Mr Cable’s warning came after unions warned of the possibility of major strikes on June 30th. The Business Secretary said that if the number of strikes remained low he would not have a compelling case for issuing tighter union laws.
During his speech, Mr Cable was jeered and heckled at as he spoke of how pressure would be on him to act if widespread disruption was caused by a higher level of public sector strikes.
The only positive cheers the Business Secretary received were when he spoke of the prospect of a day of industrial action across significant parts of the public sector.
Addressing delegates in Brighton, Mr Cable said: “We are undoubtedly entering a difficult period. Cool heads will be required all round. Despite occasional blips, I know that strike levels remain historically low, especially in the private sector.
“On that basis, and assuming this pattern continues, the case for changing strike law is not compelling.
He added: “However, should the position change, and should strikes impose serious damage to our economic and social fabric, the pressure on us to act would ratchet up. That is something which both you, and certainly I, would want to avoid.”
Mr Cable’s views are supported by the Mayor of London, Boris Johnson, who wants laws to prevent a strike taking place unless at least half of the union members in a workplace take part in a ballot.
Paul Kenny, the GMB General Secretary, said: "I don't think that any strike in this country could inflict the sort of economic damage on our country that the banks and finance houses and frankly current Government policy have done.”
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( 2.9 / 177 )After a very long period of gloomy economic forecasts and data, relief was felt following news that the construction sector experienced a modest growth spurt during May, according to a survey.
The pick-up in growth is said to be due to the increasing number of new orders and once-forgotten projects now getting the go ahead. This supported a month of expansion in the sector’s activity, which meant employment figures across the sector were also raised for the first time since June 2010.
The monthly purchasing managers' index (PMI) from Markit/CIPS came in higher than expected with a headline reading of 54, which was up slightly from last months reading of 53.3. A rise in the expansion rate is positive news as a reading above 50 signals growth across the sector.
However, the index is below the average reading experienced in the first quarter of 2011 but compared with the manufacturing sector’s PMI, which had fallen to levels last seen during the recession, the data for construction came as a relief.
After contracting in April, house building also got back onto growth mode, which helped to counterbalance the shrinking civil engineering activity. The survey also stated that, compared to the previous month, commercial building was quite stable and growing at a solid rate.
David Noble, chief executive at the Chartered Institute of Purchasing & Supply (CIPS), said: “The millstone of public spending cuts can be seen clearly in this month’s construction PMI, but aside from the unsurprising decline in civil engineering activity, the overall figures are not quite so foreboding."
He added: “It's encouraging to see a return to growth in the housing sector after April’s blip but there may be a long way to go before underlying demand for new properties, whether purchase or rental, takes the edge off market volatility.”
It is hoped that this news of growth in the construction sector will make a positive impression on the economy’s headline growth during the second quarter of this year.
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( 3 / 179 )There has been a very gentle rise to private sector pay deals, with the latest analysis revealing they have risen to 3 per cent. However, the majority of pay rises are failing to keep pace with the cost of living as they still remain below the rate of inflation.
The study by IDSPay.co.uk said that a small number of pay rises are above 4 per cent, with some car and utilities industry deals being close to the days of pre-recession.
In the first quarter of 2011, pay rises for private sector workers rose from 2.5 per cent at the end of March to 3 per cent by the end of April, showing very small signs that wages are slowly climbing back up. Workers in the manufacturing sector saw their level of pay rising considerably, from 0.5 per cent to 3 per cent during the same period.
Ken Mulkearn, editor of IDS Pay Report, said: “The latest figures show that private sector pay awards are where we thought they would be at this time, reflecting a degree of recovery in profitability and higher levels of inflation .”
However, the future for workers wages continues to look bleak as inflation sores and employers not being in the position to match the rate with pay rises. Economists have warned that there is a “limited” chance pay would catch up with inflation in the near term. Therefore, workers are set to continue to struggling as their take-home income fails to match the cost of living.
Economist at BNP Paribas, Ken Wattret, said workers would continue to feel the pinch as there were a number of recent factors, including disappointing figures for manufacturing output and yesterday’s low mortgage approval levels, showing that the economy was still “really struggling”.
Mr Wattret also said employers were under little pressure to hand out pay rises to match the inflation rate, saying: “It’s going to be a very difficult period for the economy in general and the labour force. In the short run inflation will get higher.”
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( 2.9 / 183 )The battle against red tape continues with the EU now agreeing to cut red tape for the UK’s smallest firms, which would see them benefiting from simplified accounting rules.
In Brussels yesterday, the EU came to an agreement to cut red tape for ‘micro-entities’ during a meeting of business ministers from across Europe. The move could see very small businesses being excused from the burden of certain accounting regulations. By being exempt from these regulations, firms will save money that could be used elsewhere, such as expanding to become a bigger company.
‘Micro-entities’ is a term created at the agreement to describe very small businesses. To be a micro-entity a company must not exceed two of the three criteria’s, which are:
- a balance sheet total of €250,000 (£217,000)
- a net turnover of €500,000 (£434,000)
- an average of 10 employees during the financial year in question
The rules for the profit and loss account and balance sheet reporting requirements have been simplified by the agreement. This allows EU member states the discretion to exempt the smallest companies from filing these accounts. However, simplified balance sheet information would still need to be filed at Companies House.
Business minister Ed Davey said the agreement could save firms as much as £300 million a year. Mr Davey said: “This is a significant step in reducing red tape and a clear signal that we will take action to stop our smallest companies being held back by excessive regulation.
“I believe this shows what can be achieved by a positive and constructive engagement with the European Union. We now need to build on this breakthrough and I hope that further improvements can be agreed before the proposal becomes law."
This a good move for the UK’s very small firms and it shows that the EU have recognised how much of a burden unnecessary regulations are on struggling small firms.
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( 3 / 178 )Following news that UK banks missed their small business lending targets under the Government’s Project Merlin agreement, UK manufacturers have reported an increase in the availability of new areas of borrowing allowing them to benefit from increased lending from the banks for the first time since the recession.
A survey by the manufacturing industry body EEF, reported that UK manufacturers are finding it easier to gain access to loans from high street banks.
However, the availability of funding from the banks comes at a price to manufacturers. EEF warned that companies must be prepared for high costs of credit, with one-in-five businesses reporting an increase to the overall cost of credit in the past two months.
Lee Hopley, chief economist of the EEF, said: "For the first time since the recession ended, manufacturers are reporting improving access to finance.
"Hopefully, this will translate into better news on new lending in coming months. But availability of is only part of the story and we also need to see costs coming down.
"Ensuring companies have access to the finance needed to invest and grow is critical for the recovery. We need to see a sustained improvement before concluding that the actions taken by banks and Government are bearing fruit and that no further measures are required."
The positive news for lending comes as the British Chambers of Commerce (BCC) downgrades their forecasts for economic growth. The BCC cut its forecasts for growth for 2011 from 1.4 per cent to 1.3 per cent, and have also reduced the figures for 2012 from 2.3 per cent to 2.2 per cent.
The BCC has also raised its predictions for inflation rates for 2011, from 4.2 per cent to 4.5 per cent.
News of an increase to the availability of lending for manufacturers will hopefully encourage SMEs to apply for the much-needed funding from the banks, which will in turn encourage economic growth.
For more information, please visit www.glazers.co.uk
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