(qlmbusinessnews.com via news.sky.com– Wed, 7th April 2021) London, Uk – –
The company eyes a summer resumption for holidays after a year of disruption for the travel sector as a whole.
Saga, the provider of products and services to the over-50s, has revealed it is looking to rehire 500 workers cut from its holiday operations last year as the coronavirus pandemic gathered speed.
The company, which last month pushed back the planned resumption of its cruises from May until later in the summer, axed 1,400 jobs in its financial year to 31 January.
Saga said that 600 of the redundancies were directly a result of a lack of clarity on the future of post-COVID-19 travel. Retail and hospitality jobs pay highest COVID price
The majority of the losses, across the business, were linked to the disposal of other businesses as part of a wider shake-up undertaken by chief executive Euan Sutherland.
Saga told Sky News it was already advertising for 250 of the roles across its tours and cruise operations
It reported a pre-tax loss of £61.2m for the financial year compared to £301m a year earlier as its insurance arm offset the poor performance for travel.
Profits of £17.1m were recorded on an underlying basis thanks to earnings of £134.6m for insurance.
The travel segment recorded a loss of £78.5m.
Saga said it remained hopeful of a summer restart with big pent-up demand for holidays among its clients – a customer base that is being prioritised for vaccines on an age basis.
Most over-50s have now received their first jab under the rollout.
But clouds remain on the horizon for Saga, and the wider travel sector, as the government is yet to confirm whether holidays will be allowed to resume from 17 May under PM Boris Johnson's roadmap for lockdown-easing in England.
It is examining the merits of so-called vaccine passports and testing regimes amid fears a third wave of infections in Europe poses a significant risk.
In Saga's case, it said that while bookings for this year were down on the same period the year before, demand for next year was well ahead.
It hoped its Spirit of Discovery ship would be able to set sail again from June while it would be another month for its Spirit of Adventure.
Shares were more than 10% up in early deals.
Mr Sutherland told investors: “Looking ahead, while we are mindful of economic headwinds and the potential ongoing impacts of COVID-19, it is clear that there is significant pent-up demand among our customer base, the vast majority of whom have now been vaccinated and are ready to enjoy post-lockdown freedom.”
(qlmbusinessnews.com via uk.reuters.com — Tue, 6th April 2021) London, UK —
LONDON (Reuters) – A plan by Britain’s finance minister Rishi Sunak to use a two-year “super-deduction” tax break to encourage companies to invest appears to be working, according to a manufacturing survey.
Make UK said almost a quarter of the companies they survey plan to increase investment as a direct response to the policy while more than a quarter plan to bring forward their investment plans.
The incentive was also seen by almost a third of the 149 companies that were surveyed as the measure that had made the most impact in Sunak’s March annual budget speech.
“The budget has made a clear impact on manufacturers in terms of confidence and they are stepping up their plans to invest in response,” Verity Davidge, Director of Policy at Make UK, said.
“For too long the UK’s investment performance has been below par and the incentive should provide a boost in the short-term at least.”
Sunak’s budget was designed to get Britain’s economy through the COVID-19 crisis, with more spending and plans for a 2023 corporate tax hike to help rebuild the public finances.
(qlmbusinessnews.com via theguardian.com – – Tue, 6th Apr, 2021) London, Uk – –
Investment bank could see 200 of its 6,000 London workers back in the office after Easter break
Goldman Sachs is preparing for hundreds more staff to go back to its London office this week as it eyes a return to pre-pandemic working conditions.
As many as 200 of the US investment bank’s workers could return to the main London office from Tuesday, joining several hundred staff who have been at their desks throughout several lockdowns. Goldman Sachs employs about 6,000 workers in London overall.
Bankers were classed as key workers if their jobs support the functioning of the economy and financial stability, meaning some have been allowed to work in the office throughout the pandemic.
At Goldman’s London office, between 200 and 300 workers such as financial traders have been travelling into work during the lockdowns because of their need to use specialised computer equipment.
Other banks are looking at similar plans. A small number of staff are expected to start returning to Credit Suisse from Monday 12 April, for example, although the return will be staggered.
The rapid pace of the UK’s vaccination programme and the easing of rules on travel have meant that some companies have considered plans to bring workers back to offices that have been vacated for a large part of the last year.
The government eased some lockdown restrictions on 29 March, although its official guidance remains that people should work from home where possible and minimise the number of journeys made.
Views on the future of work after pandemic restrictions ease appear to differ even within the banking sector. HSBC, the UK’s biggest bank, has said it will cut its property footprint by as much as 40% in the long term, and Lloyds Banking Group, the bank with the biggest UK high street presence, has said it will bring in working from home as a permanent lifestyle change, allowing it to cut 20% of its office space.
However, Goldman’s chief executive, David Solomon, has described working from home as an “aberration” that must be rectified “as soon as possible”.
Goldman’s working conditions have come under scrutiny during the pandemic after junior US analysts compiled a report in which they claimed they were subjected to 100-hour working weeks. After the report was leaked Goldman acknowledged that some people might be quite “stretched” by working from home, in part because the bank has enjoyed record trading volumes during the pandemic.
Based on the experience of England’s previous easing of lockdown rules it is thought that Goldman could accommodate about 1,000 workers in its London office while still observing social distancing rules, which are expected to remain in place in some form until at least 21 June.
(qlmbusinessnews.com via bbc.co.uk – -Mon, 5th April 2021) London, Uk – –
LG Electronics said on Monday it would close down its loss-making smartphone business.
In January, the South Korean electronics giant said it was looking at all options for the division after almost six years of losses totalling around $4.5bn (£3.3bn).
LG had made many innovations including ultra-wide angle cameras, rising to third largest smartphone maker in 2013.
But bosses said the mobile phone market had become “incredibly competitive”.
While Samsung and Apple are the two biggest players in the smartphone market, LG has suffered from its own hardware and software issues.
As LG struggled with losses it had held talks to sell part of the business but these fell through.
It still ranks as the third most popular brand in North America but has slipped in other markets. LG phones are still fairly common in its domestic South Korean market.
“LG's strategic decision to exit the incredibly competitive mobile phone sector will enable the company to focus resources in growth areas such as electric vehicle components, connected devices, smart homes, robotics and artificial intelligence,” it said in a statement.
Last year it shipped 28 million phones, which compares with 256 million for Samsung, according to research firm Counterpoint.
The smartphone business is the smallest of LG's five divisions, accounting for just 7.4% of revenue. Currently its global mobile phone market share is about 2%.https://emp.bbc.co.uk/emp/SMPj/2.40.2/iframe.htmlmedia captionWATCH: LG's display rolls up out of the way into the ceiling when not in use
It has been innovating its phones to compete with its bigger rivals, with last year's launch of the T-shaped Wing, a smartphone with a larger screen which swivels out to reveal a second, smaller one underneath.
Electric cars and TVs
LG still has a strong consumer electronics business, particularly with home appliances and televisions. LG is the world's second best-selling TV brand after Samsung.
In December it launched a joint venture with automotive supplier Magna International that will make key components for electric cars.
LG's phone inventory will continue to be available for sale, and it will still provide service support and software updates for existing customers. The divisions is expected to be wound down by the end of July.
“Moving forward, LG will continue to leverage its mobile expertise and develop mobility-related technologies such as 6G to help further strengthen competitiveness in other business areas,” a spokesman added.
Analysts said South Korean rival Samsung and Chinese companies such as Oppo, Vivo and Xiaomi are likely to benefit the most from LG's exit.
Smartphone makers struggled during the pandemic with sales down about 10% in 2020 mainly due to lockdowns limiting store openings.
Dels the lawyer and entrepreneur who loves travel, self-improvement and everything to do with success. Worked with several of the biggest banks, law firms and management consultancy companies in the world and is passionate about helping other high achievers to land their dream jobs in those companies or even to start their own business
(qlmbusinessnews.com via news.sky.com– Fri, 2nd April 2021) London, Uk – –
Mr Gupta admitted the business faced a “shock to the system” and that he regretted relying on Greensill for so long.
Liberty Steel tycoon Sanjeev Gupta has promised thousands of UK workers facing uncertainty after the collapse of lender Greensill that he will not close any of its plants.
In an interview with Sky News, Mr Gupta gave a bullish assessment of prospects for the business – while admitting the collapse was a “shock to the system”.
He said his business empire had already been in the process of switching away from Greensill as a source of financing and that his only regret was not doing so earlier.
In comments directed at Liberty Steel's 3,000 UK workers, Mr Gupta said: “I will not give up on you. You are my family.
“Under my watch, none of my steel plants will close, I promise.”Advertisement
Liberty Steel is the UK's third-largest steel producer while its parent company, Mr Gupta's GFG Alliance, has a further 2,000 UK staff working in the aluminium and renewable energy sectors.
Sky News revealed last week that GFG had asked ministers to approve an emergency funding of up to £170m.
Mr Gupta denied that his business had been seeking a bail-out but conceded that “given our situation every help is welcome” and that it would “continue to have positive dialogue with the government”.
The tycoon has been described as the “saviour of steel” after picking up a number of plants that were offloaded by previous owners as the industry faced a squeeze from the threat of cheap Chinese imports and soaring energy costs.
Liberty now controls 11 sites including ones at Rotherham and Stocksbridge in South Yorkshire, Newport in South Wales and Hartlepool.
Speaking to Sky on Thursday, Mr Gupta played down reports that creditors were seeking winding up orders – saying that it made no sense for them to bring down the business and that he would work with those lenders, but if necessary fight any court action.
“This is a shock to the system – there's no denying that,” he said.
“And we are handling the situation as it has arisen, but we need to keep in mind that our business actually is enjoying one of the best times it's ever had.”
Mr Gupta insisted on the viability of the business, pointing to high steel and aluminium prices and saying that globally it was doing “extremely well”, but acknowledged the difficulties of refinancing “given the size of the business and given the noise around us at the moment”.
“In the mean time, we need to find short-term working capital solutions given that some of our suppliers are nervous, insurance companies are nervous,” he added.
Asked whether the government was prepared to step in, if needed, PM Boris Johnson said on Thursday: “I think the fact that we make steel in this country is of strategic, long term importance – we've learned during the pandemic that it's not a good idea to be excessively reliant in times of trouble on imports for critical things – we saw that with PPE, for instance – so we're going to need a strong steel industry.”
Mr Gupta also defended his company's relationship with Greensill, saying that it had been a effectively a “big start-up… buying businesses nobody else wants” and had had to look for alternative financing outside more conventional sources such as banks and bond markets.
“Greensill provided us that solution, it enabled us to build those plants and it was now time to move on to conventional financing, which we were in the process of doing,” he said.
“In the beginning it was a breath of fresh air, it supported us to start and get on the journey.
“If I can express a regret, it would be that I didn't refinance away from Greensill earlier.”
Mr Gupta said the steel industry had been “decimated” over the past three decades, adding: “None of my steel plants would exist today if it had not been for our effort.”
He pointed to Liberty's track record in turning around those plants' fortunes but admitted that business had been hit by Brexit and the COVID-19 pandemic, and now the Greensill collapse.
Mr Gupta said they had a “great future” said with his business a “leader in the decarbonisation effort” as the sector seeks to become less polluting.
“Our record speaks for itself. We bought plants which would have otherwise shut. But those plants now have a viable future. Those jobs have a viable future.”
The businessman had little to say on the controversy of former prime minister David Cameron's relationship with Greensill, saying he had not been involved in any such conversations since Mr Cameron left Downing Street.
(qlmbusinessnews.com via bbc.co.uk – – Fri, 2nd April 2021) London, Uk – –
Online retailer Boohoo is investigating why the same items of clothing were sold for higher prices across a number of its fashion labels.
The BBC discovered that Dorothy Perkins and Coast, which are both owned by Boohoo, sold exactly the same coat but it cost £34 more at Coast.
There are price disparities across a range of Boohoo brands, which also include Oasis and Warehouse.
Boohoo said the “miscommunication was not intentional”.
“All Boohoo group brands work independently, and so this miscommunication was not intentional as teams are not privy to what's being bought and sold across the other group brands,” a spokeswoman for Boohoo said.
“Our internal investigation continues and we will be re-pricing all the crossover stock to be aligned.”
The price disparity was revealed after reporter Jennifer Meierhans bought a coat from Coast – as a friend happened to buy the exact same coat from Dorothy Perkins.
The Dorothy Perkins branding appeared to have been cut from the care label in the coat sold by Coast.
Boohoo said the coat was first sold by Coast and has now been re-priced at £17 on both brands' websites.
Catherine Erdly, founder of The Resilient Retail Club consultancy, and a former senior merchandiser at Coast, said: “If all Boohoo are going to do is buy the same stuff and slap different prices on it then it's destroying that brand's identity.”
She said that while each brand will have its own “architecture” for setting prices, it is likely Coast and Dorothy Perkins had benefited from some kind of trading “opportunity”, where a supplier had stock and both companies needed coats.
“But if they're going to do things like that, they didn't do it in a clever way,” Ms Erdly said. “The customer will sense that it's just trying to get as much as possible out of them.”
She added: “There's no way you could sell a genuine Coast coat at £17 without losing money because it costs more than that to make.”
There are a number of instances where the same item of clothing is priced differently across Boohoo's brands.
A long “luxe” padded coat in the colour mushroom was originally sold for £89 at Oasis and £65 at Dorothy Perkins.
The same coat in khaki was in the sale for £30 in Warehouse and £66.75 in Coast until the BBC brought the matter to Boohoo's attention.
They are now both priced at £18.
The online retailer operates a number of different brands after buying up businesses when their owners fell into administration.
Boohoo bought Coast's online business in 2019 along with sister brand Karen Millen. While in February, it acquired Dorothy Perkins, together with Wallis and Burton, from failed retail group Arcadia for £25.2m
Boohoo said: “Stock of the item in question was purchased and live on site by Coast prior to The Boohoo Group's acquisition of the Dorothy Perkins brand.”
(qlmbusinessnews.com via news.sky.com– Wed, 31st March 2021) London, Uk – –
Rishi Sunak recently hailed the company as a “British tech success” but more than £2bn was wiped off its value as trading began
Deliveroo shares have slumped as much as 30% as the takeaway delivery company made its highly-anticipated stock market debut.
The flop wiped more than £2bn off the company's initial £7.6bn valuation – just over a week after it was estimated at up to £8.8bn.
Some of the City's biggest institutional investors had shunned the initial public offering (IPO) over concerns about its working practices and the dual-class share structure which gives founder Will Shu greater control.
The loss-making company said this week that it had received “significant demand” from investors across the globe – more than enough to cover the offer of shares worth £1.5bn several times over.
However, its price range last week of £3.90 to £4.60p per share – which would have valued it as highly as £8.8bn – has narrowed over recent days, with the business citing “volatile global market conditions”.
Wednesday's float priced Deliveroo at £3.90, the bottom end of that range, and equivalent to £7.6bn.
But that was not enough to prevent a flop when trading began, with shares going as low as £2.73, although they later climbed back to around the £3 mark.
Deliveroo's float is London's biggest IPO since commodity giant Glencore went public in 2011 – and the biggest-ever tech float in the city.
Its dismal reception could be seen as blow to Chancellor Rishi Sunak's ambition to attract more technology companies to list in the UK.
Mr Sunak had hailed the company as a “true British tech success story” when it confirmed earlier this month that it would float in London.
Deliveroo, which has around 45,000 restaurants on its platform in the UK and more than 100,000 worldwide, has benefited over the past year from an increased appetite for takeaways with dining out banned or restricted.
Orders over January and February were 121% higher than the same period a year ago, while for 2020 the total of £4.1bn was 64% higher than a year earlier.
However, it still made an underlying loss for the year of £223.7m.
Russ Mould, investment director at AJ Bell, said “Deliveroo has gone from hero to zero as the much-hyped stock market debut falls flat on its face.
“It had better get used to the nickname ‘Flopperoo'.
“The narrative took a turn for the worst when multiple fund managers came out and said they wouldn't back the business due to concerns about working practices.
“This is likely to have spooked a lot of people who applied for shares in the IPO offer, meaning they are racing to dump them.”
(qlmbusinessnews.com via theguardian.com – – Tue, 30th March 2021) London, Uk – –
Company expects profit of £700m for year to end of March, more than double last year
Royal Mail is to make a one-off dividend payment to shareholders after the online shopping boom during the Covid-19 pandemic boosted its parcel delivery business, in a dramatic turnaround of the company’s fortunes.
Royal Mail expects to make an adjusted operating profit of £700m for the year to the end of March, more than double last year’s £325m. This has given it the confidence to pay a final dividend of 10p a share on 6 September, the first payout to shareholders since January 2020. It will set out a new dividend policy when it publishes its full-year results on 20 May, the company said.
Since floating on the stock exchange in October 2013, Royal Mail had been struggling with its traditional letters business, which is in decline. Attempts to restructure the company led to prolonged battles with unions. However, it has focused on expanding its parcel delivery business, as online shopping soared during the Covid-19 crisis, when many shops have been forced to shut during lockdowns.
Richard Hunter, the head of markets at the trading platform Interactive Investor, said: “The astonishing reversal of fortunes at Royal Mail continues as the momentum of bumper Christmas trading has spilled over into the new year.
“Challenges remain, however, and the group will need to be alert. Competition is particularly fierce in the parcels business and it is not yet clear whether the current volumes are at a temporary peak as customers have been driven to online shopping from their homes during the pandemic.”
The share price of the FTSE 250 listed firm has more than quadrupled in the past year, to 520p, up 2% on Tuesday. Hunter said Royal Mail would be a strong contender to regain its FTSE 100 status at the next reshuffle of the index.
As well as investing in its UK Parcelforce division, Royal Mail sees growth opportunities abroad. Its GLS international parcels arm is expected to make an operating profit of €390m (£350m) for the past year; it is forecast to rise to €500m by 2025.
Hargreaves Lansdown analyst Nicholas Hyett described GLS as “the jewel in Royal Mail’s crown”. He said: “If the UK business could emulate its international cousin the group would be home and dry. Instead the UK is suffering after a period of chronic underinvestment, and the capital expenditure needed to make up the shortfall looks set to eat into shareholder returns for years to come.”
The company recently started trialling a Sunday parcel delivery service for several big UK retailers. Rivals DPD and Hermes already make Sunday deliveries for retailers such as Amazon.
LONDON (Reuters) – PayPal Holdings Inc will announce later on Tuesday that it has started allowing U.S. consumers to use their cryptocurrency holdings to pay at millions of its online merchants globally, a move that could significantly boost use of digital assets in everyday commerce.
Customers who hold bitcoin, ether, bitcoin cash and litecoin in PayPal digital wallets will now be able to convert their holdings into fiat currencies at checkouts to make purchases, the company said.
The service, which PayPal revealed it was working on late last year, will be available at all of its 29 million merchants in the coming months, the company said.
“This is the first time you can seamlessly use cryptocurrencies in the same way as a credit card or a debit card inside your PayPal wallet,” President and CEO Dan Schulman told Reuters ahead of a formal announcement.
Checkout with Crypto builds on the ability for PayPal users to buy, sell and hold cryptocurrencies, which the San Jose, California-based payments company launched in October.
The offering made PayPal one of the largest mainstream financial companies to open its network to cryptocurrencies and helped fuel a rally in virtual coin prices.
Bitcoin has nearly doubled in value since the start of this year, boosted by increased interest from larger financial firms that are betting on greater adoption and see it as a hedge against inflation.
PayPal’s launch comes less than a week after Tesla Inc said it would start accepting bitcoin payments for its cars. Unlike PayPal transactions where merchants will be receiving fiat currency, Tesla said it will hold the bitcoin used as payment.
Still, while the nascent asset is gaining traction among mainstream investors, it has yet to become a widespread form of payment, due in part to its continued volatility.
PayPal hopes its service can change that, as by settling the transaction in fiat currency, merchants will not take on the volatility risk.
“We think it is a transitional point where cryptocurrencies move from being predominantly an asset class that you buy, hold and or sell to now becoming a legitimate funding source to make transactions in the real world at millions of merchants,” Schulman said.
The company will charge no transaction fee to checkout with crypto and only one type of coin can be used for each purchase, it said.
(qlmbusinessnews.com via bbc.co.uk – – Mon, 29thMarch 2021) London, Uk – –
The US has warned it could put tariffs of up to 25% on a host of UK exports in retaliation for a UK tax on tech firms.
Ceramics, make-up, overcoats, games consoles and furniture could all be hit, according to a list published by the Biden administration.
The duties are designed to raise $325m, the amount the US believes the UK tax will raise from US tech companies.
A UK government spokesperson said it wanted to “make sure tech firms pay their fair share of tax”.
They added: “Should the US proceed to implement these measures, we would consider all options to defend UK interests and industry.”
Washington is pressing ahead with the action, initiated under President Trump, and has scheduled hearings on the list.
It argues the recently introduced digital services tax – which taxes tech firms on their revenues – has “unreasonable, discriminatory, and burdensome attributes”.
Similar actions have proceeded against similar taxes in India, Austria and Spain, but action against the European Union as a whole was dropped.
The US Section 301 action is designed to apply domestic political pressure within the UK and other countries over the imposition of such taxes.
The UK and US held talks about the digital services tax on 4 December, and UK government sources stressed that the tariff list was being seen as procedural rather than an escalation.
The tariffs are now subject to a consultation in the US over the next few weeks.
At the Budget, the Office for Budget Responsibility calculated the digital services tax would raise £300m in the current financial year, and as much as £700m in future years.
Brought in last April it taxes at 2% the revenues – not profits – of search engines, social media services and online marketplaces which derive value from UK users.
It followed years of claims in Europe and elsewhere that big tech firms do not pay enough tax in the countries where they operate.
Last August, Facebook agreed to pay the French government €106m (£95.7m) in back taxes to settle a dispute over revenues earned in the country.
Earlier that year, Facebook boss Mark Zuckerberg said he recognised the public's frustration over the amount of tax paid by tech giants.
A UK government spokesperson said: “Like many countries around the world, we want to make sure tech firms pay their fair share of tax. Our digital services tax (DST) is reasonable, proportionate and non-discriminatory.
“It's also temporary. We're working positively with the US and other international partners to find a global solution to this problem and will remove the DST when that is in place.”
There are signs the Biden administration wants a more conciliatory relationship on trade with the UK than Donald Trump did.
Last month, Washington agreed to suspend tariffs on UK goods, including single malt whiskies, that were imposed in retaliation over subsidies to aircraft maker Airbus. However, the UK is still lobbying the US to drop duties on British steel brought in in 2018.
Everyone has seen those oversize vending machines that sell headphones and phone chargers. Dawn Dickson-Akpoghene, 42, makes those–but fancier. Her “high IQ” kiosks use AI, biometrics and computer vision to enable retailers to retain customers through data stored on the blockchain. With $3.8 million in funding, Popcom's $20,000 unit is in Polaris Fashion Place in Columbus' soon to come additional shopping malls and beyond. “We are in a new world of retail,” she says. Small businesses account for 99.9% of all U.S. businesses and some two-thirds of net new American jobs.
The vast majority of these enterprises are bootstrapped via savings and credit cards. While venture-backed startups generally skew white, male and coastal, these Main Street enterprises actually look like—and drive—America. To shine a light on this new class of entrepreneurial hero, Forbes has created the Next 1000.
This year-round initiative showcases the ambitious sole proprietors, self-funded shops and pre-revenue startups in every region of the country—all with under $10 million in revenue or funding but infinite drive and hustle.
Fueled by your nominations and screened by top business minds and entrepreneurial superstars, at the year’s end, we’ll culminate with 1,000 new faces. Let’s get started with the first installment of 250 standouts who embody the best of the American dream right now.
The International Monetary Fund’s special drawing right (SDR) – the international reserve asset created in 1969 to prepare for a new dollar crisis – is undergoing a renaissance with important worldwide repercussions says Willem Middelkoop, author of the Big Reset. “The announcement of the largest-ever increase in SDR allocations, which will greatly improve the liquidity of many developing nations, signals alignment between the US and China in a key area of global monetary power,” he tells our Daniela Cambone.
(qlmbusinessnews.com via uk.reuters.com — Sat, 27th March 2021) London, UK —
By Brenna Hughes Neghaiwi, Simon Jessop
ZURICH/LONDON (Reuters) – In 2020, as the world convulsed under COVID-19 and the global economy faced its worst recession since World War II, billionaires saw their riches reach new heights.
Now some are talking to their wealth managers about how to keep a hold of and consolidate their fortunes amid the global debris of the pandemic. Others are discussing how to preempt and navigate demands from governments, and the wider public, to pick up their share of the recovery costs.
“The stock market crashed a year ago, by July or so my portfolio was back where it was before, at the beginning of the year, and now it’s far higher,” said Morris Pearl, a former managing director at BlackRock who chairs Patriotic Millionaires, a group that believes the high net worth should do more to close the wealth gap.
“The fundamental problem is this gross inequality that’s getting worse.”
The plans being discussed by the ultra-rich range from philanthropy, to shifting money and businesses into trust funds, and relocating to other countries or states with favourable tax regimes, according to Reuters interviews with seven millionaires and billionaires and more than 20 advisers to the wealthy.
“It’s quite evident that the bill is coming for everybody,” said Rob Weeber, CEO at Swiss wealth manager Tiedemann Constantia, who said some clients were also considering selling major assets like businesses before tax rates rise.
In the United States, the election of Joe Biden as president, and anticipated higher taxes for the rich, have in particular triggered a sharp increase in demand from clients to set up trusts, according to wealth managers.
This would allow them to pass along money to children or other relatives under the current $11.7 million tax-free threshold per person. During his campaign, Biden proposed to return to 2009 levels, when the exemption stood at $3.5 million.
“We saw a surge of trusts created and funded in Q4 of last year,” said Alvina Lo, chief wealth strategist at Wilmington Trust. “The vast majority of our clients adopted a wait-and-see approach until the election in November, and then it just kicked up into high gear.”
Nearly two-thirds of the world’s billionaire class amassed greater fortunes in 2020, according to Forbes, with the biggest gainers reaching unprecedented levels of wealth, helped by the trillions of dollars in recovery money from policymakers.
Forbes, which tracks publicly known fortunes, estimated billionaires had gotten 20% richer in 2020 by mid-December.
Many enjoyed investment opportunities off-limits to ordinary retail investors, capitalising on market volatility with short-term derivative trades, according to Maximilian Kunkel, UBS’s chief investment officer for wealthy family offices.
When asset prices tumbled, he said, many of the bank’s biggest private clients sold put options or opted for more complex trades known as risk reversals, helping them capitalise on their bet that prices would eventually rise.
“Some of our clients were extraordinarily agile in taking advantage of the biggest market dislocations,” Kunkel added.
Now, as governments globally grapple with ballooning debt and growing social unrest, billionaires know the spotlight on their wealth will get stronger, according to the interviews.
Many of the wealthy are mindful of looming demands from tax authorities, and are speeding up plans to pour money into trust funds for their children.
Wealth strategist Jason Cain said many ultra-rich families had also sought to move other assets including businesses into trust funds, capitalising on the “unique” situation presented by the pandemic of low interest rates and depressed valuations to make potentially windfall tax savings in years to come.
Inquiries in such strategies tripled during the first seven to eight months of the pandemic, according to Cain, who works for U.S.-based wealth advisory Boston Private.
“75-80% of the families that we talk to were convinced that that was an opportunistic time and they needed to do something.”
THE HAMPTONS, OR SINGAPORE?
Others across the globe are also taking more drastic action, by relocating to countries and areas where the tax regimes and societies are more benign for the mega-rich.
Henley & Partners, a global citizenship and residence advisory firm based in London, said inquiries from high-net-worth individuals seeking to relocate had jumped during the pandemic. The number of calls from U.S.-based clients surged 206% in 2020 from the prior year, for example, while calls from Brazil rose 156%.
For many in emerging countries, fears that strains on public services could lead to civil unrest have prompted younger generations of wealthy families particularly to seek opportunities abroad.
“COVID just basically took the clothes off the Emperor, and all of a sudden, people started to realize: our healthcare system is not strong, our social safety net is really not available,” said Beatriz Sanchez, head of Latin America at global wealth manager Julius Baer.
Switzerland, Luxembourg and Singapore have become popular targets as wealthy individuals consider where they want to be based in the long term, said Babak Dastmaltschi, Credit Suisse’s head of strategic clients in its international wealth management division.
“They are actually saying: look, we see the world inevitably going towards more and more transparency. And there’s no point fighting a trend,” Dastmaltschi said.
“Let’s just find suitable jurisdictions which are transparent, open, respected, and internationally recognised, and establish our structures there,” he said.
Cindy Ostrager, tax director at Clarfeld Citizens Private Wealth, said she also saw many ultra-wealthy clients moving out of New York City into their vacation getaways in the likes of the Hamptons, initially to escape the worst of the pandemic, and subsequently staying to pay lower taxes.
Moves to low-tax states, including Texas, Florida and Washington, have also become more popular, said Kristi Hanson, director of taxable research at investment consulting firm NEPC’s Private Wealth group.
FOCUS ON PHILANTHROPY
As countries continue to grapple with the pandemic’s fallout, economists point to a larger looming issue: the decoupling of extreme wealth from overall economic prosperity.
By early March, the wealth of U.S. billionaires had risen $1.3 trillion, or by nearly a half, since the start of the pandemic, according to research conducted by the Institute for Policy Studies and Americans for Tax Fairness.
That brings their wealth to $4.2 trillion, roughly a fifth of U.S. economic output for 2020 and double the total wealth held by the bottom-half of the 330 million population.
“We’re at a moment, you might say, after four years of celebrating inequality, people are saying that wasn’t exactly the right answer,” said Nobel Laureate and Columbia University economist Joseph Stiglitz, referring to the U.S. Trump administration reducing taxation for the rich.
The pandemic has focused the attention of many super-rich people on social causes, according to UBS’s American head of family advisory and philanthropy services Judy Spalthoff.
“There’s been a massive shift in the conversations we’re witnessing among families, in terms of the consideration of social inequity,” she said. “The younger generation has really been pushing this topic at the board level.
“We see so many conversations in families really gut-checking to say, ‘Yes, we’ve had success. We’ve worked hard for this success. But let’s not be blind to the world around us. And let’s make sure we can step out of our bubble’.”
For many that means philanthropy.
Spalthoff’s team saw a surge in clients partnering with the UBS Optimus Foundation, which channels money to causes such as Action Against Hunger, with donations rising 74% last year versus 2019, to $168 million.
Yet for UK-based millionaire Gary Stevenson, a former trader at Citibank, any plan to tackle inequality must include a wealth tax.
“We live in a situation right now where billionaires often pay lower rates of tax on their income than ordinary workers,” he said. “But I don’t think it will be enough just simply to tax their income … it needs taxes that apply on wealth.”
(qlmbusinessnews.com via news.sky.com– Fri, 26th March 2021) London, Uk – –
The Japanese firm had promised to leave a sustainable legacy behind when it decided to pull out of UK car production.
Honda has agreed a sale of its Swindon car plant, with the new owner promising “thousands” of jobs.
The Japanese company revealed two years ago that it intended to cease production at the site in July this year as sales across the industry continued to drag ahead of an all-electric future.
The move, which the company insisted then was not related to Brexit, will result in the loss of 3,500 jobs once the final Civic hatchback rolls off the production line.
But it was announced on Friday that US-based warehousing specialist Panattoni was to take on the sprawling site following the conclusion of decommissioning work by Honda, expected in spring next year.
The company said it was making a £700m investment in its logistics-related development.
Its UK managing director, Matthew Byrom, said: “The acquisition of the 370-acre Honda facility demonstrates our capabilities to work at scale.
“The re-development of this strategic employment site will deliver thousands of new opportunities in roles which underpin the operation of the local and regional economy.”
Honda said the sale delivered on its promise to leave a sustainable legacy behind.
UK director Jason Smith said: “We are pleased to have identified a capable new owner of the site. From our engagement with Panattoni and initial discussions with Swindon Borough Council, we are confident that the new owner can bring the development forward in a commercially timely fashion and generate exciting prospects for Swindon and the wider community.”
Honda, along with its UK rivals, have endured a torrid number of years culminating in COVID-19 disruption, as sales suffer globally.
Figures released by the Society of Motor Manufacturers and Traders on Friday showed the number of cars built in the UK fell for the 18th month in a row in February.
It reported that production was 14% down compared with the same month a year ago, with just 105,008 cars leaving factory gates – the weakest February for a decade.
Honda, along with some rivals, have blamed COVID transport delays for some temporary production suspensions in recent months.
(qlmbusinessnews.com via bbc.co.uk – – Fri, 26th March 2021) London, Uk – –
Thousands of Asda supermarket workers have won a major victory at the Supreme Court in their battle for equal pay.
The court upheld an earlier court ruling that lower-paid shop staff, who are mostly women, can compare themselves with higher paid warehouse workers, who are mostly men.
The judge stressed the ruling did not mean the 44,000 claimants had won the right to equal pay.
However, they are now free to take further action.
Lauren Lougheed, a Leigh Day lawyer representing Asda store staff, said: “We are delighted that our clients have cleared such a big hurdle in their fight for equal pay.
“Already an employment tribunal, the employment appeal tribunal and the Court of Appeal ruled that these roles can be compared, and now the Supreme Court has come to the same conclusion.
“It's our hope that Asda will now stop dragging its heels and pay their staff what they are worth.”
The GMB union has members involved in the case. Its legal director, Susan Harris, said: “Asda has wasted money on lawyers' bills chasing a lost cause, losing appeal after appeal, while tens of thousands of retail workers remain out of pocket.
“We now call on Asda to sit down with us to reach agreement on the back pay owed to our members – which could run to hundreds of millions of pounds.”
Wendy Arundale, who worked for Asda for 32 years, said: “I loved my job, but knowing that male colleagues working in distribution centres were being paid more left a bitter taste in my mouth.
“It's not much to ask to be paid an equal wage for work of equal value.”
But an Asda spokesman said there was a long way to go before the issues were finally settled: “This ruling relates to one stage of a complex case that is likely to take several years to reach a conclusion.
“We are defending these claims because the pay in our stores and distribution centres is the same for colleagues doing the same jobs regardless of their gender. Retail and distribution are very different sectors with their own distinct skill sets and pay rates.”
It said it remained confident in its case.
Lawyers say the ruling will have implications for supermarkets and other retailers.
“It would be difficult to underestimate the significance of this judgment which will send shockwaves far beyond Asda,” said Anne Pritam, partner and employment lawyer at Stephenson Harwood.
“It is a watershed moment for the rest of the retail industry, particularly those defending their own equal pay claims – such as Sainsbury's, Tesco, Morrisons and Next – and which have similar staffing models and pay structures.”
“Ultimately, if all of the retailers lose their equal pay claims, it is estimated they could face £8bn in compensation payments to employees.”
Asda store workers argued they were paid less because most store workers are women, while most distribution depot staff are men.
Lawyers representing the store workers say depot workers were paid between £1.50-3.00 an hour more.
Asda said it had always paid the correct rate for the job, whether male or female, and pointed out that both men and women worked in both supermarkets and the warehouses.
Analysis: By Kate Prescott
Asda store workers may have won this battle in their long running equal pay claim – but the war is far from over.
The Supreme Court has ruled that for the purposes of equal pay the work of the mainly male distribution workers can be compared to the mainly female shop floor workers.
But next they need to prove their work is of equal value – in terms of skills and training.
And finally that gender is the key reason that their pay is different.
The stakes here are high. Supermarkets could find themselves on the hook for more than £8bn in back pay.
And it could reverberate around other businesses too – where a majority of women carry out a certain role.
Years of action
In 2016, an employment tribunal decided that Asda store workers were entitled to compare themselves to distribution staff and that decision was upheld by Court of Appeal judges in 2019.
Asda bosses then appealed to the Supreme Court.
Lawyers say litigation could run on for years.
There are three stages in equal pay action:
Are the jobs comparable?
If the jobs are comparable, are they of equal value?
If they are of equal value, is there a reason why the roles should not be paid equally?
Following the Supreme Court ruling, lawyers say the next stage would involve an employment tribunal deciding whether specific store and distribution jobs were of “equal value”.
If judges decided that different jobs were of “equal value”, the litigation would then enter a third stage.
Under this, a tribunal would then consider whether there were reasons – other than gender – why people working in stores should not get the same pay rates as people working in distribution centres.
(qlmbusinessnews.com via theguardian.com – – Thur, 25th March 2021) London, Uk – –
Bank says staff will be offered new arrangements, including working from home
Santander is to close 111 branches across the UK affecting around 5,000 staff, as the coronavirus pandemic pushed more customers to embrace digital banking for most of their banking needs.
The bank said that affected staff will be offered new working arrangements that will combine working from home with “access to local collaboration spaces”.
Santander said the majority of sites that are to be closed are less than three miles from another branch.
In addition, the bank said all current and business account holders will still be able to bank in person at 11,00 post office branches.
The bank said Covid had quickened changing customer habits, with branch transactions falling by a third over the two years before the onset of the pandemic, and by a further 50% last year.
The closure programme will start on 24 June, with four branches in London and one in Glasgow among the first to shut, with all 111 to be closed by August.
“Branch usage by customers has fallen considerably over recent years and we have made the difficult decision to consolidate our presence in areas we have multiple branches relatively close together,” said Adam Bishop, a Santander executive. “The majority of the closing branches are within three miles of another branch and the furthest is five miles away.”
He said Santander, which will continue to operate a network of 452 branches across the UK, did not intend further cuts to its network of outlets.
“We continue to believe that branches have an important role to play and we expect the size of our network to remain stable for the foreseeable future,” he said.
The move follows rival HSBC announcing that it land to close 82 branches over the next 12 months.
By Mark Sweney