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IoD Week In Policy 29th November - 3rd December 2021

03 Dec 2021


This week in policy

Ah, into the final month of this mad year. Something about this December is ringing many bells for us, and not just because it’s nearly Christmas. Cancelled parties, a new variant, fingers crossed against another lockdown, concerns over international travel. It's beginning to look a lot like Christmas last year...   

It’s all Greek to me 

  • We have a new variant. Apparently it’s the worst yet. We think that has something to do with the fact no-one really knows how to pronounce it. Oh-mic-ron? Oh-mu-kran? Om-ni-cron? The French are calling it Oh, Macron! Let’s call the whole thing off.  

  • Scientists are concerned that this variant is much more harmful than previous ones given that they say it has 10 times the number of mutations on the spike protein than the Delta variant.  

  • Despite this, we only have one reported case in England, and 9 in Scotland. Let’s hope it stays that way. 

  • The primary worry is that the vaccine will not protect against Omicron. So while the government is urging everyone to go and get their booster jabs, it may not make an iota of a difference.  

  • There is much cynicism regarding festivities this December, with Christmas parties being cancelled left right and centre, and government reluctance to implement Plan B. Though if we’ve learnt anything from the past two years, we know it’s a marathon not a sprint.  

Steel deal repealed  

  • The US has continually asserted its position on the Northern Ireland Protocol: that the UK has to do everything to make it work for the sake of the Good Friday Agreement.  

  • However with the continued threat of Article 16 hanging over us, Biden is now doing more than just expressing concerns.  

  • He has delayed a deal that would remove tariffs on UK steel and aluminium due to tensions over Northern Ireland. Biden feels that triggering the mechanism will undermine peace between Northern Ireland and the Republic of Ireland.  

  • But Lord Frost has been threatening this for months now. The question remains whether this is a tactical bluff, or if he is actually willing to go all in.   

Our index, indepth 

  • According to our data, economic confidence is stabilising after sharp falls in the early autumn.  

  • An increasing number of business leaders are claiming that the cost of energy and employment taxes are having a negative impact on their firms. However, in better news, the negative impact from the pandemic continued its decline in November.  

  • We will continue to monitor carefully as businesses navigate the implications of the Omicron variant.  

  • Our Chief Economist Kitty Ussher commented that the economy is experiencing a Catch-22 dilemma. Economic growth in 2022 is dependent on private sector investment, but many directors are nervous about committing to that investment when the economic outlook looks uncertain.  

  • https://www.iod.com/news-campaigns/press-office/details/IoD-Mood-music-on-the-economy-is-not-sufficiently-cheerful-to-reverse-decline-in-confidence  

Rules, rules, rules  

  • Good news, new FCA listing rules came into effect today.  

  • The key changes are: 
    - Allowing a targeted form of dual class share structures within the premium listing segment to encourage innovative, often founder-led companies onto public markets at an earlier stage; 
    - Reducing the amount of shares an issuer is required to have in public hands (i.e. free float) from 25% to 10%; 
    - Increasing the minimum market capitalization threshold for both the premium and standard listing segments from £700,000 to £30 million. 

  • Allowing firms to issue shares with multiple voting rights for a limited period of time (up to 5 years) could improve the capacity of innovative growth companies to adopt a longer-term investment horizon. This is a step in the direction of better governance, and we have been supportive of this reform.  

  • FCA confirms new Listing Rules to boost growth and innovation on UK stock markets 

Nor way, another deal!  

  • The trade deal between Norway and the UK came into effect on Wednesday. 

  • Within this relationship there is a focus on services and investment, with lower tariffs and exclusive duty free quotas for UK exporters.  

  • Digital provisions such as electronic documents, contracts and signatures will allow goods to more easily move across the border, saving businesses time and money.  

  • The deal will also boost fintech, reaffirm climate goals, and encourage business travel via a more straightforward visa process.  

  • https://www.gov.uk/government/news/uk-norway-deal-comes-into-effect  

Week ahead in Policy 

As we move further into December, we are fully expecting to experience the effects of the last push before everyone leaves for Christmas. We have some webinars to look forward to, a report on fund governance to get stuck into on Monday, statistics to analyse, and we feel it is finally close enough to the 25th to get started on the Christmas drinks.  

Monday 6th December 

  • Treasury Committee Oral evidence on the future of financial services 

Wednesday 8th December 

Thursday 9th December 

  • Bank of England Financial Stability Report 

Friday 10th December  

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