UK Skills Gap Widening

Recent research has suggested that the UK’s skills gap is growing wider and more problematic. The latest annual survey from the CBI has shown that considerably more employers are concerned about difficulties in recruiting skilled staff than at the time of last year’s survey.

500 employers were questioned for the CBI survey, with a combined total of three million staff. 69% of these businesses said that they were worried that they may not be able to source enough staff for skilled jobs. Last year, such concerns were only expressed by 55% of respondents.

The survey suggested that demand for unskilled labour, meanwhile, would continue on a downward trend while companies will seek to employ greater numbers of skilled individuals. This would shift the emphasis of the labour market more firmly towards skilled workers, making the possible shortage even more concerning.

Josh Hardie, deputy director of the CBI, said that it was now a “top business priority” to close the skills gap and ensure that businesses had access to a sufficient pool of skilled workers. However, it is believed that eliminating the shortage may be all the more difficult following the UK’s exit from the European Union.

The CBI’s report on the findings of the survey will states that, as well as having the current shortage of skills in the UK workforce to deal with, the country will also have “potentially reduced access to migrant skills which will also impact businesses.” According to the director of employment and skills for the CBI, Neil Carberry, it is “absolutely critical” for the government to give businesses a firm statement on what will become of EU nationals who already live and work in the UK. The wake of the referendum has seen a number of calls for such individuals to be protected in their status as legal migrants who are entitled to work. However, recently-appointed Prime Minister Theresa May made comments earlier this month which have led many to fear that this may not be the case.

The CBI survey also showed that businesses are concerned not only about job skills amongst the pool of available employees, but also basic skills. Nearly one in three businesses that responded to the survey said that they were worried about poor levels of literacy and numeracy among new hires. However, the survey also showed that formal qualifications are not everything to businesses when looking for new employees, with a majority of businesses rating them as less important than “attitude to work.”

Posted in Business, Economy | Tagged as: , , , , , , , , | Leave a comment

HMRC Accused of Aiming to Benefit From Tax Overpayments

HMRC has been accused of actively hoping to raise revenue through accidental overpayments of tax by UK businesses and individuals. The claims have come from a number of accountants, who believe that the nature of the new digital system and the handling of the switch is likely to increase the risk of people overpaying.

The accountants in question have accused the government of hoping to benefit financially from these overpayments – something they term a “fat finger tax.” The government has previously said that it expects to raise £610 million extra per year by 2020 as a result of the switch to fully digital tax records, announced in the autumn statement. In response to the recent accusations, the Treasury has insisted that this expectation is based on the system reducing the risk of underpayment, and not increasing the risk of overpayment.

However, PwC partner Aidan Sutton insists that “there’s got to be a significant risk that people do end up overpaying tax” and that it is “rare for HMRC to make errors in the taxpayer’s favour than in their favour.”

It is the nature of the digital system, Sutton believes, that makes the risk of mistakes greater. He says: “There’s a difference between filling out a tax return and sending it off at the end of the year and a website telling you ‘your balance is this’. A lot of people won’t have the expertise to challenge this number.”

Cormac Marum, head of tax advisory at accountancy firm Harwood Hutton, also voiced concerns about the risk of errors under the new system. “Anything that moves to trying to cut out accountants will not make the system more accurate,” Marum says, “it will make the system less accurate.”

A spokesperson for the treasury, however, insisted that “suggestions that enabling businesses to handle their tax affairs online will lead to more errors and extra tax revenue are simply false.”

The National Audit Office (NAO) also recently criticised HMRC, and in its report the official auditor also spoke of problems on HRMC’s part that could lead to errors on the parts of businesses and individuals. The problems highlighted by the NAO were problems with online guidance on HMRC’s own website, and this incorrect advice could lead to either underpayment or overpayment on the part of taxpayers.

After looking at the guidance for 51 self assessment questions, the NAO found that HMRC was giving incorrect advice for three. Of these, the auditor reported: “One created potential for a taxpayer to overpay £126,000 in tax. Another created potential to underpay £11,000 in tax. We do not know if any customers have gained or lost from the errors.”

Posted in Business, Economy | Tagged as: , , , , , | Leave a comment

Employment High but Wage Growth Sluggish

Recent figures from the Office for National Statistics (ONS) have come as mixed new regarding the current state of the UK’s job market. While more people are in work than at any time in the last decade, pay growth is sluggish and getting slower.

Unemployment has hit the lowest rate seen for more than ten years, according to the ONS’ most recent figures, which cover the three months leading up to November 2015. The data shows that only 5.1% of the UK’s eligible population were out of work during this period. The last time the jobless rate was this low was October 2005.

This represents a fall of 99,000 in the number of people unemployed in this three month period, and a total of 1.68 million UK adults out of work.

At one point during the period covered by the ONS’ most recent data, the UK’s employment rate hit a level of 74%. This is the highest rate of employment since records of a comparable nature first started to be kept in 1971. According to the figures, there are nearly 23 million individuals working full time in the UK – an increase of 436,000 compared to the same period in 2014. A further 8.4 million are in part-time employment, which represents a year-on-year increase of 152,000. The number of individuals who are currently part-time workers but wish to find full-time work is 1.2 million, representing a fall of 21,000 in the three months to November.

While the proportion of people in work increased, growth in wages painted a less encouraging economic picture. The growth rate for average weekly earnings slowed over the three months to November, dropping to a rate of 1.9% excluding bonuses. When bonuses are included in calculations, the rate of growth in average earnings was 2%. This is below expectations, with Reuters previously forecasting a figure of 2.1%, and is the slowest rate of earnings growth recorded since February.

Wage growth has previously been named by Mark Carney, governor of the Bank of England, as one of the factors that will be used by the Bank in determining when to raise interest rates, which have remained at their lowest ever level of 0.5%. It is therefore significant that the recent slowing of wage growth was revealed just one day after Carney announced that there was no present need to raise rates, citing global economic uncertainty and weaker growth in the UK’s economy as key reasons the rate should stay put.

Posted in Business, Economy | Tagged as: , , , , , , | Leave a comment

More Businesses Renting Out Spare Desks

Businesses with space to spare in their offices are increasingly taking an interest in earning additional revenue from their spare desks. This can be a lucrative endeavour for small and medium-sized businesses with offices in popular locations, with some desks carrying the same kind of rents as a spare bedroom in a private home.

In London, especially, a single desk in a well-located and good-quality office can attract a “tenant” and earn attractive extra revenue for the office’s main occupant. In the City, an office with good amenities and good transport links can attract over £750 for renting out a single desk. In many other parts of the country, this would cover the rent of an entire house. Even in less central parts of London and in a property with few if any amenities, businesses could potentially earn a couple of hundred pounds per desk. Outside of the capital and other major cities, the figures are more modest but could still provide an appreciable boost to businesses. Of course, this depends on their circumstances, the quality of the office, and demand for office space in their specific location.

The growth in businesses renting out spare space in their offices is down not just to the businesses themselves seeking to make their assets pay, but increased demand as the UK’s start-up scene grows. In London especially and throughout the country, more and more people are starting up their own small businesses or going self-employed. However, obtaining dedicated premises is always a challenge to small and newly-formed businesses, and this is particularly challenging in London where commercial rents are far higher than in the rest of the country and this can act as a barrier to small and not-yet-established businesses.

This has led to growth in alternative ways of finding a place to work, such as co-working spaces which have become popular in some key areas. These provide a shared area in which individual sole traders or small businesses can rent a portion of the space alongside a number of other businesses. From the point of view of the “tenant,” renting spare desks from another business is not so different. Much like renting a desk in a co-working space, it allows the business access to an affordable, professional, dedicated working space by sharing with one or more other businesses. However, where some co-working spaces only allow businesses to rent space for a short period at a time or to pay as they go, renting a desk in a bigger business’ office can provide a steady, regular workspace.

This trend in many ways mirrors similar trends on the part of consumers, such as an increase in people renting out their spare bedrooms or parking spaces.

Posted in Business, Economy | Tagged as: , , , , , , | Leave a comment

HMRC Changes Interpretation of VAT Rules

HMRC has decided to change the way it interprets key rules surrounding VAT, replacing the previous interpretation which has been used for 43 years. Many newly- and recently-registered businesses could be left unable to reclaim VAT which they would have been able to claim back under the previous interpretation.

The rules relate to businesses who newly register for VAT, specifically those businesses which have assets, including stock, purchased before their registration but which will be used afterwards. The rules allow them to reclaim VAT paid on the purchase price of these items, as they would with items purchased after their registration date.

Up until now, and for the past 43 years altogether, HMRC has interpreted these rules in a very straightforward way. VAT-registered businesses can reclaim VAT on many purchases. After registering for VAT for the first time, they have been able to fully reclaim VAT on all stock, equipment and other assets that they already hold and will be using after their registration date. However, HMRC has decided to change its interpretation of these rules and instead apply the right to reclaim VAT on a proportional basis.

Instead of reclaiming all of the VAT they paid, as before, businesses will now only be able to reclaim a percentage of VAT for each purchase that reflects the amount of usage that took place before their registration date and the amount of usage that takes place after.

For example, supposing a business holds a piece of IT equipment at the time of their registration, which they expect to use for a total of five years before replacing. They have already been using this piece of equipment for two years, meaning that they expect to continue using it for a further three years after registering.

Previously, HMRC interpreted the rules as meaning that this business would be able to reclaim all of the VAT on the purchase of that piece of equipment, because they would continue to use it as a VAT registered business. Now, however, the amount of VAT that can be reclaimed would be applied pro rata of the amount of use taking place after the registration date, meaning they could only reclaim three fifths or 60% of VAT.

A number of professionals have criticised this move on the part of HMRC, including the Association of Chartered Certified Accountants’ (ACCA) head of taxation Chas Roy-Chowdhury who said: “It’s pretty mean if they’ve changed the interpretation on that because clearly if a business is waiting for its VAT registration, it’s not in its own hands to speed that process up.”

Roy-Chowdhury continued: “It’s something that will affect businesses and their cashflow, although they won’t be charging VAT until they receive their registration.”

Posted in Business, Finance | Tagged as: , , , , , , | Leave a comment

Business Leaders More Worried About UK Leaving EU than Greece

According to prominent business leaders in Europe (including the UK) and the US, the prospect of the UK leaving the European Union is more concerning than the much-talked-about threat of a Greek exit from the Eurozone. These concerns have been brought to light in a survey from Grant Thornton, which took in the opinions of around 2,600 individuals holding roles as managing directors, senior executives, and chairpeople.

The survey, carried out in February, included all sectors of industry, and covered businesses in 36 different countries. It revealed that fears about Britain withdrawing from the EU were more prevalent and more marked than concerns about Greece doing the same. According to a chief executive at a major US multinational which bases its European operations in London, “The prospect of not being able to operate seamlessly across Europe is worrying.”

With the general election fast approaching, Britain’s membership of the European Union looks less than entirely secure. The Conservative Party has promised that, if they emerge victorious at the polls, they will hold a referendum on the matter. The outcome of such a referendum is hard to predict. The Conservative’s promise certainly stems from at least some degree of public demand, and minor party UKIP has risen to comparative prominence on the back of anti-EU sentiment amongst the British public.

Overall, 45% of business leaders questioned in the survey were concerned about the impact of a Greek exit on the EU’s economy, compared to nearly two thirds who were worried about the effects of the UK withdrawing.

Among German business leaders, 61% felt that a British exit would be damaging to the Union, and just 37% said the same about Greece. The disparity was even more marked, however, among non-eurozone members of the EU, with 72% saying a British exit would be detrimental to the EU and 46% saying that a Greek exit would be damaging.

According to chief executive elect at Grant Thornton Sacha Romanovitch, US businesses were also particularly concerned about the effects of a British exit from Europe. “The UK has a great history of being a facilitator of trade and is a gateway into Europe and the rest of the world,” she said.

Romanovitch continued: “For American businesses, there is nervousness about doing business in Europe, and there tends to be a trust and certainty when you come to Europe through the UK.”

A separate survey, carried out by the British Chamber of Commerce in late February and early March, spoke to 3,800 businesses within the UK on the same matter. 63% of these British businesses said that there would be a negative impact if the UK were to leave the EU. Though many were not entirely positive about the current state of the EU, more than half felt that remaining in a reformed EU would be the best possible outcome.

Posted in Business, Economy | Tagged as: , , , , , , , | Leave a comment

How To Create A Healthy Office

Like many others, if you spend a significant part of your day in an office environment, it’s important to make sure that your surroundings are not having a detrimental impact on your health.

Not only can creating a healthy office setting help to improve the overall mental and physical well-being of employees, it can improve staff relationships and bolster productivity. If you are serious about improving your working conditions, it may be worthwhile to attend a NEBOSH health and safety training course. These recognised qualifications are designed to provide managers and supervisors with the knowledge and skills to promote a healthy workplace.

While you may not always have complete control over the environment you work in, there are plenty of simple and effective steps you can take to make your office more pleasant and salubrious.

Workstation set-up

Sitting at a desk for long periods of time can put excessive strain on your back, neck and shoulders. Ergonomically designed chairs with adjustable heights can help to improve your posture and alleviate aches and pains. It’s also important that you assume the correct posture while sitting at a desk – aim to keep your back straight, with your feet flat on the floor and your arms at a right angle to your body.

If you are having to lean forward to see your screen, you will also need to adjust the position of your monitor to avoid neck strain.


Being surrounded by bland cubicle walls or clinical office decor can leave you feeling downcast and unmotivated. To give your mood a boost, adding plants to your workspace will instantly inject colour into the room and will also help to clear the air of toxins.

With numerous studies suggesting how different colours can bring about creativity, increase motivation and have a calming effect, filling your workspace with colourful, decorative items can aid mental stimulation and help to create an atmosphere that is conducive to good health.

Air quality

Confined office environments are notorious for being breeding grounds for contagious illnesses, such as common colds and the flu. While air conditioning can be a great way to regulate the temperature of the room, every now and then it’s a good idea to open the windows to help keep the room ventilated. Investing in an air purifier can also help to improve air quality within the office.


It’s well documented that indoor lighting can affect productivity and help to reduce feelings of fatigue and work-related stress. With that in mind, replacing standard fluorescent office lights with fixtures that emit a balanced, more natural light can act as an instant mood-booster. To prevent eye strain, lighting should also be positioned so that computer screens are free from glare.

Making use of natural light is also crucial and should be carefully considered when designing the office layout.

Outside break areas

One of the most effective ways to re-charge and relieve physical and mental tensions while at work is to take regular breaks. Every office should have a suitable break-out area where staff members can get away from their desks and clear their mind of stressful work demands.


Keeping your office organised and clutter-free can help to induce a sense of calm and enhance productivity. To achieve a clean and tidy office, make a habit of putting things back in their rightful place once you have finished with them.

Posted in Business | Tagged as: , , , | Leave a comment

Keeping Your Customers Safe With Secure Payment Processing

With trust being of huge importance to every business, having a secure method of payment processing should be high up on the agenda.  Not only does being able to securely take payments on or offline provide your customers with more options, it also helps to establish a firm foundation of loyalty and trust for the future.

By utilising secure payment processing specialists such as InverOak, you can provide your customers with an efficient, safe and secure online experience.


If customer safety is something you’re concerned about, PCI DSS compliance can provide you with added protection. Every year in the UK alone, it is estimated that credit card fraud costs in excess of £450 million. The Payment Card Industry Data Security Standard (PCI DSS) was established to regulate and improve the handling of sensitive credit card information in an effort to decrease the high levels of credit card fraud.

What’s the risk?

The risk of businesses mis-handling sensitive data can be severe. Not only can it have serious financial implications, it can also affect brand image. Fines can run to many hundreds of thousands of pounds, and this is in addition to the refunding cost of any fraudulently paid for services. The negative effects on brand reputation can be devastating and multiply the financial costs to the business many times over.

Becoming Secure

As important as it is to provide secure payments for your customers, the process can be very expensive and time consuming. For example, in a call centre, the problems range from the operational difficulties of ensuring clean room environments, to the technical difficulties of data encryption, deletion and storage management.

Is there an easier way?

There are many PCI DSS solutions out there that can help you carry on your business without having to take on the day to day element of becoming PCI DSS compliant. Services such as agent assisted automation and turn-key secure payment processing solutions can be integrated with ease, leaving you with the most secure and up to date systems that will quickly help your business become fully compliant. This allows your customers to feel secure and confident in using your services time and time again.

The risk of fraud has the potential to create huge financial loss, damage your business’s reputation, increase costs, and reduce revenue. With this in mind, it really isn’t worth the risk. By taking the necessary steps to become PCI DSS compliant today you can avoid these complications and give your customers, and yourself, peace of mind.

Posted in Business, Finance | Tagged as: , , , , | Leave a comment

The Benefits of Health and Safety Training

There’s no getting around the importance of health and safety training. Without the right knowledge and skills, employees struggle to control risks in the workplace, and this can have disastrous consequences for all involved.

Fortunately, it’s now easy to arrange suitable training. For example, you can turn to Phoenix Health & Safety consultants for high-quality, accredited courses. If you need to be reminded of the importance of such training, consider the following benefits.

Protecting your personnel

It’s true that workplaces have become much safer over recent decades. However, dangers do remain for employees. Highlighting this fact, figures provided by the Health and Safety Executive reveal that in 2013-14, around 629,000 injuries occurred at work, and 133 employees lost their lives. Meanwhile, more than 28 million working days were lost due to work-related injuries and illnesses.

These statistics bring the significance of effective health and safety measures into stark focus. It may not be possible to completely eliminate the risk of accidents occurring in the workplace, but by providing your personnel with the right safety training, you can help to minimise the dangers they face.

Bear in mind that behind these figures lie stories of personal suffering and in some cases tragedy, so there is no room for complacency on this issue.

Staying on the right side of the law

As an employer, you are legally obliged to provide suitable safety training, and if you fail to do this, you risk potentially costly and damaging legal action. If the authorities discover you have not met your responsibilities, they could take you to court. As well as having to cover your legal expenses, you might suffer reputational damage that has a major impact on your long-term finances.

Boosting worker morale and loyalty

As well as helping you to protect your workers from harm and ensuring you don’t end up on the wrong side of the law, effective health and safety training can boost worker morale and loyalty. After all, people want to feel as though they are being looked after by their employers. By giving your personnel effective training, you can increase their confidence and their satisfaction at work. Ultimately, this will help you to retain the best staff members.

As you can see, there is a strong business and moral case for providing health and safety training to your workers. You shouldn’t struggle to find the perfect courses for your employees, and by making sure you do, you stand to reap a range of rewards.

Posted in Business | Tagged as: , , , , | Leave a comment

OECD Calls for Boost to UK Productivity

According to the Organisation for Economic Co-operation and Development (OECD), higher productivity is the key to improving living standards for UK residents. Though the UK’s current growth rate of 2.6% makes it the leader of the G7 nations, the OECD says that output per worker must rise if this growth is to remain sustainable.

Growth in the UK economy has so far been achieved through the success of a number of key government policies, the OECD said. Quantitative easing, low interest rates and various initiatives to provide support to the country’s housing market have all played their part. Employment, according to the organisation’s most recent report, is now back on the trend seen before the global financial crisis and indeed has reached record high levels.

However, the OECD also feels that weak productivity in the labour market has been holding things back. Specifically, it says that since 2007 real wages, and therefore the wellbeing of UK residents, have been hampered by lacklustre productivity.

Productivity growth, the OECD said, was therefore set to be one of the UK’s most important challenges over the next few years. Boosting productivity could be the key both to improving living standards and maintaining the UK’s current course of economic growth.

Furthermore, though the organisation recognised the role of property initiatives in the UK’s current positive growth, the report also expressed some reservations about the impact these could continue to have. In particular, it suggested being wary of potential risks that could be attached to government schemes aimed at helping people purchase homes. These schemes, it said, had boosted demand but this had not been matched by a corresponding increase in supply. This could potentially result in prices increasing, perhaps quite suddenly, and that in turn could threaten the stability of the UK’s current financial outlook.

The report also suggested greater involvement from private companies in UK infrastructure projects. This, it suggested, could be achieved through Public Private Partnerships (PPPs), through which private third parties lend funding to the government for infrastructure projects as an investment, receiving interest on repayments as with any other loan. However, the report urged the government to be more transparent with the public in using this type of funding. PPPs are sometimes used by governments to conceal the extent of their infrastructure spending from the public, as it is considered separate from other forms of government borrowing and therefore tends to be left off of reports.

Posted in Business, Economy | Tagged as: , , , , | Leave a comment