A British employers group demanded immediate action from Finance Minister Rishi Sunak (pictured) after a record deterioration in business in the April-June period. The British Chambers of Commerce said on Wednesday (1 July) its quarterly survey of 7,700 firms found the share of companies reporting growth in sales was far below even the low point of the global financial crisis of 2007-08, writes William Schomberg.
“Our results demonstrate the need for swift and substantial action,” the BCC’s Director-General Adam Marshall said. “The UK cannot meander its way back to success in this era of uncertainty.”
Prime Minister Boris Johnson promised on Tuesday (30 June) to fast-track infrastructure investment and slash property planning rules. The spending announcement of £5 billion ($6.2bn) amounted to around 5% of gross public sector investment last year, most of which had already been announced. Sunak is due to announce more details of the government’s plans next week, on top of the £133bn of emergency measures he has rushed out mostly to keep people in their jobs. However, Sunak has so far opted not to bring forward a major budget statement which is due in the autumn.
The BCC said its survey showed orders and investment intentions at record lows for services firms and manufacturers. Marshall called on the government to cut employers’ social security contributions and take other measures to help companies keep workers on their books after Britain’s huge state furlough scheme expires at the end of October.
Companies would need extra investment incentives and help to survive cashflow crunches in the form of wider relief from property taxes and more grants. The government should also take measures to stimulate consumer demand, Marshall said.
($1 = 0.8129 pounds)
Italian MEP Vincenzo Sofo joins the ECR Group
The European Conservatives and Reformists Group in the European Parliament has decided to take on Italian MEP Vincenzo Sofo as a new member.
Mr Sofo was elected to the European Parliament in 2019. He was one of the three Italian candidates suspended pending the exit of the British Members. On February 1st 2020, Mr Sofo officially took his European Parliament seat. The ECR Group now holds 63 seats in the European Parliament.
After the meeting, ECR Co-Chairman Raffaele Fitto said: “I’d like to welcome Mr Sofo to our Group. He is a trained and competent colleague who has made a political choice consistent with his political path. We are sure that Mr Sofo MEP will be able to make a decisive contribution to the work of our Group, and to our alternative vision of the future of Europe, that is, a community of homelands and nations that cooperate in respect of our different identities and peculiarities.”
ECR Co-Chairman Ryszard Legutko said: “The decision of Mr Sofo shows that our political project, together with the strength of our ideas and our values, is credible and attractive, and from today even stronger and more able to give concrete answers to our citizens in terms of well-being, wealth and security.”
Following the decision, Sofo said: “The European Union is going through one of the most difficult periods in its history, not only from an economic point of view but also from a social and cultural point of view. Surely, it must be profoundly changed to be preserved. Considering the political forces grouped in the European Conservatives and Reformists, they are the ones most able to carry out this task.
“The Conference on the Future of Europe will be a crucial appointment for our Continent and the work that conservative forces will be able to do to correct the mistakes of the European project will be fundamental to straightening its path by strengthening our Nation states and values that have forged its spirit.”
Brexit causing supply problems for small UK manufacturers: survey
The survey of nearly 300 firms, by consultants South West Manufacturing Advisory Service (SWMAS) and the Manufacturing Growth Programme, a government and European Union-funded initiative providing support to small firms, adds to the picture of disruption from new customs checks that came into force on Jan. 1 for goods trade with the EU.
“Price hikes in the supply chain have been immediate, and we are hearing tales of lead times being extended on raw materials,” said Nick Golding, managing director of SWMAS.
Some 65% of manufacturers reported higher costs, and 54% said they had greater difficulties exporting goods to the EU.
Around a fifth of manufacturers thought they might gain from customers bringing work back to Britain from the EU.
Britain’s government has said many of the difficulties are “teething troubles” and last week said it would make 20 million pounds ($27.7 million) available to help small firms get used to the new rules. Further restrictions are due to take effect later this year.
Earlier this month the Bank of England forecast that Brexit-related trade disruption would reduce economic output by 1% during the current quarter - equivalent to about £5 billion - and it expects trade to fall by 10% in the long term.
Brexit supporters say Britain will gain long-term advantages by setting its own trade rules with countries outside Europe, as well as from greater control over domestic regulation.
UK says it's not yet at 'gin and tonic' stage with EU after Brexit
The United Kingdom left the EU in January last year, and fully exited the bloc’s economic orbit on 31 December 2020, though the European Commission sent shockwaves through the British province of Northern Ireland last month by threatening to restrict vaccine exports through Ireland’s land border.
“It has been more than bumpy to be honest in the last six weeks: I think it has been problematic and I hope we’ll get over this,” Prime Minister Boris Johnson’s EU adviser, David Frost (pictured), told a House of Lords committee.
“The EU is still adjusting somewhat to the existence of a genuinely independent actor in their neighborhood,” he said. “It is going to require a different spirit, probably, from the EU.”
Michael Gove, Johnson’s top minister on Brexit affairs, compared the relationship to turbulence on an aircraft after takeoff.
“You sometimes get that increased level of turbulence, but then eventually you reach a cruising altitude and the crew tell you to take your seatbelts off and enjoy a gin and tonic and some peanuts,” Gove said. “We’re not at the gin and tonic and peanuts stage yet, but I’m confident we will be.”
Britain has been seeking to etch out concessions from the EU since the Commission sought briefly to prevent vaccines from moving across the open border between EU-member Ireland and Northern Ireland. The Commission cited a shortfall of vaccines promised for the EU, but reversed its move after an uproar.
Gove, who is due to meet Commission Vice President Maros Sefcovic on Thursday (11 February), said he would press the EU for practical changes on the ground to the implementation of the protocol governing Northern Ireland’s post-Brexit trade with Ireland.
“I want the protocol to work and I think there are ways in which we can do that by making practical changes on the ground,” Gove said.
The Commission informed London that the EU would need more time to ratify the 24 December 2020 deal on future British-EU relations and Frost scolded the bloc for what he said was its restrictions imposed on the activities of Britain’s envoy to Brussels.
“I’m even more sorry there’s a restriction on the activity of our ambassador and some of his team in Brussels,” Frost said. “I don’t think it is quite tit-for-tat because we are not putting any restriction on the operation of the EU mission in London.”
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