EU debate informs businesses

Businesses in West & North Yorkshire heard compelling arguments on both sides of the European Union referendum debate recently.

EUDebate JohnGrogan
Pro-EU campaigner John Grogan

The region’s Chamber of Commerce staged an event for members to listen to campaigners ahead of next month’s poll on whether or not the UK should stay part of the EU.  Despite a strong performance by all the panellists, none of the attendees changed their view as a result of the debate.

Stephen Wright, Chairman of West & North Yorkshire Chamber of Commerce and Managing Director of Thorite, said afterwards:
“Despite no-one delivering a knock-out blow in terms of getting people to switch sides in the campaign, I think people left feeling better-informed than when they arrived – and that was the main reason for staging the event.  Business people are primarily interested in the trade aspects of the EU, and the expanded labour pool; but are also concerned with excessive regulation and the lack of accountability.  All these issues were covered in what was a passionately-delivered, cut-and-thrust debate.  The speakers all knew their stuff, and they were well-marshalled by the veteran reporter Len Tingle.”

Speakers for the ‘Remain’ camp, MEP Timothy Kirkhope and former Selby MP John Grogan, were pitted against Philip Davies, the MP for Shipley, and venture capitalist and innovation specialist Jon Moynihan.  The event was hosted by Yorkshire Building Society, whose chief economist Andrew McPhillips was on hand to provide statistics and other data to ensure balance and parity.

EUDebate JonMoynihan
Leave campaigner Jon Moynihan

Attendees at the event appeared overwhelmingly to be in favour of staying in the EU, with only approximately 15% supporting Brexit.

For more on the EU (official campaigns, etc), see our dedicated EU page here.

The Chamber also staged an EU lunch event in York on Wednesday 4 May, when Adam Marshall of the British Chambers of Commerce provided highlights from the campaign so far.

Pic caption, L-R: John Grogan, Stronger in Europe; Timothy Kirkhope MEP; Andrew McPhillips, Yorkshire Building Society; Len Tingle, BBC; Jon Moynihan, Business for Britain; Philip Davies MP.

Yorkshire Law Society welcomes Peter Kay as president

Peter Kay, Senior Director of Ware & Kay Solicitors Ltd, with offices in York, Wetherby & Malton, took office as the President of the Yorkshire Law Society last night during a reception at York’s Merchant Taylors’ Hall.  This is the Society’s 230th year and Peter is the 5th family member to lead and represent the region’s legal profession.

The Yorkshire Law Society is the second oldest local law society in the country and membership is currently open to practicing solicitors, legal executives, paralegals and university law lecturers together with some County Court Judges.  The Society is there not only to promote the interests of its members but also those of the clients of solicitors in the Yorkshire Law Society area.

In his inaugural speech following the Law Society Annual General Meeting, Peter Kay said “It is a great honour to accept such a prestigious role within an organisation that has represented the local legal profession for over 200 years.  My aspiration for the year ahead is to raise the approval rating of solicitors and their firms in the Society’s area by emphasising the importance of solicitors in enabling society to function in everyday life.  It is only through good advice and care for the client’s interests that people and businesses can achieve their legitimate aspirations, wealth, security and quality of life.  I am very much looking forward to representing local practitioners and raising issues of local concern on their behalf at national level.”

Peter is very pleased to confirm that his chosen charity of the year is to be “York against Cancer”, a charity that his family has close connections with.  York against Cancer is a small independent local charity and the money raised is spent to help and support cancer patients and their families.

Peter was born in York and educated at Bootham School, York.  He qualified as a solicitor in 1981 and practised in London for 4 years in a specialist commercial shipping practice.  He travelled extensively during this period on business.  He then spent a year travelling before returning to York in 1984.  In 1985 he became a partner in the solicitors firm (now) Ware & Kay Solicitors Ltd.  He now specialises in corporate and commercial work but his experience also includes banking work on the panel of 2 commercial lenders, commercial property leasing, commercial and residential property management; and employment law.   Peter is also trustee of a number of private trusts including on-going trusts actively involved in commercial property, residential property development, arable farming and intensive livestock rearing.

Peter has been involved in the business community for many years and this included: Member of the Private Sector Members Group of the former Yorkshire Tourist Board; Director of York City Centre Partnership Limited; Director of the York & North Yorkshire Chamber of Commerce from 2001 to 2009; President of the York and North Yorkshire Chamber of Commerce 2006 to 2008; Welcome to Yorkshire Tourism Ambassador; Chair of York Economic Partnership 2008 to 2012; Director of York Business Week C.I.C.

Reasons to advertise in the Chamber Directory

The Chamber Directory is an indispensable members’ handbook and a benefit of Chamber membership.

The Directory provides a detailed guide to Chamber services as well as full listings for the Chamber membership.

Directories are mailed directly to nearly 2,000 and given to new members as they join.

Interesting, useful and relevant content ensures that members keep and refer to their Directory throughout the year.

Member businesses are spread around the West & North Yorkshire region.

Directories are sent to all major UK Chambers of Commerce and all major UK public libraries.

300 copies are sent to partner organisations in 140 countries across the world: Chambers of Commerce overseas, Overseas Diplomatic List, Overseas Exhibition Centres.

If you have any questions about the Directory call 08455 240 240 or email us here.

Get the facts

We have Dr Adam Marshall from the British Chambers of Commerce (BCC) as guest speaker for this lunch when he will update members on the facts around the EU Referendum. Adam is Acting Director General at the BCC. This is sure to be an interesting and informative lunch around a very hot topic.

Book here.

Ware & Kay Solicitors Gear Up for Tour de Yorkshire Ride 29th April

With just over a week to go, Ware & Kay Solicitors are gearing up for another Tour de Yorkshire with riders passing their Wetherby offices on Friday 29th April.

To make the most of this, Ware & Kay are supporting the local cycle shop, Wetherby Bike Shack, who are marking the event with some exciting activities for the community to take part in as they wait for the cyclists to race through the town.

Dean Buckle, owner of the Wetherby Bike Shack and “Townsperson of the Year” is the driving force behind the Tour de Yorkshire events in conjunction with the Wetherby Town Council.  Dean is rallying the business community together including volunteers from the Wetherby Lions, the Fire Brigade and Sant’ Angelo’s Restaurant to create a fun day to enable the people of Wetherby and visitors to enjoy the full benefits of the Tour de Yorkshire.

Dean said “It is great for Wetherby to be once again in the spotlight and we are delighted that Ware & Kay Solicitors along with other local businesses are sponsoring the event.  There will be some popular attractions for children and adults of all ages including face painting and a shadows tribute guitarist in the Garden of Rest.  Car parking on the route at Kirk Deighton Rangers AFC ground in Kirk Deighton will be charged at £10.00 a car which will include free Kenco Coffee and Yorkshire Tea.  Wetherby High School has allowed their pupils time out to line the route and we are expecting other schools to follow suit.  The surplus raised will be put towards a permanent feature in the town selected by the contributing businesses.  Name plaques of the contributors will be displayed as a reminder of their support of the  event”.

This event follows the great success of the Tour de Yorkshire in 2015 when 1.5 million people came out to watch the race and the organisers are hoping many more will come and watch the race this year.

Michael Peach, Director at Ware & Kay Solicitors said “Wetherby’s exciting and diverse events and festivals are a key attraction for residents and visitors and as excitement builds for the Tour de Yorkshire, it will play a big part in creating an unforgettable weekend.  We hope that the people of Wetherby will come together, celebrate and have a fantastic time, so we are delighted to be supporting our local event organiser.  We hope that this will help to boost community involvement and visitor numbers even more.”

The first stage of the Tour de Yorkshire will set off from the Saturday Market in Beverley. The riders will parade around the town before heading north west to the Official Start at Beverley Racecourse; Holme-on-the-Wolds, Market Weighton (which also saw the race pass through in May 2015), and on westwards to a sprint point at Bubwith.  From there, the peloton will race through North Duffield and west to Cawood – scene of Dick Turpin’s famous escape from York – and on to Tadcaster, famous for its breweries. After that, riders will visit Boston Spa, Wetherby, Kirk Deighton & North Deighton and Knaresborough, home of the famous ‘spotty house’ from the Tour de France, decorated with the red spots of the King of the Mountains’ jersey. From there riders will travel to Ripley and on to Pateley Bridge where the first King of the Mountain test will be won at Greenhow Hill. After that, it’s on to Grassington, then Threshfield and a return to some of the Tour de France roads, through Cracoe then Gargrave.  The riders will then cross the finish line in Settle for the first time before a sprint at Giggleswick. They will complete a 12km loop back to the A65 and round to Settle town centre for an expected bunch finish in the town.

Increase efficiency and boost results say Chamber

The Eco Fair is back this June to give businesses the chance to showcase their achievements and efficiency solutions to a regional audience. The event, which focuses on helping visitors save money and use resources more efficiently, is aimed at senior managers involved in facilities management, procurement, supply chain, health & safety and quality.

Now in its 7th year Eco Fair is the largest B2B environmental event in the north of England. It takes place on Wednesday 15th June from 8.30am to 4.00pm at the Centenary Pavilion, Elland Road in Leeds. Last year Eco Fair attracted around 600 delegates from across West Yorkshire and further afield. Delegates said Eco Fair 2015 was “inspirational” and the seminars were “excellent”, “really useful” and “very professional”.

This year’s event will be another fantastic opportunity to network with local businesses and showcase cost-saving solutions to decision makers.

The event, organised by West & North Yorkshire Chamber of Commerce, will include 4 themed zones: energy & carbon, people & property, circular economy and policy & regulation. There will be around 20 seminars including a session on making the most of your environmental credentials when tendering for work and a case study from Agfa Graphics about how they use resources efficiently and have become a best practice, award-winning plant for sustainability.

Sandy Needham, chief executive of West & North Yorkshire Chamber said: “It is rare for anyone to leave Eco Fair and not feel the benefit. Whether that’s ideas, information, advice or new business contacts, Eco Fair will inspire people to improve their businesses through some excellent case studies, seminars and exhibitors.”

Exhibition space starts at £650 + VAT and can be booked at www.eco-fair.co.uk or by calling 01274 206660. Anyone interested in attending as a delegate to find out how their organisation can reduce costs and environmental impacts, can also register on the website. Delegate places are free of charge.

Grass roots activity still indicated exporting harvest will come, says Chamber International

MORE THAN 360 businesses approached overseas trade specialist, Chamber International, for the first time in the last 12 months seeking help with boosting their overseas sales.

In a report on its export support activity, Chamber International which delivers services on behalf of Chambers of Commerce in West and North Yorkshire, says a total of 291 business people attended its courses and seminars providing practical advice to help enterprises improve their understanding of how to sell overseas effectively.

Chamber International, Bradford, also issued a record 25,536 trade documents between April 2015 and April 2016, 80 per cent of which were online. The key markets were Saudi Arabia, United Arab Emirates and China.  Meanwhile its online platforms which address  the complexities of exporting and received more than 500,000 visitors during the financial year.

In a significant coup, Chamber International’s Export Office Services team also won the biggest contract in its six-year history, shipping a huge poultry chilling plant from Pennine Environmental Services Ltd, Leeds, to the USA, overseeing the entire US$2.5m contract from risk assessment, freight buying and delivery in the US.

In other initiatives, Chamber International launched ‘edge’, a new low-cost, Cloud-based practical toolkit which has taken two years to develop; opened its website to advertising and received its first order from Emirates Airlines; forged partnerships with bi-lateral chambers overseas as part of the Global Business Network and started its own Chamber International YouTube channel.

The organisation, which has supported Leeds City Region Enterprise Partnership’s We are International export initiative since 2013, also staged three We are International Export Network events in March, June and December attended by 161 businesses ranging from start-ups to some of the region’s best-known companies.

 

Chamber International released details of its activity after new Government figures showed that the UK current account deficit reached a new post-war high in Q4 2015 of £33bn or 7% of GDP, indicating that, in spite of Government moves to re-balance UK trade, we still borrow heavily from the rest of the world.

Chamber International director, Tim Bailey, says: “Yorkshire and, in particular, Leeds City Region, are among the success stories in the UK’s campaign to drive up exports.

“Even though there are significant headwinds for the global economy with China’s slowdown as it continues to change from a manufacturing to a services economy, the knock-on effect for commodity exporters; the Syrian conflict and business uncertainty triggered by the EU referendum, the central message that exporting is good for businesses and the UK economy is being heard in this region.

“Our job is to help businesses understand what they need to do to become successful exporters at the grass roots level. We see many small, and often micro, businesses wanting to be involved in selling abroad but we need to be patient as export development can take up to three years from visiting a market.”

Supply chain opportunities at Manufactured Yorkshire

Manufactured Yorkshire (MY16) takes place on Wednesday 11th May at Centenary Pavilion, Elland Road, Leeds.

MY16, free to attend, one day event opens up new supply chain and customer opportunities for the manufacturing sector. Retailers, hospitality and construction companies are encouraged to attend and connect with Yorkshire’s finest manufacturers for a day of learning, collaboration and trading.

There are 3 seminar halls, 100 exhibition stands – all on one level, under one roof in one day. The team at Manufactured Yorkshire are passionate about supply chain development and have Meet the Buyer opportunities with ASDA, Approved Food, Cummins Turbo Technologies and Jaguar Land Rover. Yorkshire Water joins this year to talk supply chain challenges and opportunities.

They also have Sir Vince Cable speaking, Rolls Royce, Timothy Taylors, Seabrook Crisps amongst other great names.

Last year’s event brought in around 800 delegates – 70% overall were director level. 70% overall were manufacturers.

Such is the focus of MY16 on specifically manufacturers and their supply chains and buyers, availability for delegates outside these sectors (i.e. service sectors) are strictly limited. Attracting up to 1,000 delegates across the day.

Please go to the website to register your FREE place  – www.manufacturedyorkshire.com

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The EU Deal

What did David Cameron negotiate?

After lengthy negotiations in February, David Cameron struck a deal that outlines the key steps towards the reformed EU we are promised, should we vote to remain, and that the Prime Minister claims will give Britain “special status” within the 28-nation bloc. The deal is commonly split into four sections: sovereignty, migrants and welfare, economic governance and competitiveness. Here is a brief overview of what the deal includes.

Sovereignty

Migrants and Welfare

Economic Governance

Competitiveness

Is the Deal Legally Binding?

 

Sovereignty

One of the EU’s founding ambitions was to forge an “ever closer union” between its people and member states, both economically and politically. In the wake of the Euro crisis, the notion that further integration is an unequivocal good idea was brought into question, amid increasing concerns over the commonly termed one-size-fits-all policy. Cameron’s primary objective in this regard was to give Britain the chance to opt out of “ever-closer-union” and avoid further political integration. His second objective was a call for a new arrangement which allowed parliaments acting in unison to stop unwanted legislative proposals. Finally, Cameron called for a full EU commitment to subsidiarity – which means that decisions should take place at a national level rather than at an EU level wherever possible. Two main things came out of the negotiations: firstly, a commitment to write Britain’s exemption from “ever closer union” into EU treaties, and secondly, a red-card mechanism which allows member states to collectively block or veto any proposals from the EU Commission.

How effective the deal is at addressing the objectives is up for debate. The red card for example, will be introduced in addition to the existing yellow and orange card systems. Not liking a law is not enough – all three cards can only be used over subsidiarity concerns, meaning the objection must be that the law should be made on a national rather than an EU level. The yellow card requires the support of 10 national parliaments, at which point the Commission has to reconsider but can ultimately go ahead anyway. The orange card requires 15 national parliaments, along with – if the Commission refuses to drop the proposal – the support of either 16 EU Council governments or a majority of European Parliament MEPs to be effective. To date, the yellow card has been used twice and the orange zero times. Critics would suggest this is because they are unlikely to block anything that would not be blocked under standard rules – which require either 13 governments or a majority of MEPs to block a draft law. Arguably then, the red card – requiring more support than the yellow and orange cards, may not achieve a great deal. Especially when it cannot automatically block a law, only force the Council to shelve it or amend it according to the objections; and when the question of whether or not the changes adequately accommodate the concerns is the decision of the council itself. On the other hand, whilst governments currently have a say in EU matters, the red card might be said to give national parliaments like the House of Commons more control over what their governments are fighting for in EU negotiations.

On subsidiarity, Cameron’s call for “Europe where necessary, national where possible” seems to have had an impact. The deal outlines a new focus on whether the legislation in question has “transnational aspects” or not, potentially making this more of a consideration during negotiations. In other words, the less “transnational” the subject the more likely it will be considered reasonable to object on grounds of subsidiarity. The existence of “transnational aspects” is not made an absolute requirement for action at a European level, however.

 

Migrants and Welfare

The Conservative manifesto outlined the objective to ensure that both migrants claiming tax credits and child benefit, and migrants seeking consideration for social housing must have lived and contributed to Britain for a minimum of four years. In addition, it pledged to end the ability of EU jobseekers to claim any job-seeking benefits whatsoever, and to introduce a requirement for EU jobseekers to leave if they do not find work in six months.

The main response to this in the deal is the suggestion of an “emergency brake” on in-work benefits for migrants. The measure doesn’t go as far as was intended by the Prime Minister, as directly limiting provision of benefits to EU migrants would go against the freedom of movement and right to equal treatment rules enshrined in the single market. What it does, is allow a country to signal to the EU that they have experienced an inflow of migrants of “exceptional magnitude”, and that it has affected “essential aspects of its social security system”, or leads to problems in its labour market, or is putting “excessive pressure” on public services. Permission would be required from the EU, at which point the country would be allowed to start phasing in the provision of in-work benefits for new migrants over the first four years of their residency. This would not affect migrants already living there, and the brake can be applied for up to seven years after it has been triggered. The “emergency brake” is a suggestion only at this point. Predicated firstly on a vote to remain, it would then need to go through normal EU lawmaking processes, meaning the support of both the EU Council and the EU Parliament would need to be earned. To trigger the brake, the European Commission would have to put a proposal to the EU Council on the country’s behalf, the Council would then have to give its approval. That being said, the EU Commission has publically stated that it feels Britain would be justified in triggering the brake should we vote to remain in the EU.

Another part of the deal called for “stronger powers to deport criminals and stop them coming back, as well as preventing entry in the first place”. In effect, this will be addressed by adding to the exceptions to the EU rule that citizens can work in any country they choose. This will allow countries to deport people whose behaviour is “likely to represent a genuine and serious threat to public policy or security”, and will shift focus from looking at present conduct of individuals to looking more towards their past.

Following Cameron’s key theme of ending “the abuse of free movement”, the deal sets out how to make it harder for non-EU family members of EU citizens to stay in the UK. This is to put an end to “the fact that it is easier for an EU citizen to bring a non-EU spouse to the UK than it is for a British citizen to do the same”. Changes to EU law will be needed to make this happen, and the proposed changes may still be objected to on the grounds of breaching EU human rights law.

Migration and welfare is the area where Cameron had to compromise the most, facing strong opposition from central European countries and coming up against the rules of single market. One objective was to put a stop to the exporting of child benefits back home by parents who move to work in another country. These cannot be stopped based on a principle of non-discrimination and the right to equal access in terms of taxation and social benefit advantages that the single market stipulates. What the deal does include, is the ability to alter the amount of the payment depending on the standard of living and provision child benefits where the child lives. The legalities and practicalities of doing this however, are not clear. This could amount to discrimination based on nationality, which would not be within the rules of EU treaties. Even if it is not deemed to be discriminatory, whether or not the change is “justified” or not would be up to the EU court. The court could decide for example, that people are being disadvantaged as a result of using their right to free movement. It would be a complex and moral quandary-ridden process to say the least. Furthermore, this change should do little to quell concerns over the sheer number of workers entering the country, and numerous studies indicate that EU citizens mostly come to work rather than take advantage of social benefits.

 

Economic Governance

The thrust of this part of the negotiations was to get an explicit recognition that the Euro is not the only currency in the European Union. The aim was both to safeguard against steps to further financial union being imposed on non-Eurozone members and to ensure the UK will not have to contribute to Eurozone bailouts. Cameron was fairly successful in this regard, the deal guarantees that countries outside the Eurozone will not have to fund Eurozone bailouts and will be reimbursed for any funds used to prop the Euro. Also included is a right to allow any member to raise concerns about the impact of Eurozone decisions for urgent discussion in the European Council. However, In light of the fact that the EU court has already banned preferential treatment of countries using the Euro, and that non-Eurozone states have been effectively exempted from Eurozone bailouts since the third one for Greece in 2015, this aspect of the deal is largely symbolic. There was some from France on the issue of financial regulation. Despite the recognition of multiple currencies, the French made certain this did not mean that Britain would win any “exceptions to the rules of the EU”, especially with regards to financial institutions and the city.

 

Competitiveness

This final topic – being the least controversial of the government’s demands, was sparsely covered. The intention was simply to set a target for the reduction of the “burden” of excessive regulation on business and to continue the expansion of the single market in a way which promotes competition. The deal included a promise to establish “feasible burden reduction targets in key sectors, with commitments by EU institutions and EU member states”. So, Mr Cameron got everything he wished for with regards to red tape, but similar promises have been made before that have not gone on to reflect reality. Furthermore, boosting the competitiveness of the single market has always been one of the EU’s and its member states’ key priorities. So although the line on the burden of regulation was included, it is up for debate as to whether it would initiate any substantive action we wouldn’t have seen otherwise.

 

Is the Deal Legally Binding?

Like many in this debate, this is almost an unanswerable question. There are several different parts to the deal, all taking different legal forms and requiring different processes to come into law.

The main part of the deal itself – the “Decision of the Heads of State or Government”, which includes the information about “ever closer union” and the red card system, actually concerns international law rather than EU law. The government intends to register the decision as an international treaty, which would require the consent of all EU countries and ratification from national parliaments. When declared legally binding by European leaders this part of the deal would become binding under international law, in that the UK government would have to consent before it could be amended or repealed. The decision can include legal obligations for EU members, but EU law would take precedence in the event of any conflict. Although, because it would not be part of EU law, no country could challenge it through EU channels. In short, there is a small risk that this part of the deal will not become international law; the mechanisms through which the changes would take effect and the extent of this effect however, are unclear.

Benefit changes – the “emergency brake”, the changes relating to non-EU family members of EU citizens and the changes to child benefits – will all require EU laws to be passed or changed. The process starts with the EU Commission drawing up proposals; the Commission is not forced to do this but the deal contains two declarations from the Commission outlining its intentions to do so. The Commission says it will propose these 3 laws following a vote to remain. For these proposals to be passed they need a qualified majority vote within the EU Council and a majority vote in the European Parliament. The deal itself does not affect this process, the ministers in the council could decide to support only two of the three proposals, or none. Similarly, the parliament may have objections to some or all of the laws proposed in the deal, but this may only become clearer as we approach voting day. There is the further issue of legal challenges to the EU court. Any of the proposed changes could be objected to on a legal basis. Some experts have determined that the change most vulnerable to this is the “emergency brake”. Aside from court challenges, in principle, there is a possibility the new legislation could be revoked or repealed after being passed as the UK could not veto such a decision. In reality, the statements from the Commission in the deal and the verbal support from other governments should mean this is highly unlikely.

Technically speaking, the deal is binding, but there are significant caveats. The big changes – the passing/changing of EU laws and treaty changes – must follow independent procedures after a vote to remain, each coming with new negotiations and potential sticking points. The benefits changes in particular may face opposition. Even if passed, the enforceability and effectiveness of the new laws is questionable.

Below is a table setting out the legalities of the various parts of the deal. The table was produced by Professor of EU Law and Human Rights Law at the University of Essex, Steve Peers, and the always excellent fact-checking charity www.fullfact.org

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(Source: Full Fact website)

National QES results: growth softened

The British Chambers of Commerce (BCC) Quarterly Economic Survey – Britain’s largest and most authoritative private sector business survey, based on over 8,500 responses from firms in Q1 2016 – suggests that growth in the UK economy continued to soften in the first quarter, with most key survey indicators either static or decreasing.
Several key indicators for the services sector – the UK’s main driver of economic growth – fell slightly this quarter, with domestic sales and orders reaching their lowest level for over three years. For manufacturing, domestic sales fell again, and remain low in historical terms.

While some manufacturing sector indicators have shown slight improvements, these increases are from a very low base. Combined with the slight weakening in some areas of the dominant services sector, the Q1 figures suggest a static picture — with potential downside risks for UK economic growth ahead.

Key findings in the Q1 2016 survey:

  • Overall, the figures for both the services and manufacturing sectors indicate continued growth. However, this has remained static across many indicators, and slackened in others.
  • In the manufacturing sector, there has been a slight increase in the number of firms reporting improved export sales and orders – both indicators rising to a percentage balance of +8 from the near-stagnation of +1 seen in Q4 2015
  • However, fewer manufacturing firms have grown their workforce in the last three months (+13), or are looking to do so in the next three months (+13), down from a percentage balance of +20 and +17 respectively
  • In the services sector, the percentage of companies who are struggling to recruit has risen to 68, the highest level for 18 years – however, more firms expect to increase their workforce in the next three months (+27, up from +21)
  • Confidence in turnover and profitability for both services and manufacturing remains low by historical standards
  • Domestic indicators largely fell, although they remain stronger than export indicators. The balance of manufacturers reporting improved domestic sales balance fell two points to +11, although the balance of firms reporting improved orders was up slightly to +13 (from +10). In services, the balance of firms reporting improved domestic sales fell a further six points to +26, while orders fell two points to +21. For both sectors, these are the lowest levels in nearly three years.
  • The balance of manufacturers intending to increase prices fell sharply, from +19 to +8 (reversing the rise of the previous quarter), but rose in services, from +21 to +27
  • The balance of firms intending to invest in plant and machinery and training fell in the services sector
  • Fewer companies reported increased pressures for higher pay settlements (33 in manufacturing, 27 in services). In manufacturing, the level is still higher than before the financial crisis.

A four-page report on the results is available here.

Dr Adam Marshall, Acting Director General of the British Chambers of Commerce, said:

“Our latest survey results suggest that the UK economy is in a holding pattern. While the picture is static overall, there are clear indications that economic growth is continuing to soften. From sales and orders to confidence and investment intentions, many of the business indicators we track are at a low ebb.

“The softening environment should be a wake-up call for Westminster. Further action is likely to be needed to support business confidence, encourage trade and underpin investment in the months ahead.”

David Kern, BCC Chief Economist, added:

“These results are disappointing but not surprising. Although GDP growth for the previous quarter was upgraded slightly, our survey points to a slowdown in Q1 2016. This is the inevitable consequence of mounting global and domestic uncertainties, but it is nevertheless concerning that the vibrant and dominant services sector is likely to face mounting challenges in the next few years. The mediocre employment balances are a warning that we cannot afford to be complacent about the continued dynamism of our labour market.

“The improvement in the manufacturing export balances, probably helped by sharp falls in sterling, is welcome. But exports are still weak by historical standards. Our current account deficit has escalated to a record high in 2015 and is likely to remain unacceptably large in the next few years. Britain’s credit rating will be at risk, unless we make improving our trade balance and boosting our exports national priorities.

“In spite of the headwinds facing our economy, Britain has major areas of strength that can make a sustainable recovery possible, if correct policies are adopted. In this survey we report a few setbacks, but UK businesses are very resilient. Our labour market and the services sector remain dynamic, and Britain is still likely to grow faster than most other G7 economies in the next 2-3 years.”