A recent survey of 600 European tech start-ups, conducted by venture capital firm Index Ventures, reveals that most companies do not anticipate artificial intelligence (AI) tools leading to job losses. In fact, half of the surveyed firms view AI investment as an opportunity to expand their workforce, while an additional 29% expect to maintain current staff levels.

While some start-ups acknowledge that certain roles in areas such as software development, marketing, and customer service may be reduced due to automation, they expect to increase hiring in other sectors, particularly in software engineering and product development. According to Hannah Seal, a partner at Index Ventures, this optimistic outlook aligns with her experiences working with high-growth companies. She explained that AI tools are seen as productivity enhancers, rather than role replacements. For example, AI assistants like GitHub’s Copilot can double the efficiency of engineers, enabling companies to allocate resources more effectively and focus on expanding their product offerings without reducing headcount.

The study also highlighted that many employees are taking a proactive approach to adopting AI technologies. On average, workers are dedicating four hours per week to self-teach AI tools and techniques. In contrast, only 29% of respondents reported receiving formal training from their employers. Employees skilled in AI-related areas are commanding higher wages, with an average salary premium of 10% compared to their peers in non-AI roles.

Seal further noted that AI-powered services are not only enhancing productivity but are also helping address labor shortages in specific industries. She pointed to DataSnipper, a Dutch start-up that developed software for auditors, as an example. By automating the tedious task of data reconciliation, AI enables auditors to focus more on strategic client advisory work, making the profession more attractive to new graduates and helping to draw fresh talent into the field.

The findings suggest that, for many European tech start-ups, AI is viewed as a tool to enhance capabilities and drive growth rather than a threat to jobs. As businesses increasingly invest in AI technologies, it appears that the focus is on leveraging these tools to improve productivity and foster new opportunities, both for companies and their employees.

HM Revenue & Customs (HMRC) has reported a significant rise in tax receipts, marking a positive development for the government following recent budget criticisms. According to leading audit and business advisory firm Blick Rothenberg, total tax receipts have increased by £24 billion over the past year compared to the previous 12-month period.

Tom Goddard, Senior Associate at Blick Rothenberg, noted that the growth in tax receipts has been consistent, despite a slight dip in August where receipts were almost £1 billion lower than in August 2023. He stated, “Total tax receipts continue to grow year on year, with an increase of £24 billion over the last 12 months. This offers some much-needed financial optimism for the government after a challenging budget that left many concerned about the economy.”

The latest figures show that total tax collected in the past year has now surpassed £842 billion and is on track to reach the £850 billion mark by December, traditionally a strong month for revenue collection.

Income tax has been a major contributor to the increase, with an approximate 8% year-on-year rise in receipts. This growth outpaces the current Consumer Price Inflation (CPI) rate of 2.3%, which itself rose by 0.6% in the past month. Goddard explained, “The rise in wages, particularly for the UK’s lowest earners, is continuing to drive higher tax receipts. Labour’s commitment to maintaining the national living wage and freezing income tax thresholds and personal allowances until 2028/29 will bring even more people into higher tax bands.”

Goddard further highlighted the potential future impact of these policies. “Labour’s stance on income tax thresholds and National Insurance contributions will not affect the tax take until after April 2025, but the groundwork is already being laid for a sustained increase in tax revenue in the coming years.”

On the topic of inheritance tax, which has also drawn attention in recent discussions, Goddard pointed out that it contributes a relatively modest portion to HMRC’s overall receipts. Over the last year, inheritance tax accounted for just under £8 billion, or approximately 0.9% of total receipts. He added that any changes to Agricultural Property Relief (APR) and Business Property Relief (BPR) will not impact revenues until April 2026, and the effects of inheritance tax changes may not be seen until November 2026.

The boost in tax receipts comes at a crucial time, providing the government with some financial breathing room amidst ongoing economic challenges.

Santander UK has set aside £295 million to potentially compensate customers affected by the mis-selling of car loans, as the controversy surrounding the motor finance industry continues to escalate. The bank’s provision comes amid concerns that the mis-selling scandal could lead to a redress bill of up to £30 billion, with Santander’s move contributing to nearly £1 billion in compensation provisions across the industry so far.

The issue stems from a wide-ranging review by the Financial Conduct Authority (FCA) into potentially unfair commissions in motor finance deals, which has prompted several lenders to set aside funds. Santander’s decision follows a landmark Court of Appeal ruling last month that expanded the scope of the issue and raised the possibility of mass redress for consumers.

The Court of Appeal judgment significantly widened the legal requirements around commission disclosures in motor finance agreements. The ruling found that any commission not properly disclosed or consented to by the borrower was unlawful, making lenders liable for repaying affected customers. This shift in legal interpretation has sent shockwaves through the industry, with lenders revising their practices and temporarily suspending some operations.

Santander’s provision, disclosed in its third-quarter figures, includes estimates for operational and legal costs, as well as potential compensation. The bank acknowledged significant uncertainties regarding the extent of any misconduct, stating that the financial impact could be either higher or lower than the amount set aside. The decision to make provisions follows growing expectations that lenders will be forced to compensate customers due to these mis-selling practices.

The provision also contributed to a sharp decline in Santander UK’s pre-tax profits, which dropped to £143 million for the three months ending in September, down from £558 million during the same period last year. The bank joins other major lenders, including Lloyds Banking Group, which has set aside £450 million for similar issues.

The controversy began in early 2021 when the FCA banned discretionary commissions, which were linked to the interest rates customers paid on loans. The commission arrangements were seen as encouraging dealers to sell more expensive credit to customers. The FCA’s subsequent investigation into these practices has sparked consumer complaints, leading to a review of contracts dating back to 2007.

The Court of Appeal ruling in October compounded the issue, calling into question the adequacy of current FCA regulations. Critics, including the head of the Finance & Leasing Association, have argued that the lack of regulatory clarity allowed the court to intervene, exacerbating confusion in the market. As the legal and financial consequences unfold, the industry awaits further clarity from the Supreme Court, which may ultimately decide the future of compensation claims.