1% rise in National Insurance, 14bn pound would be price paid

If Lord Madelson, the secretary of business in UK has his way and gets the proposed hike in the National Insurance of 1% ratified, then this will prove as a serious set back in the global recovery process, which is currently slow, yet steady. The 1% rise will increase the overall costs to various businesses in the country by 14 billion pound, in the country. The argument put forward by the companies are that they faced the worst winter of their life ever and it has only been since six or seven months that the economy started returning back. In such a scenario, the imposition of this 1% rise in the National Insurance amount is being hailed by as many people are interested in getting higher perks today. If you are in need of  immediate cash. then immediate cash loans help to tide you over until your next pay check.

These employers are really miffed over the whole issue as it doesn’t stand to benefit them one bit. Government says that the announce will be spent towards the betterment of the employees but employers have also threatened to reduce the number of jobs in their organisation in such a scenario me by almost as 8% which would be really bad. In fact, just imagine the condition of the economy which will stand derailed at a crucial point during its journey to the restoration state.

Apart from this, the companies and firms are also insisting upon the government to freeze or delay the raise in the wages of the national youth and development rates of the National Minimum Wage.  Otherwise, doing so would lead to a fall in the employment creation process in the country, further worsening the situation for the one million unemployed youth in the country.

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European Banking not amused with President Obama.

European banking is not following US president , Barack Obama’s way, for the restructuring he proposed in the US banking structure for overhauling the entire global economy out of the recession . He said the system for undue and lavish bonus has to be bought to an end and referred to the embarrassing tale of Goldman Sachs in this context. The President is highly against paying the top notches of a company high and atrociously priced bonuses that affects the profit structure in an adverse way.

But will this work? Because when the UK government tried to do just the thing, it failed miserably. A 50% of the bonus, which would have been levied on any such amount didn’t generate the desired results. So will Obama’s proposals generate the expected results?

But one thing that we cannot understand is that how deterring banks from participating in equity and hedge funds will cause risk and failure for the system? Max to max it can pronounce doom for one single institution or company, not the entire system.

The UK treasury will not apply any of these measures to safeguard the economy against further recessionary tendencies. Though it will try its best to prevent any such occurring and a restructuring is surely there on the cards, but it doesn’t have to the US way. And anyway, failure of one or a couple of large institutions cannot affect an entire economy in such a bad way. The main reason for the economy to be hit hard during recession is that all the parts of the financial system were linked and inter-woven in a complex matrix and there was no escape for any single sector.

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