Intelligence Briefing - 16 October 2009

Published: 16/10/2009

EEF's weekly briefing on the issues affecting manufacturers.

Week in Review

Respite for members on agency workers directive

Following EEF lobbying the government has announced a delay to the introduction of the Agency Workers Directive. This will now take effect in October 2011, not earlier as the trade unions had wanted. The delay will ensure manufacturers avoid increased costs in this area while the economy is still recovering and give them longer to prepare for the new approach. The government has also announced a delay in implementing the right of employees to request time off for training. This will now come into force in April 2011 for firms with less than 250 employees.

You can read our consultation response here and for further information contact, David Yeandle, Director of Employment Policy. For more on the right to request time off for training, contact Nigel Fletcher, Skills Policy Adviser

Environment Secretary urged to adopt waste policies which improve the bottom-line

EEF has lobbied the Environment Secretary, Hilary Benn MP, to simplify the regulatory framework for waste and reduce costs through a more risk-based approach. Meeting him following his speech to set out the government’s vision for a “world without waste”, we welcomed these ambitions, but argued that the government needed to do more in this area as set out in our recent waste policy brief.

For further information contact, Vanessa Fandrich, Senior Climate & Environment Policy Adviser

EEF discusses UK skills policy with Liberal Democrat front bencher

We have outlined the skills needs of UK manufacturing in a meeting with Stephen Williams MP, Liberal Democrat Shadow Secretary of State for Innovation, Universities and Skills. Reflecting strains on government budgets, we also stressed the need to ensure that successful training programmes do not run out of funding.

For further information contact Nigel Fletcher, Skills Policy Adviser

Top civil servant at DWP briefed on manufacturing recession strategies

We met with Permanent Secretary at the Department for Work and Pensions, Sir Leigh Lewis, this week to discuss a range of issues from pensions reform to health & safety directives. Sir Leigh was particularly interested in how and why manufacturers’ responses to the current economic downturn have been different from their responses in previous downturns.

For further information contact Jennifer Huckstep, External Affairs Adviser

EEF challenges government on its better regulation efforts

We attended DEFRA’s Ministerial Challenge Panel for Regulation, chaired by junior Environment Minister Huw Irranca-Davies MP. At the meeting we voiced concerns over delays in delivering on existing better regulation commitments as well as proposals for implementing new waste laws. Finally, we urged the government to ensure that policy objectives do not lead to overlapping requirements on manufacturers.

For further information contact Vanessa Fandrich, Senior Climate & Environment Policy Adviser


In the News

This week's coverage spanned a range of issues. Our success in reducing the cashflow burden of the Carbon Reduction was reported in the Sunday Times. Elsewhere our Senior Economist, Jeegar Kakkad, was interviewed for BBC news bulletins talking about the falling pound, whilst our latest pay data featured in the national, regional and online press with highlights including the Guardian, the Independent’s city editorial and the Times. Finally we also respond to the Agency Workers announcement in the FT and Personnel Today.


Weekly Focus

UK Steel: Steel market briefing - October 2009

UK Steel, a division of EEF, has produced a briefing examining the causes of recent steel shortages in the UK, with an analysis of recent market developments more generally and the factors influencing steel price increases.

It concludes that:

  • Any steel shortages currently appearing on the market are temporary, and have been due to the difficulties inherent in bringing large increments of capacity back on stream to match fluctuations in demand.
  • Market conditions, and accordingly steel prices, while improved from earlier in the year, remain poor in historical terms.
  • Despite this, steel raw material prices have not fallen to the same degree as steel product prices, and steel companies will need to recover these costs through price increases as and when market conditions permit.


Ecconomic Data

Latest economic indicators

↓ Consumer prices

CPI inflation slowed to 1.1% in September, reaching a five-year low. RPI inflation edged lower to -1.4% from -1.3% in August.

↔ Earnings growth

EEF’s Pay Bulletin reported the three-month average pay settlement held steady at 0.3% in September. Pay freezes accounted for 80% of all settlements.

Excluding bonuses, official statistics showed manufacturing earnings growth came in at 1.1% in the three months to August compared to the same period a year ago. Across the whole economy earnings growth slowed to 1.9%.

↑ Unemployment

The number of people claiming Job Seekers’ Allowance rose by 20,800 in September, while the ILO unemployment rate came in at 7.9% with 2.47 million unemployed.

↑ House prices

The RICS house price balance rose to +22 in September, the highest since May 2007.


Coming Up...

Forthcoming data and statistics

21 October: Monetary Policy Committee minutes; Bank of England Agents' Summary of Business Conditions.

22 October: Retail sales, Office of National Statistics (ONS)

23 October: GDP figures, ONS

Forthcoming events...

Finance for our Future
Wednesday 4 November 2009, 8am for 8.30am - 10am
Council Chamber, Broadway House, Tothill Street, London SW1H 9NQ

This talk brings manufacturing leaders together with financial experts and senior government policy-makers to discuss the financial challenges facing manufacturers today.

 


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