The Autumn Statement 2016
Chancellor Philip Hammond gave the government’s first major update on economic policy since Britain voted for to exit the European Union when he delivered the Autumn Statement on the 23rd of November. With the triggering of Article 50 looming there is continued confusion about what Brexit will look like and its impact on the UK workforce, the announcements made have been framed as a way to support the UKs economy.
The chancellor has declared a £23bn investment fund for infrastructure and innovation set to deliver a surge in spending on roads, rail, low-emission vehicles, broadband and 5G. This aims to ensure that the UK is prepared for current and future economic uncertainty and to improve the UKs productive.
Currently the UK lags behind German and the US in terms of productivity by 30%. This has been partly attributed to a deficit in professional management so, to help combat this, Hammond has committed £13m to enact Sir Charlie Mayfield’s proposal to improve management skills across British business. Currently, only one in five businesses invest in management skills. The Chancellor’s comment signals that we need world-class management and leadership to close the gap with our G7 competitors.
CBI Speech
During her keynote speech the CBI’s (Confederation of British Industry’s) Prime Minister Theresa May has backed away from a pledge to require companies to put worker representatives on boards. Speaking to the CBI’s annual conference, while she emphasised the importance of representation she made it clear that her government has no intention of mandating it.
She added: “Some companies may find that these models work best for them – but there are other routes that use existing board structures, complemented or supplemented by advisory councils or panels, to ensure all those with a stake in the company are properly represented. It will be a question of finding the model that works.”
In October, Mrs May said she planned to have “not just consumers represented on company boards, but workers as well”. On the change of message, the TUC general secretary, Frances O’Grady, said: “Theresa May made a clear promise to have workers represented on company boards. The proposals in her speech today do not deliver on this.
“This is not the way to show that you want to govern for ordinary working people.”
May’s official spokeswoman denied the policy had been watered down. “Look at what the PM has said all the way through. This is about how workers’ views are represented on boards. This is consistent with that… I think there will be a number of ways to do it. Part of the approach we will be taking is to put it out to consultation and hear views from stakeholders, employees and businesses on the best way forward. We are absolutely committed to having the voice of workers heard on boards as part of establishing the best corporate governance of any major economy.”
British workers won’t get a pay rise for 10 years
The Institute for Fiscal Studies (IFS) have said that the UK was in line for ‘an additional dollop of austerity’ in the 2020s after Chancellor Philip Hammond admitted in Wednesday’s Autumn Statement that he has given up hope of eliminating the deficit by the end of this Parliament.
Included in the Autumn Statement were changes to the living wage going from £7.20 to £7.50 in April, which equates to a £500 annual increase for low wage workers. However, forecasts from the independent Office for Budget Responsibility suggested that real wages will remain below pre-recession 2008 levels until 2021 – the longest period since the Second World War.
IFS director Paul Johnson said ‘One cannot stress enough how dreadful that is – more than a decade without real earnings growth. We have certainly not seen a period remotely like it in the last 70 years.’