Month: May 2014

UK Economy in Good Health

UK Economy in Good Health

UK Economy in Good Health, Business Lobby Groups Say
The UK economy is in good health according to two major business lobby groups, the CBI and the British Chambers of Commerce (BCC). The CBI says growth reached a record high in May, marking the best reading since it began gathering data in 2003.

Meanwhile, the BCC upgraded its growth forecast for 2014 from 2.8% to 3.1%, which, if achieved, would be the highest rate since pre-crisis 2007.

That figure is well above the 2.7% forecast by the OBR.

The OBR, or Office for Budget Responsibility, is the government’s independent fiscal watchdog.

Latest official figures showed that the UK economy grew by 0.8% in the first three months of 2014.

The CBI’s growth report suggests the UK economy has continued to perform strongly in the second quarter of this year. Stronger economic performance was seen across the board, it said.

Sectors including retail sales and professional and consumer services did well in the three months to May, while manufacturing output continued to grow at a “solid pace”.

Andrew Graham, the chief executive of wallpaper manufacturer Graham & Brown, told the BBC he was cautiously confident: “The economy is improving, but that is from a very low base. “I think we are just starting to see recovery. As a business, we have starting investing seriously again over the last 12 months.”

CBI deputy director-general Katja Hall said the improvement was down to increased confidence in the UK economy, easier access to credit, and better global economic conditions.

However, Ms Hall said there were risks to the UK’s outlook from global developments, including the “possibility that the situation in Ukraine and Russia could impact on global commodity prices”.  She added: “With the eurozone crisis still far from being fully resolved, the UK continues to be exposed to a prolonged period of subdued activity in the region.”

The BCC also said the economic recovery was not guaranteed. John Longworth, the BCC’s director general, said: “Our forecast confirms that Britain is leading, rather than following, other major economies when it comes to short-term growth, which is great news. “But make no mistake – we still have a lot of work to do.” He added that the UK was “overly reliant on consumer spending” as a driver of growth.

Serco Wins Franchise for Caledonian Sleeper Train Service

Serco Wins Franchise for Caledonian Sleeper Train Service

Serco Wins Franchise for Caledonian Sleeper Train Service
Serco has been awarded the contract to run the Caledonian sleeper train service between Scotland and London. Transport Scotland announced the company would take over the franchise from Aberdeen-based First Group.

Serco already offers luxury sleeper services in Australia. The new 15-year franchise will start in April 2015.

The Caledonian franchise connects Inverness, Fort William, Aberdeen, Edinburgh and Glasgow to London. Serco will be responsible for operating all aspects of the Caledonian Sleeper including marketing, sales, passenger services, station facilities and fleet maintenance.

More than £100m will be invested in new rolling stock by the summer of 2018, part-funded by a £60m grant from the Scottish government.

Serco is promising improvements including en-suite berths, “pod flatbeds” and a brasserie-style club car. The rolling stock will be built by CAF, which also built Edinburgh’s new trams.

Serco chief executive Rupert Soames said: “Serco has a strong track record of providing high quality and efficient rail services around the world, as well as experience in managing large-scale tourism-focused transport services.  “I am delighted that we can use this unique blend of expertise to transform the iconic Caledonian Sleeper into a modern, high quality hospitality service to make Scotland proud.”

The company said customers would also benefit from being able to book through a new website with a much broader range of fares and earlier boarding.

Total revenue to Serco over the 15-year period is estimated at up to £800m, of which approximately £180m will be in the form of franchise payments.

Three companies bid for the contract; Serco, Arriva Night Trains and First Group which runs the service currently as part of the ScotRail franchise.

First Group chief executive Tim O’Toole said the sleeper service only represented a very small part of ScotRail’s business.  He said: “We will continue to provide sleeper passengers with the best possible service until the new franchise commences, and will work closely with the new operator to ensure a seamless handover.  “We are tremendously proud to have provided this important service, providing a key link between Scotland and London, for the last decade and wish the team every success for the future.”

The ScotRail franchise is also up for renewal with an announcement due in the autumn.