Chamber News

Commenting on the proposals to reform collective redundancy prcedures announced by Norman Lamb today, Caroline Williams CEO Norfolk Chamber said:

“As they stand, the UK’s redundancy rules are outdated and damaging to Norfolk firms. Consulting for a quarter of a year to change the direction of a business is unnecessary and out of step with the modern world. Instead of thresholds and processes, the rules should encourage firms to focus on quality consultation with staff, and enable fair decisions in a swift timeframe. A shorter compulsory period of 45 days would allow quicker decision-making where the survival of the business could be at risk, such as following the loss of a major contract.

“Redundancy is always a last resort, but is sometimes necessary to save other jobs or prevent the business from failing. When tough decisions are necessary, businesses must be assured that the redundancy consultation process can be carried out efficiently, rather than being drawn out in a way that increases uncertainty for employers and employees alike.”

Measures to make the international system of patent application faster and more effective were announced today by the UK Intellectual Property Office (UKIPO) with changes to the UK’s Fast Track system. These moves come as part of a wider effort by the UK and US intellectual property authorities to get more businesses to use the PCT system.

The UK’s Fast Track system, originally introduced in June 2010 with the aim of getting business’ patents granted faster and more cheaply, will now give applicants the chance to make changes to an international application, and still have the opportunity to request accelerating processing in the UK. This change removes a bureaucratic hurdle and increases the flexibility and accessibility of the patent application process.

Click here for further details.

The UK’s best and worst locations for doing business effectively have been revealed by a new survey from the Forum of Private Business (FPB). Energy costs and access to effective telecommunications top the list of infrastructure issues for small firms.

The survey, “Infrastructure for Growth”, found that, overall, 74% feel their location is effective for their business needs, with the key factors being their proximity to good road networks (16%), their centrality (14%) and their footfall (9%).

As far as geographical location is concerned, 79% of business owners in the North West feel their location is effective for their company, 78% in the South West, 76% in the Midlands, 75% in Wales, 75% in the East of England, 74% in London, the North East and Yorkshire, 67% in the South East of England and 65% in Scotland.

The survey also found that 80% of respondents thought energy costs are an extremely important infrastructure issue and 80% also cite the importance of telecommunications and broadband access. Working down the list, 75% believe the reliability of the energy supply to be a key issue, 73% feel local banking services are key and 65% cite local roads. The next priorities are post office services (60%), mobile communications (59%), the motorway network (56%), the provision of skills training (46%), waste services and recycling (41%), e-communications (32%) and rail transport (23%).

When asked what infrastructure-related problems should be prioritised by the Government, most business owners identified business rates (52%), followed by measures to boost consumer and business confidence (49%), health and safety regulations (45%), utilities costs (44%), tax policies (44%), other regulations (42%), reducing employment law (40%), and late payment and debt (28%).

The European Commission has launched a challenge at the World Trade Organization (WTO) in Geneva to Argentina’s import restrictions.

Under WTO dispute settlement procedures, the EU is first requesting consultations with Argentina in a bid to have these measures, which negatively affect the EU’s trade and investment, lifted. This is a first step in the WTO dispute settlement system.

If no solution is found within 60 days, then the EU can request a WTO Panel to be established to rule on the legality of Argentina’s actions.

The restrictive measures include Argentina’s import licensing regime, notably the procedures to obtain an import licence as well as the obligation on companies to balance imports with exports.

EU Trade Commissioner Karel De Gucht explained: “The trade and investment climate in Argentina is clearly getting worse. This leaves me no choice but to challenge Argentina’s protectionist import regime and ensure that the rules for free and fair trade are upheld.”

Argentina subjects the import of all goods to a pre-registration and pre-approval regime, called the “Declaración Jurada Anticipada de Importación”. Since February 2012, this pre-approval requirement is applied to all imports.

Hundreds of goods also need an import licence.

On the basis of these procedures, imports are systematically delayed or refused on non-transparent grounds. In early 2011, more than 600 product types were affected by this licence regime, such as electrical machinery, auto parts and chemical products.

Moreover, Argentina requires importers to balance imports with exports, or to increase the local content of the products they manufacture in Argentina, or not to transfer revenues abroad.

This practice is systematic, non-written and non-transparent. Acceptance by importers to undertake this practice appears to be a condition for obtaining the licence that allows imports of their goods.

The Government has introduced legislation promising to encourage long-term growth, although some of the country’s leading business organisations seem, at best, to be taking a wait-and-see attitude to the new proposals.

Presenting the Enterprise and Regulatory Reform Bill to Parliament, Business Secretary Vince Cable said: “Growing our economy out of a period of acute crisis is the most pressing issue for this Government. We want to make sure the right conditions are in place to encourage investment and exports, boost enterprise, support green growth and build a responsible business culture.”

The Bill includes provisions to change the employment tribunal system by encouraging parties to come together to settle their dispute before a tribunal claim is lodged, through Acas early conciliation and greater use of Settlement Agreements.

It also aims to make the determination of less complex disputes quicker and cheaper for employers and employees alike, through a new “Rapid Resolution” scheme. Taking away the fear of employment tribunals will give business more confidence to take on new staff, the Government said.

The Bill will also address the disconnect between directors’ pay and long-term company performance by giving shareholders of UK-quoted companies binding votes on directors’ remuneration.

It will also reduce inspection burdens on businesses of all sizes and increase SME access to “reliable, consistent advice” on complying with regulations in areas such as trading standards, health and safety and environmental health.

The Bill has not been well-received by the Institute of Directors (IoD) with Alexander Ehmann, Head of Regulation and Employment Policy, describing it as disappointing.

“It signals another missed opportunity for the Government,” he said. “In a week where Adrian Beecroft’s report has dominated the news agenda, the gap between government rhetoric and actual deregulation is all too obvious.”

For the CBI, Chief Policy Director Katja Hall said that it was light on detail in some key areas.

“Companies will judge the Government’s progress by what changes in their business on the ground,” she said. “So far, there has been too little progress in too many areas, with the Government’s intended changes yet to filter through.”

HMRC has been blasted for the length of time that callers have to wait before they get through to someone on the organisation’s helpline numbers.

The Low Income Tax Group undertook a mystery shopping exercise of three HMRC helplines in the week after Easter – the first of the new tax year – and it revealed that each caller was kept on hold for an average of 30 minutes before it was answered. The group also said it had reports of member clients hanging on the phone for up to an hour.

It says that over recent years, HMRC has consistently failed to answer their telephone helplines within a reasonable time-scale. It points to the halcyon days of the Inland Revenue back in 1997/98 when it vowed to answer a call within 30 seconds 91% of the time.

But now, according to the LITRG, callers “can spend four times as much time pushing buttons before you even get in a queue”. It said the subsequent wait can then be excessively costly for callers on a low income, especially as many rely on PAYG mobiles.

It carried out its “mystery shop” on Tuesday 10 April 2012 and made three calls using the routes taken by an ordinary PAYE caller, a pensioner and a tax credit claimant. On average, the wait was 29 minutes. On a PAYG mobile that could have cost £11.60 per call, which could equate to half a day’s income for a pensioner.

An HMRC spokesman said: “HMRC handles around 60 million telephone calls every year. During busy periods, there will be times when customers will find it more difficult to get through. We are working hard to improve contact centre service levels and have made good progress. We are managing busy periods better by deploying extra people to deal with short-term increases in demand.”

He added that the week after Easter was an exceptionally busy week, and typical call volumes can vary from 750,000 to 1.7m in any given seven-day period, so it was “very hard to forecast”.

“We are sorry if anyone has been kept waiting, or could not get through over the last couple of days, but we are getting back on top of things”.

Further details of the mystery shop exercise can be found on the LITRG website

Air freight markets slumped sharply in the first half of 2011, bottoming out towards the end of the year. However, various distortions and month-to-month volatility have continued to mark performance since the beginning of 2012.

According to the International Air Transport Association (IATA), things may finally be taking a turn for the better.

Tony Tyler, IATA’s Director General and CEO, said after viewing the latest figures that, amid the many distortions that have marked the first four months of the year, it is possible to identify the start of a growth trend in cargo for some parts of the world.

“But economic uncertainty in Europe makes it very difficult to be optimistic in the near to medium-term,” he warned.

Asia-Pacific carriers saw a 7.3% decline in demand in April, well ahead of capacity cuts of 4.1% and reflecting weakening exports from China.

Meanwhile, European airlines saw a 4.9% fall in cargo traffic compared to the year before, despite having cut capacity by 0.2%, and North American carriers showed a 6.4% drop in demand with a 2.9% cut in capacity.

Latin American carriers recorded a 3.6% fall in demand, even though capacity expanded by 8.8% compared to April 2011. Middle Eastern carriers were the bright spot in cargo with a 14.5% increase in demand, and even this was behind a 15.1% increase in capacity.

African carriers showed a 6.1% increase in demand, behind a 9% increase in capacity.

See what the Bank of England’s Agents think about business conditions in Norfolk and East Anglia and what they think is going to happen with consumer demand, investment, exports, employment and the housing market. Click here to read the full report.

Members of the Norfolk Chamber of Commerce will meet with Ruud Haket, Managing Director of Greater Anglia on Friday 22 June 2012 in Norwich.

The meeting will provide an opportunity for Norfolk businesses to highlight any business issues and concerns to Greater Anglia. What is your opinion about the Greater Anglia rail franchise, do you have any comments?

If you have a comment that you would like the Chamber to raise with Greater Anglia, please email it to nova.fairbank@norfolkchamber.co.uk .

• Annual CPI inflation down from 3.0% in April to 2.8% in May
• Annual RPI inflation down from 3.5% in April to 3.1% in May

Commenting on the inflation figures for May 2012, published today by the ONS, Caroline Williams CEO Norfolk Chamber said:

“The large decline in the May inflation figures is good news. If current trends continue, the squeeze felt by many Norfolk businesses and consumers will begin to ease. Disposable incomes will improve, which will in turn give a significant boost to consumer spending which will help amongst other Norfolk’s key sectors of retail, tourism and hospitality. While inflation is still above the 2% target, it is heading in the right direction. Compared to its 5.2% peak in September 2011, annual CPI inflation has almost halved.

If current trends continue, the squeeze felt by many Norfolk businesses and consumers will begin to ease

“The latest inflation figures may increase calls for more quantitative easing (QE). The Bank of England should not rule this out if the eurozone collapses, as this would put pressure on our banking system. But we know that additional QE has not made much of a difference to businesses on the ground.Unless we are facing a global shock, the government must instead ensure that the measures to improve liquidity and lending to businesses announced last week are implemented effectively and without delay. The government should go further and consider introducing a state-backed business bank to facilitate access to finance for new and growing companies. Deregulation and investment in infrastructure must also be key ingredients of a long-term growth strategy

News bulletin – 18 June 2012

Record fall in ‘NHS satisfaction’ Public satisfaction with the NHS has dropped by a record amount, the British Social Attitudes Survey suggests.

Patients dropped from ‘re-categorised’ NHS waiting lists The Royal College of Surgeons (RCS) has condemned NHS trusts in England for changing the criteria for operations, leading to some patients being taken off operation waiting lists.

Chiropractors continue to treat children despite a lack of evidence The reluctance of chiropractors to change, in the face of a lost court case, the evidence and public opinion, is disconcerting.

Patients do not know how to contact GP outside normal hours: survey Four in ten patients do not know how to contact their GP out-of-hours services, a government survey has found.

Organ donation: Opt-out bill to be published in Wales Legislation to change the organ donation system in Wales will be published on Monday.

SMEs cutting back on PMI and group protection Smaller businesses are cutting back on the level of cover provided by benefits such as private medical insurance (PMI), according to analysis by Mercer.

Dental access figures look promising The Department of Health has published dental access statistics on findings from the second wave of results from the GP Patient Survey (conducted between January and March 2012).

Diabetes: a million not getting all basic checks About a million people with diabetes are at an increased risk of stroke, blindness, amputation and heart attacks because they are not getting all the medical checks they should, an NHS audit has found.

Olympic fever sees spike in A&E sports injuries Accident and emergency departments have seen a 15 per cent rise in sports injuries as an unfortunate side effect of Olympic fever, figures show.

Prime Minister David Cameron is leading a high-level business delegation this week to Mexico, which is hosting the G20 and B20 summits in Los Cabos.

He is accompanied by Chancellor George Osborne, Trade & Investment Minister Lord Green and over 25 UK companies, institutions and universities including Diageo, Rolls Royce, Virgin Atlantic and the Confederation of British Industry (CBI). Also travelling are Business Ambassador Tamara Mellon and pottery designer Emma Bridgewater.

Lord Green said:

“Almost two hundred years ago, the UK was the number one European exporter to Latin America. British expertise helped to build Mexico’s railways and canals, but UK firms currently account for less than one per cent of Mexico’s imports. We need to turn this performance around in one of the world’s most promising markets.”

This year, Mexico is hosting the G20 summit in Los Cabos which is due to focus on growth and employment; strengthening the international financial architecture; financial market reform; and food security and development.

The B20 summit, which immediately precedes the G20 and is due to be opened by Mexican President Felipe Calderón, gathers senior business people to discuss themes such as growth, development, trade and investment.

The UK has made expanding trade with Mexico a priority, and Deputy Prime Minister Nick Clegg led a delegation there last year. Mexico is currently the 14th largest economy in the world and the second largest in Latin America, with a rapidly expanding middle class.

The Prime Minister and the business delegation are expected to arrive in Mexico on Monday and will travel to Mexico City on Tuesday. On Wednesday, the Prime Minister is expected to hold bilateral meetings with Mexican leaders.

UK business leaders accompanying Prime Minister David Cameron to Mexico have underlined the potential of this market.

Dr. Neil Bentley, CBI Deputy Director-General, said:

“This timely visit with the Prime Minister shows British companies are committed to strengthening their ties with Mexico, and is a great opportunity to showcase what the UK can offer, such as retail, luxury and consumer goods, and green technologies. Mexico is a vital trade partner for the UK, with its growing economy and burgeoning middle class, and demand for quality British goods and services is increasing. To achieve a potential £20 billion boost to the UK economy by 2020 through increasing exports, the UK must look beyond traditional markets and strengthen its relationships with fast-growing economies like Mexico.”

Steve Ridgway, Chief Executive of Virgin Atlantic, which last week started direct flights into Cancun, said:

“We are excited to have started flying into Mexico. It is one of the top five long-haul leisure destinations for UK passengers and we see this market as a valuable addition to our network. Early bookings have been strong and it looks set to be one of our busiest routes this summer. We expect to carry over 75,000 passengers in the first year alone, which could generate as much as $20m in tourism revenue to the Mexican economy. We’re very pleased to be involved in carrying the Prime Minister and this important business delegation to the G20 and hope it will further develop relations with this important market.”

Kirk Kinsell, President, the Americas, for InterContinental Hotel Group (IHG), which is headquartered in Buckinghamshire, said:

“Mexico provides many opportunities to diversify in the hotel business, from resort to business destinations. The country can serve several tastes in regards to tourism – adventure, sun, colonial – and it has a growing economy in the trillion dollar range. We see a huge opportunity to grow many of our hotel brands, such as InterContinental Hotels & Resorts, Holiday Inn and Staybridge Suites in Mexico.”

Hugh Richmond, Managing Director of ENER-G Natural Power, said:

“We’re proud that our biogas generation project in Aguascalientes is contributing to the country’s visionary climate change targets, as well as supplying green power to Nissan. ENER-G sees huge investment potential in Mexico’s emerging renewable energy industry.”

Nigel Curson, Director of Integrity Services at London-based Penspen, said:

“Mexico represents a wealth of opportunities for companies like Penspen with a strong track record in oil and gas engineering, project management and integrity services. The country’s estimated 681 trillion cubic feet of shale gas reserves, combined with its aim to replace 100 per cent of extracted oil with new discoveries, make it a crucial market for engineering consultancy, training and knowledge-transfer.”

UK Mexico facts

• The population of Mexico is over 112 million
• The median age in Mexico is 26
• GDP has been growing at five per cent per year over the last decade (3.9% in 2011)
• Mexico has free trade agreements with 44 countries
• Mexico has a $226 billion plan to bring its infrastructure into the 21st century and recently unveiled the world’s second highest bridge across the Baluarte Gorge. At 403 metres, it is higher than the London Shard (310m)
• In 2010, 22.3 million tourists visited Mexico
• The UK is Mexico’s 5th largest investor, having invested just over £5 billion since 2000
• In 2011, UK imports of goods from Mexico were valued at £1.05 billion, led by telecommunications exports (largely mobile phones). The UK’s exports to Mexico last year were worth £952 million
• There are just under four million Spanish speakers in the UK