Published: 01 April 2021
The minimum wage goes up today:
- From £8.72 to £8.91 an hour for workers over the age of 23
- From £8.20 to £8.36 for those aged 21-22
- From £6.45 to £6.56 for 18 to 20-year-olds
- From £4.55 to £4.62 for under-18s
- From £4.15 to £4.30 for apprentices
The National Living Wage will also rise 2.2% to £8.91 and will also be given to 23 and 24-year-olds for the first time, rather than just those aged 25 and over. The voluntary Real Living Wage will rise to £10.85 an hour in London and £9.50 outside the capital, although few employers have signed up to pay it. However, some 800,000 workers still on furlough will see no uplift and will continue to get 80% of their usual income, based on pre-pandemic rates for the minimum wage, until they return to work.
The Office for National Statistics yesterday revealed the UK economy grew by 16.9 percent and 1.3 percent in the third and fourth quarters of 2020. However, GDP shrank by more than expected in the second quarter during the first coronavirus lockdown, plunging by 19.5 percent. Overall GDP fell 9.8 percent overall in 2020, the largest contraction of the UK economy in more than 300 years since 1709, according to a GDP reconstruction by the Bank of England. The deficit also widened to £26.3 billion in the fourth quarter, almost double the shortfall in the third quarter, as firms rushed to import goods before the January 1st start to the country’s new trade relationship with the European Union.
Business confidence may be high, with 55% of firms saying they expect turnover to increase over the next 12 months, but economic conditions remain “historically poor” according to a new report from The British Chambers of Commerce. The group’s Quarterly Economic Survey, published today, finds that all the key indicators for business conditions remain in negative territory and well below pre-pandemic levels. 40% of firms reported a decrease in domestic sales, with B2C firms faring worst. 83% of hospitality and catering firms reported decreases in Q1, up from 79% in Q4. Sectors able to harness the power of online and remote working have done better, with 35% of firms in professional services, and marketing and media, reporting increased sales in Q1, up from 29% and 28% respectively in Q4 2020. Cash flow continued to deteriorate for 41% of firms in Q1, with those in hotel and catering hit the hardest. "Despite improvement from the lowest levels on record, this balance is still at a level comparable to the 2008-09 recession," the BCC said.
Deliveroo saw more than £2bn wiped off its value when it debuted on the London Stock Exchange yesterday, with shares sinking as much as 30% at one point. The fast-food delivery app had already cut £1.2bn off its original top end valuation, after several major investment companies said concerns about workers’ rights meant they would not be buying. Up to 70,000 individual retail investors who put £50m into the company may now be looking at heavy losses: IPOs are usually only open to institutional investors but Deliveroo allowed its customers and the general public to invest through a platform called PrimaryBid. Deliveroo has yet to make a profit; in March the company posted a £223.7m loss, despite heightened sales during lockdown.
Lloyd's of London has reported pre-tax losses on £0.9bn and says it expects 2020 payouts for covid-related insurance claims to hit £6.2bn. The 335-year old firm also blamed natural disaster and Brexit for the dramatic fall in earnings from £2.5bn in 2019.
The Payment Systems Regulator says that Mastercard and rivals Allpay, PFS, Sulion and APS have admitted liability for breaching competition rules in relation to pre-paid cards used by local authorities to distribute welfare payments. The firms may now have to pay fines totalling more than £32m. The regulator’s preliminary investigation found the alleged collusion meant public bodies were limited in their choice of suppliers of pre-paid cards services, and potentially “deprived of lower prices and better quality for those services.” The firms “engaged in anti-competitive behaviour by agreeing not to compete or poach each other’s clients” and “broke the law by engaging in cartel behaviour,” the regulator said.
The Guardian reports a High Court win by Amigo Loans allowing the firm to potentially cap compensation payments for nearly 1 million customers mis-sold unaffordable loans by the firm. Board directors will earn £7m in long-term bonuses as part of the deal, which will be voted on by all customers at a meeting on 12 May. The Financial Conduct Authority did not oppose the proposal, despite concerns mis-sold customers were could receive little more than 5% of a successful claim. Amigo wants to cap its compensation pool at £35m and 15% of profits over the next four years.
Profits at high street fashion chain Next have more than halved because of lockdowns. Pre-tax profits fell 54% to £342m for the year ending in January compared with the previous year. However in the second half of the year, sales lost across its shops (£368m) were almost entirely offset by a 60% increase in online sales in the past two years, at £364m.
UK house prices dipped slightly in March ahead of the original deadline for the stamp duty holiday, the latest Nationwide house price research reveals. Prices fell 0.2% on the month following a 0.7% increase in February, and versus expectations for a 0.4% rise.
Denise Coates, the boss of gambling company Bet365, is under fire this morning from the Telegraph and the Guardian who claim she is paid more than the entire gambling industry donates to initiatives designed to combat problem gambling. Coates, the multibillionaire founder of the firm, was paid £421m in the year to March 2020, not including a share of £95m in dividends, meaning she received £1.3m for every working day. According to the Guardian, she is now on course to have been paid more than £1bn in four years. The firm paid executives a total of £607.4m in the year to March 2020, up from £428m.4m in the year prior, a move which contributed to Bet365’s operating profit falling 74% to £194.7m, down from £758.3m in 2019.
The owner of Poundland is reviving plans for a multibillion-pound flotation, possibly on the London Stock Exchange. Sky News has learnt that Pepco Group, which trades from more than 3,000 stores across 15 European markets, has begun holding preliminary talks with institutional investors about an initial public offering. City sources told Sky that London had re-emerged as a serious contender to stage the listing after Warsaw had previously become the likeliest destination for the company.
Google has pledged €25m to the European Media & Information Fund over the next five years to prevent ‘fake news.’ The company called for other organisations to follow its lead and support the newly formed fund.
PriceWaterhouseCooper is to allow employees to work from home a couple of days a week and start as early or late as they like, including being able to legitimately knock-off early on Fridays too.
PwC chairman Kevin Ellis said he hoped this would make flexible working "the norm rather than the exception…We want our people to feel trusted and empowered."
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