Tag Archive | "british chamber of commerce"

Companies are completely confused by government regulations


The continual changes to employment and tax regulations are leaving companies confused, stifling the country’s competitiveness and hindering job creation.

61% of businesses are unclear as to what is classed as tax avoidance and what constitutes legitimate tax planning and 33% believe they are treat as guilty by HMRC until they can prove their innocence, according to BDO LLP.

A large proportion of UK companies think the current tax framework is to complex and the situation is made worse by HMRC’s aggressive stance. Companies feel they now need to spend more time on their tax affairs instead of focusing on growing their business. Dealing with the Revenue has become more of a burden in the last five years, according to 65% of business leaders and 88% think things would be much easier if the tax rules were simplified.

Employers also have to fight their way through a ridiculous amount of employment legislation. David Frost, the director general of the British Chamber of Commerce, said that there was a growing consensus that employment law is weighted in favour of employees. A lot of employee rights have been implemented as a result of EU legislation but European labour markets are very different to ours.

The UK government should be prioritising job creation as this will lead to future prosperity. Mr. Frost said the coalition must desist from implementing any new employment laws for the next three years and cancel the 1% increase in employer NICs in order to encourage companies to recruit more staff.

Over the next four years, BCC estimates show that new legislation and tax will cost UK employers £25.6 billion.

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What does 2011 have in store?


Contractors could be amongst those set to benefit from internal skills shortages at UK firms as we go into 2011.

The Chartered Management Institute recently said that 43% of managers in the UK think they cannot fulfil their objectives for next year with the staff they currently have. As a direct result, 48% are expecting to make further redundancies in 2011. This could lead to openings for highly-skilled limited company contractors as companies look to complete tasks without increasing the size of their permanent workforce.

The CMI’s chief executive, Ruth Spellman, said that 2010 has been a very difficult year for managers and in many cases they have had to deal with the difficult conditions without a suitable team.

There are also conflicting reports on the state of the UK economy and its jobs market. The latest figures from the ONS show that unemployment reached 29.13 million in the quarter to October. 33,000 of the 35,000 job losses were in the public sector which is to be expected considering the government’s austerity measures.

The CIPD says the figures bring no joy to jobseekers and its chief economic advisor, Dr John Philpott, said the data was far worse than expected. He believes the jobs market has run out of steam which does not bode well for prospects in 2011.

The British Chamber of Commerce, on the other hand, said that whilst the figures were disappointing, they gave no cause for despondency and longer-term trends point to a strong labour market.

The REC was also disappointed by the latest figures. Kevin Green said that employers are still cautious about hiring new employees but he still believes growth will return to the jobs market in the New Year. However, contractors, temporary staff and interim workers are likely to play an important role in helping businesses meet increased customer demand.

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2011 looks encouraging for most industry sectors


Contractor accountants with clients operating in or relying on a number of UK sectors will be pleased to hear of some positive growth.

For example, new research from the EEF shows that the UK’s manufacturing sector reported strong output and good order balances in quarter three.

Manufacturers have already started hiring new staff and making new investments which will undoubtedly come as welcome news for contractors. Ms Lee Hopley, the chief economist at EEF, said that the manufacturing industry was ending 2010 on a high and this will provide the sector with a strong footing to begin the New Year. EEF also predicts that manufacturing and engineering will outperform other contributors to the UK economy in 2011.

It’s not only the UK that has witnessed this welcome boost in manufacturing either. Markit Economics recently reported that last month, the manufacturing sector across Europe increased at its fastest rate for 4 months.

But manufacturing isn’t the only sector planning to expand next year. Research by PwC shows that 28% of firms in the UK intend to increase recruitment in 2011. In addition to manufacturing, the technology and services industries should see vigorous recruitment, the study showed.

The recent Growth Review from the government also contained encouraging news for a lot of UK contractors.

David Frost, from the British Chamber of Commerce, said that enterprises will be reassured now that the focus is to return to balanced, sustainable growth. The review talks about creating a framework for growth and also acknowledges the vital contribution made by SMEs. However, it remains to be seen whether the coalition can bring down the barriers that have been preventing firms from thriving.

One piece of not so positive news regarding the service sector has come from the CBI. Although professional and business services have remained steady over the past few months, consumer services have tumbled. The CBI cited reduced consumer discretionary spending as a contributory factor along with rising costs and falling prices.

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