to thing twice in investing in Sunderland and in the UK, it could have a significant downside for the economy on this area,” which he described as “the equivalent of when the collieries closed in the 1980s”.
Calling the decision “very disappointing news” for Sunderland and the north-east”,the Unite union said it blamed Brexit uncertainty for the decision, along with the government’s “mishandling” of the transition away from diesel. It expected the company “to work with us to ensure full preparations for Brexit in which jobs and investment are prioritised”.
Nissan said plans over other future models destined for the Sunderland plant – the next-generation Juke and Qashqai – were unaffected by the announcement.
The company’s decision will fuel concern about the economic impact of Brexit, particularly on deprived parts of the country – less than eight weeks before the UK is due to leave the European Union – with some global companies appearing reluctant to make further investment.
The announcement came days after figures from the Society of Motor Manufacturers and Traders (SMMT) revealed that British car production had dropped to a five-year low in 2018, as manufacturers warned that fears of a no-deal Brexit had prompted a fall in new investment.
Nissan employs about 6,700 staff at the Sunderland site, producing 2,000 cars a day. It is Britain’s biggest car plant, making it one of the region’s key employers. The opening of the Nissan plant in the mid-1980s marked the revival of a UK car industry that makes some of the world’s most renowned brands, including Mini, Jaguar Land Rover, Toyota, Honda and Bentley.
Since the plans were linked to greater investment, the move is not expected to have a significant impact on jobs, although Unite’s assistant general secretary, Steve Turner, referred to hundreds of new jobs and apprenticeships being lost because of the move.
Labour’s Bridget Phillipson, the MP for Houghton and Sunderland South, said the announcement “is the clearest signal yet of the damage being caused to the UK car industry by the uncertainty around Brexit. I fear this announcement is only the beginning and it is working people who will suffer the consequences.”
The MP for Sunderland Central, Labour’s Julie Elliott, said tens of thousands of people depended on Nissan for their livelihoods – both directly and through the supply chain. She said: “The production of the X-Trail would have created hundreds of much-needed extra jobs in the future. Sadly, any loss of future production at the plant makes it less stable.”
Rebecca Long-Bailey, the shadow business secretary, said: “The government’s chaotic handling of Brexit has been the root cause of business uncertainty. There are serious questions that the government must now answer on Monday, not least what was in the secret Brexit deal it issued to Nissan and why this was no longer good enough.”
Nissan said the company had decided to “optimise its investments in Europe” by consolidating X-Trail production at its Kyushu plant in Japan, which is the model’s global production hub.
Hideyuki Sakamoto, Nissan’s executive vice-president for manufacturing and supply chain management, said: “A model like X-Trail is manufactured in multiple locations globally and can therefore be re-evaluated based on changes to the business environment. As always, Nissan has to make optimal use of its global investments for the benefits of its customers.”
Gianluca de Ficchy, Nissan Europe’s chairman, said that with the X-Trail already manufactured in Japan, “we can reduce our upfront investment costs”.Advertisement
He added: “We appreciate this will be disappointing for our UK team and partners. Our workforce in Sunderland has our full confidence and will continue to benefit from the investment planned for Juke and Qashqai.”
Other Nissan models built at the site include electric car the Leaf.
(qlmbusinessnews.com via news.sky.com– Tue, 29th Jan 2019) London, Uk – –
The company now expects group underlying earnings to decline to between £500m and £530m, compared with £694m last year.
Shares in Royal Mail have plummeted after the company warned that letter numbers by volume will be lower than expected next financial year.
Royal Mail said that letters by volume dropped 8% over the nine months to 23 December, with letter revenues down 6%.
It attributed the volume drop in part to the impact of the General Data Protection Regulation (GDPR) as well as “business uncertainty” in the run up to Brexit.
The company also confirmed that it expects group underlying earnings to decline to between £500m and £530m, compared with £694m last year.
This projected earnings fall comes after Royal Mail warned of a fall in annual profits last October.
The stock market reacted badly to Royal Mail's trading statement and shares fell by as as much as 13% on opening, making it the FTSE 250's worst performer at the start of business.
Shares rallied slightly within a hour to being down 8% on Monday's closing price of 301p.
Overall, Royal Mail reported a 2% rise in underlying revenues for the period, held up by an 8% revenue increase at its General Logistics Systems (GLS) division, which offset a 1% fall in its UK parcels and letters arm.
Royal Mail group chief executive Rico Back said: “We have had a busy Christmas season.
“In the UK we recruited 23,000 seasonal workers and opened six temporary parcel sorting centres to make sure we had the capacity to handle the high volumes of parcels and cards through our network.
“In the December trading period alone we handled 164 million parcels, up 10% compared with last year.”
Mr Back added: “Due to our letters performance to date, we expect addressed letter volume declines, excluding elections, to be in the range of 7% to 8% for 2018-19.
“While the rate of e-substitution remains in line with our expectations, business uncertainty is impacting letter volumes.
“As a result, addressed letter volume declines, excluding elections, are likely to be outside our forecast medium-term range next year.
“Otherwise, we are reconfirming the outlook and other guidance for 2018-19 provided in our half-year results.”
Nicholas Hyett, Equity Analyst at Hargreaves Lansdown said: “The continuing collapse in letter volumes is the big news in these numbers.
“Royal Mail's gone out of its way to say that's down to wider uncertainty, and the introduction of new privacy laws under GDPR, rather an uptick in companies using email rather than paper.
“Whatever the cause, we suspect those mailings are gone for good.”
“News that the capital markets day has been pushed back to after full year results suggests to us that the all-important cost savings may also be proving harder to deliver than hoped.
“Those efficiency gains remain central to the Royal Mail investment story, and if they can't be delivered then there's nothing to protect the group from the pains of an economic downturn in the UK.”
(qlmbusinessnews.com via bbc.co.uk – – Fri, 25th Jan 2019) London, Uk – –
British clothing manufacturers have been forced to pay almost £90,000 to employees for non-payment of the minimum wage.
An HM Revenue & Customs investigation found that over a six-year period 126 garment workers were paid wage arrears.
MP Mary Creagh, who reviewed the HMRC data, said it showed exploitation in the industry was still “rife”.
HMRC has 14 ongoing investigations, and it found underpayment in one in every four inspections.
“This [exploitation] must stop,” said Ms Creagh, chairwoman of the Environmental Audit Committee. “We need government action to end these 19th century practices in 21st century Britain.
“It has been 20 years since the introduction of the minimum wage but in our inquiry we heard that underpayment is rife and goes hand-in-hand with a culture of fear and intimidation in the UK's textile industry.”
The committee has been looking into the sustainability of the fashion industry.
In October, it warned that fast fashion is damaging the planet, and in November MPs quizzed retail executives on how firms could justify selling clothes for £5 or less.
According to Adam Mansell, chief executive of the UK Fashion and Textile Association (UKFTA), retailers have long been aware that problems exist with exploitation of workers in Britain, but the problems are numerous and difficult to solve.
“There have been efforts in the past to shut down these factories, but unfortunately what happens is they operate under a phoenix system where they will close one day, and then open up under a different name the next day,” he told the BBC.
And following attempts by retailers to quell exploitation by publicly terminating contracts with certain factories, some factory owners have found other ways to evade detection of their business practices.
“For instance, you place an order with Factory A, but they outsource that manufacturing to Factory B or C [which might be exploiting workers], so the retailer doesn't get to see the factory where the goods are actually being made,” said Mr Mansell.
The trade body has also received anecdotal evidence that many of the exploited workers claim state benefits, which makes them more likely to accept being paid below minimum wage.
“The retailers and government enforcement agencies are aware of this and they don't want to put people who are being exploited in an even worse position,” he added.
UKFTA is working with the government and retailers to try to prevent exploitation.
“In London, there are 13,500 people employed making clothes for high-end fashion brands. Quite often these brands pay a London living wage,” said Mr Mansell.
“If you can afford to operate in London, make a profit and still pay a living wage, then there's no reason you can't do this anywhere else in the country.”
(qlmbusinessnews.com via theguardian.com – – Mon, 21st Jan 2019) London, Uk – –
Value of retail property will slump as shift to online giants continues, says report
A further 175,000 jobs will be shed from struggling UK high streets this year and the value of retail property will slump as the boom in online shopping and rise of giants such as Amazon continue to take their toll, research warns.
More than 23,000 shops are forecast to close in 2019, according to the findings published on Monday in an annual report from the real estate adviser Altus Group.
The figures suggest this year will be even worse than 2018, when a series of high-profile company failures and store-closure programmes claimed nearly 20,000 stores and 150,000 jobs. They include both multiples or chains as well as independent stores and – in the hospitality sector – restaurants and casual dining outlets.
The seismic shift in shopping habits in the UK prompts the authors to predict that the overall value of retail property will tumble by 15.9% this year as shoppers are lured away from the high street by online alternatives.
Many high streets are struggling with fewer customers and the shift to online shopping. The most recent official figures available showed the number of shops, pubs and restaurants lying empty soared in the first six months of 2018.
Last year was a difficult year for the retail sector, with a long list of high street failures, including House of Fraser, Evans Cycles, Maplin and Poundworld, while other chains including Mothercare and Carpetright, together closed hundreds of underperforming stores. Retailers planning to close stores this year include Marks & Spencer and Debenhams.
Altus Group’s annual commercial real estate (CRE) innovation report found that 62% of major UK property owners and investors claim that Amazon and other online players have disrupted the retail property market.
A further 78% said the trend towards “experiential” retailing was affecting their investment decisions as customers seek out experience-led shopping. Overall, it warned that “2019 is set to be another tough year for Britain’s high streets as businesses continue to grapple with rising costs, subdued consumer confidence and an increase spend online”.
Separately, the Royal Institution for Chartered Surveyors has taken the unusual step of instructing valuers to be “aware of the potential for significant changes in value” in retail properties – effectively a wake-up call for listed landlords and owners of major shopping centres such as Intu Properties and Hammerson.
“Retail of the future will use bricks-and-mortar spaces in a very different way mixed in with leisure and lifestyle residential spaces” the Altus Group managing director, Guillaume Fiastre, said. “The most successful retailers – the survivors – are learning to draw in their customers with the promise of a personalised experience. Technology makes that all possible but it still needs a strong human element.”
The warning about plummeting retail values comes after the Postings shopping centre in Kirkcaldy, Fife, was put up for sale last week for £1.
(qlmbusinessnews.com via cityam.com – – Thur, 17th Jan 2019) London, Uk – –
The government has reasserted it commitment to developing nuclear power after Hitachi pulled out of the Wylfa nuclear power plant this morning.
The company took the decision to suspend work on the £16bn facility behind Hinkley Point C, which was meant to produce six per cent of the UK’s electricity, after holding detailed discussions with the government.
Read more: Hitachi claims ‘no decision' has been made on future of UK nuclear plant
But despite the move, Hitachi has indicated that it will keep ownership of the site, while discussing options with the government.
“I am very sorry to say that despite the best efforts of everyone involved we’ve not been able to reach an agreement to the satisfaction of all concerned,” said Duncan Hawthorne, the chief executive of Hitachi subsidiary of Horizon Nuclear Power.
“As a result we will be suspending the development of the Wylfa Newydd project, as well as work related to Oldbury, until a solution can be found. In the meantime we will take steps to reduce our presence but keep the option to resume development in future.”
The move puts thousands of jobs at risk and will cause headaches for a government which aims to increase nuclear’s share of energy production from a quarter to a third by 2035.
It could also come at a cost to taxpayers if the government decides to step in and rescue the project.
However, the move also hits Hitachi. The company said it will take a write-down of ¥300bn (£2.14bn) at its British nuclear unit as it suspends the project.
A spokesperson for the Department for Business, Energy and Industrial Strategy said: “As the business secretary [Greg Clark] set out in June, any deal needs to represent value for money and be the right one for UK consumers and taxpayers.”
They continued: “This government is committed to the nuclear sector, giving the go ahead to the first new nuclear power station in a generation at Hinkley Point C, investing £200 million through our recent sector, which includes millions for advanced nuclear technologies.”
“We are also reviewing alternative funding models for future nuclear projects and will update on these findings in summer 2019.”
Read more: Toshiba withdraws from UK nuclear power station
Hitachi was struggling to find other investors to join it in the project, and had called on the government to step in to provide support.
The Japanese company bought into the project when it paid £697m to two German power companies in 2012.
(qlmbusinessnews.com via bbc.co.uk – – Wed, 16th Jan 2019) London, Uk – –
Chancellor Philip Hammond has raised the possibility of an extension to Article 50, the process by which the UK is due to exit the EU.
In a call with business leaders on Tuesday evening, Mr Hammond sought to reassure the business community that a “no-deal” Brexit could be avoided.
According to the CBI, he outlined how the 29 March date might be postponed.
John Allan, president of the CBI, said the chancellor appeared more relaxed about the possibility of a delay.
The CBI, the UK's biggest business lobby group, has warned a “no-deal” Brexit is a threat to jobs and growth.
Mr Allan said it “wasn't absolutely crystal clear” that the government could avoid that scenario, but he understood, following the call, that there would be moves in Parliament next week which would allow the UK's exit date from the EU to be put back “if it became clear we were heading towards that”.
A delay to implementation of Article 50 would avoid the UK leaving the EU without a negotiated deal.
The CBI chief said he was encouraged by government moves to build a cross-party consensus for a new approach to Brexit.
Andrea Leadsom, leader of the House of Commons, told the BBC the government would not be delaying Brexit.
“We are clear we won't be delaying Article 50. We won't be revoking it,” she said.
Despite fears that the pound would plummet if the government suffered a heavy defeat in Parliament, sterling rallied slightly. Shares traded in London broadly flat on Wednesday morning. Some observers have suggested that there is now a stronger consensus amongst MPs wishing to avoid a “no-deal” Brexit, making that a less likely outcome.
Investment bank Goldman Sachs said Tuesday evening's Parliamentary defeat for the prime minister made it more likely that the UK would pursue a “softer” Brexit, retaining closer ties to the EU, or even that Brexit might be overturned.
“We think the prospect of a disorderly ‘no-deal' Brexit has faded further,” Goldman Sachs' European economist Adrian Paul wrote in a note.
Goldman Sachs still believes the most likely outcome is that “a close variant” of the deal Mrs May has negotiated with Brussels will eventually be passed by the House of Commons.
However, Stephen Martin, director general of the Institute of Directors, said the UK was still “staring down the barrel of no deal”.
“As things stand, UK law says we will leave on 29 March, with or without a withdrawal agreement, and yet MPs are behaving as though they have all the time in the world – how are businesses meant to prepare in this fog of confusion?” he said.
(qlmbusinessnews.com via news.sky.com– Wed, 16th Jan 2019) London, Uk – –
The PM's commons defeat has angered business leaders who fear they are looking “down the barrel” of a no deal Brexit.
Business leaders have expressed their “frustration” over the political turmoil and lack of a Brexit deal after Prime Minister Theresa May's defeat in the Commons.
Sky's City editor Mark Kleinman reported executives from some of the biggest companies rounded on cabinet ministers after they refused to rule out a no-deal Brexit.
Here's the response to Mrs May's defeat from some of UK's leading business groups.
Adam Marshall, director general of the British Chambers of Commerce, said:
“There are no more words to describe the frustration, impatience, and growing anger amongst business after two and a half years on a high-stakes political rollercoaster ride that shows no sign of stopping.
“Basic questions on real-world operational issues remain unanswered, and firms now find themselves facing the unwelcome prospect of a messy and disorderly exit from the EU on March 29th.”
Stephen Martin, director general of the Institute of Directors, said:
“It is the collective failure of our political leaders that, with only a few weeks to go, we are staring down the barrel of no deal.
“As things stand, UK law says we will leave on 29th March, with or without a withdrawal agreement, and yet MPs are behaving as though they have all the time in the world – how are businesses meant to prepare in this fog of confusion?
“The clock is still ticking, and whatever the outcome of tomorrow's no confidence vote, the reality is that MPs will still need to find a way to put aside their differences and come to an agreement.”
Carolyn Fairbairn, CBI director-general, said:
“Every business will feel no deal is hurtling closer. A new plan is needed immediately. This is now a time for our politicians to make history as leaders. All MPs need to reflect on the need for compromise and to act at speed to protect the UK's economy.”
Miles Celic, chief executive of TheCityUK, said:
“The outcome of today's vote prolongs uncertainty and will continue to depress business confidence.
“The lack of clarity on the path to an orderly Brexit risks disruption and financial instability on both sides of the Channel. We urge the government and MPs to carefully consider the options without delay and put forward an economically sensible way ahead.
“A no deal outcome is not in the best interests of customers in the UK or the EU.”
Catherine McGuinness, policy chair at the City of London Corporation, said:
“Parliament's decision to reject the Government's deal means businesses across the UK will continue to face uncertainty regarding our relationship with the European Union.
“The Government must now urgently set out its ‘Plan B' to ensure we can secure a deal locking in a legally binding transition before 29 March.
“Financial stability must not be jeopardised in a game of high-stakes political poker. Politicians across all parties should work together pragmatically to avoid a no-deal Brexit, which would be a hugely damaging outcome for households and businesses on both sides of the Channel.”
(qlmbusinessnews.com via uk.reuters.com — Thur, 10th Jan 2019) London, UK —
LONDON (Reuters) – Britain’s biggest carmaker Jaguar Land Rover (JLR) (TAMO.NS) is set to announce “substantial” job cuts in the thousands, a source told Reuters, as the company faces double-digit drops in demand in China and a slump in sales for diesel cars in Europe.
The company builds a higher proportion of its cars in Britain than any other major or medium-sized carmaker and has also spent millions of pounds preparing for Brexit, in case there are tariffs or customs checks.
JLR swung to a loss of 354-million pounds between April and September and had already in 2018 cut around 1,000 roles in Britain, shut its Solihull plant for two weeks and announced a three-day week at its Castle Bromwich site.
The Tata Motors-owned company has unveiled plans to cut costs and improve cash flows by 2.5 billion pounds including “reducing employment costs and employment levels.”
Those cuts will be “substantial” and run into the thousands, the source told Reuters.
“The announcement on job losses will be substantial, affecting managerial, research, sales, design,” said the source, who spoke on condition of anonymity.
Production-line staff will not be affected “at this stage,” said the source.
The company, which employs nearly 40,000 people in Britain and has been boosting its workforce at new plants in China and Slovakia in recent years, declined to comment when contacted by Reuters on Thursday.
JLR, which became Britain’s biggest carmaker in 2016, had been on course to build around 1 million vehicles by the turn of the decade, but output in 2018 looks set to have fallen as sales in the first eleven months dropped 4.4 percent.
Sales in China between July and September fell by 44 percent, the biggest slump of any market for the central England-based firm, turning the country from its biggest sales market to its smallest.
Its chief financial officer said in October that the firm’s Changshu plant in China “has basically been closed for most of October in order to allow the inventory of both our vehicles and dealer inventory to start to reduce.”
Diesel accounts for 90 percent of the firm’s British sales and 45 percent of global demand, the company said last year, as demand in the segment tumbles following new levies in the wake of the 2015 Volkswagen emissions cheating scandal.
Like fellow automakers, the company could see its three British car factories grind to a halt in fewer than 80 days if lawmakers next week reject a deal by Prime Minister Theresa May, leading to tariffs and customs checks after a no-deal outcome.
(qlmbusinessnews.com via theguardian.com – – Thur, 10th Aug 2019) London, Uk – –
MPs told of triple threat of disruption to stocks, higher prices and farmers going bust
Farming leaders and landowners from across the UK have written to MPs to plead with them to make sure that the idea of a no-deal Brexit is taken off the table, warning of the “catastrophic” impact it would have on the country’s food supply.
They warned of a triple threat with the possibility of disrupted food supplies, higher food prices and farmers being put out of business because the EU market could be closed to British food exporters for six months.
“Brexit will mean that, for the first time in a generation, UK politicians will have direct responsibility for ensuring our nation is properly fed. The implications, not only for domestic food supply but for the careful management of our cherished countryside, would represent an historic political failure,” said the four main farmers’ unions, including the National Farmers Union, in a letter to MPs.
Separately, tenant farmers and landowners have written to MPs warning of a no-deal disaster.Advertisement
“This is a recipe for disaster for all farmers and ultimately will cause long-term damage to the rural communities and countryside of our nation,” said the Country Land and Business Association and the Tenant Farmers Association in a joint letter.
They also want assurances over the prospect of lower-quality food such as chlorinated chicken, currently banned by the EU, entering the market in a no-deal scenario. They said the thought that the standards of British farming could be “undermined by cheaper, lower-quality, imports” was a major concern.
The NFU, NFU Cymru, NFU Scotland and the Ulster Farmers’ Union, said the impacts of no deal would mean a potential trade embargo on UK meat and plant products.
They raised similar concerns in September but feel that few grasp the implications of Britain becoming a “third country” in relation to the EU.
They have been told that 6,000 meat processing plants that export to the EU will have to undergo individual audits by British authorities which must then be certified in Brussels. These will then be checked by EU officials and put to a standing veterinary committee for approval, a process that the NFU has calculated will take six months “at a conservative reading”.
In its letter the NFU says this would lead to an “effective trade embargo on the export of UK animals and animal-based products”. Farmers exporting products would face “draconian tariffs” designed to make any non-EU products uncompetitive” against EU food. The effective EU tariff would be 65% on beef, 46% on lamb and 27% on chicken, MPs have been told.
Small-scale sheep farmers, many of whom earn less than £20,000 a year, are thought to be particularly vulnerable, with 21% of all lamb meat being exported and 94% of that to the EU. Almost 90% of all beef exports also went to the EU, according to 2017 figures.
The Farmers’ Union of Wales has suggested that mountain sheep farmers would be “wiped out” by a no deal over Brexit.
(qlmbusinessnews.com via news.sky.com– Mon, 7th Jan 2019) London, Uk – –
Plummeting diesel sales, new emissions rules, and a Brexit-linked hit to consumer confidence were all blamed for the downturn.
New car sales fell by nearly 7% last year in the biggest annual drop since 2008, according to industry figures.
A slump in demand for diesel, stricter emissions rules, and falling consumer confidence ahead of Brexit were blamed for the decline.
Figures from the Society of Motor Manufacturers and Traders (SMMT) showed 2.37 million new cars were sold in 2018, down more than 174,000 on the previous year.
The 6.8% fall was the second year in a row of decline and the largest drop since demand fell by 11.3% during the financial crisis a decade ago.
SMMT chief executive Mike Hawes described the challenges facing the industry as a “perfect storm”. The trade body is forecasting a further 2% decline in 2019.
Mr Hawes said: “A second year of substantial decline is a major concern, as falling consumer confidence, confusing fiscal and policy messages and shortages due to regulatory changes have combined to create a highly turbulent market.
“The industry is facing ever tougher environmental targets against a backdrop of political and economic uncertainty that is weakening demand so these figures should act as a wake-up call for policy makers.”
The key factor in the decline for last year was a 29.6% drop in diesel sales – with the SMMT blaming a “lingering sense of uncertainty” over how diesel cars will be taxed and treated after the Volkswagen emissions cheating scandal in 2015.
Petrol car sales were up by 8.7% while alternatively-fuelled vehicles such as plug-in hybrids or electric cars were up 20.9%.
Another factor affecting car sales was the implementation of a new EU emissions testing procedure which came into force in September and was blamed for a supply shortage in the autumn.
Mr Hawes said it would be unfair to attribute too much significance to concerns over Brexit when explaining the fall in new car sales.
But he said that falling consumer confidence had reduced consumers' appetite for a “big ticket purchase”.
The SMMT, like other business bodies, is calling for MPs to back Theresa May's Brexit agreement and avoid a no-deal scenario.
It says that crashing out of the EU without an agreement risked destroying the car manufacturing industry, which employs more than 850,000 people in the UK.
(qlmbusinessnews.com via bbc.co.uk – – Fri, 4th Jan 2019) London, Uk – –
UK house prices grew at an annual pace of 0.5% in December, the Nationwide building society has said, the slowest annual rate since February 2013.
The lender says uncertainty over the economic outlook appears to be undermining confidence in the market.
London and surrounding areas saw a small fall in house prices in 2018.
Northern Ireland saw the biggest house price rises, up 5.8%. Prices in Wales climbed 4%, in Scotland they were up 0.9% and in England they rose 0.7%.
December's growth rate, based on its own mortgage data, was a marked slowdown from the annual pace of 1.9% recorded by the Nationwide in November.
The Nationwide's chief economist, Robert Gardner, told the BBC the severity of the slowdown was unexpected: “It is a little bit surprising that house price growth has slowed as much as it has in the last month or so.
“It seems to be the uncertain economic outlook that is really weighing on buyer sentiment. I think once that lifts then things should start to pick up to normal levels of about 2%.”
He said a lot of it “depends on how we get through this Brexit uncertainty”.
Chief UK economist at Pantheon Macroeconomics, Samuel Tombs, said the slowdown was striking, but the overall outlook for the market was relatively benign: “The hefty month-to-month fall in house prices in December [of 0.7%] – the biggest Nationwide has reported since August 2011 – brings an end to a weak year for the housing market.
“While the supply of homes for sale also has dwindled, the balance of demand and supply has shifted in buyers' favour. That said, we continue to doubt that a sustained period of falling house prices is likely.”
He said that assuming MPs back some form of Brexit deal, with a subsequent recovery in consumers' confidence, prices were likely to pick up to grow by 2% this year.
Nicholas Finn, executive director of Garrington Property Finders, said: “At one extreme we are seeing a surge in the numbers of opportunistic, frequently cash, buyers emerging to snap up homes at large discounts.”
“Meanwhile thousands of would-be sellers are instead hunkering down and waiting until things improve before putting their home on the market.”
Separate figures from the Bank of England showed that mortgage approvals for house purchases fell in November, and are now at half the level of 15 years ago.
The Nationwide said that house prices in London and the surrounding areas, such as Berkshire, had fallen by 0.8% and 1.4% in the past year.
However, outside these areas, each nation and English region – based on Nationwide's local mortgage data – recorded annual house price growth.
In addition to steady price growth in Northern Ireland and Wales, the East Midlands also saw prices increase by 4%.
“With prices in both inner and outer London falling, the capital bears a share of responsibility for dragging down the national pace of growth,” Mr Finn said.
(qlmbusinessnews.com via theguardian.com – – Thur, 3rd Jan, 2019) London, Uk – –
Brexit blamed as 81% of manufacturers and 70% of service sector firms report difficulties finding skilled staff
Britain’s manufacturers are facing the biggest shortage of skilled workers since 1989 amid record levels of UK employment and falling numbers of EU27 nationals coming to the country to work since the Brexit vote.
The British Chambers of Commerce (BCC) said more than four-fifths of manufacturers struggled to hire the right staff in the final months of 2018.
In a survey of more than 6,000 employers across the country, the lobby group found 81% of manufacturers and 70% of service sector firms reported difficulties with finding staff with the right qualifications and experience.
Adam Marshall, the director general of the BCC, said the government urgently needed to recognise the magnitude of the recruitment difficulties firms faced as ministers prepared to introduce restrictions on EU nationalsworking in the UK after Brexit.
Sajid Javid, the home secretary, is looking to cut immigration from the EU by 80% after Britain leaves, including through the extension of a £30,000-a-year minimum salary threshold already applied to non-EU workers.
Marshall said: “Business concerns about the government’s recent blueprint for future immigration rules must be taken seriously – and companies must be able to access skills at all levels without heavy costs or bureaucracy.”
The recruitment difficulties come as the UK employment rate stands at the highest level since 1971, while unemployment is at its lowest since 1975, making it harder for companies to hire new workers without offering higher wages.
Net migration from the rest of EU to the UK has also slumped to a six-year low. The weaker pound has made it less attractive for foreign nationals to come to Britain to work, while Brexit has also raised the prospect of tougher immigration rules in future.
The BCC said the economy also appeared to be “stuck in a weak holding pattern” at the start of the year owing to Brexit uncertainty, with companies reporting stagnant levels of growth and faltering business confidence.
While manufacturers are coming under pressure from labour shortages, the service sector, which includes banks, hotels and restaurants, and accounts for about four-fifths of the economy, reported weaker domestic sales.
Production in the manufacturing sector hit its fastest pace of growth in six months in December as firms stockpiled in preparation for potential border holdups in the event of a no-deal Brexit.
The IHS Markit/Cips manufacturing purchasing managers’ index rose from 53.6 in November to 54.2 last month, beating all forecasts in a Reuters poll of economists. Above 50 indicates economic growth.
The latest snapshot raises the prospect that Brexit uncertainty may perversely benefit the economy in the short-term by prompting companies to raise their activity levels in preparation for potential disruption from the UK leaving the EU on 29 March without a deal.
The Bank of England has previously said that the majority of businesses in Britain have done little to prepare for a no-deal scenario, while the government has started to tell more companies to make preparations as it steps up its plans.
Economists, however, said the growth in activity was likely to be temporary. Disruption after 29 March could curtail activity, while any removal of Brexit risks could lead businesses to run down their stockpiled goods rather than placing new orders.
(qlmbusinessnews.com via theguardian.com – – Wed, 2nd Jan 2019) London, Uk – –
Demonstrations held at more than 20 stations as fares rise by above-inflation average of 3.1%
Campaigners have staged demonstrations at railway stations across the country as the transport secretary, Chris Grayling, blamed trade unions for ticket price hikes.
Protests were held at about two dozen railway stations as fares rose by an above-inflation average of 3.1% on Wednesday morning.
The cost of many rail season tickets has risen by more than £100, while punctuality is at a 13-year low.
At Manchester Piccadilly station, union officials and Labour councillors handed out flyers titled “Cut fares not staff” as commuters began returning to work after the Christmas holiday.
One passenger, Lorraine Southon, 57, said all three of her daily trains were usually late and that she had been forced to change her route to work due to the introduction of new timetables, which caused months of disruption last year.
“In my experience it’s a very poor service,” she said outside Manchester Piccadilly station. “I don’t mind [fares] going up if they would improve the service, but they don’t improve the service – the service continues to be poor.”
Southon, a BT worker, added: “I can’t comprehend how the management continue to get these huge bonuses when the service is just so poor. Why are the bonuses not performance-based? Chris Grayling should be responsible.”
Another commuter, Phillip Shields, 32, added: “I’m definitely not happy with the rise. There’s no justification really for it at the moment.
“They keep promising every year that they’re going to improve services but it never seems to materialise. It’s the same statements they repeat over and over again, every year.”
The 3.1% average fare increase outpaces the 2.6% rise in the average wage in 2018 and will add hundreds of pounds to the cost of season tickets for some rail passengers.Advertisement
Costs will come down for 16- and 17-year-olds, who are to be given half-price travel on all trains from September – benefiting up to 1.2 million people – according to an announcement by the government in November, at the same time as the wider fare increase was revealed.
But the vast majority of passengers are to pay more despite poor service, prompting renewed calls from Labour and the Trades Union Congress for UK railways to be nationalised.
Speaking on BBC Radio 4’s Today programme on Wednesday morning, Grayling defended the fare rise by saying trade unions were to blame.
He said: “The reality is the fare increases are higher than they should be because the unions demand – with threats of national strikes, but they don’t get them – higher pay rises than anybody else.
“Typical pay rises are more than 3% and that’s what drives the increases. These are the same unions that fund that Labour party.”
The Labour leader, Jeremy Corbyn, joined protesters outside King’s Cross station in London as he described the rail fare increases as a “disgrace” that was driving people away from public transport.
Responding to Grayling’s insistence that the rise was needed to fund the upkeep of the network, Corbyn said Britain must “invest in our railways as a public investment”. He added: “If we don’t invest then people will have to suffer in their journeys, and we end up with more people using their cars and that’s far more dangerous for our environment than rail travel.”
Pressed whether it was fair to ask taxpayers to subsidise commuters, he replied: “All public transport is subsidised in one form or another, and there is a public good from it. No other country in the world has a transport system that sits completely alone.”
Outside Manchester Piccadilly, Michelle Rodgers, the RMT national president, said the fare increase followed an “abysmal” year for rail passengers.
She added: “We’ve had an absolutely fantastic response this morning. They’re all really angry and disgusted about the fare increase, especially in this region where we have seen the worst [service] in many, many years. I’ve been around 20 years and I’ve never seen it as bad as in the last 12 months.”
Handing out flyers branded “Tory rail rip off”, Adele Douglas, a Labour party councillor for the Piccadilly ward on Manchester city council, said the unreliable trains were “destroying people’s working lives”.
She added: “I’m not going to encourage anyone to civil disobedience that’s going to get them into serious trouble but I think there does come a line where the public will have to say: we don’t accept this – it’s too much money, too little in return and it’s not fair..”Topics
(qlmbusinessnews.com via uk.reuters.com — Wed, 2nd Jan, 2019) London, UK —
(Reuters) – UK shares were lower on Wednesday as investors returned from New Year celebrations to more disappointing data from China that deepened concerns about the health of the global economy and sparked a global sell-off.
London's blue-chip bourse .FTSE dropped 0.9 percent and the mid-cap index .FTMCdipped 0.3 percent by 1018 GMT.
Most sectors were still in the red, setting a bleak tone for 2019’s first trading day after both indexes recorded their worst yearly drop since the 2008 financial crisis last year.
Positive domestic PMI data due to Brexit-induced stockpiling provided some respite, but investors were focussed on Chinese data that showed manufacturing activity in the world’s second-largest economy contracted for the first time in 19 months.
It followed a poor official survey on factory output on Monday. Data also revealed that euro zone manufacturing activity barely expanded in December.
Continued concerns that the prospect of a global cyclical downturn will likely cap the upside of UK’s blue-chip shares, said CMC Markets analyst Margaret Yang.
“A string of missing PMIs from China’s official and private sector suggest that Asia’s largest economy is still cooling off due to weaker external demand and trade uncertainties,” Yang added.
“It is still too early to say markets have bottomed out yet.”
UK-listed companies with more exposure to the Asian market were the most hit with HSBC (HSBA.L) edging 1.8 percent lower and Standard Chartered (STAN.L) down 3 percent.
Fellow financial heavyweights Prudential (PRU.L), Lloyds (LLOY.L) and Royal Bank of Scotland (RBS.L) also fell over 3 percent.
Global miners were also weak with copper prices lower amid concerns over growth in top metals consumer China. Antofagasta (ANTO.L), BHP (BHPB.L), Anglo American (AAL.L), Rio Tinto (RIO.L) and Glencore (GLEN.L) were down between 3.2 percent and 4.3 percent.
Blue-chip medical products maker Smith & Nephew (SN.L) tumbled 2.5 percent, with traders citing a rating cut by brokerage JPMorgan.
Among the midcaps, Energean Oil & Gas (ENOG.L) added 5.1 percent to top the gainers after signing a gas supply agreement with independent power producer I.P.M. Beer Tuvia.
Elsewhere in corporate news, Ophir Energy (OPHR.L) shares outperformed the small-cap index .FTSC and soared over 33 percent after the oil and gas producer said it was in takeover talks.
Gambling software company Playtech (PTEC.L) gave up losses to turn positive. It said it would pay 28 million euros under a settlement with Israeli tax authorities following an audit of its annual accounts.
Real estate investment trust Hammerson (HMSO.L) was 3.9 percent lower as it said its share buyback programme will be paused ahead of the release of 2018 results.
Reporting by Muvija M and Shashwat Awasthi in Bengaluru