Category Archives: News

UK Visitor Visa | Streamlining

The UK visitor visa system will be streamlined to attract more business and leisure visitors. The new rules, which will reduce the number of visitor visa categories from 15 to four, will come into effect in April 2015.

The proposed new visa types are:
– visitor (standard)
– visitor (to hold marriage or civil partnership)
– visitor undertaking permitted paid engagements and
– visitor transiting the UK

The new visas will be more flexible, allowing visitors to carry out a greater range of activities under one visa instead of having to apply for separate ones e.g. to take a holiday along with a business meeting. To make it easier for visitors to understand immigration the rules and guidance will be shortened and written in plain English.

The Home Office said it had drawn up the reforms after consulting with more than 100 organisations, including business groups, tourism bodies and representatives from the worlds of science and technology. Outlining the changes at a Confederation of British Industry meeting, Home Secretary Theresa May said “These further reforms to the immigration system are part of our work to demonstrate to the rest of the world that Britain remains open for business and that visitors are always welcome in the UK, whether they come for leisure or work.”

The business community lobbied the government for a number of years to simplify the visa application process, especially for emerging markets like China, India and Latin America, which benefit Britain through mutual trade and inward investment.

Welcoming the news, Mark Boleat, Policy Chairman, City of London Corporation, said “The new measures demonstrate that the government is listening to the concerns voiced by firms across a range of different industries, and match the aspiration of “open for business” with action. London cannot afford to fall behind other global financial hubs such as Singapore and New York, which have continued to show foresight by simplifying their visa processes. That is why our visa regime needs to react quickly to the realities of a fast changing global economic landscape.”

Continue reading

Autumn Statement 2014

The government’s intention to carry out a review of overarching contracts of employment, as announced in the Autumn Statement 2014, is of most relevance to umbrella companies and contractors. A discussion paper will be published in time to inform possible action in the 2015 Budget. The reason given for the review in the Autumn Statement document is to restrict the claiming of tax relief for home to work travel expenses. In his speech however, the Chancellor emphasised that it was to ensure umbrella companies were not depriving people of basic employment rights like the minimum wage. (AS 2.147).

Anthony Thomas, chairman of the Low Income Tax Reform Group (LITRG) voiced disappointment at the lack of help in the Autumn Statement for taxpayers, especially the self-employed, to pay their taxes according to a flexible timetable. LITRG argues that “bunching tax payments into such a lump sum can cause problems for taxpayers” and that flexibility “might enable more taxpayers to comply with their tax payment obligations, benefiting both them and the Exchequer.”  Read more . . . 

Other Autumn Statement 2014 measures of potential interest are outlined below.

Eligibility for Tax Credits

Eligibility conditions for those claiming tax credits on the basis of self-employment will be tightened. The government says this is to prevent abuse of the system while allowing HMRC to continue to support those who are genuinely self-employed. A new test will be introduced to ensure work undertaken is “genuine and effective” and a requirement that anyone claiming Working Tax Credit as self-employed registers with HMRC and provides their Unique Tax Reference (AS 1.232).

Employee Benefits and Expenses

From April 2015, ‘trivial benefits’ i.e. those worth under £50 will be statutorily exempt. At present, if an employer feels a benefit is trivial, they must request HMRC exemption from disclosing it. The £50 threshold will help to reduce the time and money firms have to spend on administering employee expenses and benefits (AS 2.136)

The government will carry out full public consultation on the framework for new rules for tax relief on travel and subsistence payments, announced in Budget 2014 in response to the Office for Tax Simplification’s (OTS) review of the rules for tax relief on employee benefits and expenses (AS 2.141)

As part of its reform of the rules for employee benefits and expenses, the government will stop tax relief from being claimed on reimbursed business expenses when they are paid in conjunction with a salary sacrifice scheme (AS 1.251).

 Restricting Unfair Tax Advantages on Incorporation

The government will restrict the Corporation Tax relief a company may obtain for the acquisition of the reputation and customer relationships associated with a business (‘goodwill’) when the business is acquired from a “related individual or partnership.” (AS 2.146)

The change came into effect from 3 December. Louis Baker, head of professional practices at national audit, tax and advisory firm Crowe Clark Whitehill, quoted in the Law Society Gazette, said “This will end of the flow of firms converting to limited company status solely for tax mitigation purposes. From now on firms will choose their ownership structure and entity on purely commercial and cultural grounds. Many firms will reflect that the partnership/LLP model remains the right vehicle for their firm, and there will be far fewer converting to limited company status than has been the case in recent years.” See full article here.

On the other hand, ATT’s president Natalie Miller thought the measure did nothing to address the difficulty of valuing goodwill and “one side-effect (of the new measure) may be that more businesses are created as limited companies from the outset or transferred into limited companies at an earlier stage” running “against the principle supported by the OTS that businesses should be structured according to their commercial needs rather than any particular tax treatment.”

 Tax Avoidance and Evasion Measures

The ‘Diverted Profits Tax’ will come into force from April 1st 2015 at a rate of 25% Also known as the ‘Google Tax’, this new tax has been designed to “counter the use of aggressive tax planning techniques used by multinational enterprise to divert profits from the UK”. (AS 2.142)

The government will introduce legislation to give the UK the power to implement the OECD model for country-by-country reporting. The new rules will require multinational enterprises to provide high level information to HMRC on their global allocation of profits and taxes paid, as well as indicators of economic activity in a country.

The government will introduce legislation to strengthen the Disclosure of Tax Avoidance Scheme (DOTAS) regime and increase HMRC resources involved in administering and enforcing the DOTAS regime by creating a new taskforce (AS 2.161-2.162)

The  Chartered Institute of Taxation’s (CIOT) expressed support for change to DOTAS but preferred to see it recast it as a targeted regime dealing specifically with tax avoidance.

CIOT was concerned that the new proposals risked eroding cooperation between HMRC and advisers and that, as a result the DOTAS regime would not operate effectively. CIOT  was particularly concerned with the changes being proposed to the ‘hallmarks’ and ‘grandfathering’ provisions, which would mean that schemes previously excluded from DOTAS would now be included. “We think that it is essential that the system should contain sufficient protection for the vast majority of advisers who comply with the rules, and that it should not be cast too widely so as to catch straightforward tax planning arrangements.”

The government will consult on action to take against ‘serial’ avoiders (AS 2.158) and on whether and how to introduce penalties where the GAAR applies (AS 2.159).

Civil penalties for offshore tax evasion will be enhanced (AS 2.155).

The government will consult on a proposal to give HMRC a new power so it can achieve early resolution and closure of one or more aspects of a tax enquiry, while “leaving the other aspects open” (AS 2.169)

Business Funding

The government will extend Funding for Lending to January 2016. The FLS will be further focussed on SMEs and will complement various other initiatives in train to support credit to SMEs, including British Business Bank programmes to make finance markets work better for SMEs and proposals in the Small Business, Enterprise and Employment Bill to improve access to SME credit information. Funding for the Enterprise Finance Guarantee and an expansion of Enterprise Capital Funds will unlock up to £1 billion of finance for smaller businesses (AS 1.38).

Malcolm Small, IoD senior financial services policy adviser, welcomed this news but could see a reduction in business lending as a result new taxes imposed on banks.

 Exports

Acknowledging the UK’s disappointing performance on exports, the Autumn Statement provides a £20 million package of support for first time exporters. Alongside this, UK Export Finance will modernise and digitalise its processes to make them more accessible to SMEs (AS 1.179).

In addition, the FCO will deliver a £25 million ‘surge for growth’ programme to support projects and trade agreements across the world, including £22 million for emerging and developing economies on projects with the potential to increase UK exports.  (AS 1.179 – 1.180)

IoD’s head of Europe & trade policy, Allie Rennison, welcomed additional resources for the digitalisation of export support, describing it as “crucial”. “Nearly half of IoD members have used social media and online networking to identify business opportunities abroad, indicating that digital resources are important tools for would-be exporters”. But, she adds “there is no substitute for tax relief when it comes to offsetting costs to get businesses exporting, and the IoD hopes this will be an important consideration for this and the next government.” For full article click here.

R&D

The government will increase the rate of the of the ‘above the line’ R&D tax credit rates from 10% to 11% and will increase the rate of the SME scheme from 225% to 230%, from 1 April 2015 (AS 2.97)

The government will restrict qualifying expenditure for R&D tax credits so that the costs of materials incorporated in products that are sold are not eligible, with effect from 1 April 2015. (AS 2.98)

The government will introduce an advanced assurance scheme for small businesses making their first claim and develop new guidance for R&D tax credits. The government will launch a consultation on the issues faced by smaller businesses when claiming R&D tax credits in January 2015. (AS 2.99).

David O’Keeffe, chairman of the CIOT working group on R&D tax relief, welcomed the news of increased tax relief rates and the advanced assurance scheme “the introduction of this new service, alongside new guidance and the promise of a consultation on the issues faced by smaller businesses, should make it a lot easier for companies to claim R&D tax relief”. The plan to restrict relief for the costs of materials incorporated in products that are sold was not so welcome however. “It will be interesting to see just what the Government has in mind here and why.”

 Science and Innovation

£5.9 billion has been allocated over the next Parliament (AS 2.220); £3 billion for individual research projects, world-class laboratories and international subscriptions and £2.9 billion for scientific Grand Challenges including:

  • £113m to build a new Cognitive Computing Research Centre in Hartree aimed at giving non-computer specialists insights from big data in order to enhance and design products, services and manufacturing processes.
  • £235 million investment in the Sir Henry Royce Institute for advanced materials which will be based at Manchester University
  • A £20 million Centre for Ageing Science and Innovation in Newcastle, utilising academic research to tackle many of the challenges faced by an ageing population and, in doing so, ensuring optimum health and quality of life whilst reducing health and social care costs
  • £95m investment in European Space Agency programmes to take the operational lead on the first European Rover mission to Mars which will search for life, past and present.

The Institute of Directors (IoD) head of technology policy, Jimmy McLoughlin, said “Britain has long been a leader in the space sector, and funding the first European rover mission will pay for itself far into the future when the information and technology acquired makes regular missions to Mars possible.“

 

 

 

 

Continue reading

New Border Force Cutter the HMC Protector Launched

The latest addition to the Border Force’s fleet, HMC Protector, was officially launched this Monday (17th March) by Home secretary Theresa May at a ceremony at HMS President in London. She said:

‘We are an island and seafaring nation and HM cutters have a proud history of protecting our shores.

‘Today’s vessels include sophisticated surveillance and navigation equipment to locate potential threats at sea.

‘But it is the professionalism and commitment of the crew, who patrol all year round and in all weathers, that is our strongest weapon against organised traffickers.’

HMC Protector is to join four sister cutters, Seeker, Searcher, Vigilant and Valiant, operated by Border Force in their priority function of the protecting and securing UK waters and coastal borders. They operate 24 hours a day throughout the year patrolling high risk areas and responding to risk and intelligence led information, manned by crews highly trained in maritime enforcement.

Last year officers boarded 2000 vessels arriving in UK waters with the primary aim of intercepting and deterring shipments of drugs and other prohibited goods, and people trafficking into the UK. Some of the largest seizures over recent years include:

  • 2013 – 120kg of cocaine worth £20 million was found on a yacht off the Isles of Scilly
  • 2011- 1.2 tonnes of cannabis worth £10 million was discovered on a yacht off the Isle of Wight

The Immigration control remit for Border Force and its fleet of cutters falls under the Home Office Policy of “Securing borders and reducing immigration”.

Another change announced is that in Australia, South Africa, Bangladesh, India, Hong Kong, Italy and Finland there are changes to the UK visa application centres and you can check for details here.

If you need a visa to work in IT, Engineering, or Finance then Commonwealth Contractors may well be able to help.

To find out more about our solutions call now on 0800 294 4388 or Send us some details now and we will get right back to you!

contact_us_tiny

Continue reading

Ghost Ships on the Starboard Side!

Mary Celeste style ships may become more common place if European researchers and the Rolls Royce engineering group have their way. Much of the tonnage currently afloat on the high seas could be replaced with crewless drone ships.

The main driver of this development is cost. According to Oskar Levander, head of marine innovation at Rolls Royce, crew expenses can range from between 10-30% of operating costs. With no need to facilitate humans for weeks on end the provision of  food, accommodation, galley, sewage treatment system, etc. would no longer be a requirement.

Shore based teams of qualified captains could operate dozens of ships at the same time. According to MUNIN (Maritime Unmanned Navigation through Intelligence in Networks), an EU sponsored research project, 75% of maritime accidents can be attributed to human error and “a significant proportion of these are attributed to fatigue and attention deficit”. The technology is already here and tested in day to day use. Global communication satellites have the power to provide enough bandwidth to navigate the vessels remotely using feed from onboard radar and cameras. Currently GPS technology is used to automatically navigate ships. Onboard cameras are used to enhance human vision in poor visibility and to spot objects far beyond the range of the human eye.

Mr Levander also claims the threat of piracy could be diminished. The crew with their ransom value are often the most valuable commodity on a ship. Once they are removed from the equation the value of any piracy is diminished. Could pirates hack into the ships computer system and take control? Extra security measures such as flooding the ships with incapacitating gas to fell would be pirates would be possible with no crew.

A ccording to a report in the FT more circumspect voices are heard from the International Chamber of Shipping’s secretary general, Peter Hinchliffe. He concedes that it is becoming harder to find young people to go to sea today, so making the idea of crewless ships interesting. Months away from friends and family year after year does not appeal to a lot of people, coupled with the fact that they can visit faraway places for a reasonable air fare, means the romance of going to sea has possibly lost its lustre.

But he thinks the complexities of a ship mean that you cannot remove the crew. Highly complex collision avoidance rules would have to be rewritten to account for manned and crewless ships operating in the same area, with an implementation period of decades. The amount of bandwidth needed for radar and video feeds alone would be immense so the costs could make it prohibitive. Mr Hinchliffe also argues that extra redundancy and backup systems would be needed in case something fails at sea, raising questions about the promised weight savings.

There are a host of other issues to consider. With no seafarer on board who will lower the life boat and come to the rescue of fellow seamen in distress? Would the unscrupulous boss on land lean on the captain in a nearby office, to steam on by? Will every ship on the seas no matter how small require radar identification systems? This could have hefty cost implications. Also with the possibility of something breaking down on a ship it is hard to visualise a ship without at least one engineer on board.

Ahoy to the future.

While we await…

if you need a visa to work in IT, Engineering, or Finance then Commonwealth Contractors may well be able to help.

To find out more about our solutions call now on 0800 294 4388 or Send us some details now and we will get right back to you!

contact_us_tiny

Continue reading

Statoil Is Not On An Artic Roll

Extracting oil is never an easy job and neither is balancing the needs of national governments, shareholders and environmentalists. Statoil, the Norwegian oil company, with a majority holding of 67% by the Norwegian government is presently navigating these choppy waters.

The Arctic seemed to offer unlimited riches but the small issue of finding the oil and extracting it is proving more troublesome than first thought. Royal Dutch Shell and Cairn Energy have spent billions of dollars with little or no progress. The permanent ice conditions and extremes of environment make extraction much more difficult and expensive than other areas. Contrast this to the Norwegian Barents Sea, where there is no ice. Statoil, Lundin Petroleum (Sweden) and OMV ( Austria) have all found oil there. Helge Lund, Statoil’s CEO, said “No doubt there is a huge resource potential in the Arctic, but the contrast needs to be made between the workable Arctic and the so called stretch Arctic”. Independents think the “stretch Arctic” would include Alaska though Mr Lund would not confirm this.

At the same time the Norwegian government is trying to stem a decades long drop in oil production by increasing exploration in the Barents Sea. It plans to sell 72 licenses this summer for exploration blocks as well as opening up its first new acreage in two decades after resolving a 40 year old border dispute with Russia. Statoil has made some of the biggest discoveries in the past few years. Off the eastern coast of Canada it found 2013’s biggest; the Bay du Nord.

This presents a quandary for Mr Lund who despite Statoil having a target of increasing production says he is not bound by the goal. He is focused on value, not volume. This chimes with the discomfort of shareholders who have seen the oil companies spending heavily to replenish depleting reserves and boost production. With not enough cash being generated to cover capital expenditure and dividend payouts, investors have been pressuring them to show more capital discipline.

In June 2013 Statoil postponed construction of a $15 Billion Arctic oil hub, 1500km from Oslo. Reasons cited for this were costs of the infrastructure, uncertainties on the amount of oil in the Johan Castberg field which was estimated at 400-600million barrels as well as Norwegian government tax increases. Other projects on hold include the Bressay heavy oil development in the UK North Sea costed at $5.5 billion. In December 2013 it announced it was selling its 10% stake in the Shah Deniz 2 natural gas project in Azerbaijan for $1.45 billion. The company has also increased its 2013 dividend payment to $1.13, a 4% increase on 2012. As well as this dividends will now be paid quarterly.

The new direction for Statoil of restricted capital expenditure and more focused spending could see it losing out to its competitors as could the Norwegian Sovereign Wealth Fund.

The sources for this article are from the  FT. One , Two, and Three.

For career opportunities for oil engineers with Statoil please click here.

If you need a visa to work in IT, Engineering, or Finance then Commonwealth Contractors may well be able to help.

To find out more about our solutions call now on 0800 294 4388 or Send us some details now and we will get right back to you!

contact_us_tiny

Continue reading

The Single Market is Not a Swiss Cheese

“The single market is not a Swiss cheese. You cannot have a single market with holes in it.” said Viviane Reding, vice-president of the European Commission,  when speaking to the FT

An historic vote in the Swiss cantons is sending ripples of surprise throughout the EU. Switzerland is not part of the EU but it has bilateral agreements that give it access to the single European market. The Swiss Peoples Party (SVP) led a campaign where a 50.3% majority of voters agreed with the need for immigration quotas on EU citizens. This directly contravenes their agreement on  one of the four EU fundamental freedoms – free movement. The others are capital and services and all four are part of a package and are not separable.

The Swiss government will now have to enforce the wishes of the electorate within the next three years.The voting reflects a growing hostility to immigrants across Europe’s big economies, with calls for tighter immigration curbs and a repatriation of powers from the EU.  Heinz-Christian Strache, the head of the Austria’s far right freedom Party, welcomed the decision, claiming that citizens in every other west European state would vote the same way if they were given the opportunity.

Net immigration levels in Switzerland have risen between 60,000-80,000 per annum for the last seven years and this equates to roughly 1% of the population. The immigrants hail mainly from Italy and Germany.

The SVP blame a host of ills on this immigration; higher rents, increased levels of crime and overcrowded trains. The election result has been celebrated as a display of Swiss power in the face of over-bearing EU pressure.

“This vote says that Switzerland is a deeply divided country” says Patrick Emmenegger,  Professor of Comparative Political Economy and Public Policy at the School of Economics and Political Science at the University of St. Gallen.

Others feel there will be a real economic cost to this vote. Brussels has already warned Switzerland that its access to the EU’s single market for goods and services could be under threat. The EU is the destination for 56% of Swiss exports and 80% of Swiss imports.

The Swiss Bankers Association (SBA) along with other businesses has been quick to urge the government to act in a concillatory fashion to the EU and so minimise any backlash. As well as the EU being the most important market for Swiss banks the SBA has fears over the supply of qualified staff in Switzerland with 25% currently coming from the EU. Financial services groups are some of their biggest exports and major Swiss outposts in London such as credit Suisse and UBS may be undermined.

Also like any uncertainty it leads to indecision with companies not willing to invest until there is a clearer picture. There are already rumblings in Brussels of cancelled deals with the €80 Billion EU Horizon 2020 research and development programme mentioned. Pia Ahrenkilde-Hansen, a European Commission spokesperson, said Sundays vote had “not set the right tone for the beginning of an institutional agreement governing the relations between the EU and Switzerland”. However, she added, “it’s still too early in the day for Brussels to decide how to respond…. the ball is now in Switzerland’s court”.

This gives hope to the integrationists and some business people who think that with a three year period for implementation into law the quotas can be set at such a level that the EU does not feel compelled to cancel its accords.

Could the Swexit influence the Brexit?

The events in Switzerland are already referred to as the Swexit while the UK coming out of the EU is referred to as the Brexit. Banks, asset managers and insurers have lobbied the UK government over the importance of the single market to the City of London. The EU is the biggest single market for UK exports of financial services and generates a trade surplus of £15.2bn. Watching how Switzerland discusses and manages its situation with the EU may inform people in the UK of the correlation between EU membership and the prosperity of the UK.

If you need a visa to work in IT, Engineering, or Finance then Commonwealth Contractors may well be able to help.

To find out more about our solutions call now on 0800 294 4388 or Send us some details now and we will get right back to you!

contact_us_tiny

Continue reading

The Brightest and The Best | The UK Needs You

Business leaders have repeatedly warned of a serious shortage of British graduates qualified to fill key engineering jobs, a position justified by a report authored by Prof. John Perkins and published by the Department of Business Innovation and Skills (BIS) in November 2013.

The dearth of skilled home grown graduates has led to migrants filling one fifth of jobs in key industries. With migrants accounting for 20% of workers in fields such as oil and gas extraction, aerospace manufacturing and computer, electronics and optical engineering. Such is the scale of the skills deficit, half of the 119 occupations on the Government’s shortage occupation list require engineering qualifications. Firms requiring these skills have a special dispensation to employ staff from overseas.

This situation has long term consequences. One third of university places in engineering and technology subjects are currently filled by non-British students. The turn around in the education system that must happen if British school children are to be encouraged to pursue disciplines leading to jobs in engineering cannot happen quickly enough. The report by Prof. John Perkins outlines the crippling skills shortage amongst British workers while almost 1 million 16 to 24 year olds are classified as not in education, employment, or training (NEET). It is clear migrants will continue to be an important source of engineering skills for some time.

This acute skills deficit poses huge problems for British engineering and technology companies. Difficulties filling engineering vacancies  delays and hampers projects and consequently stalls research and development and economic growth. James Dyson, founder of Dyson, the technology group, believes the solution lies in education. He proposes offering financial incentives to encourage the brightest and the best towards areas of vital national interest, with costs quickly recouped as engineering graduates earn higher salaries and will therefore  pay more taxes throughout their working life.

The Government’s flagship immigration policy, an important election issue, is possibly having a negative impact on non-EU students  and may deter thousands of international students from coming to study in UK universities. BIS claims that overseas students contribute over £13 billion to the UK economy each year and is not just focused on the brighest and the best but sees education as a commodity that can be sold to India which has a huge young population and an under-supply of higher education. As we reported here last February, David Cameron, the UK Prime Minister, during his visit to India, emphasised that students from there were welcome in the UK and that there was not a cap on how many could come here as undergraduates.

The Home Office crackdown on “bogus students” is thought to have  affected students from India and Pakistan. Nicola Hart of Pinsent Masons, the law firm behind Out-Law.com, said “”The Home Office is cracking down particularly strongly on visas issued in a number of countries including India, which probably accounts for the reported halving of numbers of Indian students coming to the UK in just two years,” she said.

Non EU international students are classified as ‘migrants’ if they stay in the UK for more than one year and the post-study work visa has been abolished which means that many are included in the calculation of figures for net migration which the government promises to reduce before the next election. This is at odds with industry demands. Both BIS and Dyson believe the long term key to the skills deficit, lies in education of both British and international students with Dyson saying “We need to start handing out visas to the brightest students at the graduation hall.”

If you are qualified and one of the brightest and the best then the UK needs you.

If you need a visa to work in IT, Engineering, or Finance then Commonwealth Contractors may well be able to help.

To find out more about our solutions call now on 0800 294 4388 or Send us some details now and we will get right back to you!

contact_us_tiny

 

 

Continue reading

More Job Opportunities But Don’t Pop The Champagne Corks Yet

According to a report in the FT  UK graduate job opportunities are rising, leading to a return to pre-crisis (2007) levels of university leavers employment opportunities. A survey of the UK’s top 100 companies including Rolls Royce, Sainsbury’s and the BBC says graduate vacancies will see their largest annual growth since 2009. Martin Birchall, Managing Director of High Fliers Research, said that the prospects for graduates leaving university this year are the best they’ve been since the start of the recession. There will also be a rise in the number of paid internships at top companies with 11,000 placements available for first and second year students. Government ministers have claimed that the rising vacancies are a sign of confidence in the growing UK economy.

The terrific increase in vacancies in the City of London figures for November and December provided a buoyant end to 2013. While good news, Mark Cameron, Astbury Marsden’s Chief Operating Officer said “There is no popping of champagne corks yet. What drives a lot of the volume of recruitment in the City is the investment banks and they’ve still got some business challenges to work through before they consider growing.” The growth is mainly coming from smaller and mid-cap financial companies. The strong end to the year does not hide the fact that less jobs were created in 2013 (27,915) than in 2012 (35,115). It merely suggests a slowdown in the contraction.

The UK’s largest recruiters are all experiencing a rise in gross profits. Both Hays and Robert Walters reported strong growth in the fourth quarter of 2013 in permanent contracts. These optimistic green shoots in the recruitment sector need to be tempered with the knowledge that the European economy is still sluggish.

There may well be a technological disrupter on the horizon for the recruitment market that could result in a reduction of profits. Recruitment software company Jobbio has just opened offices in Dublin and London. According to TechCentral

The website is free to join for candidates and companies, who can post as many open vacancies as they like. The service’s revenue model is based on charging companies on a ‘pay per hire’ basis with prices starting at €2.

Candidate features include personalised ‘job streams’ where relevant position are displayed to candidates similar to Facebook news feeds and ‘live bios’ which remove the need for CVs and can be browsed anonymously by recruiters.

UK technology investors MXC Capital are backing Jobbio. Will they succeed? Wait and see.

In the meantime if you need a visa to work in IT, Engineering, or Finance then Commonwealth Contractors may well be able to help.

To find out more about our solutions call now on 0800 294 4388 or Send us some details now and we will get right back to you!

contact_us_tiny

Continue reading

EU Migration

On January 1st this year people from Romania and Bulgaria gained the same working rights as other European citizens in eight European countries, including the UK, Germany, Austria and France. This has fuelled a widespread perception in the UK that the floodgates would be opened to mass immigration, further pressurising the welfare state.

It has provided the backdrop to an the going debate amongst the three main British parties about the costs and benefits of immigration, and has lead to demands for changes to immigration policy, particularly migrant access to public services, including benefits. It is argued that Britain’s welfare system which is largely non-contributory, is more open that those of many EU countries and is acting as a magnet to welfare tourists.

EU citizens are entitled to free movement within the EU but there are some restrictions on the right to live in the UK. There is an initial right to reside for 3 months but after this period they only have a right to reside if they are exercising their treaty rights as a worker, self-employed person, job seeker, student or self-sufficient person, or if they pass the Habitual Residence Test.

With  European elections looming in 2014 and national elections in 2015, David Cameron’s Conservative Party is under increasing pressure on this issue as they risk sharing the pool of likely voters with the anti-immigration party, UKIP. To fulfil its promises to cut net migration  and bolster support amongst voters they are proposing to change British law for new EU immigrants in an attempt to deter those seeking to take advantage of the UK’s welfare system. Measures proposed include EU migrants having to wait 3 months before they can obtain unemployment benefits; not being eligible to housing benefit; and losing the right to unemployment benefit after 6 months unless they have proof of a realistic chance of finding work. It is envisaged that these changes to protect the benefit system will have widespread support whilst not deterring genuine workers.

There is also a call for the reform of freedom of movement at EU level, a long term overhaul which may require treaty change. Theresa May, home secretary, proposed that accession countries are phased in to full free movement rights when they reach a certain level of income or economic outlook, with opportunities for national government to cap migration if there are economic concerns.

These attempts to curb migration have provoked a  backlash from within Europe, and the European Commission is taking the UK government to court over what it sees as discriminatory practices over the right to reside. Freedom of movement is one of the basic rights of EU citizens, and seen by many as essential to the globalised world of open markets and frontiers. Martin Schulz, the European parliament’s president has said that while he takes the UK demands for reform within the EU very seriously, there was no question of parliament agreeing to reopen the rule book on free movement.

Many believe that immigration has, on balance been good for Britain’s economy. A belief borne out by most academic research, with the 2011 study, Unemployment Benefits and Immigration: Evidence from the EU, finding no statistically significant causal effect between social welfare spending and immigration. Robert Chote, head of Office for Budget Responsibility, told MPs at a Treasury select committee last Tuesday(14/01/14) that the country’s fiscal position would be “somewhat worse” if net migration was lower, because immigrants are more likely to be of working age. They also arrive when another country has already picked up the tab for educating them, and will leave before they reach a point at which they’re most expensive in terms of pensions and healthcare.

The Conservative’s target to cut net immigration to below 100,000 per year by 2015 looks increasingly unlikely to be met. One option that could be taken to reach the bar would be to exit from the EU, a move that may be popular with sections of the electorate and the referendum on that is not due to happen till after the election in 2015. Vince Cable, business secretary, believes uncertainty over whether the UK will leave the European Union – dubbed the “Brexit” – is spooking investors and is holding back a full economic recovery.

Meanwhile the Immigration Bill 2013-14 is due to have its report stage and third reading on Thursday the 30 January 2014. The summary of the Bill is:

To make provision about immigration law; to limit, or otherwise make provision about, access to services, facilities and employment by reference to immigration status; to make provision about marriage and civil partnership involving certain foreign nationals; and for connected purposes.

Regardless of the progress of this bill, the UK still needs to attract highly qualified and talented people in order to compete on a global scale.

If you need a visa to work in IT, Engineering, or Finance then Commonwealth Contractors may well be able to help.

To find out more about our solutions call now on 0800 294 4388 or Send us some details now and we will get right back to you!

contact_us_tiny

Continue reading

Challenger Banks

On Friday, Ed Miliband, the Labour Leader, announced his party’s proposal to create greater competition in the high street with two new  “challenger banks”. The market is dominated by the top 5 banks – Lloyds, Royal Bank of Scotland, Barclays, HSBC and Santander. They control roughly 85% of all current accounts.

The opposition leader outlined Labour’s plans to use the Competition and Markets Authority (CMA) to investigate high street banking and recommend regulatory changes to bolster competition in the market.The Competition and Markets Authority, is due to take over the roles of the Competition Commission and Office of Fair Trading from April 2014. The changes Milliband is suggesting would limit market share and enforce branch closures.

Despite a current lack of confidence and transparency in the banking system the UK’s main business lobby, Confederation of British Industry (CBI), view the imposition of arbitrary caps on market share as too simplistic, with politicians dictating market structure. Further comment by the Bank of England Governor, Mark Carney, may have dealt another blow to the Labour proposals when he said “Just breaking up an institution doesn’t necessarily create a more intensive competitive structure.”

Twice in recent years UK banks have narrowly missed a full competition enquiry. The 2011 Vickers Commission and last year’s cross-party Parliamentary Commission on Banking Standards both stopped short of recommending the move. There is evidence of new entrants to high street banking without policy change and CBI’s Chief Policy Director, Katja Hall, argues they are making an impact on the market without the need for artificially carving up existing branches.. This mini-revolution among new banking entrants has largely succeeded due to a shift in the competitive playing field of the internet. A whole new banking interface has opened up using on-line tools to reach the mass market, offering convenience and transparency.

Back on the high street there is still an appetite for traditional face-to-face banking and there are also new movers. The most notable of these would be Metro Bank, which opened its first store in Holborn, London, in 2010. This was the first new high street bank in over 100 years and it has now built up a network of 25 branches in the South East. A report from Reuters on the 19th January says:

(Reuters) – New British lender Metro Bank has raised 387.5 million pounds ($637.2 million) to fund its expansion plans by selling stock to institutional and private investors, it said on Sunday.

and further on in the same report:

Metro promised to shake up the country’s banking industry and now has 25 branches in and around London. It is loss-making and wants to have 200 branches by 2020.

Richard Branson also established Virgin Money when he obtained a banking licence by purchasing a regional bank, Church House Trust in 2010. Two years later he bought 75 branches from Northern Rock creating a high street foothold.

More recently, the Post Office, with an unparalleled network of over 11,500 branches across the UK, has moved to extend its presence in the current account market. Following on from a pilot scheme available at 29 branches in East Anglia, services are being rolled out to another 81 branches in the East Midlands and the East of England. In partnership with the Bank of Ireland they are a serious alternative to the major UK banks with a large established customer base and ease of access in their favour.

Regulators have worked to ease the process for new entrants to banking by cutting away some of the red tape. The start-up capital requirements have been lowered and the timetable for authorisation has been accelerated. One major problem remains: access to an independent money transfer system. New banks can only access the transfer systems through one of the existing high street lenders so are totally beholden on what the established banks are willing to offer.

Further encouraging signs for high street banking competitiveness is the 7 day switching system being initiated by the Payments Council. For the UK’s 49 million current account holders it should herald a new era of banking choice with a guarantee for the customer to “ditch and switch” their current account provider within 7 days. The new bank will be responsible for all existing payments being moved over with the account.

These changes may herald new opportunities for finance and IT professionals.

If you need a visa to work in IT, Engineering, Actuary or Finance then Commonwealth Contractors may well be able to help.

To find out more about our solutions call now on 0800 294 4388 or Send us some details now and we will get right back to you!

contact_us_tiny

Continue reading