A survey carried out by the Confederation of British Industry (CBI) has suggested that business owners in the UK will seek to increase their employees’ pay in 2018.
The CBI found that 52% of survey respondents will aim to raise pay for their employees in line with, or above, inflation in the coming year.
51% of businesses are also seeking to grow their workforce in 2018, the data revealed.
However, a significant number of firms reported that they have been affected by rises in the National Living Wage (NLW): 55% stated that they have felt the effects of the NLW on their business, which is a slight rise when compared to last year’s figure of 50%.
Commenting on the findings, Matthew Percival, Head of Employment Policy at the CBI, said: ‘Living standards have been squeezed in 2017 because of higher inflation.
‘The good news is that despite this, more than half of companies will offer real pay rises next year – despite a slowing economy.
‘Higher productivity is the only sustainable way to increase pay, so it is rightly the focus of business and the government through the Industrial Strategy.’
The government has launched its new complaint handling service, which will be managed by the new Small Business Commissioner, Paul Uppal.
The service will seek to resolve complaints from small businesses in regard to unfair payment practices and late payments.
Firms can also visit the Small Business Commissioner’s new website, which will provide guidance to businesses on payment issues, including advice on which course of action to take if a payment is overdue.
It will also supply guidance on how to check if the correct information has been provided to the correct person in order for an invoice to be paid, and chase when a payment is overdue. The Small Business Commissioner’s website can be accessed here.
Commenting on the launch of the new service, the Small Business Commissioner, Paul Uppal, stated: ‘My mission is to help all small businesses nurture positive and lasting relationships with their customers that work in the best interests of both.’
Meanwhile, the Federation of Small Businesses (FSB) welcomed the launch. Mike Cherry, its National Chairman, said: ‘The Small Business Commissioner is crucial to turning the tide on [the] late payments culture. FSB will be encouraging small businesses affected to use the service, and we hope then to see clear actions taken to tackle the worst examples of supply chain bullying.
‘Success will be a UK economic culture where a business that does a job promptly is paid promptly.’
Research carried out by insurance provider Aviva has suggested that many older workers are struggling to save for a comfortable retirement.
Aviva found that 18% of workers in their fifties and sixties are ‘unable to save anything for retirement’, with two in five older employees describing themselves as ‘occasional’ or ‘absent’ savers.
49% of employees in their fifties have not yet calculated how much money they will need to retire, Aviva found.
The research also revealed that 60% of older workers are yet to build upon their savings as they approach retirement age.
Lindsey Rix, Managing Director of Savings and Retirement at Aviva, said: ‘It is worrying to see so many of the UK’s older workers in the dark over how much they need to save to afford a comfortable retirement.
‘As the cost of living creeps up and wage growth continues to slow, saving for retirement in the current climate is particularly challenging.
‘These findings show the importance of industry and government taking action to help consumers become better informed and active savers.’
A survey carried out by charity Time to Change has revealed that the subject of mental health is still regarded as a taboo topic in many UK workplaces.
The survey, which polled 2,000 UK workers, found that discussing mental health issues is ‘one of the last taboos in the workplace’.
Survey respondents were asked to select subjects they felt comfortable talking about with work colleagues from a list of topics. Of these topics, the subject of mental health ranked the lowest, with only 13% of respondents stating that they would feel comfortable discussing their own mental health concerns.
However, more than half of workers quizzed said that they would support a colleague if they were struggling with mental health issues.
The data also revealed that 26% of employees would rather discuss money issues than mental health problems.
Time to Change stated that there is ‘a lot more work to do in 2018 to combat the stigma of mental health’.
Commenting on the findings, Sue Baker, Director of Time to Change, said: ‘Christmas is branded the most wonderful time of the year but it can be challenging and stressful for those of us struggling with mental health problems or with life stresses.
‘So let’s add talking about mental health into the usual mix of workplace conversations.’
In a new report, the government has proposed to extend its pensions automatic enrolment scheme to include younger workers.
Under auto-enrolment, employers in the UK are required to automatically enrol all eligible members of staff into a workplace pension scheme, and pay a minimum contribution into the fund. Employees do, however, have the right to opt out.
Currently, only those who are aged between 22 and the State Pension Age (SPA) are eligible to be automatically enrolled into a pension scheme.
Government ministers plan to reduce the lower age limit to 18 by the mid-2020s, in order to increase the eligible target group and get younger workers into ‘the habit of saving’.
Commenting on the proposals, Work and Pensions Secretary David Gauke said: ‘We are committed to enabling more people to save while they are working, so that they can enjoy greater financial security when they retire. We know the world of work is changing, so it is only right that pension saving does too. This ambitious package will see more people than ever before helped onto the path towards building a secure retirement.’
However, experts have warned that lowering the age limit for pensions auto-enrolment may burden employers with additional costs. Mike Cherry, National Chairman of the Federation of Small Businesses (FSB), stated: ‘Requiring employers to contribute from the first pound of earnings will mean that, by 2019, hundreds of thousands of small employers will have to pay up to £180 more per employee each year.
‘For employers in certain sectors, such as care and hospitality where margins are tight, this will really add up.’
In his draft Budget, Derek Mackay, the Finance Secretary for Scotland, has unveiled a series of changes to the Scottish income tax rates and bands.
Mr Mackay used the Scottish Budget to confirm an increase in income tax rates for higher earners, together with the introduction of two new income tax bands.
The changes will see the higher rate of income tax increase from 40p to 41p, with the top rate rising from 45p to 46p.
Meanwhile, those earning more than £24,000 a year will be taxed under a new 21p band, and a ‘starter’ rate of 19p will also be introduced.
In addition, the Finance Secretary confirmed that Land and Buildings Transaction Tax (LBTT) will be maintained at its current rates, and announced the introduction of a new relief for first-time homebuyers purchasing property worth up to £175,000 in Scotland.
Commenting on the Scottish Budget announcements made by Mr Mackay, Hugh Aitken, Director of the Confederation of British Industry in Scotland (CBI Scotland), stated: ‘By putting productivity at the heart of the Budget, it’s clear that Derek Mackay has listened to organisations like the CBI that have said consistently that boosting productivity is the only sure-fire way to grow our economy, generate the revenues we need for quality, sustainable public services and raise living standards.
‘But things aren’t all rosy – the prospect of income tax rises and added complexity in Scotland’s tax code will be a bitter pill to swallow.’
The Scottish Budget announcements can be read in full here.
Research published by banking group Close Brothers has suggested that small and medium-sized enterprises (SMEs) are struggling to access the funding required to grow their business.
The bank found that only 41% of UK firms are able to access finance from their preferred source, with a further 23% stating that while they are able to access the funding they require, it is often not supplied by their preferred provider.
5% of those surveyed said that they wouldn’t know where to access capital that they require, and an additional 33% use an overdraft to help finance the expansion of their business, the research found.
In addition, Close Brothers revealed that the British Business Bank supplied over £3.1 billion in finance to UK SMEs last year.
Commenting on the findings, Adrian Sainsbury, Banking Division Manager at Close Brothers, said: ‘Low productivity hinders economic growth and improving productivity is vital, particularly as the UK prepares to leave the EU.
‘SMEs need access to the right finance and support to invest in training staff or adopting new technologies, so increasing awareness of financial options is crucial.’