Angela Rayner’s Employment Rights Bill is causing significant concern among employers, leading to a record low in business confidence. According to a survey by the Chartered Institute of Personnel and Development (CIPD), only 25% of bosses expect to increase their workforce in the next three months. A quarter of employers are planning redundancies, with fears surrounding the new regulations. James Cockett, a CIPD economist, said: “The Employment Rights Bill is landing in a fundamentally different landscape.” Separate analysis by BDO showed UK employment plunged to a 12-year low after Chancellor Rachel Reeves hiked National Insurance contributions and introduced a minimum wage increase. Finally, a survey by KPMG and the Recruitment and Employment Confederation indicates a weakening demand for staff. Neil Carberry, chief executive of the REC, urged the Government to reconsider the reforms, stating that “the biggest single drag factor on activity right now is uncertainty.”

The Deputy Prime Minister’s proposal to grant workers automatic rights to flexible working arrangements has raised alarms regarding national security. Peers, including Lord Sharpe of Epsom, have cautioned that the Bill could hinder the operations of security services, stating: “The need for immediate action, tight schedules and often secretive operations simply cannot be fully compatible with the predictability that flexible working arrangements might demand.” The legislation aims to limit employers’ ability to refuse such requests, potentially impacting businesses and economic growth. In addition to flexible working, the Bill includes measures against zero-hour contracts and ensures full employment rights from day one. Baroness Meyer expressed concerns that the Bill could lead to economic instability reminiscent of the 1970s. A government spokesperson defended the initiative, claiming it represents the most significant upgrade to workers’ rights in a generation.

Over 200 employers have shown interest in a new retirement scheme that could increase worker pensions by 20% to 50% without additional risk. TPT, a pensions administrator, is moving forward with the UK’s first multi-employer collective defined contribution (CDC) scheme, aiming for authorisation from the Pensions Regulator by the end of 2026. Andy O’Regan, chief client strategy officer at TPT, said: “We’ve had conversations with more than 200 employers who are interested in pursuing this.” CDCs, which blend features of traditional defined benefit and modern defined contribution schemes, are being closely monitored by the pension industry. The Department for Work and Pensions is set to establish regulations for CDCs in September, with pensions minister Torsten Bell expressing enthusiasm for their potential impact on the UK pensions landscape.

Karim Haji, KPMG’s global and UK head of financial services, warns in City AM that geopolitical turmoil poses significant risks to the UK’s financial stability. Haji notes that over 60% of financial services leaders are increasing investments to safeguard their businesses against geopolitical volatility. To foster growth, Haji calls for clarity from the Government on its Financial Services Growth and Competitiveness strategy, urging a balance between regulation and risk management. He also highlights the need for support for UK fintechs, sustainable finance initiatives, and a stable tax regime to attract investment and talent. “The fragility of geopolitics is the most significant threat to future growth for the sector,” he states, advocating for a shift in mindset towards viewing risk-proofing as not just a means to achieve resilience, but as an opportunity too.

Shadow Chancellor Mel Stride writes in the Sunday Express on the impact of Labour’s budget on small businesses. He recounts a meeting with Tony Brown, owner of Beales, who said: “We’re shutting our doors because of Labour’s Budget.” The 140-year-old department store is closing its last location in Poole, resulting in 30 job losses due to increased costs from National Insurance and business rates. Stride stressed that Labour’s economic policies are harming the very businesses that create jobs, stating: “You can’t support working people without supporting the businesses that employ them.” He warns that without urgent support, many more businesses will face closure, leading to a bleak future for Britain’s high streets.

Despite a challenging economic environment, the logistics and supply chain management sector continues to show strong appetite for deals, as highlighted in the ‘UK M&A Update – Q1 2025’ report by BDO. Jason Whitworth, deal advisory partner at BDO, noted that while the sector faces hurdles such as increased costs and regulatory changes, there remains significant interest from international investors and a focus on tech-enabled growth.

Sir Nicholas Lyons, chairman of Phoenix, has called for UK pension funds to be “named and shamed” if they fail to invest in British companies. Lyons proposes a lifetime cap on cash Isas of £50,000 and urges Chancellor Rachel Reeves to link tax relief on pensions to UK investments. While some firms have committed to investing 5% of workplace pension savings into unlisted equities by 2030, overall investment remains low. He warns against mandatory targets, suggesting that the threat of such measures may encourage funds to invest more.

Ross Altmann argues for radical reform of pension investment in the Sunday Telegraph, claiming that UK equities would be boosted by pension funds putting a minimum of 25% of contributions into British assets. Altmann, says that if they don’t, those funds should be stripped of the 25% tax relief provided by the Government. “Reforming pension tax relief rules could herald a new dawn for British markets and growth,” Altmann writes. “A return of reliable domestic institutional support for our own economy, after years of taxpayers spending billions to boost overseas markets rather than our own.”

The proposed changes to inheritance tax, particularly regarding business property relief (BPR), threaten the survival of family businesses in the UK. John Lamont, MP for Berwickshire, Roxburgh and Selkirk, warns in a piece for the Scotsman that a significant tax bill upon a founder’s death could force many to sell assets or shut down entirely. He says: “That’s not economic strategy, that’s economic vandalism.” The Government’s lack of prior communication about these reforms has left businesses unprepared, leading to hiring freezes and stalled investments. Lamont urges the Government to reconsider these damaging proposals, pointing to the essential role family businesses play in the economy.

With the new Making Tax Digital (MTD) rules coming into effect from April 6, 2026, many self-employed individuals and landlords are feeling unprepared. A survey by Accountex found that four in five accounting professionals think MTD for income tax is the “biggest challenge” of the next 12 months,. while one in three admitted they felt unprepared for the change; one in 10 said they were “very unprepared”. Some 780,000 people are expected to be affected initially, rising to 970,000 by April 2027. The income threshold for these rules will drop to £30,000 in 2028, impacting more individuals. Craig Ogilvie, director of MTD, stressed the importance of early preparation, stating: “With April 2026 on the horizon, we are issuing letters to customers we believe will be mandated.” Accountants are encouraged to adopt the necessary software to ensure compliance and accuracy in their tax submissions.

Huw Pill, the chief economist at the Bank of England, has said recent tariffs and trade uncertainties are not causing a “dramatic shift” in the UK economy. Following the Bank’s decision to cut interest rates to 4.25% and revise its economic growth outlook, Pill stressed that trade disruptions will “weigh on growth” but the overall inflation impact remains “ambiguous.” He noted: “There are other forces that may be more long-lasting and underlying in the UK economy itself,” pointing to trends like wage growth. Pill, who opposed the rate cut, advocated for a “gradual and careful” approach to monetary policy, especially in light of the new UK-US trade agreement that aims to remove tariffs on UK metals and reduce car levies. He cautioned against “misleading views” regarding the trade deal’s macroeconomic effects.

The Mail’s Alex Brummer reports on how an inspection team from the International Monetary Fund is coming to check on the UK economy this week, with the body expected to focus on the Chancellor’s fiscal rules and whether they are sufficiently robust to keep Britain’s rising borrowing and debt under control. The IMF’s visit marks its first since Labour took office in July and will delve into the Government’s Budget and growth strategy. Concerns have been raised regarding the UK’s high levels of economic inactivity, with 9.2m working-aged individuals not participating in the labour market. Rachel Reeves is under pressure to address the issue. The IMF is reportedly supportive of the Government’s public sector investment focus but warns of insufficient headroom to meet spending targets.

Britain is optimistic about reaching a deal to eliminate President Donald Trump’s remaining tariffs within months, leveraging its £800m Digital Services Tax (DST) as a “bargaining chip.” The recent agreement, hailed as “historic,” reduces tariffs on British cars from 27.5% to 10% and on steel from 25% to zero, while the UK will lower tariffs on US agricultural exports. Ongoing discussions will address the digital services tax, which has been described as “discriminatory” by the US. Peter Navarro, Trump’s trade adviser, said such taxes had “spread like a bad virus around the world, but it started in Europe, and it basically targets American companies”.

London has been named the best city in Europe for ‘liveability, loveability, and prosperity’ for the third consecutive year, according to the Resonance Consultancy report. The report, which evaluated 182 cities, highlights that “London’s magnetic appeal continues to draw a global audience,” with international travel spending reaching nearly £16.3bn in 2024. London excelled in both loveability and prosperity metrics, praised for its transport, business sector, and community space, particularly its educational attainment and nightlife.