Wages Rises Accelerate to Fastest Pace since 2008

Wages Rises Accelerate to Fastest Pace since 2008
The BBC are reporting that Wages are continuing to rise at their highest level for nearly a decade, the latest official Office for National Statistics figures show.

Average weekly earnings, excluding bonuses, went up by 3.3% in the three months to October, the biggest rise since November 2008.

Average weekly wages are £495, £25,740 a year, the highest since 2011, once adjusted for inflation.

Wages Rises Accelerate to Fastest Pace since 2008

The number of people in work rose by 79,000 to 32.48 million, a record high. That is the highest figure since records began in 1971.

Unemployment increased by 20,000 to 1.38 million, although the total is still lower than a year ago. The number of unemployed men increased by 27,000, while the number of unemployed women fell by 8,000. The reason both employment and unemployment have increased is a result of the UK’s rising population and more people joining the labour force, such as students and older people.

UK Retail Sales Hit by Mild Autumn

UK Retail Sales Hit by Mild Autumn
Retail sales fell by a worse-than-expected 0.5% in October, after a mild autumn hit sales of winter clothes. Sales at household goods stores fell 3% following a particularly strong August and September, the Office for National Statistics (ONS) said.

For the three months to October, retail sales rose 0.4% – a considerable slowdown from the 2.3% increase recorded for the three months to July.

Analysts said October’s fall suggested shoppers were cutting back spending. Samuel Tombs at Pantheon Macroeconomics said the drop was the “first real sign that consumers are tightening their purse strings due to uncertainty about Brexit”.

Non-food sales fell 1.3%, with a 1% decline in clothing sales, which he said could not be blamed on the weather.

“Consumers’ confidence already has weakened in recent months due to concerns about the economic outlook and we doubt households are feeling any surer that a no-deal Brexit will be avoided after this week’s political turbulence,” Mr Tombs said.

“Unless the government miraculously manages to force the current withdrawal agreement through parliament soon, growth in consumers’ spending will weaken markedly in the fourth quarter.”

Thomas Pugh at Capital Economics said some of October’s weakness may reflect consumers delaying spending ahead of “Black Friday” discounts this month. “High oil prices also weighed on the volume of fuel sold. As such, we suspect that there could be a rebound in sales volumes in November a

Pound Rises on Hopes of Brexit Progress

Pound Rises on Hopes of Brexit Progress
The value of the pound continued to climb on Thursday as hopes rose of progress in the Brexit negotiations. Sterling hit a two-month dollar high on Wednesday on reports the UK had offered to pay up to €50bn to settle its EU “divorce bill”.

The Times also reported on Thursday that the UK was close to a deal concerning the border with Northern Ireland and the Republic of Ireland.

The pound was up more than half a cent against the dollar at $1.3467. Against the euro, sterling also rose 0.4% to €1.1363. On the stock market, the benchmark FTSE 100 share index was down 25.06 points at 7,368.50.

Shares in Aviva rose 2.6% after the insurer increased its targets for growth and dividend payouts.

Outside the FTSE 100, shares in the owner of the Daily Mail newspaper – Daily Mail and General Trust – plunged by a quarter after the publisher reported a full-year loss and gave a downbeat outlook for next year.

The company reported a loss of £112m after writing down the value of some of its businesses by more than £200m, and added that expected earnings in the short-term to be “adversely affected by recent disposals and challenging conditions in some of our sectors”.

Pub operator Marston’s saw its shares jump nearly 10% after it reported a rise in full-year profits and said it was “well positioned” for growth next year.

But results from rival Greene King fell flat by contrast. Its shares dropped 2.8% after the brewer and pub owner reported an 8% fall in half-year profits and said trading conditions were likely to “toughen” in the next few years.

UK Economy Grows by 0.4%

UK Economy Grows by 0.4%
The UK’s economy grew more than expected in the three months to September – increasing the chances of a rise in interest rates in November. Gross domestic product (GDP) for the quarter rose by 0.4%, compared with 0.3% in each of the first two quarters of the year, latest figures show.

The services industry was behind most of the rise but manufacturing, helped by car production, also helped.

Industrial production rose in July and August but construction output fell.

Debtors to be Given ‘Breathing Space’

Debtors to be Given ‘Breathing Space’
People with problem debt could be given a six-week breathing space, the government has confirmed. It follows pressure from rebels in the House of Lords, who had threatened to vote down the Financial Guidance and Claims Bill later on Tuesday. They wanted the bill amended to include the breathing space idea.

But the Treasury has now confirmed that help for those in debt will now be the subject of a consultation, and will become law by 2019. The concept had been promised in the Conservative party manifesto, and was mentioned in the Queen’s Speech.

The news was welcomed by the debt charity StepChange, although it said debtors needed protection beyond the six week grace period. However, the rebels – led by former pensions minister Ros Altmann – still want a ban on pensions cold-calling to be included in the bill.

The Department for Work and Pensions announced in August that a ban would happen, but as yet there is no date. It told the BBC that a bill would be brought forward “when time allows”.

Under the government plan, those people affected by debt would be exempted from further interest, charges and enforcement action in order to give them a chance to seek advice. That exemption period could last up to six weeks.

The Economic Secretary to the Treasury, Stephen Barclay, said: “For many people in the UK problem debt seems impossible to escape. Its effects can be far-reaching, impacting all aspects of a person’s life and leaving them feeling helpless. “That is why we are working to give people who are overwhelmed by debt, more time to seek advice, find a workable solution, and help get their lives back on track.”

The plans include better legal protection for debtors once a debt repayment plan is in place.

But the debt charity StepChange said there needed to be protection from creditors right the way through the process.

“We know from the experiences of our clients that continuous protection between the initial breathing space period and any statutory repayment plan is vital,” said Mike O’Connor, the chief executive of StepChange. “Any interruption would destabilise fragile family finances and risk putting people back to square one.”

The Conservative rebels will still push for an amendment to the Financial Guidance Bill to include a ban on pension companies cold-calling consumers. It is illegal to cold-call someone to try to sell a mortgage, but as yet not a pension. The cold calling ban to include texts and emails.

Many people have been scammed, after being persuaded to withdraw cash from their pension and move it to unregulated investments, such as storage schemes or car-parking spaces.

“The government has talked about banning cold-calling – it’s talked about protecting pensioners – but in fact it hasn’t done anything yet,” said Ros Altmann. “This bill is an ideal opportunity to actually put some legislation in place that would ban cold calls.”

Millions may Lose Promised Pension Payout

Millions may Lose Promised Pension Payout
Three million savers in final-salary pension schemes only have a 50/50 chance of receiving the payouts they were promised, a study has concluded.

Some employers were under pressure to meet their pension obligations, the Pensions and Lifetime Savings Association (PLSA) said. High-profile cases such as the BHS collapse have highlighted concerns over the future of workplace pensions. The PLSA said one solution could be the pooling of resources into “superfunds”. This would allow relatively small companies to pay a fee to transfer final-salary pensions to a larger fund – which would then have bigger investment opportunities.

A standard deal for pension scheme members could see some receive better final payouts as a result, but others could see their expected income deteriorate.

The in-depth study by the PLSA considered the outlook for final-salary pensions used by 11 million people in the UK. Employers have pumped in an extra £120bn in special payments to try to plug financial holes in these schemes, but the combined deficit of the UK’s 6,000 schemes remains at £400bn.

The majority of final-salary schemes had a sustainable model for meeting future payouts, the PLSA said. However, three million members of schemes faced a more uncertain financial future, it concluded.

Ashok Gupta, who chaired the PLSA review, said there was a “real possibility” of a collapse for more high-profile pension schemes, and so the report’s many proposals needed to be considered. “The industry and government need to grasp this opportunity and tackle serious flaws that threaten the security of people’s retirement,” he said.

Pension saving has become automatic for most workers, owing to the government’s automatic enrolment scheme, but there are still concerns about a lack of saving across all age groups.

Insurer Aviva estimated that two million older workers had dependent children or parents, and a third expected to delay retirement with others likely to reduce pension saving owing to the financial pressures involved. “Many over-50s are shouldering the responsibility of putting their families’ financial needs ahead of their own for a prolonged period of time,” said Lindsey Rix, of Aviva. Aviva’s survey did find that many older workers were staying on in employment owing to job satisfaction rather than financial need.

UK Jobless Rate Down to 4.4%

UK Jobless Rate Down to 4.4%
Unemployment in the UK fell by 57,000 in the three months to June, official figures show, bringing the jobless rate down from 4.5% to 4.4% – its lowest since 1975.

Average weekly earnings increased by 2.1% compared with a year earlier. But with the rate of inflation running at 2.6%, real earnings fell by 0.5%.

The number of people employed on zero hours contracts as their main job fell 20,000 compared to a year earlier.

G4S Slides as FTSE 100 Tumbles

G4S Slides as FTSE 100 Tumbles
Security group G4S was the biggest faller on the FTSE 100 in early Wednesday trading despite reporting a 7.6% rise in first-half profit. The firm saw its shares slide 3.7% after chief executive Ashley Almanza said it would sell off more underperforming assets this year.

Overall, the 100-share index was down 42.11 points or 0.56% at 7,500.62.

Meanwhile, the pound rose 0.13% against the dollar to $1.3010 and was up 0.14% against the euro to 1.1070 euros. Among the top gainers was payment processing firm Worldpay, which added 0.6% after agreeing to merge with US rival Vantiv.

Biggest winners were mining firms Randgold Resources and Fresnillo, which gained 1.7% and 1.4% respectively.

On Tuesday, the FTSE 100 narrowly failed to hit a record closing high after a late rally stalled just short of the magic mark.

Brexit: Johnson, Davis and Fox Push Agenda

Brexit: Johnson, Davis and Fox Push Agenda
Senior cabinet ministers will push the UK’s Brexit agenda on three different continents later. International Trade Secretary Liam Fox will travel from the US to meet Mexican counterparts to discuss trading relationships. Foreign Secretary Boris Johnson is on a two-day tour of Australia, saying post-Brexit trade is “top of the agenda”. And Brexit Secretary David Davis will hold private talks in Germany ahead of the next round of negotiations.

The globetrotting by the three ministers – dubbed the “three Brexiteers” for their role in backing a Leave vote – comes amid increased scrutiny of the opportunities and challenges facing Britain in terms of negotiating free trade agreements with other countries once it leaves the EU.

No deals can be done until withdrawal in March 2019 but the UK has established a series of inter-ministerial working groups in the US and Australia to discuss the way ahead while also signalling to other countries, such as New Zealand, that they will be “near the front of the queue”.

US President Donald Trump has said a deal with the UK could be “big and exciting” in terms of jobs, accusing the EU of a “very protectionist” stance towards America.

The EU has insisted Brexit talks will only be held by the European Commission, and the Department for Exiting the European Union confirmed Mr Davis’ talks with officials in Germany would be private.

Brussels has also made clear that trade talks between the UK and the EU must wait until other issues, including the status of expats and any “divorce bill” to be paid by the UK, have been settled.

The role of the European Court of Justice has emerged as a stumbling block to a deal on citizen’s rights, despite both sides insisting that they want to come an arrangement.

The UK is seeking a “comprehensive free trade deal” with the EU after Brexit to replace its membership of the common market and customs union.

UK & US to Start Talks on Post Brexit Trade Deal

UK & US to Start Talks on Post Brexit Trade Deal
The UK is to hold its first talks with the US to try to sketch out the details of a potential post-Brexit trade deal. International Trade Secretary Liam Fox will spend two days in Washington with US counterpart Robert Lighthizer. EU rules mean the UK cannot sign a trade deal until it has left the bloc.

Mr Fox said it was too early to say exactly what would be covered in a potential deal. Firms and trade unions have both warned of the risks of trying to secure an agreement too quickly. The Department for International Trade said discussions were expected to focus on “providing certainty, continuity and increasing confidence for UK and US businesses as the UK leaves the EU”. Mr Fox added: “The [UK-US trade and investment] working group is the means to ensure we get to know each other’s issues and identify areas where we can work together to strengthen trade and investment ties.”

The British Chambers of Commerce (BCC) director general Adam Marshall said the US’s experience at such negotiations would make it difficult for the UK to secure a good deal.

“We’re just getting back into the game of doing this sort of thing after 40 years of doing it via the EU,” he told the BBC’s Today programme. “So I think early on in the process, it would be concerning if the UK were to go up against the US on a complex and difficult negotiation.”

Mr Marshall said while the BCC’s business group’s members would welcome the US and the UK talking about how to increase trade between them, the focus should be on improving “small practical things” such as custom procedures rather than a comprehensive trade deal.

Trade unions the TUC and Unite have also expressed disquiet over a rushed US trade deal. “Ministers should be focused on getting the best possible deal with the EU, rather than leaping into bed with Donald Trump,” TUC boss Frances O’Grady told the Guardian.