Freedom day – business news 6 July 2021.

James Salmon, Operations Director.

The PM confirms Freedom day, saying we must learn to live with covid, business seeks clarity,  OECD warns governments not to unwind SME support too rapidly and lots more of the days business news.

Freedom day – Learn to live with Covid

Boris Johnson confirmed Freedom day for  19th July and said yesterday that we must learn to live with covid-19, even as cases rose 53% in a week and a new Israeli study has shown the efficacy of the Pfizer/BioNTech vaccine has fallen with the spread of the delta variant from 94.3% against previous strains to 64% now.

Mr Johnson said requirements for mask wearing and social distancing would probably end. “We must reconcile ourselves, sadly, to more deaths from covid,” he said.

The PM announced plans to end social distancing and capacity limits at venues in England from July 19 and face masks will be made voluntary in all settings and the government will no longer instruct people to work from home. Business leaders hailed the return to the office. While working from home will no longer be mandated, employers will still be responsible for providing a safe working environment and many expect hybrid work schemes to continue.

The rule of six inside private homes will be removed and further updates on school bubbles, travel and self-isolation will follow in the coming days, Mr Johnson told a Downing Street news conference. The Government has also chosen not to impose the use of domestic COVID “passports” for people to demonstrate their vaccination or testing status when attending pubs, bars and restaurants or other venues.

All remaining businesses will be however allowed to open, including nightclubs, and none will be required to demand any proof of vaccination or testing before entry. The final decision will however still need to be confirmed on July 12 once data has been checked.

Businesses seek clarity on “freedom day”

Business groups have called for clarity on Covid rules after Boris Johnson announced that most would be relaxed later this month.

Shevaun Haviland, director general of the British Chambers of Commerce, said businesses were still lacking the “full picture they desperately need to plan for unlocking”.

There are fears, for example, that the removal of legal requirements on mask wearing and social distancing could create friction between employers, their staff and customers.

Businesses are concerned at what their legal liability might be if they remove safeguards and then see a spike in cases among workers.

“After enforcing restrictions for so long, the Government must not simply withdraw and allow a free-for-all,” said Mike Cherry, national chair of the Federation of Small Businesses, adding that small companies had a “host of questions they need answering in the next 14 days”.

OECD warns governments not to unwind SME support too rapidly

A new OECD report reveals how government rescue packages have played a crucial role in not only helping SMEs survive but in many cases thrive during the pandemic. According to OECD analysis, 55% of SMEs in the UK have been able to access and combine government support, compared to 33.6% in the OECD, with non-repayable forms of support the most popular.

However, the report warns that many support mechanisms for SMEs and entrepreneurs have come in the form of debt which, if unwound too rapidly, could precipitate a wave of bankruptcies that jeopardises the recovery.

The report also says, however, that the crisis has strengthened SME resilience; more than half of SMEs in OECD countries have increased their use of digital tools, which has helped to narrow digital divides with their larger counterparts. The pandemic has also created new opportunities for SMEs and entrepreneurs, through shifting global value chains, stronger local business ecosystems and the green transition, it says.

UK to enjoy green jobs boon
Analysis by EY suggests about 625,000 jobs will be created through solar and wind power – enough to replace nine in ten jobs lost owing to the Covid pandemic.

Services Growth rebounds

UK Services Sector growth continued to rebound from the pandemic, but concerns about inflation are gathering pace, show new figures published today. UK Services PMI reached 62.4 in June, down slightly from 62.9 in May, but still the second-highest reading since October 2013. A reading above 50 indicates an expansion in business activity.

Inflation tracks up causing alarm
Advanced nations are experiencing the fastest rise in inflation since 2008, with OECD members averaging an annual rate of 3.8% over May, up from 3.3% in April.

In the UK, services businesses raised prices at the fastest rate on record, according to a survey by the Chartered Institute for Procurement and Supply (CIPS). Duncan Brock, group director at CIPS, said: “With the sharpest escalation in price inflation for 25 years, it is no wonder businesses are concerned that they are paying substantially more for fuel, food and transport costs than they were a year ago.”

Meanwhile, prices across Europe rose at the fastest pace for 20 years in June as restrictions were lifted, according to IHS Markit, which compiles the survey. Its chief business economist Chris Williamson said the data signalled “a broad-based increase in inflationary pressures”.


Sainsbury has increased its pre-tax profit forecast to £660m for the financial year to March 2022. In its Q1 update Sainsbury said like for like sales rose 1.6%. As buyers circle Morrison , UK Supermarket news is being watched intensely.


The oil producing nations have been unable to break a deadlock on a deal for production levels and have abandoned their meeting. Oil prices jumped to a three-year high and are expected to rise. A public argument between  Saudi Arabia and the United Arab Emirates has made negotiations difficult and oil could quickly hit $80 a barrel.

Tech giants will account for almost half of new global tax revenue
City A.M. picks up on a report from Oxford University’s Centre for Business Taxation which estimates US tech giants such as Google and Facebook could face a $28bn (£20bn) bill when new global corporation tax rules are introduced. The OECD last week agreed on a new tax model to ensure companies pay tax in countries where they earn revenue, building on a plan inked last month by the G7. Major tech firms will account for almost half – or $39bn – of the estimated $87bn that will be brought in under pillar one of the proposals. Pillar one applies to firms with revenue of more than $20bn and a profit margin higher than 10%. Under pillar two of the reforms, a minimum corporation tax of 15% will apply to multinational companies with revenue over €750m (£652m). If the threshold for the pillar one reforms was lowered from $20bn to the same level it would lead to a thirteen-fold increase in the number of companies targeted, the research added

Calls for laws to force firms to clean up supply chains
The Government is being urged to introduce corporate accountability laws in line with other parts of Europe that require human rights and environmental due diligence across firms’ supply chains. Rights groups, including the TUC, Friends of the Earth, and Amnesty International, say systemic human rights abuses and environmentally destructive practices are commonplace in the global operations and supply chains of UK businesses, and that voluntary approaches to tackle the problems have failed. France, Germany and Norway have laws on supply chain due diligence, and the EU is to introduce obligations on firms operating in the single market. Those backing a new British law say that without it companies in the UK operating in the single market will be obliged to meet such obligations, yet those outside the market will not.

EU plot to destroy City a catastrophic failure
The Telegraph’s Matthew Lynn asserts that EU efforts to damage the City since the UK voted to leave five years ago have failed. Only a handful of jobs have left while London has already reclaimed its position as the key centre for equity trading after briefly losing the crown to Amsterdam. Lynn says the strategy adopted by Paris and Frankfurt, along with the Commission officials in Brussels, was all stick and no carrot – they figured they could simply legislate their way to commercial success, but business simply worked around the rule changes.

Lynn concludes: “In truth, the EU has made a mess of this. It has failed to win any significant business from Brexit. And the continent’s main financial centre – significant for a bloc that floats on a sea of debt – is now outside its regulatory orbit. Brussels has failed in lots of ways over the last couple of decades, from mis-managing the single currency, to stifling industry in red tape. But this will go down as one of the most glaring failures.”

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