Chamber News

UKTI’s Franco-British Offshore Wind and Tidal event at the British Ambassador’s Residence in Paris has been confirmed for Tuesday 26 January 2016. The format will be similar to last year; although UKTI are planning to allow more time for the one-to-one meetings with your French prospects. (That’s why the actual programme is still to be confirmed). As before, UKTI’s Alan Highet will attend to support East of England delegates, by helping you to get as much benefit as possible out of your participation …

Register promptly to be profiled in a catalogue of UK participants, that will be sent to all the participating French companies so they can request meetings. UK companies that have registered in time to feature in the catalogue will receive the equivalent catalogue of French participants, so you can request meetings with them.

Indeed, if you know already that there are French companies you’d like to meet, let Alan Highet know now at [email protected]. If you don’t know Alan Highet already, he’s UKTI’s lead advisor for Environmental & Energy in the East of England. It’s likely the companies you’ll want to meet will attend anyway, as this is recognised in France as one of the major OWE events, but just in case they might not have done so already, Alan’s colleagues in Paris will call them to encourage their participation … . UKTI might not be able to guarantee it, but they’ll do their best to get you that meeting!

It really is an appropriate time to meet French companies associated with developing their emerging OWE market; the prestigious surroundings of HM Ambassador’s Residence near the Élysée Palace helps to attract important buyers and influencers; and UKTI is collaborating once again with the French renewables industry organisation Syndicat des Energies Renouvelables (SER) and others – so you’ll have access to France’s key industry players. What’s more, UKTI are hoping to arrange a “return” event later in 2016, exclusive to the East of England, inviting French companies who have met East of England companies in Paris to visit our region so they can witness your capabilities at first hand …

The closing date for registrations that’s on 28 December, for entry in the catalogue that will be sent to French companies so they can request meetings with you. As that’s in the middle of the Festive Season, and there won’t be time after the New Year to include companies who haven’t already registered, UKTI recommend registering as soon as possible to ensure your inclusion well before Christmas! The participation fee is £420 that allows representation by two delegates per company. Last time East of England companies averaged more than 6 meetings per company, and it’s quite common for French companies to agree to a follow-up meeting soon afterwards, while you might still be in Paris!

SMEs that meet the qualifying criteria can apply for £200 towards travel costs associated with attending this event (also subject to budget availability at the time of your application, so don’t delay!)

If you register on-line now, please email [email protected], to let him know, so that he can alert his colleagues in Paris and to highlight your participation. If you want to register but it’s not convenient to do so on-line right now, you can email [email protected], sending the message – “Yes, please book my place at the British Embassy in Paris, 26 January 2016” – and Alan will let his colleagues know. You’ll still need to register on-line before the deadline for inclusion in the catalogue, but at least UKTI will have noted your interest and send you reminders if necessary!

Your commitment to attend and settle the participation fee, via UKTI’s OMIS system (Overseas Market Introduction Service), will follow. On-line registration is being organised for UKTI by Proximum Group, then UKTI will assist you locally with the OMIS admin.

The OMIS fee for participation on 26 January is set again at UKTI’s minimum level (£420 + vat) for up to two delegates to attend. That reflects a significant subsidy against the actual costs of facilitating your series of business meetings. During the day you’ll also find out what’s up-to-date in the French sector, and there are several networking opportunities to meet others with whom you might not have pre-arranged meetings – particularly over coffee, lunch and between your meetings; and previously there has been an end-of-event reception.

Please click here to register

Commenting on the latest delay to a government decision on a new runway in the South East, John Longworth, BCC Director General, said:

“Businesses will see this as a gutless move by a government that promised a clear decision on a new runway by the end of the year.

“Business will question whether ministers are delaying critical upgrades to our national infrastructure for legitimate reasons, or to satisfy short-term political interests.

“Businesses across Britain will be asking whether there is any point in setting up an Airports Commission – or the recently-announced National Infrastructure Commission – if political considerations are always going to trump big decisions in the national interest.

“The Commission has said that a new runway should be built at Heathrow, and quickly. Expansion at other airports is needed too.Ministers need to stop prevaricating and get on with doing what the country sorely needs.”

Over 80 members joined us armed with Christmas sweaters for a morning of festive fun at Sprowston Manor at our annual Norwich Christmas Breakfast.

We had a variety of Christmas themed networking activities, including a Two Truths, One Lie activity which involved delegates announcing the worst of their Christmas present history. Delegates also had the opportunity to draw and listen to their favourite Christmas songs in other ice breakers.

Featured charity Break were very grateful for the huge amount of donated gifts and food from delegates that they will include in their Christmas drop off to those in need of a little festive magic this year.

Motorists are warned of overnight restrictions and closures as the major works at the A47 Postwick junction near completion. These restrictions will mainly affect eastbound traffic.

For the next three nights, Wednesday 9 December to Friday 11 December (8pm to no later than 6am) there will be eastbound lane closures on the A47 and the full closure of the new slip road, with traffic diverted around the A47 Cucumber Lane roundabout and back to the Postwick junction via the westbound A47.

These restrictions are to allow surfacing, white lining and the installation of new signs to complete the tie-in of the new slip road with the main eastbound carriageway.

A47 eastbound overnight closure

Next week, the A47 eastbound will be closed overnight (8pm to no later than 6am) on Monday 14 December for completion of the new slip road and removal of traffic management from the main A47. (Tuesday 15th and/or Wednesday 16th may be used if completion that night is not possible).

The signed diversion route will be via the A146 from Trowse, the A143 and A12, re-joining the A47 at Vauxhall roundabout, Great Yarmouth. The closures are taking place overnight to avoid peak daytime traffic.

The British Chambers of Commerce (BCC) has today (Wednesday) downgraded its UK GDP growth forecast, from 2.6% to 2.4% in 2015, from 2.7% to 2.5% in 2016, and from 2.7% to 2.5% in 2017.

Weaker than expected net trade and manufacturing figures were the main reasons for the leading business group’s downgrading of its growth forecasts. The BCC believes the UK economy is set to continue expanding at a moderate pace, mostly driven by strong growth in the service sector and in consumer spending.

Key points in the forecast:

• UK GDP growth forecast downgraded, from 2.6% to 2.4% in 2015, from 2.7% to 2.5% in 2016, and from 2.7% to 2.5% in 2017
• The downgrade is mainly due to weaker than expected trade figures and a worse than predicted manufacturing performance, largely as a result of falling global prospects in recent months
• Lower than predicted actual GDP growth in Q3 2015 and downward ONS revisions of earlier estimates also contributed to the BCC’s downgrade
• Quarterly UK GDP growth is expected to average just over 0.6% per quarter from Q4 2015 onwards, in line with the economy’s long-term growth trend
• The service sector is forecast to grow by 2.7% in 2015, 2.9% in 2016 and 2.9% in 2017 (revised slightly from 2.8% in 2015, 2.9% in 2016 and 2.9% in 2017 in the previous forecast)
• The manufacturing sector is expected to contract by 0.2% in 2015, followed by growth of 0.7% in 2016, and 2.0% in 2017
• The first interest rate increase to 0.75% is expected in Q3 2016

Caroline Williams, Chief Executive of Norfolk Chamber said

“Official data is starting to reflect what the Quarterly Economic Survey has been showing all year – that our persistently weak trade performance and current account balance are impacting our overall growth. Similarly, the manufacturing sector has been hit badly by falling global prospects, tipping an earlier prediction of growth in 2015 to an expected contraction.”

John Longworth, Director General of the British Chambers of Commerce, said:

“We cannot rely so heavily on consumer spending to fuel our economy, especially when driven by increased borrowing. We have been down this path before, and know that it leaves individuals and businesses exposed when interest rates do eventually rise.

“Not all debt is bad though. Better access to growth funding and working capital will help UK firms to achieve the scale needed to expand into export markets, which in turn creates jobs and growth at home. Investment in infrastructure is also crucial in enabling businesses to get their goods and services to market.

“The UK still needs to see a fundamental shift in its economic model if we are to remain relevant and prosperous in a changing world economy. Anyone who says that the job is nearly done needs to look again at the trade deficit, current account position and long-term business investment – and realise there’s still a long way to go.

“Government and business need to work together to provide UK firms with support similar to our international competitors if we are to begin to turn the tide of our trade deficit.”

David Kern, Chief Economist at the BCC, said:

“Despite our downgraded forecasts, GDP is likely to continue expanding broadly in line with the UK economy’s long term growth trend. However, services and household consumption remain the main drivers of UK growth, and their contribution to GDP is set to rise even further in the next few years.

“International uncertainties, coupled with undue reliance on excessive personal debt and a falling savings ratio, pose serious potential risks for the UK economy, although rising earnings and disposable incomes, lower inflation and a strong labour market will help growth.

“These dangers facing the UK economy make it important to sustain areas of domestic strength in order to underpin UK growth. While we expect the first increase in UK interest rates in Q3 2016, we believe that rising international uncertainty provides strong arguments for the MPC to delay this.”

Other elements from within the forecast

Main components of demand

• Annual average growth in household consumption is forecast to accelerate to 3.1% in 2015, before slowing to a still strong rate of 2.7% in 2016 and 2.6% in 2017
• UK business investment is predicted to grow by 6.2% in 2015, 7.4% in 2016, and 7.4% in 2017
• Our forecast is that the real net trade deficit will fall from 2.8% of GDP in 2014 to 2.6% of GDP in 2017, a much smaller fall than we predicted in Q3
• Growth in real exports is forecast to be 3.5% in 2015, 3.4% in 2016, and 3.0% in 2017

Main sectors of the economy

• Service sector output is forecast to grow by 2.7% in 2015, 2.9% in 2016 and 2.9% in 2017. The share of services in total UK output is likely to rise further in the next few years
• Manufacturing output is expected to record negative growth of -0.2% in 2015, followed by positive growth of 0.7% in 2016, and 2.0% in 2017
• Total industrial output growth is forecast at 1.1% in 2015, 0.8% in 2016, and 1.3% in 2017
• Construction output growth is forecast at 2.3% in 2015, 0.9% in 2016, and 2.0% in 2017

Official interest rates

• The first increase in UK official interest rates to 0.75% is expected to occur in Q3 2016, one quarter later than we previously predicted
• Further modest increases in official interest rates can then be expected, in small 0.25% steps, with official interest rates reaching 1.75% in Q4 2017

Unemployment and productivity

• The UK unemployment rate is forecast to fall from 5.3% in Q3 2015, to 5.2% in Q2 2016, 5.1% in Q2 2017 and 5.0% in Q2 2018
• Total UK unemployment is forecast to fall from 1,749,000 in Q3 2015 to 1,724,000 in Q3 2016, 1,709,000 in Q3 2017, and to 1,694,000 in Q3 2018, a net overall fall in the jobless total of 55,000 over the next three years
• Total youth unemployment (people aged 16 to 24) is expected to fall from 726,000 (a jobless rate of 15.7%) in Q3 2015, to 692,000 (a jobless rate of 14.7%) in Q3 2018, a net fall of 34,000
• Productivity has been weak since the financial crisis, but has risen over the past year, and we expect a further gradual improvement in the next few years

Public finances

• The UK public finances have improved in the current financial year, although there was a setback in October 2015
• The Chancellor’s new and more flexible medium-term fiscal consolidation timetable, outlined in the November 2015 Autumn Statement, is challenging but realistic
• We are now predicting that UK public sector net borrowing will move into surplus in 2019/20, which is also in line with the OBR’s November 2015 forecast

Inflation and earnings

• Annual CPI inflation will stay around zero for the next few months, before edging up slowly from Q1 2016 onwards, but will remain below the 2% target at least until mid-2017

• In annual average terms, we are forecasting annual CPI inflation at 0.1% in 2015, 1.1% in 2016 and 2.0% in 2017. In Q3 we predicted 0.1% in 2015, 1.2% in 2016 and 2.0% in 2017
• We are now predicting that total earnings growth (total pay including bonuses) will average 2.5% in 2015, 3.3% in 2016 and 4.0% in 2017
• The new earnings forecasts are slightly lower for 2016 and 2017 than those made in Q3

Today marks the soft launch of the Government’s National Living Wage campaign.

The campaign is aimed at ensuring employers are aware of and comply with the new legal requirement. It is also designed to ensure eligible workers know that they are entitled to the NLW, and what to do if they are not being paid the correct amount.

This ‘soft launch’ phase, from now until mid-January, is focused on making sure that employers know about the NLW, know when it is coming, and what they should do to prepare their businesses for it.

So are Norfolk employers prepared – do they know when it is coming, and what they should do to prepare their businesses for it?

The Government has advised four simple steps for employers to take – as soon as possible – to make sure that they are ready.

• Know the correct minimum rate of pay -£7.20per hour for staffaged 25 and over
• Find out which members of your staff are eligible for this new rate
• Update the company payroll in time forApril 1, 2016
• Tell staff about any changes as soon as possible

The Government has provided a toolkit, which should give employers the information and assets they need to ensure that employers and employees know about the National Living Wage.

Caroline Williams, Chief Executive of Norfolk Chamber said:

“It is important that all businesses, both large and small, understand the new National Minimum Wage regulations and take the necessary steps to ensure they are compliant by 01 April 2016.

“The NLW will leave some businesses with a large increase in wage bills to adapt to over the coming months. The Chamber will continue to call on politicians to recognise that the UK economy is still fragile and to heed the Low Pay Commission’s considered recommendations for future wage rates, if they are to reassure businesses who may be looking at their recruitment plans for the year ahead.”

Preliminary work on site has started on Norwich Northern Distributor Road (NDR), Norfolk County Council announced today (Tuesday 8 December).

The start, on land already controlled by the Council, comes less than two weeks after Full Approval and the release of national funding was announced in the Chancellor’s Autumn Statement (25 November). Since then, Norfolk County Council has moved quickly to instruct Balfour Beatty, the main contractor for the project, and to serve notice on landowners of its intention to take possession of land needed for the road.

The preliminary work, including clearance of vegetation, archaeology, utility service diversions and some drainage lagoon excavations, will be stepped up in January along the whole footprint of the scheme. This will prepare the route before construction of the new road startsaround the end of March, with completion of the main works early in 2018.

Today’s start on site announcement took place near Rackheath, where ground works are being carried out for a bat roost barn – one of the manywildlife and environmental protection measures built into the project. The Leaders of Norfolk County Council, Cllr GeorgeNobbs, and Broadland District Council, Cllr Andrew Proctor, were joined by Chris Starkie, Managing Director of New Anglia LEP, and Stephen Tarr, Managing Director, Major Projects, Balfour Beatty, to mark the transition from the lengthy planning, project developmentand approval process to actual work on site.

Once complete, the 20km dual carriageway, runningfrom the A47 at Postwick to the A1067 Fakenham road, will take thousands of vehicles a day off congested and unsuitable roads in and around Norwich. As well as easier journeys and relief for local communities, the NDR will:

• Pave the way for a range of further ‘Transport for Norwich’ improvements in and around Norwich.
• Improve accessibility and journey times inBroadland and to and fromNorth Norfolk.
• Provide a high quality linkto Norwich International Airport from the A47 trunk road.
• Improve access to existing and planned business and housing areas.
• Give a£1billion boost to the local economy.

This preliminary work, including clearance of vegetation, archaeology, utility diversion and some drainage lagoon excavations, will be stepped up in January along the whole footprint of the scheme. This will prepare the route for construction of the new road, which will start around the end of March 2016 and is expected to take less thantwo years to complete.

A brief history of Norwich Northern Distributor Road

It has taken many years for proposals for a Norwich Northern Distributor Road (NDR) to reach the point where work has started on site.The idea was floated in the 1990s after the opening of the A47 Southern Bypass, but the lack of funding opportunities led to it being shelved. The current scheme emerged from a 2002/3 update of the Norwich Area Transport Strategy (NATS).

Initial stages:

2003

• NDR gains 78% support as key element of NATS.

2004/2005

• Route option consultation

2005

• September- Council drops western section on environmental grounds and adopts current route.
• Timetable envisages construction starting 2010, road open 2012.

Scheme development and setbacks

2008

• Major Scheme Business Case approved by Cabinet.

2009

• E of E Regional Assembly supports NDR, Department for Transport (DfT) grants ‘programme entry’NDRand allocates £21m from Community Infrastructure Fund (CIF) for Postwick Hub. Start of works put back from 2010 to 2012.

2010

• February – DfT allocates £67.5m for NDR to A140 (in addition to PostwickCIF allocation). County Council agrees to underwrite cost of continuing to A1067.
• General Election – New Coalition Govt withdraws NDR and Postwick allocations. NDR goes into ‘Development Pool’ process with DfT to re-establish funding.

2011

• December – DfT announces combined allocation of £86.5m for NDR to A140 (£67.5m) and Postwick (£19m).

2013

• Total estimated cost of NDR (including Postwick) put at £148.55m. Postwick Hub public inquiry held and completed in July.

Final approvals phase:

2014

• Final approvals (road orders) granted for Postwick in January.
• Work starts in May.
• NDR enters NSIP development consent procedure. Examination begins 2 June 2014, ends 2 December.

2015

• 2 June: Development Consent granted by Secretary of State for Transport.
• Costs rise to £178.95m. DfT, New Anglia LEP and Norfolk County Council agree to cover increase.
• 25 November: Full Approval and release of national funding announced in Autumn Statement.
• 8 December: Norfolk County Council announces start on site of preliminary works.
• Main Postwick Hub junction works due for completion before the Christmas holidays.

The EU and Vietnam have approved a new free trade agreement worth £20 million a year for UK businesses exporting to Vietnam.

The EU and Vietnam have today (2 December 2015) approved a new free trade agreement that will ease trade of products and services between the UK and Europe with the Vietnamese market. In practice the deal means 99% of tariffs will be eliminated – worth £20 million a year for UK businesses exporting to Vietnam.

Commenting on the deal, the Business Secretary Sajid Javid said:

“Today’s free trade agreement with Vietnam, the most ambitious and comprehensive the EU has ever concluded with a developing country, is great news for British businesses enabling access to a fast-growing market of 90 million people in one of the most dynamic regions in the world – boosting export opportunities for our world-class food and drink, pharmaceutical and aeronautical sectors to benefit our long-term economic security.”

International Development Secretary Justine Greening said:

“Vietnam is a development success and UK aid has helped it make great progress on creating jobs, boosting incomes, growing its economy and reducing poverty.

“This free trade agreement reflects our changing relationship with Vietnam. It shows how our investment in overseas development can help build prosperity and stability, our trading partners today and in the future, and serve Britain’s interest.”

According to the Chartered Institute of Procurement and Supply (CIPS) Risk Index for the third quarter (Q3) of 2015, global supply chain risk remains stubbornly high.

Factors taken into account include the cross-border presence of the terrorist organisation ISIS throughout the Middle East, the subsequent re-introduction of border controls within Europe’s Schengen zone, a more assertive Russia and the easing of sanctions by the United States with regard to Iran and Cuba.

For CIPS, Dun & Bradstreet analysed 132 countries against a number of criteria, including level of exports, to assess issues and challenges along the supply chain to produce a global risk score.

This showed the global supply chain risk standing at 79.1, only slightly down from the record high of 82.4 two years ago and nearly double the pre-financial crisis level of 40.4 in Q4 of 2003.

One particular problem highlighted in the latest report is the threat to the Schengen area.

Nearly all the EU’s Member States (and a number who are not members such as Norway and Switzerland) signed up some years ago to the Schengen Agreement by which they eliminated internal border controls.

While this has produced considerable benefits for the free movement of goods over the last 20 years, the system is now coming under real strain with various Member States demanding a return to controls in order to restrict the numbers of migrants and asylum seekers trying to cross from one Schengen country (say Hungary or Greece) in order to reach their eventual goal (say Germany).

Although border crossings are taking as long as 90 minutes in the countries involved, traders who were in business before Schengen will remember that lorries could sometimes be delayed at customs crossings for several hours or even days.

The Chamber’s Representation Council today heard from Chris Starkie, Managing Director of New Anglia LEP about the progress so far with Devolution and how it could affectthe Norfolk business community.

Chris outlined the background and context for Devolution. In October 2015 a joint bid from Norfolk and Suffolk was submitted to Government and representatives from our region met with Lord Heseltine to discuss the details of the bid at the beginning of November.

Devolution is important to business, as it has the potential to strengthen our local economy. It will give our region greater clarity on funding for skills, housing, roads, rail and other infrastructure, as well as business support and will put emphasis on productivity.

Caroline Williams, Chief Executive of Norfolk Chamber said:

“Norfolk Chamber and our Representation Council are, in principal, in favour of Devolution as a way to bring greater economic growth and prosperity to our LEP region. As the Norfolk business community is the key driver for economic growth, it is essential that we ensure that businesses are kept up to date and engaged with the Devolution process to influence the outcome. In conjunction with the LEP we have put together a briefing note and FAQ that we would encourage businesses to take note of. Any queries, please contact me by email on: [email protected]“

Norwich City Council have released their latest economic barometer. The report highlighted:

Nationally

• The Office of National Statistics advised that the GDP (gross domestic product) increased by 0.5% this quarter (July to September).
• The Consumer Price Index indicated that households have seen little change in the prices they pay for goods and services.
• UK retail sales volumes fell in October after a drop in trading at food stores. This was the largest drop since May 2014.
• Mortgage lending increased to £21bn in October – up nearly 20% from a year ago. The total was the highest seen since 2008.

East of England

• East of England has the third highest concentration of employees in the UK for firms in the technology sector. Many of these firms have plans to strongly increase employment over the next 12 months.
• Construction workloads in the East increased with private housing and the commercial sector expanding at the fastest rate. 46% of firms in East Anglian reports an increase in their workloads, according to the RICS.
• The number of new businesses starting up in the East of England rose by 7% to 243,000.

Norwich

• Services group Norse has driven nearly £130m into the Norfolk economy.
• WiSpire, a Norfolk based internet provider has officially opened its new head office in Rackheath Industrial Estate, Norwich.
• Jarrolds saw pre-tax profits growth 40% to £3m.

For full details of the latest economic barometer click here.

Representatives from Norfolk Chamber, Norwich Business Improvement District (BID) and Norfolk County Council sat down this week to talk about the proposed improvements to the city centre, in particular the inner ring road.

At an earlier November meeting of the Norwich Chamber Council, concerns had been raised about the noticeable increase in inner ring road traffic, with particular focus on the traffic impact roadworks planned for Golden Ball/Westlegate area. It was agreed that a joint meeting with the Chamber, the Norwich BID and the County Council would be useful to clarify the improvement plans.

The impact of the NDR; the inner ring road; and specific projects such as the works on Golden Ball/Westlegate were reviewed. It was noted that the inner ring road was nearly at capacity and at peaks times was at or over capacity. The County Council advised that once the improvements to Golden Ball/Westlegate had been completed, they planned to do more detailed modelling of the inner ring road, looking in particular at the junctions.

Chairing the meeting, Chamber President, Jonathan Cage said:

“The joint meeting has helped to provide clarity on the County Council’s plans for the city centre. The Chamber and the BID agreed that closer engagement with the business community at an earlier stage would not only provide a better understanding when construction/roads works were underway, but would help provide business support to the proposed plans.”

The meeting closed with an agreement for all parties to meet again in late January/early February 2016. In the meantime, the Chamber has released a quick transport survey to allow the business community to communicate their views on how Transport for Norwich affects their business. The survey is open until 21 December 2015.