Autumn Statement 2014

Autumn Statement 2014

Queen's Speech 2014

Queen's Speech 2014

Budget 2014

Budget 2014

Autumn Statement 2013

Autumn Statement 2013

Queen's Speech 2013

  Queen's Speech 2013 - Briefing by PSA Communications by Martin Forsythe

PR Week - PSA Communications forms Save Our Royal Mail coalition

PR Week reports: PSA Communications has built a coalition around its client the Communications Workers Union for a Save Our Royal Mail campaign. As the primary union for approximately 130,000 Royal Mail workers, the CWU is opposing moves to transfer the service away from full state ownership.

Two months ago Royal Mail called in City PR agencies Brunswick and Tulchan Communications, to lead it through a privatisation process (PRWeek, 8 February).

 The launch partners for Save Our Royal Mail include the Countryside Alliance, the National Pensioners Convention...

You read the complete PR Week article here.

You can find out more about the Save Our Royal Mail campaign here.

Budget 2013

Budget 2013 by Marty Forsythe

Autumn Statement

Autumn Statement 2012

Cameron's first major reshuffle

Reshuffle 2012

Queen's Speech 2012

Queen's Speech 2012 - Briefing by PSA Communications

Budget 2012

The politics and economics of today’s Budget

A defining budget?

Today’s Budget was delivered at the mid-term point of the Coalition’s term of office, so conventional wisdom would suggest that the Chancellor would deliver a low key budget which gives an indication of the direction of travel the Government will take in the latter part of this five year term. Low key and un-dramatic was not what we got today. The Chancellor claimed he “had not settled for a do nothing budget.”

Despite the reduction of the structural deficit remaining the guiding principle of the Government’s economic strategy, the Chancellor demonstrated his political creativity by balancing a range of bold measures to assuage both parties in the Coalition. This is no easy task and it seems the Chancellor, who is never short of political acumen, has achieved just that. The Budget remains fiscally neutral and the moves on tax will have to be funded by further cuts in other areas.


The big gamble

Despite the political balance achieved in this Budget, the reduction of the top rate of tax is a political gamble. The public do not appear to be on the Chancellor’s side on the issue with polling suggesting the majority of the country is against such a move. The Chancellor will be hoping that the balanced nature of the budget “to support working families” will shine through public pessimism. The Chancellor also sneaked in a £5bn cut for pensioners which has already been labelled “Granny Tax” and suggested another £10bn of welfare cuts would be forthcoming.

The Liberal Democrats are claiming several victories in today’s budget labelling it the ‘Robin Hood’ Budget. They have achieved at number of measures to assuage the claim that this is a budget for the rich including a 7% stamp duty rate being introduced on residential properties worth more than £2m. It’s not labelled a mansion tax but it’s not far off. Increasing the personal income tax allowance will also lend the Liberal Democrats much needed credibility in the eyes of the public if they can convincingly claim ownership.

Growth improving……but more needs to be done

Growth in the UK economy remains sluggish but there was a glimmer of hope in the Office of Budget Responsibility’s growth forecast for this year improving to 0.8%.

The Government's forecast for public borrowing in 2012-13 was £120bn, and despite the Government borrowing almost twice as much as expected in February, today the Chancellor informed Parliament that the actual number will fall below £100bn next year for the first time since 2008-09. This is because of a one-off windfall of about £28bn from a transfer of assets from the Royal Mail pension fund.

The end game

Ed Miliband leading Labour’s Budget response today was caustic. He called it a “budget for millionaires” and landed several hits on the government. No one was safe from the on-form opposition leader who unleashed the term “calamity Clegg” on a willing blogosphere. Miliband also reminded the public that all of the Conservative front bench would benefit from the reduction in the top rate of tax.

Yet such short term performances cannot mask the fact that Labour still lacks economic credibility in the eyes of the public. Miliband’s shadow Chancellor Ed Balls remains a divisive figure, unable to disassociate himself from the previous government. The reduction in the top rate is a natural gift for Labour but the opposition will need to go some way before it can lay claim to be electable.

Mid-term Budgets of this kind rarely determine election outcomes and this one will not. George Osborne has laid down a marker about how he wants to manage the economy – rewarding the high achievers while slowly reducing the burden on others as economic circumstances allow. If the economy does pick up the public appetite for tax cuts will pick up with it, leaving Labour struggling to keep up with public expectation.

The Budget headlines

Economic forecasts

• The Office for Budget Responsibility (OBR) expect the British economy to avoid a technical recession with positive growth in the first quarter of this year. They say that the British economy has “carried a little more momentum into the new year than previously anticipated”. 
• The OBR revised up their growth forecast this year to 0.8%. OBR growth forecasts for UK: next year 2%; 2014 2.7%; 3% in 2015 and 2016 
• The OBR’s forecast unemployment rate is the same as it was last autumn. They expect it to peak this year at 8.7 per cent before falling each year to 6.3 per cent by the end of the forecast period. 
• Borrowing this year is set to come in at £126 billion; £1 billion lower than forecast in the Autumn Statement. 
• The deficit is predicted to fall to 7.6% next year. Debt forecast will now peak at 76.3% of GDP in 2014/15 rather than 78% in previous forecast. 
• OBR Eurozone growth forecast for this year revised down from 0.5% to -0.3%. 
• UK inflation forecast to fall from 2.8% this year to 1.9% next year. 

Business and general taxes

• The Government will consult on the removal of VAT loopholes and anomalies. The broad exemptions on food, children’s clothes, printed books and newspapers will remain. 
• The Chancellor has announced a further cut of corporation tax of 1%, to start immediately. The cut will continue with the two further cuts planned next year and the year after so that by 2014, corporation tax will be 22%. 
• The Government will introduce legislation relaxing the Sunday trading laws during the eight week Olympic period. 
• A tax relief for the video games, animation and high-end television production sectors has been announced. 
• The bank levy will be increased to 0.105% from next January so the banks do not benefit from corporation tax cuts. The levy will raise £2.5bn a year. 
• Enhanced capital allowances for businesses setting up in new Scottish enterprise zones in Dundee, Irvine and Nigg. A Welsh enterprise zone will be created in Deeside. 
• There will be a consultation on simplifying the tax system for small firms with a turnover of up to £77,000. 
• Government support for £150m of tax increment financing to help councils promote development and an extra £270m for the Growing Places fund. 

Housing and planning

• The Chancellor announced the expansion of the Get Britain Building Fund that provides upfront finance to construction firms to build new homes. 
• The Stamp Duty Land Tax charge on residential properties held in corporate envelopes over £2m will be increased to 15% and will take place today. 

Income taxes, NI and personal allowances

• The personal allowance of income tax will increase from next April to £9,205. 
• From April next year, the top rate of tax will be reduced to 45p. 
• There will be a new single tier pension for future pensioners, set above the means test - currently around £140. There will be an automatic review of state pension age to ensure it keeps pace with the ageing population. 
• From 2014, taxpayers will at the same time receive a new Personal Tax Statement. 
• Child benefit will be withdrawn in stages when someone in the household has an income of more than £50,000. 

Fuel and transport duties

• Vehicle Excise Duty (VED) will rise by inflation only. To encourage fuel efficient fleets, the Government will extend the 100 per cent first year capital allowance for low emission business cars. 
• The Government will reduce the CO2 threshold for the main capital allowance rates and increase the percentage list price of company cars subject to tax. 
• The Chancellor also announced that he was again freezing VED for road hauliers. 
• The Chancellor confirmed the fair fuel stabiliser. There will be no changes to fuel duty plans. 

Economic “bads”

• There are no further changes to the rates of alcohol duty put in place by the previous government. The Government will shortly be publishing its Alcohol Strategy to address the growing problem of alcohol abuse, and the many billions of pounds it costs our NHS and criminal justice system. 
• Duty on all tobacco products will rise by 5 per cent above inflation. That’s 37 pence on a packet of cigarettes. This will take effect at 6pm tonight. 

Other points of note

• The Government will seek "major savings" in the administrative cost of the Carbon Reduction Commitment, and bring forward an alternative environment tax this autumn if such savings cannot be found. 
• Ministers will consult on expanding airport capacity in the South East of England. 
• There is new funding for a total of 250,000 more apprenticeships over the next four years. 
• Mayor of London Boris Johnson receives a £70 million development fund to attract new business and new jobs. 
• The National Planning Policy Framework will be published next Tuesday. 
• The Government announced funding for ten major cities to become super-connected through superfast broadband. A further £50 million of funding was announced for other cities. 
• The Government will consult on offering gilts with maturity terms of more than 50 years. 
• Anti-avoidance measures in this year’s Finance Bill are expected to increase tax revenue over the next five years by around £1 billion. 

A cautionary note

Mind the gap

Budget Statements are famous for “gaps” – the hidden detail and stealth consultation that eventually emerge from the mass of paperwork released on the day. Over the next week, think tanks, MPs, academics, tax and economic experts will pick the Budget apart word by word and graph by graph.

Keep on track with PSA

As and when greater detail emerges on key issues, we will let you know. However, if there is something in particular that you would like us to look out for, or to follow in detail, please let us know.

February Structural Reform Plan progress reports

Download the updated reports for each department (all links will open in a new window):

• Cabinet Office SRP progress report  (pdf, 92kb)
• Department for Business, Innovation and Skills SRP progress report  (pdf, 121kb)
• Department for Communities and Local Government SRP progress report  (pdf, 106kb)
• Department for Culture, Media and Sport SRP progress report  (pdf, 99kb)
• Department for Education SRP progress report  (pdf, 94kb)
• Department for Energy and Climate Change SRP progress report  (pdf, kb)
• Department for Environment, Food and Rural Affairs SRP progress report  (pdf, 122kb)
• Department of Health SRP progress report 2011  (pdf, 86kb)
• Department for International Development SRP progress report  (pdf, 112kb)
• Department for Transport SRP progress report  (pdf, 90kb)
• Department for Work and Pensions SRP progress report (pdf, 110kb)
• Foreign and Commonwealth Office SRP progress report  (pdf, 141kb)
• HM Revenue and Customs SRP progress report  (pdf, 84kb)
• HM Treasury SRP progress report  (pdf, 226kb)
• Home Office SRP progress report  (pdf, 157kb)
• Ministry of Defence SRP progress report  (pdf, 103kb)
• Ministry of Justice SRP progress report  (pdf, 97kb)

Not too fast, Mr Huhne.

For many observers, Chris Huhne’s Cabinet exit has been bizarrely slow.

The most predicted Cabinet resignation since Clare Short flounced out in 2003 finally occurred today.  The LibDem MP for Eastleigh succumbed to months of pressure over an alleged offence for which he has now been charged.  The ex-DECC Secretary of State faces a Watergate-like charge relating to an alleged cover-up of a possible motoring offence.

At the point of charge, his exit was politically inevitable.  Yet Mr Huhne has been skating on the thin ice of a Cabinet departure for months.  Almost since the Coalition Government took office, Mr Huhne’s fingerprints have been detected on Cabinet leaks, anti-Conservative briefings and other political mischief-making.

From his over-the-top "Goebbels" jibes about the AV referendum to the immigration "cat flap", the former Minister seemed to take little notice of the doctrine of Cabinet collective responsibility.  His reputation for negative briefing even saw journalists making automatic assumptions – wrongly as it turned out – that he was behind the leaking of a letter proposing a new Royal Yacht.

If the Cabinet were populated by a single political party, Mr Huhne may have been spending more time with his family – or families – much earlier than today.  Now, regardless of the outcome of the judicial process, it seems likely that the ambitious MP’s life in the political fast lane has come to an abrupt, and terminal, conclusion.

December Structural Reform progress reports published

Download the updated reports for each department:

• Cabinet Office SRP progress report (pdf, 92kb)
• Department for Business, Innovation and Skills SRP progress report (pdf, 121kb)
• Department for Communities and Local Government SRP progress report (pdf, 106kb)
• Department for Culture, Media and Sport SRP progress report (pdf, 99kb)
• Department for Education SRP progress report (pdf, 94kb)
• Department for Energy and Climate Change SRP progress report (pdf, kb)
• Department for Environment, Food and Rural Affairs SRP progress report (pdf, 122kb)
• Department of Health SRP progress report 2011 (pdf, 86kb)
• Department for International Development SRP progress report (pdf, 112kb)
• Department for Transport SRP progress report (pdf, 90kb)
• Department for Work and Pensions SRP progress report (pdf, 110kb)
• Foreign and Commonwealth Office SRP progress report (pdf, 141kb)
• HM Revenue and Customs SRP progress report (pdf, 84kb)
• HM Treasury SRP progress report  (pdf, 226kb)
• Home Office SRP progress report (pdf, 157kb)
• Ministry of Defence SRP progress report (pdf, 103kb)
• Ministry of Justice SRP progress report  (pdf, 97kb)

Cameron’s premiership defined

Last night the Prime Minister decided enough was enough and vetoed a change to the Lisbon treaty. Britain will now stay outside of any new treaty agreement reached. (Initially alongside Hungary, Sweden and Czech Republic. A briefly held together European gang of four which quickly became one). The 26 other EU states will now to seek their own fiscal agreement involving deep integration around public spending and tax. 

While the finer details are yet to emerge there can be no doubt that this is the defining moment of David Cameron’s premiership. His coalition partners and the Labour party will be deeply unhappy. But how will it resonate with the public? And what exactly has the PM vetoed? At the moment it seems the PM has put Britain firmly outside the tent to borrow an analogy from Lyndon Johnson. 

How this decision reverberates will be crucial to the health of the Coalition. Our Polyglot DPM will be facing some difficult questions from the integrationists in his party over the coming days, weeks and years. He has already said he regrets the lack of a consensus deal and added, “as a lifelong pro-European, I will continue to argue within Government." 

The Labour Party’s initial reaction is to suggest that Cameron has put party before country and that this development is a sign of weakness not strength. They suggest that if the PM had decided to accept new Treaty changes the chances of getting it through Parliament would be almost impossible given the size of the recent Europe rebellion he faced. Ed Miliband claims he would have negotiated a better deal for Britain. At the moment it’s hard to see how without signing up to a new treaty. 

This remains a fluid situation and it is not easy to tell if the PM did the right thing but he has certainly taken a gamble. It will be difficult for the PM to claim "Game, set and match to Britain" for some time. What is clear is that the right wing of the Conservative party will be emboldened and the case for further withdrawal will be pressed hard. It would appear the biggest winners of this treaty rejection are the Euro-sceptics.

Autumn Statement 2011

The politics and economics of today’s Autumn Statement

A defining moment

Chancellor George Osborne’s Autumn Statement delivered today will prove to be a defining moment for the Coalition Government. Set against the backdrop of the continuing Eurozone crisis, the OECD warning that the UK is likely to slip back into recession, the Office of Budget Responsibility lowering its growth forecasts, borrowing set to rise and looming public sector strikes.

The Chancellor said the Government would “do whatever it takes” to protect Britain from the “debt storm”. As expected Mr Osborne identified growth as the number one priority for Government and announced a swathe of measures aimed at creating the right conditions to allow businesses to grow and said the Government would provide “leadership for tough times”.

The Chancellor decided to target tax credits and public sector pay today rather than the welfare system to fund new initiatives such as infrastructure spending. This is a political quandary for the government, whilst they can claim this a fairer method of saving money it is likely to give further credence to Labour’s “squeezed middle” mantra.

The war of words between the public sector trade unions and the Government looks set to continue for the foreseeable future and makes reaching an agreement on pensions even more difficult.

Cutting the deficit

Mr Osborne told the Commons that the Government is still on track to cut the deficit within the lifetime of this Parliament. Despite being helped by a reduction in debt repayment charges of £22bn to do this he will extend the public spending cuts beyond 2014-15, when they are scheduled to end.

The Office of Budget Responsibility says Growth this year will be 0.9%, next year it will fall to 0.7%. For 2013, 2014, 2015 the economy will grow by: 2.1%, 2.7%, 3% respectively.

National Infrastructure Plan

The Chancellor announced the publication of an infrastructure plan with £5bn worth of additional spending. Key announcements below:

· 500 new infrastructure projects will be funded over the next decade.

· 35 new road and rail schemes will be given the go-ahead today.

· a new urban broadband fund that will create up to ten ‘super-connected cities’ across the UK, with   superfast broadband, including Edinburgh, Belfast, Cardiff and London.

To drive forward the Government’s infrastructure programme, the Prime Minister has asked the Chief Secretary to the Treasury to chair a new Cabinet Committee on infrastructure. The Government will update on further progress delivering the priority programmes and projects before the end of 2012.

Key policies

Innovation

The Government will publish its Innovation and Research Strategy shortly to set out how it will support innovation in the UK.

The Government will invest an additional £75 million in supporting technology-based SMEs to develop, demonstrate and commercialise new products and services.

The Government will introduce an ‘above the line’ tax credit in 2013 to encourage research and development (R&D) activity by larger companies.

The Government will consult on the detail at Budget 2012 and will ensure that SME R&D incentives are not reduced as a result of this change. This builds on measures from the 2011 Budget to increase the generosity and accessibility of R&D tax credits for SMEs.

Following a consultation over the summer 2011, the Government will publish on 6 December 2011 further details of the Patent Box and of its reform of the Controlled Foreign Company rules and R&D tax credits.

The Government will launch a new Seed Enterprise Investment Scheme (SEIS) from April 2012, offering 50 per cent income tax relief on investments, and will offer a capital gains tax exemption on gains realised in 2012–13 and then invested through SEIS in the same year.

Education

The Government will invest £600 million to fund an estimated 100 additional Free Schools by the end of this Parliament. This will include new specialist maths Free Schools for 16-18 year olds.

The Government will invest an additional £600 million from 2012-13 to support those local authorities with the greatest demographic pressures.

Regional

The Government will increase the Regional Growth Fund for England by £1 billion, plus Barnett consequentials for the devolve administrations, and extend it into 2014-15 to provide ongoing support to grow the private sector in areas currently dependent on the public sector.

The Government announced 100 per cent capital allowances will be made available in the Black Country, Humber, Liverpool, North Eastern, Sheffield and Tees Valley Enterprise Zones.

Digital infrastructure

The Government announced a £20 million Rural Community Broadband Fund to help ensure more rural homes and businesses receive superfast broadband. If it is successful the Government will consider extending it.

The Statement headlines

• These are the key points from today’s Autumn Statement: 
• Working age benefits will be uprated in line with the Consumer Price Index's September level of 5.2%. 
• The permanent bank levy will rise by 0.088%, which will ensure the Treasury raises the £2.5bn it needs. 
• Public sector pay will rise by 1%, rather than 2%. 
• A National Loan Guarantee Scheme worth £20bn for small and medium-sized business will be introduced over the next two years. 
• Employment regulations will change to help businesses, including a change to TUPE regulations and cutting health and safety rules. 
• Pension age to rise to 67 by 2028. 
• The planned January fuel duty hike has been cancelled. The fuel duty rise for August will be limited to 3p. 
• Free nursery places will be extended and an extra £1.2bn will be spent on new school places and 100 new free schools. 
• Unemployed young people will be offered a Youth Contract. 
• Business rate holiday for small firms will be extended until 2013. 

October Structural Reform Plan progress reports published

Download the updated reports for each department:

• Cabinet Office SRP progress report (pdf, 92kb)
• Department for Business, Innovation and Skills SRP progress report (pdf, 121kb)
• Department for Communities and Local Government SRP progress report (pdf, 106kb)
• Department for Culture, Media and Sport SRP progress report (pdf, 99kb)
• Department for Education SRP progress report (pdf, 94kb)
• Department of Energy and Climate Change SRP progress report (pdf, 127kb)
• Department for Environment, Food and Rural Affairs SRP progress report (pdf, 122kb)
• Department of Health SRP progress report  (pdf, 86kb)
• Department for International Development SRP progress report (pdf, 112kb)
• Department for Transport SRP progress report (pdf, 90kb)
• Department for Work and Pensions SRP progress report (pdf, 110kb)
• Foreign and Commonwealth Office SRP progress report (pdf, 141kb)
• HM Revenue and Customs SRP progress report (pdf, 84kb)
• HM Treasury SRP progress report  (pdf, 226kb)
• Home Office SRP progress report (pdf, 157kb)
• Ministry of Defence SRP progress report (pdf, 103kb)
• Ministry of Justice SRP progress report  (pdf, 97kb)

Olympic security – time to up the communications game

With the Olympics only months away, those faced with ensuring the games pass without incident are now faced with the enormity of a task which seemed so far off when London was awarded the games six years ago.

The Olympic Park

Inevitably costs have ballooned as the games have loomed closer. Two years ago the public purse was expecting to cough up around £280m to cover security costs; last year that had risen to £475m which is the current estimate of costs of police security outside of the venues (against a £600m ”cost envelope”).  A further £282m has been allocated to pay for security arrangements inside the venues. Earlier this year, the company with the contract to handle internal security said it would need to double the number of civilian security staff needed to screen visitors and train volunteers from ten to twenty thousand!

So by the time the games have finished it is likely that the total security costs for the 2012 Olympics will be around a cool £1bn. If these figures appear eye watering then it is worth remembering that no one will argue for security of this kind to be trimmed. Even the most ardent opponent of overbearing “elf and safety” rules will simply shrug and look for easier targets to criticise. And it’s not just us. Athens was awarded their games prior to 9/11. That fateful day in New York led to security costs for the 2004 games increasing from an estimated $122m to an actual outlay of $1.8bn – more than ten times the initial assumption.

Olympic security doesn’t just evolve around Stratford. It is estimated some 350,000 foreign visitors will attend the games each day. This will place unprecedented pressure on the UK Borders Agency, airlines and airport operators and the public transport infrastructure.

The communications challenge

So in an era of fiscal restraint and accountability how should the private security industry, airport operators’ and others communicate what they are doing with this public money? Certainly it is worth those security businesses explaining how they are ensuring the games can pass off peacefully and how value for money is being achieved.

Evidently politicians, media and the public are different audiences. With politicians it is possible to establish a clear narrative and a hierarchy of messaging on the most important facts. Ministers and others will want to be assured that the risk of an attack on the games – and other “lesser” acts of criminality such as illegal immigration – are minimal. Equally the politicians will want to know that taxpayer’s money is being spent efficiently (even if not parsimoniously).  Communicating direct with Members of Parliament and other political stakeholders on this should now be a priority.

Reassuring the public that everything is going to be ok is a different matter. The security industry is reliant upon the media to act as an intermediary to communicate key messages. Planning and timing is extremely important. It would be counterproductive to discuss security issues too far ahead of the games as this might suggest there is a reason to be concerned. Instead it is important to start to introduce the media to the issues so that at the right time those key messages on security are relayed loud and clear.

Finally there is the power of advertising.  Hundreds of millions of pounds will be spent on Olympics related advertising. Brands will use the Olympics formally as an official sponsor or in other creative ways to identify their product or service with the games. The security sector should consider itself very much part of that commercial process and use advertising to show how efficient it is at what it does.