BUSINESS LIVE: Pay rises set to slow; Heathrow slams ‘tourist tax’; Frasers lines-up fresh buyback

The FTSE 100 will open at 8am. Among the companies with reports and trading updates today are Heathrow Airport, Frasers and SSP. Read the Monday 12 February Business Live blog below.

> If you are using our app or a third-party site click here to read Business Live

Heathrow: ‘Britain has shut the door on home grown growth’

Heathrow Airport has reiterated criticism of the so-called ‘tourist tax’, telling investors on Monday that Britain has ‘shut the door on home grown growth’ by ‘turning away international shoppers…and tarnishing the UK’s reputation as a competitive country to spend and do business with’.

Britain’s busiest airport added it had ‘joined forced’ with the British Chambers of Commerce and the Federation of Small businesses to make the case for ‘and internationally competitive tax-free shopping incentive’ in the upcoming Spring Budget.

Heathrow also reported that just shy of 6 million people travelled through the hub in January, a 9.4 per cent increase on the same time last year.

Heathrow CEO Thomas Woldbye said: ‘The year has got off to a strong start, retaining Heathrow’s crown as the best UK airport.

‘We are ready for the first passenger peak of the year, with February half term fast approaching. Whether you are travelling to ski, soak up the sun, or visit friends and family, Heathrow has you covered.’

Recession set to be confirmed and inflation up too in double blow to economy

Britain’s economy looks set for a double setback this week – with figures expected to confirm a recession at the end of last year and a rise in inflation at the beginning of 2024.

That would deliver a blow to ministers’ hopes of reviving growth and bringing the cost of living squeeze to an end as the election nears.

However, experts think the setbacks will prove temporary. And a business survey, from accountants BDO, suggests that output bounced back at the start of this year to its strongest level in 18 months.

UK pay rises set to slow

The rate of UK pay growth is expected to slow this year for the first time since the pandemic, potentially easing pressure on the overall rate of inflation, according to a closely-watched survey.

British employers expect to raise basic pay by an average of 4 per cent over the next 12 months, down from an expected rise of 5 per cent through 2023 and in late 2022, according to a survey by the Chartered Institute of Personnel and Development (CIPD).

This is the first fall since early 2020 amid the fallout of the pandemic.

Wage growth has been a key concern for the Bank of England and its efforts to tame inflation, amid fears of a wage-price spiral.

UK pay before bonuses was up 7.3 per cent in the three months to October, according to the most recent Office for National Statistics data, down from a summer peak of 8.5 per cent.

The BoE continues to keep a close eye on the rate of wage growth as it considers when to begin cutting interest rates.