Queen’s Speech outlines government’s legislative agenda

The Queen has delivered her annual speech at the state opening of Parliament, in which she outlined the government’s legislative agenda.

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This year’s speech differed to speeches given in previous years: it outlined the government’s legislative plans for the next two years, as opposed to one.

Earlier in the week, the government took the decision to cancel the 2018 Queen’s Speech in order to give MPs ‘extra time to deal with Brexit laws’.

Brexit proposals granted to the UK government include the power to make any future changes to UK laws, flexibility to accommodate trade agreements with the EU and other countries, control over the import and export of goods and the ability to end the free movement of EU citizens into the UK.

Other proposals outlined in the speech include a data protection bill designed to strengthen consumers’ rights, a national insurance contributions (NICs) bill aimed at ‘making the NIC system fairer’, and a financial guidance and claims bill, which establishes a new statutory body to co-ordinate the provision of debt, money and pension guidance.

Business groups have responded to the Queen’s Speech. Dr Adam Marshall, Director General of the British Chambers of Commerce (BCC), said: ‘While Brexit isn’t the top immediate priority for many businesses, firms of every size and shape want to avoid turbulence and confusion during the Brexit transition. The government’s proposed bills on trade, customs and immigration must minimise adjustment costs and maximise opportunities.’

Meanwhile, Mike Cherry, National Chairman of the Federation of Small Businesses (FSB), commented: ‘It’s good to see commitment to special support to help British businesses export to new markets around the world, which we look forward to engaging with the government on.’

Brexit deal must put jobs and prosperity first, says Chancellor

In his annual Mansion House speech, Chancellor Philip Hammond stated that any Brexit deal between the UK and the EU must put UK jobs and prosperity first.

Mr Hammond revealed that the government will seek a ‘bold and ambitious’ free trade agreement, that covers both goods and services. He also stated that mutually beneficial transitional arrangements will be made in order to avoid ‘disruption and dangerous cliff edges’.

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Agreeing ‘frictionless’ customs arrangements to facilitate trade across UK borders is also a priority during Brexit talks, Mr Hammond said.

Additionally, the Chancellor pledged to keep taxes ‘as low as possible’, stating that higher taxes will ‘slow growth, undermine competitiveness and cost jobs’.

Responding to the Chancellor’s speech, Mike Cherry, National Chairman of the Federation of Small Businesses (FSB), said: ‘In the negotiation itself, small businesses are looking to the government to secure an ambitious free trade agreement with the EU, while still allowing small firms to retain access to the skills and labour they need to grow and prosper.’

He continued: ‘While Brexit is the dominant issue of the day, our members are increasingly concerned about the weakness in the domestic economy. We therefore welcome the Chancellor’s commitment . . . to a low tax burden.’

Business groups call for ‘softer’ Brexit

Five business groups, including the Confederation of British Industry (CBI), the Federation of Small Businesses (FSB) and the British Chambers of Commerce (BCC), have called for the government to secure continued access to the European single market until a final Brexit deal can be struck with the EU.

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The letter to Business Secretary Greg Clark calls for the government to ‘put the economy first’, and to ‘prioritise an early agreement on guarantees for EU citizens’ already residing in the UK.

A final agreement between the UK and the EU should guarantee certain economic principles, as outlined in the letter. These include securing tariff-free goods trade between the UK and the EU, establishing a flexible system for the movement of labour and skills between the UK and the EU, and protecting the benefits of free trade agreements currently delivered through the EU.

The letter, which is also signed by the Institute of Directors (IoD) and manufacturers’ organisation the EEF, comes as Brexit Secretary David Davis enters into formal Brexit negotiations with the EU.

Commenting on the negotiations, Mr Davis said: ‘I want to reiterate at the outset of these talks that the UK will remain a committed partner and ally of our friends across the continent. And while there is a long road ahead, our destination is clear – a deep and special partnership between the UK and the EU. A deal like no other in history.’

The UK is set to leave the EU by the end of March 2019.

UK economic growth ‘weakest in Europe’ during first quarter of 2017, data suggests

The UK economy experienced the weakest rate of growth in the EU during the first quarter of this year, figures published by European statistics agency Eurostat have suggested.

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Britain’s economy grew by just 0.2% in the three months to March – a significant fall from the rate of 0.7% recorded during the last quarter of 2016.

Experts believe that Brexit was partly to blame for the UK’s low economic growth rate, alongside rising prices due to lower sterling.

The data also revealed that growth for the EU as a whole totalled 0.6% in the first quarter of 2017. It found that the French economy grew by 0.4%, whilst German economic growth rose by 0.6%.

Economists expect Britain’s Gross Domestic Product (GDP) rate to rise slightly in the coming months.

The UK economy is set to grow by 1.6% by the end of 2017, as predicted by the Organisation for Economic Co-operation and Development (OECD). However, the OECD also expects UK economic growth to fall to 1% during 2018, as Brexit looms.

‘Brexit funding gap’ poses threat to small businesses, report warns

In a new report, the Federation of Small Businesses (FSB) has warned that ‘billions of pounds in EU funding’ will need to be replaced following the UK’s departure from the EU if Britain is to avoid creating a ‘business support black hole’ for small firms.

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According to the report, the EU has dedicated £3.6 billion to the development of a competitive business environment for UK small businesses for the funding round set to end in 2020.

The FSB has suggested that, currently, there is ‘no regional development spend budgeted at national level beyond 2021’.

It is calling for the next government to seize the opportunity that Brexit presents to reform the business support landscape for small firms.

Mike Cherry, National Chairman of the FSB, stated: ‘Small businesses across the country are staring into a business support black hole from 2021. This is a particularly pressing issue for the many small firms with growth ambitions and those in less economically developed regions.

‘If the next government is serious about developing an Industrial Strategy that delivers prosperity across all areas of England, it must replace EU funding dedicated to small business support and access to finance after we leave the EU.’

Significant rise in business confidence, ICAEW reveals

Business optimism has moved into positive territory in the second quarter of this year, according to business confidence monitor data published by the Institute of Chartered Accountants in England and Wales (ICAEW).

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Confidence amongst UK firms has increased from -8.7 in the first quarter of 2017 to 6.7 during the second quarter.

However, the ICAEW has warned that, with the General Election and Brexit negotiations looming, businesses have decided to put recruitment and wage growth on hold.

As a result, the ICAEW is urging all political parties to outline ‘how they are going to address the problem of business investment’.

Commenting on the apparent rise in business confidence, Stephen Ibbotson, Director of Business at the ICAEW, said: ‘It’s encouraging to see that confidence is starting to rise after a sustained period of decline.

‘Yet against this improved sentiment, businesses are not investing in staff and wages and may well be waiting to see what happens in the political arena, particularly in relation to how the EU negotiations play out.’

TUC report suggests workers’ rights ‘at risk’ after Brexit

A new report published by the Trades Union Congress (TUC) has warned that employees in the UK and the EU are ‘at risk from the erosion of workplace rights after Brexit’.

The report reviewed the relationship between labour standards and foreign direct investment, and analysed the potential consequences for individuals working in Britain and the EU following the UK’s departure from the Union.

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Better labour standards help to attract foreign investment, the report revealed. It also suggested that there is a real risk of a ‘race to the bottom’ for low-pay and low-productivity sectors if countries seek to compete by restricting workers’ protections.

Frances O’Grady, General Secretary of the TUC, called for workplace rights to be protected in a post-Brexit trade deal with the EU. She said: ‘If we don’t put strong protections for working people at the heart of our deal with the EU, Britain could become a bargain basement economy.

‘The next government must get a deal with Europe that protects current rights, like paid holidays, equal pay and fairness for agency workers. And it must guarantee a level playing field with the rest of Europe now and in the future, so working people in Britain don’t fall behind our European neighbours.’