Welcome to our round up of the latest business news for our clients. Please contact us if you want to talk about how these updates affect your business. We are here to support you!
This will be our last business newsletter before Christmas and the New Year break so let us wish you a happy Christmas and a prosperous New Year.
2021 – A Year of Resilience and Recovery?
Let us have hope that in 2022 we return to a more normal way of life free of the restrictions that we have faced over the last two years.
The pandemic happened and now is not the time to reflect how it happened or judge how it was managed, indeed further restrictions have recently been introduced and all we can do is take precautions individually to prevent the Omicron virus spreading and continue to take responsibility in the community to socially distance and help prevent the spread.
This year, despite the lockdowns and restrictions, we have been amazed at the resilience of clients and how they have energetically repurposed or pivoted their businesses into new areas, products and services. Businesses have redesigned delivery and payment systems, moved their entire processes digital, accepted remote working or new safe working environments and adopted to new technologies to survive and indeed prosper in the Covid-19 era.
Clients have demonstrated to us how we can all readily adapt to a change in circumstances and have given us inspiration and optimism for the future. We believe that by this time next year we will be back to where we want to be and more of our daily lives will resemble some kind of normality again. Do not give in to the virus, stay strong, be resilient and together we will move forward!
Job Vacancies Continue to Rise!
The Office for National Statistics (ONS) estimate that between August to October there was a continuing recovery in the labour market, with a quarterly increase in the employment rate, while the unemployment rate decreased. Total hours worked increased on the quarter, due to the relaxing of some coronavirus (COVID-19) restrictions but are still below pre-coronavirus levels. The UK employment rate was estimated at 75.5%, 1.1 percentage points lower than before the coronavirus pandemic (December 2019 to February 2020), but 0.2 percentage points higher than the previous quarter (May to July 2021).
The UK unemployment rate was estimated at 4.2%, 0.2 percentage points higher than before the pandemic, but 0.4 percentage points lower than the previous quarter. The economic inactivity rate was estimated at 21.2%, 1.0 percentage point higher than before the pandemic, and 0.1 percentage points higher than the previous quarter.
The number of people in part-time work jumped in the three months to October, after falling sharply during the pandemic and there was also a fall in unemployment among 16-24 year-olds, another group initially hit by the crisis.
Unemployment continues to fall after a spike last year, with job vacancies now at a fresh record high.
See: Employment in the UK – Office for National Statistics (ons.gov.uk)
HMRC Employer Bulletin December 2021
The December edition of the Employer Bulletin brings you all the latest HMRC updates and guidance to support employers and payroll agents.
There is important information on:
- PAYE – there is important information for those who pay employees early for Christmas, and advice on how to prevent and correct payroll errors
- UK Transition and the recently agreed UK-Swiss Convention on Social Security coordination which came into force on 1 November 2021
- coronavirus (COVID-19) summary of guidance published by HMRC, and declaring grants on tax returns
- tax updates and changes to guidance, with information on the tax avoidance campaign
See: Employer Bulletin: December 2021 – GOV.UK (www.gov.uk)
UK Average House Prices Increased by 10.2% Over the Year to October 2021
The Office for National Statistics (ONS) latest figures show the UK’s average house price increased by 10.2% over the year to October, down from 12.3% in the year to September 2021. The average UK house price was £268,000 in October 2021, which is £24,000 higher than this time last year.
The temporary changes to Stamp Duty, Land and Buildings Transaction Tax, and Land Transaction Tax may have allowed sellers to request higher prices as buyers’ overall costs are reduced. As the tax breaks were originally due to conclude at the end of March 2021, it is likely that March’s average house prices were slightly inflated as buyers rushed to ensure their house purchases were scheduled to complete ahead of this deadline.
This effect was then further exaggerated in June 2021, in line with the extension to the holiday on taxes paid on property purchases in England, Wales and Northern Ireland. Following a decrease in July, average house prices increased in the months of August and September 2021, reaching a record level in September 2021 (when the last of the tax holidays came to an end in England). Despite a slight fall in the month of October 2021, average house prices remain higher than the previous peak seen in June.
Private rental prices paid by tenants in the UK rose by 1.7% in the 12 months to November 2021, up from 1.6% in the 12 months to October 2021. The beginning of 2021 saw a slowdown in rental price growth, which was driven by prices in London.
In England the October data shows, on average, house prices have fallen by 1.5% since September 2021. The annual price rise of 9.8% takes the average property value to £285,113.
See: UK economy latest – Office for National Statistics (ons.gov.uk)
Inflation at its Highest Rate in Over a Decade
Consumer prices rose by 4.6% in the 12 months to November 2021, according to the lead measure of the Consumer Prices Index including owner occupiers’ housing costs (CPIH). This is up from 3.8% in the year to October 2021. Annual inflation rates at this time are influenced by the effects of coronavirus (COVID-19) in 2020.
The Consumer Price Index (CPI) also rose from 4.2% to 5.1% in November 2021.
A wide range of prices contributed to the rise in inflation, with the largest upward contributions coming from motor fuels as well as clothing and footwear, where prices rose this year but fell a year ago.
See: UK economy latest – Office for National Statistics (ons.gov.uk)
International Travel Update
From 15 December 2021, all remaining countries were removed from the UK travel red list. The red list policy and additional testing measures in response to Omicron remain in place. As such, passengers arriving from Angola, Botswana, Eswatini, Lesotho, Malawi, Mozambique, Namibia, Nigeria, South Africa, Zambia and Zimbabwe will not have to stay in a managed quarantine hotel on arrival from this date. Pre-departure tests and PCR testing measures on or before day 2 remain in place, with a review of all travel measures in the new year. Airlines must continue to check all passengers for pre-departure tests alongside their completed Passenger Locator Form, and passengers will not be allowed to board a flight without providing evidence of a negative test result.
Advice for Pregnant Employees
The advice for pregnant employees on risk assessments in the workplace and occupational health during the coronavirus (COVID-19) pandemic has been updated to reflect recent government announcements. This advice is for you if you are pregnant and working as an employee. This includes pregnant healthcare professionals. It will help you discuss with your line manager and occupational health team how best to ensure health and safety in the workplace.
Finding and Choosing a Private Coronavirus (COVID-19) Test Provider
The lists of and information about private test providers, to help you get the private COVID-19 tests you need, has again been updated.
Second State Pension Age Review Launches
The Review will consider whether the rules around pensionable age are appropriate, based on the latest life expectancy data and other evidence.
The Pensions Act 2014 requires the government to regularly review State Pension age, and in accordance with law, this latest Review must be published by 7 May 2023.
State Pension age is currently 66 and two further increases are currently set out in legislation: a gradual rise to 67 for those born on or after April 1960; and a gradual rise to 68 between 2044 and 2046 for those born on or after April 1977. The first Review of State Pension age was undertaken in 2017 and concluded that the next Review should consider whether the increase to age 68 should be brought forward to 2037-39 before tabling any changes to legislation.
This Review will consider a wide range of evidence, for example, it will:
- examine the implications of the latest life expectancy data;
- provide a balanced assessment of the costs of an ageing population and future State Pension expenditure;
- consider labour market changes and people’s ability and opportunities to work over State Pension age;
- and develop options for setting the legislative timetable for State Pension age that are transparent and fair.
See: Second State Pension Age Review launches – GOV.UK (www.gov.uk)
First Minister Outlines Aim to Offer all Eligible Adults a Booster Appointment by End of Year
Urgent plans are being put in place to further accelerate the booster programme as new evidence has emerged showing two doses of the Covid-19 vaccine are not enough to offer protection against the new omicron variant. The booster dose is vital in improving protection against the fast-moving variant.
Barriers to Start Up Grant
The Barriers To Start Up Grant is a £1million fund to enable economically inactive, unemployed individuals and young people not in education, employment or training to start their own business.
A grant of up to £2,000 is available to help individuals overcome barriers to starting a business. The grant will come as a part of a package of support that will include one-to-one advice and webinars to build confidence in business practices and develop plans for starting a business.
If successful, applicants will also be expected to consider the role they play in adopting our values of equality and sustainability in the running of their new business.
In allocating funding, priority will be given to those individuals that are facing barriers to business start-up and are furthest away from the employment market.
To apply you should be:
- Economically inactive or unemployed
- Looking to start up a self-employed business in Wales
See: Barriers To Start Up Grant | Business Wales (gov.wales)
Economy Minister Sets out Plans for Banc Cambria, Wales’ New Community Bank
The Welsh Government’s Programme includes a commitment to support the creation of a Community Bank for Wales, in order to seek to address the market failure in relation to the gap in provision, the effectiveness and the quality of banking services in Wales.
The Economy Minister has confirmed that Monmouthshire Building Society, working with the Welsh Government and Cambria Cydfuddiannol Ltd (CCL), has announced its intent to develop its approach of delivering a community bank in Wales, Banc Cambria, which will aim to provide everyday full retail banking services in communities across Wales by 2023.
The UK has one of the least diverse Retail Banking systems in Europe, dominated by a small number of very large banks, which operate according to a shareholder-value business model, seeking to maximise profits for their owners.
Since Welsh Ministers initially set out plans to explore the creation of a Community Bank for Wales, traditional High Street Banks have further accelerated their retreat from Wales’ High Streets.
An increasing number of communities across Wales are now left without access to accessible banking services, which Ministers believe is an essential public service, with rural communities and those individuals and businesses across Wales, who are more reliant upon cash, and face-to-face relationship banking, being hit the hardest.
Retail High Street Banks are retreating from our High Streets at an ever increasing and alarming pace:
- According to ONS data, the number of bank branches in the UK has fallen by 4,390, or by 39% between, 2012 and 2021.
- Which? estimates that by the end of 2022, only 277 Bank and Building Society branches will remain in Wales.
See: Economy Minister sets out plans for Banc Cambria, Wales’ new Community Bank | GOV.WALES
Introduction of the Welsh Tax Acts etc. (Power to Modify) Bill
The Welsh Tax Acts etc. (Power to Modify) Bill and Explanatory Memorandum has been laid before Senedd Cymru (“the Senedd”).
This Bill is intended to provide an additional lever to respond to external events which impact on devolved taxes, enabling the Welsh Government to protect the revenues used to fund public services.
This single purpose Bill will enable changes to be made to the Welsh Tax Acts by regulations where Welsh Ministers consider that such changes are necessary or appropriate and where they are required to have effect immediately or shortly thereafter. Those changes will be permitted in order to respond to a number of external circumstances:
- to ensure the devolved Welsh taxes are not imposed where to do so would be incompatible with any international obligations;
- to protect against tax avoidance in relation to devolved Welsh taxes;
- to respond to changes made by the UK government to ‘predecessor’ UK taxes (that is, those where there are equivalent devolved taxes) which affect, or may affect, the amount paid into the Welsh Consolidated Fund, and
- to respond to decisions of the courts or tribunals which affect or may affect the operation of the Welsh Tax Acts, or any regulations made under them.
The devolution of taxes in Wales marked an historic moment in Welsh political history. Over three years ago, the Welsh Government introduced two fully devolved taxes, land transaction tax and landfill disposals tax, which have been successfully administered by our first non-Ministerial body, the Welsh Revenue Authority. This Bill provides a valuable tool for protecting devolved taxes, allowing Ministers to ensure they continue to reflect our distinctive circumstances in Wales and are able to respond to external events which may impact on those taxes.
See: Introduction of the Welsh Tax Acts etc. (Power to Modify) Bill (13 December 2021) | GOV.WALES
Winter Fuel Support Scheme
Eligible people in Wales may be able to claim a one-off £100 payment from their local authority to provide support towards paying their winter fuel bills. Information on how to apply will be available via local authority webpages. The scheme opened 13 December.
See: Winter Fuel Support Scheme opens Monday 13th December | GOV.WALES
UK House Price Index for October 2021
Wales shows, on average, house prices have risen by 2.6% since September 2021. An annual price rise of 15.5% takes the average property value to £203,224.
See: UK House Price Index for October 2021 – GOV.UK (www.gov.uk)
BioAccelerate
BioAccelerate is AberInnovation’s investment-readiness accelerator programme for early-stage businesses and startups designed to help you bring your innovative idea to fruition. Applications are now open to individuals or groups who wish to develop a new product or service in the bioscience, healthcare, agri-tech or food and drink sectors.
There is £60,000 in Innovation support available. The closing date for applications is Tuesday 21 December 2021.
See: BioAccelerate – Our Flagship Accelerator | AberInnovation
