Rising number of UK employees work on Christmas Eve

The holiday season may traditionally be a time to celebrate and relax with loved ones, but more than half of Britons will be working this Christmas Eve, according to one study.

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Research by a major retail outlet suggests that some 63% of people will be in the office today. Around half of those who choose to work on Christmas Eve do so in order to help fund their festive celebrations.

Meanwhile, some 30% of the employees surveyed said they will even work on Christmas Day, with younger staff members and women more likely to work at this time.

An estimated 60% of employees will even be checking their emails over the holiday period.

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‘No festive cheer’ for Chancellor as November borrowing figures are published

Public sector net borrowing for November was £14.2 billion, up by £1.3 billion compared with the same month in 2014, according to the Office for National Statistics (ONS).

The figure is higher than expected and casts doubt on whether Chancellor George Osborne will meet forecasts for this financial year.

The Office for Budget Responsibility (OBR) estimates that borrowing for the whole of 2015/16 will be £68.9 billion (excluding support for public sector banks and changes to the treatment of housing associations). However, borrowing in both October and November was higher than predicted, leading many commenters to suggest that the Chancellor will fail to meet the OBR forecast.

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Paul Hollingsworth, UK economist at Capital Economics, said: ‘There was no festive cheer for the Chancellor in November’s UK public finances figures. Indeed, it now looks almost impossible for Mr Osborne to meet the OBR’s forecast for the fiscal year as a whole.

‘If we assume that the trend seen so far this year continues, then borrowing for 2015/16 as a whole would come in at around £81 billion.’

The ONS said last November’s figure was boosted by a one-off gain of £1.1 billion in fines for foreign exchange rigging, while a Treasury spokesman claimed that borrowing this November was higher because of a number of one-off factors.

In the current financial year to date, public sector net borrowing, excluding public sector banks, was £6.6 billion lower than in the corresponding period of 2014, but public sector net debt (excluding public sector banks) at the end of November 2015 was 80.5% of GDP.

David Kern, chief economist at the British Chambers of Commerce (BCC), said: ‘Although we saw a minor setback in November, gradual progress is being made with reducing the deficit. The public finances are likely to be better this year than in the previous financial year, but the improvement may not be as large as the OBR suggested in the Autumn Statement.

‘The underlying message remains that our budget deficit is still too high, and greater efforts are needed, through reducing current public spending and generating sufficient tax receipts.’

Study suggests that gender pay gap ‘doubles’ for female managers over 40

The Chartered Management Institute (CMI) has released a study suggesting that female managers aged 40 and over are paid a total of 35% less than their male counterparts.

According to the report, the gender pay gap almost doubles for women aged over 40 when they enter management roles. The study has also revealed that this figure is only set to worsen with age.

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Currently, men and women in their 20s and 30s receive broadly similar levels of pay. However, once women reach their 40s, a sizeable pay gap develops.

The average pay gap in the UK currently stands at 19%. When women who hold senior positions enter their sixties, the pay gap stretches to 38%.

Data from the CMI’s latest National Management Salary Survey suggests that female employees working in professional and full-time management positions earn, on average, 22% less than male employees.

The survey polled 72,000 managers in the UK, and revealed that, in monetary terms, the gender pay divide stands at £8,524.

Women typically earn £30,612, compared to a figure of £39,136 for men.

Those women who hold director roles earn an average of £123,756, whereas men in the same positions earn £138,699.

Investigations are being undertaken by MPs into levels of pay discrimination between male and female employees.

Jobs recovery could be impeded by red tape and extra taxes, warns CBI

UK businesses looking to hire face additional taxes and red tape on jobs, making employing new staff too expensive, the Confederation of British Industry (CBI) has stated.

New labour costs, such as the National Living Wage (NLW) and the apprenticeship levy, mean that many companies are considering raising prices or placing a freeze on recruitment in order to offset the extra costs that these schemes will bring.

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Carolyn Fairbairn, CBI director-general, stated that firms may have to cut down their workforces in order to save.

Speaking to The Sunday Times, Mrs Fairbairn warned that unless there are changes, it is ‘inevitable that there will be significant job losses’ in some sectors.

She added: ‘There’s a danger of Government complacency, with companies facing multiple increasing costs, through the apprenticeship levy, the National Living Wage and unreformed business rates, these are acting as a cumulative drag that could hamper growth’.

According to a recent study by the CBI, 43% of businesses expect to hire new permanent employees next year. Furthermore, a total of 51% of employers will consider raising wage levels to offset any costs introduced by the new compulsory NLW or the apprenticeship levy.

Some 47% of firms believe that the new apprenticeship levy will be ‘costly and bureaucratic’. A mere 16% of UK businesses support the levy.

However, a Government spokesperson said the measure ‘will mean that businesses and the public sector invest in the skills and training they need.’

The levy will be introduced in April 2017 at a rate of 0.5% on company wage bills, raising an estimated £3 billion a year.

Meanwhile, the NLW will come into force in April 2016, and will apply only to those workers aged 25 or over. The rate will initially be set at £7.20 an hour, rising to £9 an hour by 2020.

Advisory body predicts that National Living Wage will cost UK businesses ‘more than £1bn’

Government advisory body the Regulatory Policy Committee has estimated that the National Living Wage (NLW) will cost firms an additional £804.4 million in staff and wages costs.

The organisation stated that an extra £234.3 million in ‘wage spillover’ effects from retaining differences in pay will push the cost over the £1 billion mark.

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This total rises slightly further when the public sector is included – within this category, many workers are already paid an amount above the NLW.

The Institute of Directors (IoD) has suggested that implementing the NLW is only one of a series of new costs facing UK businesses.

Head of employment and skills policy at the IoD, Seamus Nevin, stated: ‘A new payroll tax, in the form of the apprenticeship levy, will cost employers £12 billion over the course of the Parliament, while the next tranche of pensions auto-enrolment will affect the very smallest businesses’.

Currently, nine out of ten members of the IoD pay a separate, voluntary Living Wage to their staff members. The voluntary Living Wage is used as an informal benchmark, and recommends that businesses pay their employees a figure of £8.25 an hour, while the suggested rate for those based in London is set at £9.40 an hour.

The new compulsory NLW will come into force in April 2016 and will apply to those workers aged 25 and over. Initially, the rate will start at £7.20 an hour, rising to £9 by 2020.

Inflation turns positive but report suggests that wages could take years to rise

Following October’s negative figure, the UK’s inflation rate as measured by the Consumer Prices Index (CPI) turned positive in November, the Office for National Statistics (ONS) has reported.

The CPI rate is 0.1%, up from a figure of -0.1% for October. Transport costs, alcohol and tobacco prices were the main contributors to the rise, partially offset by a fall in clothing prices, according to the ONS.

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Inflation as measured by the Retail Prices Index (RPI) – which includes mortgage interest payments and council tax – was at 1.1% for November, up from 0.7% the previous month.

Monthly CPI inflation has been between -0.1% and 0.1% for the whole of 2015, which has led to the Bank of England’s Monetary Policy Committee holding UK interest rates at 0.5%. The committee again voted to keep the rate unchanged last week.

Chris Williamson, chief economist at data firm Markit, said: ‘UK inflation remained largely absent in November, and looks set to remain weaker for longer than forecasters have recently been expecting. Falling prices for oil and other commodities are helping drive down companies’ costs.

‘Weak wage pressures and fierce competition in the retail sector are also helping keep a lid on prices. Hence clothing prices showing a record fall between October and November.’

Meanwhile, a report by the Resolution Foundation has suggested that pay growth in 2016 could be as little as 1%. After six years of stagnation, real pay increased in 2015, but that was primarily due to low inflation.

Laura Gardiner, senior policy analyst at the think tank, argued that pay growth next year would depend on whether the rising productivity could counterbalance rising inflation.

She said: ‘Strong output growth and prolonged low inflation could result in the highest level of real wage growth in over a decade. But equally, a failure to build on the early signs of a productivity recovery, combined with a swifter-than-expected return to target inflation, could send real wage growth tumbling to less than 1%’.

If pay growth did stay at 1% next year, it could mean that average pay levels do not return to pre-financial crash levels until at least 2020.

New online Personal Tax Accounts officially launched by HMRC

HM Revenue and Customs (HMRC) has officially launched its new digital Personal Tax Accounts (PTA) system.

The digital resource is intended to be used in a similar way to online banking.

The new online accounts will enable people to view their individual tax information and will provide the option to make payments at any time during the year.

PTAs have been created with the aim of supplying ‘real-time’ overviews of tax affairs and situations.

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Taxpayers will also be given the option to discuss tax matters via a virtual assistant or web chat facility.

The system roll-out is currently being phased in for individuals in the self assessment system.

By April 2016, every personal taxpayer is expected to have a PTA, along with the UK’s five million small businesses – two million of these presently use the new arrangement.

A spokesman for HMRC explained: ‘Self assessment for individuals and small businesses (including companies) will work through digital tax accounts, so there will be no need for them to send in annual tax returns.

‘Taxpayers will still have to confirm their information is correct and make sure the right tax is paid.’

The Government believes that the use of digital PTAs should help to stop any tax due or any refunds owed from building up at the end of each tax year, eliminating unwanted surprises for taxpayers.

David Gauke, financial secretary to the Treasury, stated: ‘Giving customers the ability to manage their tax affairs online is our latest step towards a fully digital tax system’.

More than a million users are expected to have access to their PTAs by mid-December.