UK set for weakest growth since 2009

UK set for weakest growth since 2009

UK set for weakest growth since 2009

The lack of progress on the UK’s trade and investment negotiations with the EU has led ICAEW to slash its 2018 GDP growth forecast for the UK from 1.7% to 1.3%

It says that the economy is likely to experience its weakest growth since 2009 on the back of weak output in the first quarter of 2018 and the recent oil price volatility which is depressing consumer demand.


Most economic indicators point to “sluggish” economy growth, with business investment on hold, the diminishing spare capacity in the workforce potentially forcing up wages, and input price inflation continuing to outstrip selling prices.

Job creation is likely to cool throughout 2018 with total employment growth down by 0.1% to 0.9%.

ICAEW chief executive Michael Izza says that the situation will continue while progress on Brexit remains stalled.

“The US, Australia, Germany and even Greece are expecting growth above 2% and there is a danger that the UK’s sluggish growth will become acceptable at a time when other countries are gathering pace,” he warns.


On the bright side, evidence from ICAEW’s quarterly Business Confidence Monitor shows that optimism among exporting businesses is rising faster than among non-exporters.

Trade and political tensions stirred up by the US could pose a risk but if these come to nothing, then quarterly GDP growth will remain around 0.4% throughout the rest of the year.

Izza urges the government to “make progress with the EU in helping to pave UK business success once Brexit takes place”.

He adds that there are plenty of new opportunities for businesses to take advantage of but the lack of clarity and agreements about the UK’s future outside the EU are “a clear own goal”.



Nicky Morgan calls to end “alpha-male culture” in finance

Nicky Morgan calls to end “alpha-male culture” in finance

Nicky Morgan calls to end “alpha-male culture” in financial services

Nicky Morgan, chair of the Treasury Committee, has called on businesses to alter the way they award bonuses, as the current culture may be placing women at a disadvantage

“In the current bonus culture, – whereby individuals argue how well they have performed – it’s perceived that men argue more forcefully for bonuses, which can be a disadvantage for women,” Morgan, who has previously called for firms to “abolish their gender pay gap and support the progression of women”.


The committee’s Women in Finance report, published today, suggested that performance related bonuses should instead be “assessed against clearly objective and formulaic criteria”.

Culture was seen as one of the major barriers to gender diversity in financial services, with the benefits of diversity including “better financial performance, reduced groupthink and more open discussions”.

Workplace culture is also significant in determining a focus on diversity “right at the start of the recruitment process”, the report said, while a culture of presenteeism (coming in to work while physically unwell) was flagged as another barrier to women’s inclusion at senior levels.


Addressing presenteeism, Jayne-Anne Gadhia, CEO of Virgin Money and Women in Finance charter champion, explained that many women believe businesses should measure employee output, not employee presence.

She also addressed the negative impact maternity leave could have on their careers, while PwC partner Jon Terry pointed to the fact that women can often return to “less remunerative and less senior roles than they have left”.

The report urged employers to communicate the opportunities to those returning from maternity leave “so that women can make decisions about their careers without impediments”.


Morgan argued that firms should “encourage flexible working, promote returner schemes for women on maternity leave, and re-examine their recruitment and promotion policies to eliminate unconscious bias.”

Sarah Churchman, head of diversity at PwC, said that promoting diversity and reducing large bonus pay gaps could help close the gender pay gap.

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HMRC enforce National Minimum Wage

HMRC enforce National Minimum Wage

BEIS and HMRC are urging underpaid workers to complain about National Minimum Wage (NMW) and National Living Wage (NLW) underpayments. Recent figures show that the number of workers receiving the money they are owed has doubled.

During 2017/18, HMRC investigators identified £15.6 million in pay owed to more than a record 200,000 of the UK’s lowest paid workers. This is an increase on the previous years figures of £10.9 million for more than 98,000 workers.

HMRC launched its online complaints service in January 2017 and believes this has contributed to the 132% increase in the number of complaints received over the last year and the amount of money HMRC has been able to recoup for those unfairly underpaid.

The figures are published as the government launches its annual advertising campaign which encourages workers to take action if they are not receiving the NMW or NLW. The online campaign urges underpaid workers to proactively complain by completing an HMRC online form.

HMRC state that the types of business receiving most complaints include restaurants, bars, hotels and hairdressing.

Business Minister Andrew Griffiths said:

Employers abusing the system and paying under the legal minimum are breaking the law. Short changing workers is a red line for this government and employers who cross the line will be identified by HMRC and forced to pay back every penny, and could be hit with fines of up to 200% of wages owed.

I would urge all workers, if you think you might be being underpaid then you should check your pay and call Acas on 0300 123 1100 for free and confidential advice.’

Please contact us for help with payroll matters.

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Scott Sanderson

Partner, Sheffield

0114 266 7141