Your commercial news round-up: welfare cuts, privacy tussles, employee rights, ‘digital nomads’

Reading time: four minutes

The commercial world moves at such a rapid pace and keeping on top of developments can often feel impossible. We’ve summarised four recent stories into bitesize chunks to make this more achievable. In the first round-up of March, Rachel Reeves is expected to make major cuts in her spring statement and Apple faces an unprecedented dispute with the UK government. Meanwhile, trade unions celebrate the Employment Rights Bill and a new study shows that there’s an increasing number of ‘digital nomads’.

• Chancellor Rachel Reeves is predicted to propose major cuts across government departments, including welfare, in her spring statement later this month. In December 2024, economists warned that tax rises could be on the cards – a prediction that hasn’t been ruled out by the chancellor, who’s previously stated that her self-imposed fiscal rules are “non-negotiable”. Factors such as global economic policy and geopolitical uncertainty have significantly impacted the hike in government borrowing costs. The cuts drafted by the treasury will assist in plugging the gap that’s emerged, with the new welfare cuts designed to reduce the huge growth in health-related benefits. The welfare cuts will be outlined in the upcoming speech from Work and Pensions Secretary Liz Kendall.
   
• Apple is taking legal action in an unprecedented dispute with the UK government over data privacy. Served through the Home Office under the Investigatory Powers Act, the UK government has demanded access to encrypted data stored by Apple worldwide in the iCloud Advanced Data Protection (ADP) tool, which is Apple’s opt-in privacy tool.
  
  Legally this order can’t be made public, so the UK government has neither confirmed nor denied its existence. Apple has also declined to comment; however, in response, it’s stopped offering ADP in the UK. Apple has recently appealed to the Investigatory Powers Tribunal. Meanwhile, the UK government has argued that encryption enables criminals to hide easily and that it wants to access encrypted data only where there’s a risk to national security, rather than for mass surveillance purposes. However, cyber security expert Professor Alan Woodward argued that such methods are misguided and “won’t make the UK safer”.
   
• Trade unions are celebrating the measures outlined in the new Employment Rights Bill, with Unite stating that the government has “listened and acted” to improve the bill in favour of workers. As part of the changes to the bill, which is currently in the reporting stage, the government plans to ban zero-hour contracts, with employers required to offer agency workers a contract. With more than a million people in the UK currently employed on a zero-hour contract, according to the Office for National Statistics, it’s hoped that the changes will enable workers to “enter a labour market where good jobs offer both security and flexibility”. Workers who opt for a zero-hour contract will also be entitled to compensation should their shifts be cancelled or changed at “short notice”. Although unions have welcomed these reforms, they’ve also urged the government to not undermine the “flexibility” that zero-hour contracts provide for some workers.
   
• According to a study from Public First, the increasing trend of ‘digital nomads’ has been costing the UK £3 billion in consumer spending and £320 million of lost value-added tax (VAT) revenue a year. ‘Digital nomads’ refers to the approximately 165,000 British citizens living and working abroad for longer periods of time, with the UK’s high cost of living and the financial advantage of working abroad cited as one of the key reasons many choose to do so. British digital nomads still pay their income tax and national insurance contributions; however, this doesn’t include VAT and the economic activity that would’ve been generated by their general spending. Despite this, digital nomads contributed £1.6 billion in income tax and national insurance in 2024 – revenue that could be lost if they were to away from the UK permanently.
   

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