Intelligence Briefing - 26 November 2010

Select Committee Chair Briefed

We met Anne Begg MP, the new Chair of the House of Commons Work and Pensions Select Committee as she plans the Committee’s future work. In a constructive meeting we agreed that the general direction of Pensions Reform is positive, but significant challenges remain. In particular businesses need the fine details of government proposals in plenty of time to enable them to amend their systems and software before auto-enrolment begins. We also pressed the importance of the government continuing to develop support for businesses in keeping employees with health conditions in work; smaller businesses in particular cannot meet their equality responsibilities and cut their absence rates without practical support.

For further information contact Steve Pointer, Head of Health and Safety Policy

EEF discuss next steps on access to finance with BIS officials

Following EEF’s submission to the government’s green paper on improving access to finance and subsequent recommendations from both the government and the British Bankers’ Association (BBA), EEF met with officials to discuss how proposals would be taken forward. We provided our feedback on the recommendations from both government and the BBA in particular those areas, such as greater competition in non-debt finance and increasing the effectiveness of government scheme, that have not so far been addressed. We will continue to work with the government, including through the Small Business Economic Forum on this issue and we are keen to hear members concerns or comment about their experience in accessing finance.

For further information contact Lee Hopley, Chief Economist, or Andrew Johnson, Senior Economist

EEF resists European Commission pressure on EMF Directive

We have been working to prevent an attempt by the European Commission to push an incomplete health and safety directive on electromagnetic fields through to the parliament. Members of the Commission's Working Party on electromagnetic fields (including our own Gary Booton) have been asked to approve an incomplete unofficial draft directive by the 2nd December or face a currently postponed directive coming into force. We are working with the Health and Safety Executive, CEEMET and others to resist agreement until a full and official draft is provided. If necessary we will seek a further postponing directive to allow the issues to be properly resolved.

For further information contact Steve Pointer, Head of Health and Safety Policy

Weekly focus/In the News Special: The Shape of British Industry

How well prepared are UK manufacturers for the next challenge of turning their investments in productivity and competitiveness over the past decade into transformational growth in the next?

To answer this question and to understand the current trends in British industry, we have this week published a new report - The Shape of British Industry - Growing from strong foundations - drawing on a survey of 300 manufacturers as well as in-depth discussions with dozens of businesses.

What comes out is a picture of an industry starting from strength, but cautious about growth. Having weathered the recession, UK manufacturing emerges as an innovative, diverse and globally engaged sector. Firms have continued to boost productivity and competitiveness, even if they have struggled to deliver profits or meet their ambitions.

There is, however, one striking feature: the UK, has relatively fewer large manufacturers – those employing more than 250 people – than our closest competitors. Thus 1.2% of UK manufacturers employ more than 250 people, compared with 2.1% in Germany. In the US, firms with 500 or more employees account for 2.9% of manufacturers, compared with 0.6% in the UK.

The report examines this issue and concludes that the twin dynamics that could drive growth in manufacturing are 1) large companies creating markets for a dynamic, diverse supply chain and 2) innovative, agile suppliers attracting large, mobile multinationals to the UK.

The danger for manufacturing and the economy is that the lack of larger companies could slow this dynamic, leading to a hollowing out of supply chains and placing a cap on future growth. The report goes on to argue that the UK needs hundreds of larger companies, not just a handful.

To do so we need to continue to attract new ones to the UK. But it is also about ensuring small and medium-sized manufacturers overcome barriers that constrain them. The report goes on to make a number of recommendations to both government and manufacturers themselves in areas such as access to finance, regulation and the image of manufacturing.

You can read more by downloading the report or this summary of key findings. To coincide with its release our Chief Executive, Terry Scuoler, had this article published in the Daily Telegraph. And there was plenty of other media coverage for the report including:

The Telegraph again

http://www.telegraph.co.uk/finance/newsbysector/industry/8150392/Tax-and-regulation-hurdles-loom-for-manufacturers.html

The Independent

http://www.independent.co.uk/news/business/news/manufacturing-can-compensate--for-publicsector-cuts-says-eef-2140469.html

The Guardian

http://www.guardian.co.uk/business/2010/nov/22/uk-lacks-large-manufacturers

And the Daily Mail

http://www.dailymail.co.uk/money/article-1331393/SUNDERLAND-ON-SATURDAY-UKs-new-industrial-revolution.html

Week in Review

The week ahead

Wed 1st: Manufacturing PMI

Fri 3rd: Services PMI

We recommend that you take our advice before using any of the information or documents on this website. You should always seek specific legal advice before taking or refraining from any action. Information and documents on this website are prepared in accordance with the laws of England, Wales and Scotland. Users accessing from Northern Ireland should be aware that different laws and interpretations may be applicable to Northern Ireland.