The conclusions of the Knox D’Arcy Report  shown below has been widely challenged, due to the lack of specific details to support their findings. In response Knox D’Arcy research into public sector productivity will be available as a down load from their web  site when the report is released at the end of August. 

Councils workers are “wasting” up to two-thirds of their day, mainly due to poor line management, new research has suggested.

The productivity of local government workers is lagging so far behind that of their private-sector counterparts that up to 500,000 public-sector jobs could be cut without affecting front-line services, claims the report from management consultancy Knox D’Arcy.

Junior staff in local authorities are productive only 32 per cent of the time during working hours, compared to an average of 44 per cent in the private sector, according to the study.

The research calculated that by matching work rates in the private sector, local government could provide the same level of services with half a million less staff.

The report’s findings were based on 1,855 manager and supervisor surveys (173 were from local government officers), plus 376 days of detailed work shadowing of managers from both sectors.

Local government supervisors were found to be spending less than 15 minutes per day, or only 3 per cent of their time on average, engaged in active management of their staff. The average private-sector manager spent 25 minutes, or 5 per cent of their day, following up work assigned to their team.

Paul Weekes, the report’s author and principal consultant at Knox D’Arcy, said: “Put simply, by matching average private-sector staff utilisation levels, local government could increase its productivity by roughly a third. This sort of dramatic increase would help to significantly offset the cuts that are on the agenda as part of the government’s austerity package.

“More worryingly, our research indicates that councils and other public-sector bodies lack the skills within their management teams to drive the scale of efficiencies being requested by the Treasury.

“Changing the management style in councils is going to be vital to improving performance if cuts to front-line services are to be avoided, given the inevitable redundancies over the coming two years.

“This means a significant cultural change, with a much more active management style needed more individual accountability for performance.”

Weekes added that most managers were observed to be uncomfortable with confronting poor performance, but that many of those in local government held the misconception that their staff were highly utilised and effective – based on perception rather than hard evidence of productivity.

Employer keen to help counter ‘gloomy’ graduate job market

South Korean car manufacturer Kia Motors has launched a graduate employment and training scheme for its UK division.

The programme is offering five places, which will start later this year and last 12 months. Kia said it expects at least 120 applications for the scheme.

Gary Tomlinson, head of HR at Kia Motors UK, told PM: “This scheme is an opportunity to provide positives throughout – it provides Kia Motors UK with fresh talent, provides greater support to our employees and gives the graduate an opportunity to join our organisation.”

Commenting on the high competition for graduate schemes, he said: “As many as one in 10 UK graduates failed to find a job last year and prospects for 2010 are just as gloomy.

“We are aware of the difficulties for graduates in the current market and it’s a chance for us to make some contribution in supporting them. So, we’re conscious of the scheme’s corporate social responsibility aspect, something our managing director has taken a specific interest in.”

Tomlinson added that they had received more than 60 applications after one week of advertising the scheme, and this number was likely to double.

Chosen graduates will get the chance to work in key areas of the business including sales, marketing, after-sales and logistics, finance and dealer training.

“I’m very excited,” Tomlinson said. “This is new to Kia and I’m glad that we have entered the graduate market. It’s something I’ve personally managed in other organisations in other industries, so I have seen the benefits.”

He added that they would also consider running a similar programme in future years, with the possibility of expanding the scheme.

The head of HR is also responsible for the Kia Academy, the firm’s branded dedicated dealer training function, where part of the brief is the recruitment of apprentices.

Through the apprenticeship scheme, for which they have a target of more than 20 places in 2010, they aim to bring school leavers into the Kia brand through the 150-plus dealerships across the UK

16 August 2010

• The Audit Commission for Local Authorities in England and Wales was established in 1983
• It is an independent watchdog “driving economy, efficiency and effectiveness” in local public services
• The commission assumed auditing responsibility for the National Health Service in 1980
• Functions were extended to fire and rescue services in 2004
• Its remit in Wales was transferred to the auditor general for Wales, also in 2004
• The commission now covers local government, health, housing, community safety and fire brigades
• It audits £200bn spent by 11,000 local public bodies

The body, which looks for savings and efficiencies in local government, has offices in London, Bristol, Leicester, Solihull, Stevenage, Bolton, Gateshead, Leeds and Exeter.

In a press statement, Mr Pickles said the commission’s research functions would stop and councils would be able to ask private companies to carry out audits. There would also be a “new audit framework” for local health services.

Source: BBC News

Increase in part-time workers results in labour market improvement

The number of people unemployed in the UK fell by 34,000 in the three months to May, to 2.47 million, official figures show.

Data released today from the Office for National Statistics (ONS) also shows a reduction of 20,800 in the numbers claiming jobseeker’s allowance, to 1.46 million. The jobless rate is therefore now 7.8 per cent, down from 7.9 per cent.

The number of people in work rose by 160,000 in the three months to May, the biggest rise since August 2006. However, most of the increase was attributed to an increase in part-time workers (up by 117,000 in the quarter) and self-employed workers (up by 59,000); the full-time workforce actually diminished by 22,000.

The ONS said that 27 per cent of people in work are employed part-time, the highest proportion since records began in 1992.

There was bad news on long-term unemployment, with the number of people out of work for longer than 12 months standing at 787,000, up by 61,000 in the last quarter.

CIPD chief economic adviser John Philpott commented that the figures were easily the best since the recession started two years ago, but the coming public-sector jobs squeeze may mean this is the “calm before the storm”.

“A spring 2010 pick-up in employment comes as no surprise to the CIPD, since this is what our own surveys of employers’ hiring intentions had shown. Worryingly, however, more recent employer surveys suggest the pace of jobs recovery has slowed since the spring, placing a question mark over whether the private sector will in the short-run generate enough jobs to offset mounting public sector job cuts,” said Philpott.

“Moreover, while the jobs market improved in the spring all the net new jobs being created were either part-time, temp positions or filled by the self-employed. The number of full-time employees continued to fall while the number of people working part-time because they could not find a full-time job further increased to reach 1.06 million.”

On a more positive note, there are signs that the youth employment situation may be improving, and one of the challenges for the coalition government is to get its planned work programme up and running in time to effect further recovery in this area, said Philpott.

TUC general secretary Brendan Barber commented: “These are flat, disappointing figures and you need a magnifying glass to see much sign of recovery here. And because unemployment lags behind the rest of the economy we have yet to see any impact from the new government’s policies on the dole queue. When the cuts start to bite not only will jobs be lost from the public sector but across the private sector too

14^th July 2010

Source: Office for National Statistics (ONS)

Francis Maude, Minister for the Cabinet Office, said the move will bring together in one place all the cross-government operational functions, including procurement, project management, IT and Civil Service workforce and reform functions.

The Efficiency and Reform Group will have a strong mandate at the centre of government to ensure departments work together to quickly tackle waste and improve accountability across all these areas.  The Group’s work is overseen by an Efficiency Board, co-chaired by the Minister for the Cabinet Office and the Chief Secretary to the Treasury.
In a further boost for the work of the Efficiency and Reform Group, Francis Maude has announced that three senior business leaders, who have all worked in Whitehall, will bring their years of experience to the Efficiency Board. They are:

• Sir Peter Gershon, Chairman of Tate & Lyle, former government efficiency adviser and first chief executive of the OGC;
• Lucy Neville-Rolfe, Executive Director, Tesco PLC; formerly a senior career civil servant; and
• Dr Martin Read, Non-Executive Director of Invensys, Aegis and Lloyd’s of London.

“These changes will bring together our operational capability to form a single strong but streamlined group to drive efficiency across Government. By taking this really tough stance on inefficiency and waste, we can tackle Britain’s massive budget deficit and bring order back to the country’s finances, whilst protecting vital frontline services.

“Our new board members will be critical in making this happen.  Sir Peter Gershon, Lucy Neville-Rolfe and Martin Read have varied business expertise combined with deep understanding of the unique challenges of government.  They’ll be energetic and challenging, and I’m grateful that they have stepped up to offer their valuable service to the country.”

Sir Peter Gershon, who will lead on looking at procurement issues, said:

“Whilst tackling the budget deficit is a challenge, I am convinced that by bringing experts together and harnessing the talents of the public sector we can start to make improvements immediately. We will need to be creative and innovative in order to make a real difference and look at new ways of working.”

Dr Martin Read, a senior businessman who led the 2008/2009 Government review on back office operations and IT across the public sector, said:

“The long term health of the UK economy is critically dependent on securing value for money across the public sector.  The Efficiency and Reform Group has a crucial role to play in ensuring that cost reduction becomes a fundamental management objective in the public sector and I look forward to supporting this initiative.”

Lucy Neville-Rolfe, who will be looking at workforce issues, said:

“In these challenging economic times, greater efficiency and effectiveness in government can play a large part in helping to make Britain a better and a fairer place to live and work. I am delighted to lend my experience to this important work.”

In a further example of the new business-like approach to government, today the Cabinet Office became the first government department to publish its structural reform plan, setting out its new priorities, with implementation milestones clearly exposed for public scrutiny.  Other departments will publish their plans in due course.

Source

· To help areas and communities particularly affected by reductions in public spending make the transition to private sector-led growth and prosperity, the Government will create a Regional Growth Fund in 2011-12 and 2012-13. This fund will operate in England only and support proposals from private and public-private bodies that create sustainable increases in business employment and growth.

· Confirmation of temporary increase in the level of small business rate relief (SBRR). Eligible businesses occupying properties with rateable values up to £6,000 will pay no business rates for one year from 1 October 2010. Businesses with rateable values up to £12,000 will receive significant reductions. 58 per cent of properties in the South East have a rateable value of up to £12,000, and will benefit from this measure if occupied by an eligible business.

· The impact of the employer NICs rate rise previously announced will be largely reversed by increasing the threshold for employer NICs by £21 a week above indexation. This will lead to a saving of around £440 million in the South East.

· The Budget 2009 proposal to repeal the special tax rules for furnished holiday lettings will not be implemented. Instead, the Government will consult over the summer on an alternative proposal to ensure the tax treatment of holiday lettings meets EU legal requirements in a fiscally responsible way, which does not penalise UK businesses, by changing the eligibility thresholds and restricting the use of loss relief. This will benefit an estimated 7,800 individuals in the South East who receive an income from furnished holiday lettings.

· The income tax personal allowance for those aged under 65 will be increased by £1,000 in cash terms, taking it from £6,475 in 2010-11 to £7,475 in 2011-12. As a result, the Government estimates that 23 million basic rate taxpayers will benefit by up to £170 each. In the South East over 3 million basic rate taxpayers will gain from this measure.

· Government will uprate the basic State Pension by a triple guarantee of the highest of earnings, prices or 2.5% from April 2011. The Consumer Price Index will be used as the measure of prices in the triple guarantee. However, to ensure the value of a basic State Pension is at least as generous as under the previous uprating rules, the Government will increase the basic State Pension in April 2011 by the equivalent of Retail Price Index. An estimated 1.6 million pensioners in the South East will benefit.

· Government will uprate the standard minimum income guarantee in Pension Credit in April 2011 by the cash rise in a full basic State Pension to ensure the lowest income pensioners benefit from the triple guarantee. 220,000 pensioners currently receive Guarantee Credit in the South East.

· The Government will introduce legislation to waive certain backdated business rates bills, including for some businesses in ports. An estimated 3,000 businesses across England will benefit.

Chief Secretary to the Treasury Danny Alexander:

“The previous Government has left us with a legacy of debt and unsustainable spending, we are taking the decisive action needed to pay for the past and plan for the future. That is why today we have set out a comprehensive five year plan to put the British economy back on track. We have made the tough choices needed to get our borrowing down but we have done it in a way that is fair, protects the vulnerable and supports businesses across Britain.” ]]> http://www.imseasternregion.co.uk/2010/06/22/458/feed/ 0 http://www.imseasternregion.co.uk/2010/06/08/the-governments-2010-spending-review/ http://www.imseasternregion.co.uk/2010/06/08/the-governments-2010-spending-review/#comments Tue, 08 Jun 2010 19:50:14 +0000 Ray Martin http://www.imseasternregion.co.uk/?p=453 The Chancellor of the Exchequer George Osborne and Chief Secretary to the Treasury Danny Alexander today announced details of how the next Spending Review (SR) will be conducted. The SR, due to conclude in the Autumn, will set spending limits for every Government department for the period 2011-12 to 2014-15.

The timetable for the review, the process and guiding principles that will underpin the Government’s approach to setting spending limits are set out in the Spending Review Framework presented to Parliament today.

Last year, Public Sector Net Borrowing was the largest in Britain’s peacetime history. The March Budget forecast the UK deficit to be 11 percent of GDP this year. According to the IMF, the UK has the highest deficit in the G7 and G20.

The Government has made clear that the bulk of the reductions in the current structural deficit will be achieved through reductions in spending. The Spending Review Framework sets out how the SR will:

. To ensure that resources are prioritised within tighter budgets, departments will be asked to prioritise their main programmes against a tough set of criteria to ensure value for money in public spending. The criteria:

• Is the activity essential to meet Government priorities?
• Does the Government need to fund this activity?
• Does the activity provide substantial economic value?
• Can the activity be targeted to those most in need?
• How can the activity be provided at lower cost?
• How can the activity be provided more effectively?
• Can the activity be provided by a non-state provider or by citizens, wholly, or in partnership?
• Can non-state providers be paid to carry out the activity according to the results they achieve?
• Can local bodies, as opposed to central Government, provide the activity?

• start a period of external engagement between the Government and all parts of society including; the private sector, the general public, voluntary/charitable organisations and experts, in order to obtain the best ideas from those most involved in and affected by public services

• require each Secretary of State to appoint a Minister with specific responsibility for driving value for money across their department, identifying savings opportunities and playing an important role in challenging spending in all areas, including on contracts and programmes.

• comprehensively examine areas such as: social security, tax credits and public service pensions as part of the process

• end the previous administration’s complex system of Public Service Agreements that relied too heavily on rigid targets and instead ask departments to publish business plans that show the resources they need to put in place in order to protect key frontline services and deliver on their objectives.

On 24 May the Chancellor set out how the Government will reduce spending this year by £6¼ billion by cutting waste. This was the first step on the road towards restoring good management of Britain’s public finances.

Even tougher decisions will be required at the Spending Review.  The Spending Review will set out the Government’s spending plans for the next Parliament, setting departmental budgets for the years 2011-12 to 2014-15.

In the Budget, the Government will set out the overall path it will pursue for the public finances, against which the OBR will judge its fiscal policy. This will include setting the path for expenditure in the next SR period, which will give a clear sense of the scale of the challenge.

To ensure that the SR looks comprehensively across the whole of Government expenditure, it will also cover significant elements of Annually Managed Expenditure, where the risk is taken by the Exchequer as a whole, including social security, tax credits and public service pensions, setting out plans for savings and reform in these areas.

Tough decisions need to be taken in order to reduce the unprecedented deficit. The Government is committed to achieving the bulk of this through reductions in Government spending, rather than tax increases, while protecting the quality of key frontline services.

This SR is not just about cutting spending and setting budgets. It will be a  complete re-evaluation of the Government’s role in providing public services.  The SR will look at what services the Government should  be providing and how to get more for less.

. The Government is determined to take decisions in a way that is in line with its values of freedom, fairness and responsibility.  Therefore the Government will:

• Deliver its guarantee that health spending will increase in real terms in each year of the Parliament, and that 0.7 per cent of GNI with be spent on overseas aid by 2013;
• Limit, as far as possible, the impact of reductions in spending on the poorest and most vulnerable in society, and on those regions heavily dependent on the public sector
• Protect, as far as possible, the spending that generates high economic returns
• Make further savings to fund the priorities set out in its programme

To lead collective decision-making in Government on spending, the Prime Minister has appointed a Committee of senior Cabinet Ministers – the Public Expenditure Committee (PEX/Star Chamber). Chaired by the Chancellor of the Exchequer and supported by the Chief Secretary, the PEX Committee will advise the Cabinet on the high-level decisions that will need to be taken in the Spending Review. The membership of the Committee will be:

• Chancellor of the Exchequer (Chair) – The Rt Hon George Osborne MP
• Chief Secretary to the Treasury (Deputy Chair) – The Rt Hon Danny Alexander MP
• Foreign Secretary – The Rt Hon William Hague MP
• Minister for the Cabinet Office and Paymaster General – The Rt Hon Francis Maude MP
• Minister of State at the Cabinet Office – The Rt Hon Oliver Letwin MP

The Government will require the input of the brightest and best individuals to achieve the optimal outcome in this Spending Review. Therefore, it will form a Spending Review Challenge Group of experts – both from within Government and outside – to act as independent challengers and champions for departments throughout the process. Their remit will be to think innovatively about the options for reducing public expenditure and balancing priorities to minimise the impact on public services.

The Government is determined that this Spending Review process will be open, responsible and fair and conducted in a way that protects the poorest and most vulnerable in our society. Over the next few weeks, the Government will begin a process to engage and involve the whole country in the difficult decisions that will have to be taken.

The Government is committed to greater transparency to enable the public to hold politicians and public bodies to account, and will build on the actions it has already taken to publish raw public spending data from the Combined Online Information System (COINS). It will publish more user-friendly subsets of COINS data by August 2010, and has committed to publishing online all new items of central Government spending over £25,000 from November 2010.

The Government will also organise a series of events over the summer to discuss and debate various aspects of public spending. The line-up of events will incorporate many of the key areas that need to be considered as part of the overall SR process. A range of people will be invited to these events, to make sure that they represent a wide spectrum of expertise and viewpoints. Invitees will include members of think tanks and interested groups, academics, representatives of local government, business and trade unions, and public sector experts and watchdogs such as the Audit Commission.

For the first time in decades, Singapore (1) and Hong Kong (2) have topped the USA (3) in IMD’s World Competitiveness Yearbook rankings. They are so close, however, that it would be better to define them as the leading “trio”. In the first 10 places: Australia (5), Taiwan (8) and Malaysia (10) also benefit from strong demand in Asia. Switzerland (4) maintains an excellent position characterized by strong economic fundamentals (very low deficit, debt, inflation and unemployment) and a well-defended position on export markets. Sweden (6) and Norway (9) shine for the Nordic model, although Denmark (13) surprisingly loses ground, in particular due to the pessimistic mood expressed in the survey.

Not surprisingly Germany (16) leads the larger “traditional” economies such as the UK (22), France (24), Japan (27) and Italy (40). Despite a significant budget deficit and growing debt, Germany’s performance is driven by strong trade (second largest exporter of manufactured goods), excellent infrastructure, and a sound financial reputation. It was also to be expected that China (18) would lead the other BRIC nations, followed by India (31), Brazil (38) and Russia (51). And of course the credit-worthiness storm that affects Southern Europe acts as a drag on the performance of Spain (36), Portugal (37) and Greece (46).

JUST RELEASED! IMD WORLD COMPETITIVENESS YEARBOOK 2010
(Pioneers in competitiveness since 1989)

Chancellor George Osborne has confirmed that an emergency Budget will be held on Tuesday 22 June.

He has also announced the creation of a new Office for Budget Responsibility, headed by respected fiscal and macroeconomic expert Sir Alan Budd, to assess the state of the nation’s finances.

Speaking to journalists at the Treasury’s offices in London, Mr Osborne said he wanted an emergency Budget that would “show that Britain can live within its means and…provide the solid foundation for a private sector recovery.”

He added that the Chief Secretary, David Laws, would meet Cabinet colleagues this week to agree £6 billion of cuts in this year’s spending.

The Treasury has undertaken work on how these cuts should best be implemented. It expects savings to be made:

• in discretionary areas like consultancy and travel costs:

• through doubling the current delivery plans for savings in IT spending:

• from immediate negotiations to achieve savings from the 70 major suppliers to government:

• from reductions in property costs:

• from restraining recruitment:

• by cancelling wasteful projects like ID cards:

• from cutting other lower value spending

The final detailed announcement on each Departments’ contribution will be made next Monday.

Finally, it is critical that we look for savings and root out wasteful spending wherever we can.

About 5,000 female council staff have won their case for equal pay at an employment tribunal.

The women, who include cleaners, cooks and care assistants, were all employed by Birmingham City Council.

Unions said the women may be owed £30m in back-pay because bonuses were paid only to male counterparts. Solicitors said the pay-out could be up to £600m.

The Unison union said it was a “major” victory. The council said the ruling related to its old bonus structure.

Story from BBC NEWS:

Obituary by Harry Downes. Hon. FMS

It is with great sadness that I report the death of ARTHUR HULME Hon. FMS. Arthur passed away suddenly but peacefully on Sunday14th March 2010 aged 94. He will be fondly remembered by all his colleagues in the NHS and IMS. He was married to Vera for over 60 years, they were not blessed with any children. Arthur was a proud Lancastrian and moved south to join the NHS.

In 1957 the Ministry of Health issued a directive allowing each Region to appoint up to seven “organisation & methods” (0&M) work study officers. Their purpose would be to carry out in-depth efficiency studies into methods of working – covering domestic services, laundry and linen services, gardening, laboratory procedures, nursing and other selected clinical areas.

Arthur Hulme joined the Manchester Regional Hospital Board as one of three work study officers in 1958. He had formerly been carrying out similar work in a range of industries. In September 1960, he became the East Anglian Region Hospital Board’s first Organisation and Methods Work Study Officer.

He quickly discovered that his appointment was generally viewed with trepidation and was faced with the prospect of having to “sell” himself.

The Region Medical Officer referred to the O&M & work study as a “gimmick” yet to be put to the test. The Treasurer was not convinced, particularly about what financial savings could be achieved The Regional Engineer was interested but fell silent when told Arthur was an expert on Laundries.

The climate among the 12 Hospital Management Committees (HMC)had yet to be tested. Arthur arranged a series of one-day seminars in Cambridge and all the heads of the HMC’s attended. Within two weeks large numbers of invitations arrived arrived in the secretaries office requesting work study surveys in the many departments of the region’s hospitals. With only a one man team it was proving a difficult task.

The first study was carried out in February 1961 on the portering services at Newmarket General Hospital. It generated more than 60 recommendations. An understanding was given that there would be no redundancies and that staff cuts, if necessary would be by natural wastage. This policy was pursued throughout the Region and further in-depth studies followed.

Eventually, management became more accustomed to the new services and within two years demand had grown. Between 1961 and 1967 more staff were recruited ans it was decided to set up “out-posted teams” of officers in the main hospital centres of Norwich,Ipswich,Peterborough and Cambridge.

In 1966, another milestone was reached (apart from England winning the world cup). The Region became the first to be allowed to carry out an experimental incentive bonus scheme, choosing for this purpose the group laundry at Bury St Edmunds. The scheme created nationwide interest and Arthur was eventually appointed to a national committee on pay and productivity in the NHS.

In 1968, the Government established a “Prices and Incomes Board”, which produced the important “Report 29″. The main thrust of this report was that staff employed in the public sector were among the lowest paid and that their productivity was very low. It recommended that steps should be taken to improve the situation.

The report led to the introduction of incentive schemes in many areas, including ancillary staff in the NHS. All schemes had to be self financing which meant that the new working practices would have to produce savings to cover the bonus payments. These schemes were also valuable from another viewpoint. They provided weekly “management controls” so that section managers could see how their departments were working. Such a system had never been known before in the NHS.

From its inception in 1961 until 1981, some 1,100 efficiency studies were carried out, resulting in considerable financial benefits and better working methods.

Arthur was also a founder member of the Cambridge Branch of the IMS, he was also a member of the Eastern Regional Board, which he served with distinction. He was very active in the formation of the Health Services Specialist and served on its board as secretary for over 20 years. In 1981 Arthur received the “Geographical Services Award” for outstanding contribution to the work of the Institute.

In spite of his heavy workload and commitment and to the IMS, Arthur still found time to carry out other activities. He was a member of the local Rambling club,the Bowling club and even a keen cyclist. Even at the age of 94 he cycled to the village every morning for a copy of his beloved “Guardian”. He was also founder member and vice-president of the Cambridge branch or the NHS Retirement Fellowship. At our last meeting before he died we were discussing matters relating to the Institute. He loved our profession and all it stands for. I am proud to have known Arthur and worked with him .

Theme: The Economy

Whole economy output per worker decreased by 1.4 per cent in the fourth quarter of 2009, compared with the same quarter a year ago, up from a fall of 3.3 per cent seen in the previous quarter.

On a quarter on previous quarter basis, output per worker increased by 0.5 per cent in the fourth quarter of 2009, up from a fall of 0.2 per cent in the previous quarter.
Unit wage costs for the whole economy in the fourth quarter of 2009 increased by 2.4 per cent compared with the same quarter a year ago, down from growth of 4.2 per cent in the previous quarter.

Source: Office for National Statistics [Date: 31 March 2010]

- Nissan to build UK’s first mass market electric car

- Government commits £20.7m grant to support Nissan investment in battery plant and car production

- Nissan investment of more than £420 million safeguards and creates 550 highly skilled engineering jobs at Sunderland

The Government is to commit £20.7 million under the Grant for Business Investment scheme for both the production of the car and the new battery plant at Sunderland. This will support total investment of over £420 million by Nissan in their UK operations.

Nissan has plans to make up to 50,000 vehicles and 60,000 batteries a year which will help to safeguard and create over 550 highly skilled jobs at the Sunderland plant.

The Business Secretary announced the government investment for Nissan as one of the company’s top executives demonstrated the advanced technology of the car at the Department’s offices in London.

Lord Mandelson said:

“This investment is a fantastic vote of confidence in the Sunderland plant and its excellent workforce.

“The automotive sector is of key importance to the UK. It supports R&D, technological innovation, skills and a supply chain that’s a mainstay of the wider manufacturing sector.

“Today’s news from Nissan, with support from government, shows that by working together we can achieve our aim of making the UK a world-leader in ultra-low carbon vehicles.”

Andy Palmer, senior Vice President responsible for Nissan’s global electric vehicle strategy, said:

“The world is at the dawn of a new era in automotive transport. Nissan LEAF, which will go on sale later this year, is a five-seater hatchback that offers the same space, practicality and performance of a similar car in its class – minus the tailpipe emissions.”

“Thanks to the UK’s firm commitment to a low carbon future in terms of infrastructure, customer incentives and educational programmes, Nissan LEAF will be built at Sunderland, making the UK the third country in the world to produce this revolutionary car.”

Earlier today the Government also said it is to support Ford’s £1.5 billion investment in creating a new generation of environmentally friendly engines. The Government will provide £360 million in loan guarantees towards six Ford projects through its Automotive Assistance Programme (AAP).

Ford’s plans will safeguard around 2.800 highly skilled jobs in the UK at its manufacturing plants in Dagenham, Southampton and Bridgend in south Wales as well as its research and development centre at Dunton in Essex.

Government support for Nissan and Ford follows last week’s announcement of a 300 million Euros loan guarantee to General Motors Europe, helping to secure the company’s operations in the UK at Ellesmere Port, Luton and Millbrook and the rest of Europe.

The funding is being allocated to all areas of the country from the Local Authority Business Growth Incentives (LABGI) scheme that rewards councils which successfully promote local growth. In the East of England more than £5.5million funding is being allocated to eight sub-regions as follows:

Bedfordshire and Luton             £664,322
Heart of Essex                                £603,690
South west Essex                         £319,617
Hertfordshire                              £1,386,687
Peterborough and Lincs          £653,285
Norfolk                                            £632,833
Suffolk                                             £591,443
Thames Gateway                          £689,468

John Denham is clear that vital public sector support at this time can lessen the impact for struggling families and businesses. He wants to see councils use this grant to help small and new businesses in hard hit areas who often need extra support to get through the tougher times so they can hit the ground running as economic growth picks up.

Last July, the scheme was re-launched with a similar £50m grant. Today’s announcement builds on that and takes the total LABGI funding since 2005 over £1 billion, on top of normal Government grants.

Government action through Real Help Now has supported many families and businesses.  It is also giving wider support including free business health checks, discounted rate bills for small businesses, tax payment deferrals, capital loans or help with bank loans for business growth, and a 10 day Government payment promise.

Mr. Denham said

“Building economic recovery is the Government’s top priority and we firmly believe in the decisive leadership role councils have to play. Strong, vibrant, decisive local government is an essential part of our plans to promote growth and cut unemployment while rebuilding the public finances.

We put the public sector in the lead while the private sector was struggling, spending and investing to lessen the impact on individuals, businesses and communities. We are giving councils up and down the country a further £50m to support small and new businesses in hard hit areas that might need a little jump start to get up and running again.

“Local councils, and councillors, with their unique democratic mandate, are best placed to provide financial support and local services that are responsive to the pressures being felt by families and businesses in local areas.

“Through our Real Help Now plan, we have committed a billion pounds to create more than 150 000 jobs and guaranteed everyone under the age of 25 a job, training or work experience if they are out of work for over six months and given struggling small businesses financial support through our billion pound Enterprise Finance Guarantee and tax payment deferrals.”

The award was won by PD Ports for its Logical Link service – a coastal feeder container shipping service offering a next day connection between Felixstowe in the south of England and Teesport in the north, which runs three days per week.

ASDA has used the Logical Link service since it launched in January 2009, to ship goods destined for its northern markets into Teesport, where the retailer operates a 360,000ft distribution centre. In its first year of operation, the Logical Link service reached its goal of reducing operational costs for customers and minimising the adverse impact that road transport has on the environment.

ASDA, which opened the first PortCentric import centre at Teesport in 2006, has now considerably reduced the volume of company trucks on the already over-burdened UK road network. This has led to a saving of over 1,265,459 road miles. That’s enough to make almost three trips to the moon and back.

Alex Linton, ASDA’s supply chain operations manager, commented: “PD Ports’ innovation in the development of the Logical Link concept and the subsequent efficiency in the management of the service were key factors in winning this award.

“The continued improvement and solid performance in PD Ports’ transport business, PD Logistics, provided a further rationale for judging the company to merit this award.”

Jerry Hopkinson, PD Ports MD, Bulks, Ports & Logistics, said: “We are delighted to have been named as ASDA’s outstanding carrier of the year as a result of the success we have seen with the Logical Link service.

“There is without doubt, a continued and vital need to reduce the amount of freight transported by road from southern UK ports but which is destined for the north of the UK. This award further cements the benefits our customers can achieve through the Logical Link service.”

This blip in the prevailing downward trend in U.S. productivity was largely explained by dramatically reduced working hours that offset output decline (employment fell by 3.6 percent in 2009; hours worked per worker by 1.5 percent.) U.S. productivity growth is projected at 3 percent for 2010.

European productivity growth turned negative in 2009, falling far behind the United States. Output per hour fell 1 percent in the Euro Area.

“These are unusually large differences in productivity growth between the United States and Europe,” said Bart van Ark, chief economist of The Conference Board. “U.S. employers have reacted much more strongly to the recession than their European counterparts in terms of cutting jobs and hours. In 2010, both Europe and the United States will see higher productivity growth coming out of recession. However, a jobless productivity recovery is the most likely scenario in both regions.

“Most emerging markets outside Central and East Europe and Russia fared better than advanced economies on both output and productivity growth in 2009,” said van Ark. “Emerging economies are becoming global competitors to be reckoned with on the basis of high productivity growth, not just because of low cost.”

China’s productivity growth rate (8.2 percent) was the best among emerging markets in 2009 and is projected to be 7.7 percent in 2010. “China’s 2009 productivity growth is largely due to government stimulus supporting state-owned enterprises,” van Ark said. “Going forward, it remains to be seen whether this can continue as support for SOEs wanes.”

World productivity growth also declined in 2009 (-1 percent in terms of output per worker), putting it in negative territory for the first time in almost two decades, but it is expected to recover strongly in 2010 as both emerging and developing economies show stronger productivity performance.

The data reported today is drawn from The Conference Board Total Economy Database. Widely watched and utilized by economists and other analysts around the world, the database is available free of charge for public use. It is updated twice yearly, with analyses provided to member companies in January in The Conference Board Productivity Brief, and a more in-depth Performance research report later in the year.

Among today’s key points:
The worldwide recession caused a 1-percent drop in global output per worker, taking it into negative territory for the first time in 19 years. (It was negative in 1991, but by only 0.1 percent). Global productivity growth is expected to go strongly positive again in 2010 (+2.2 percent).

Productivity growth in the Euro Area turned negative (-1 percent) following two years of decline, but is projected to recover significantly (+2 percent) in 2010. Of the -3.1 percent decline in hours worked, only -1.9 percent was due to a fall in employment; the rest was due to a 1.2-percent drop in hours per worker.

U.K. productivity (-1.9 percent) fared worse than that of the European Union or the Euro Area, primarily due to a larger contraction in output. Productivity is projected to return to positive growth of 1.7 percent in 2010. The long-term trend in U.K. labor productivity has been significantly downward since 1995, along with a weakening labor market.

The Conference Board Total Economy Database provides a comprehensive overview of growth rates of productivity, GDP, employment and hours worked for 123 economies representing 97 percent of the world’s population and 99 percent of global output. It also contains estimated levels of productivity (expressed in U.S. dollars and adjusted for relative price differences), as well as the levels of GDP, employment, hours worked (for selected countries), population, and labor productivity. (Productivity per hour captures those workers who are still employed, but at reduced hours.) The Total Economy Database draws largely on such international sources as the OECD, Eurostat and the IMF, and also from the latest national accounts, labor surveys, and other employment statistics available for individual countries. New to the Total Economy Database this year is Total Factor Productivity (TFP), which accounts for such sources as improvements in workers skills, machinery and software. TFP is a more precise measure of efficiency than labor productivity.

ABOUT THE CONFERENCE BOARD
The Conference Board is a global, independent business membership and research association working in the public interest. Our mission is unique: To provide the world’s leading organizations with the practical knowledge they need to improve their performance and better serve society. The Conference Board is a non-advocacy, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States.

For further information contact:
Frank Tortorici
(1) 212 339 0231
f.tortorici@conference-board.org

More than 8m Toyota cars are being recalled worldwide, including 180,000 in the UK, with the company also under investigation in the US over problems with the brakes on its hybrid Prius car.

Mr Toyoda is planning measures which he hopes will avoid a repeat of the crisis. He will lead a committee that will take charge of introducing initiatives including the introduction of new “quality management” professionals at “Automotive Centres of Quality Excellence” in key regions, an improvement in the way it researches its cars and customers, and greater autonomy for regional divisions.

Mr Toyoda apologised to customers for the turmoil but insisted that his company’s vehicles are safe. and that Toyota has yet to establish whether it needs to launch a global recall of the Prius, of which there are about 40,000 in the UK. “I have instructed that consideration be made as soon as possible regarding the way to address such units. Once a decision is made we will inform the public,” he said.

The Toyota boss, who took over last year in the face of a major collapse in global car sales, has come under fierce criticism for his handling of the crisis, which has wiped $30bn (£19bn), or a fifth, off the company’s market value and is estimated to have already cost $2bn.

The crisis could have serious implications for the Toyota brand, which prides itself on quality and reliability. Standard & Poor’s, the rating agency, yesterday put Toyota’s AA rating on its negative watchlist because of “increased concern over the potential negative impact on Toyota’s business risk profile of unfolding developments related to recent quality issues”.

Source: Based on Daily Telegraph Article