So, Brexit has 'clearly impacted the UK economy'. In a positive or negative way, would you say? Don't bother answering that, we all know the answer. The real point of my post (which you seem to have ignored - or perhaps I wasn't clear enough) was whether or not we should be turning away from the US and back towards Europe. I think I know the answer to that, do you?
As regards to Brexit, as you say, the answer is obvious. As for the US and the EU, from a Trade perspective, I don’t think we’ve ever really turned away from the EU (how could we Europe’s our most important trading market) but the trading mechanisms changed due to Brexit. In 2015, 44% of the UK's goods and services were exported to the EU, while 53% of our imports came to the UK from the EU. In the same year, UK exports to the EU were valued at £223.3 billion, while UK imports from the EU stood at £291.1 billion. As for the US, why walk away from Trade opportunities if they are available? The big question under a Trump Administration is IF? In 2023, the USA was the UK’s Number 1 export country for our goods and services at £191.5 billion, accounting for 22% of our exports. Germany and Ireland came 2nd and 3rd at £61bn and £57bn respectively. The EU as a bloc accounted for £357bn, 41% of our exports. So if we turned away from the US and focussed even more on Europe/the EU, how much of the £191bn exported to the US could be sold to Europe/the EU? We need good trading relationships with both the US and the EU
Agree with the conclusion but at what price? A choice is coming not because we want to make one but because Trump does.
Just noticed your photo ID. Is that Neath in the Hunter Valley Australia? I ask 'cos it sure doesn't look like the Neath Port Talbot area I visited on a school trip during the 70s recession. As for Trump. he will do what he wants to do, as the checks and balances of the American constitution have given him the once in a generation jackpot. Have to say I hope COP 30 is held in America at some point during his term. He can then cancel it for all the good it does.
Trump has said that tariff is his favourite word and is rumoured to want 20% on all imports. He's also said he's going to abolish inflation in the US,. The majority of Americans seem to be too dumb to realise that tariffs will increase inflation. Perhaps Trump himself is too dumb to realise this. Of course we will continue to trade with the US, but it's going to be much more difficult. Brexit looks even more ridiculous now. We should remove the self-constructed obstacles to trading with the EU by rejoining the single market and customs union. In fact, with the US becoming more and more isolationist, we should look to fully rejoin the EU.
No - sunny Neath in (old) South Wales The photo is looking out to the Caribbean Sea taken in Holetown.
Do you think that the increase in Employers’ NI could similarly increase inflation here? The reduction in the threshold from £9100 down to £5k represents an increased cost of £615/employee.
In October 2023 there were 2.3 million people in employment but also on Universal Credit. We are effectively subsidising businesses that underpay their employees.
Small businesses are protected through the increase in the Employment Allowance, large businesses should just absorb the additional cost.
Why can’t the large businesses pass the cost on to their customers through price increases or decide to absorb them through not granting pay increases or reducing investment? I think we’ll see a whole range of responses. Small businesses are only protected for the first £10,500 of NIC contributions come next March, that’s less than 3 employees earning £30k each. Any organisation employing 27 people (including directors) or more earning an average of £30k each would have a NIC liability of over £100k and would not be eligible for the allowance. I’m sure Reeves has factored all the downsides into her calculations. Although she did seem surprised and ‘not satisfied’ that the Chancellor and PM continually talking down the economy to get their excuses in early might have a negative impact on confidence and growth. Personally I’m not all that hung up on ‘growth’, but we were kind of promised that growth would pay for improved public services rather than tax rises, weren’t we? Still, give them time.
Sorry Stroller but that is just wishful thinking The increase from 13.8% to 15% is expected to generate £12bn, whilst the reduction in the threshold is assessed as raising £18bn. The increase in the Employment Allowance for SMEs is expected to cost £4bn if fully taken up by eligible businesses. So businesses are to be clobbered with a net increase of £26bn - and you think that ‘large businesses should just absorb the additional cost.’ For a start, being a large business doesn’t necessarily mean that it is highly profitable. Secondly, the Institute for Fiscal Studies has written that what is most concerning is that the NI changes will have the greatest (negative) impact of those employing lower wage workers, for example employing someone earning £11,500 will now cost 5.4% more compared to an increase of 2.5% for a median paid employee. With the Budget adding £32bn to annual borrowing, it is likely that interest rates will stay higher for longer. Considering everything, businesses may/will have to pass on cost increases to customers not just to remain profitable, but just to stay viable. Another option to passing on cost increases in the form of selling price increases would be to make savings - reducing employee headcount? Lower wage increases? Lower bonuses? I read this on LinkedIn earlier this week:
Elsewhere, over 100 Labour MPs are ‘undecided’ on the assisted dying bill. This astounds me. I’m probably looking at this the wrong way, but I think it’s a matter of principle - either you think people should have the right to choose to end their life under certain circumstances or you don’t. The practicalities, safeguards, costs etc are separate issues. I’d expect any self respecting ‘representative of the people’ to have a pretty clear and well thought through position on this, even if I personally might disagree with them. Of course, as 70% of the British public are in favour of assisted dying voting against it is the opposite of representing your constituents, but that’s ‘representative’ democracy for you. For those ‘undecided’ MPs - just do what the majority of your constituents want, do yourselves a favour. Nearly all Lib Dem’s have been able to declare in favour, with only Ed Davey being against. Not sure on the Tories. I don’t think it’s going to get through.
I remember similar scare stories when Labour first introduced the minimum wage and the World didn't come to an end then, did it? Some businesses may struggle, but they'll have to learn be more efficient or go under.
I remember similar scare stories when Labour (Brown) last intervened in Pension Reform and the World of (Company) Defined Benefit Pension Schemes didn’t come to an end ….. oh, hang on … Seems like we will have to agree to disagree Anyway, Wales are playing Turkey on S4C
