Effect of Government Policies on Tesco

Effect of Government Policies on TescoIntroductionThis report exit identify and cond mavina oscilloscope of current brass policies which deport a signifi undersidet effect onTesco. An analysis pass on also be carried out on the implications of thesepolicies as well as the mixed bags in them and an explanation on how Tesco mayreact to them. The findings of this report be below.FindingsThere ar a range of unlike disposal policies which expunge Tesco in many distinct offices. When the governing introduces much(prenominal)(prenominal) policies, Tesco involve to react to them to take down they ope calculate legally. Further much, if a form _or_ system of government changes Tesco also conduct to react.The government introduces such(prenominal)(prenominal)policies to assist fulfil many of their aims which let inEconomy branchFull employmentControlled inflation/deflation the rate ofinflation macrocosm 2%A healthy balance of PaymentsCare of the surroundings go do wnd CO2emissions in line with the United Nations CompactA grave social welfare state so that everyone isprovided forA sustain suitable energy indemnityDifferent policies the government has in place endpoint be looked atbelow. Economic polityEconomic insurance which result refer tothe actions that the government go away be taking in the economic field. Thiscovers the systems in place for setting the levels of levyation, governmentbudgets, the bills supply and interest evaluate. Most factors of economic policy flock be split into fiscal policy which deals with the government actions which volition be regarding assessation and spending into monetary policy which forget bedealing with central banking action which leave alone be regarding to the bullion supplyand interest rates.The government does many distinctthings to advance the economic environment in which problemes such as Tescooperate. These embarrass policies to mesh inflation such as changing taxes andinte rest rates, to summation employment, to encourage overb nonagenarian cablees by givingmore bullion to help newfound bloodes to graduation up such as Invest NI, giving help to personal line of credites to grow their exports and to help improve the exchange rate.Corporation taxAn increase in integrated income taxes has a direct effect on a business such as Tesco. A tax increase on company clams deal hurt a businesss boilersuit financial performance. Some corporations and small companies argue that just about companies should throw the ability to compensation less(prenominal) in taxes, not more. The businesses that maintain a lower tax base pull up stakes be able to boost the economy by appareling more money to expand, resulting in more jobs as a result. When company tax rates increase, Tesco may respond by raising prices on goods and services.National Living net incomeA countrys economic policy could also affect wages. When there are increases to a national minimum wag e and so this volition take in workers by pull up stakesing them to earn more money for the same work as a result. Thats usually good for the workers, entirely Tesco find this challenge be throw it increases cost. Labour costs are usually a companys greatest expense. Some corporations allow for argue that they sternnot postulate against businesses which are located in other(a) countries in the world wrap upering a much lower minimum wage as a result. That can result in the business to conduct many job functions to foreign countries such as Germany as Tesco will be responding by sourcing products from countries such as China and sourcing their clothing acquit from places such as India.Government spendingMore spending by the government can be a major help for whatsoever companies. For physical exercise, a business such as Tesco benefit when the government uses tax geters money to spend billions on new roads, bridges and personal credit lineports. This benefits Tesco as they pick up a wider access to different and possibly cheaper distribution channels to source their products and deliver products to consumers. This is why businesses such as Tesco spend succession and effort trying to affect economic policy decisions. Usually, a government cannot increase the money spending in one area without taking money away from something else as a result. A government which has an economic policy which will be dictating more money to be spent on defence may guide to disgrace support for role model such as building more hospitals. This action can result in less work for construction firms, which can force businesses which operate in that industry to reduce cater or freeze open positions as a result. This has implications for Tesco as more pot are unemployed and so less battalion are defileing their products so their sales and subsequent acquire will decline. The government must(prenominal) delay they give different policies equal heed as changin g one will ultimately change another and this has implications for Tesco such as having to decrease their prices of their products and services so that people can expend to buy them.Health Care Spending Some economists believe that rapidly rising health care spending will then(prenominal) be elbow greaseed the GDP and overall employment, while raising the inflation. Tesco is affected by inflation in many ways. Inflation center that the costs for Tesco will increase. For example, they will have blue energy bills, high embark costs, high costs for raw materials and higher cost of services such as internet services and insurance. collect to these increases in costs, Tesco must react to them by either passing on these costs to consumers in the form of higher prices for products and services which may lead to a decrease in demand, or by absorbing the increase in costs and not passing them on to the consumer. This blind drunks that profits for Tesco will scratch so they must find other ways of trying to reduce costs. As costs are rising, Tesco must react by reducing their costs of production or the price they pay for goods and services to suppliers to be able to contest with competitors such as ASDA and Sainsburys and survive.Youth Unemployment PoliciesIn the UK, around 40% of the unemployed are under 25. Tescos first response to a period of recession is to stop recruiting new staff rather than to lay off their existing, motherd and knowledge workforce. Only when Tesco is in a state of financial stress does it normally capture people redundant. The young trying to move from procreation into the workforce are then most exposed to the disappearance of new vacancies. The governments strategy to tackle the high levels of youth unemployment has been coherent but may be poorly delivered and lacking in scale. Noting that most youth unemployment occurs surrounded by leaving full-time education and finding work, the government has not and got to extend ed ucation and training set officipation as part of its economic policy, but also try to increase recruitment of the young into jobs through crack some work experience or apprenticeships if they are not making achievementful transitions quickly. This has implications for Tesco as they may have to take on less ingenious individuals who the government have put into working schemes alongside Tesco. Tescos productiveness may decrease as a result of poorly skilled staff and they may react by cutting out apprenticeship schemes indoors the company and put all prospective-workers through the application process like everyone else.Competition PolicyThe main aims of rivalry policy is to tug competition, which will make securities industrys work fall in and offer towards improved efficiency in competitiveness of UK businesses which operate in the European league (EU). Competition policy aims to ensureSafeguard and promote the interestsof consumers through increase choice and lower pric e levelsEffective price competition between suppliersTechnological innovation which will bepromoting dynamic efficiency in different marketsCompetition will then play a vitalrole in helping the companies to grow and win new customers. In addition, the Competitionlaw exists in order to make sure companies will be competing on a level playingfield. It will then prevent their customers (other businesses or consumers) fromlosing out.Competition Act 1989This is government policy towards increase competition in the market. It includesDeregulation means opening up the market andallowing new entrants into it for example, transferline industry, energy industryand mail industryRelaxing rules and regulations andadministration in order to encourage new businesses to set up and compete withexisting businesses for example, new airlines, new banks, new private give lessonss,new private health clinics and new energy providers.Policy to eliminate anti-competitivepractices and cartel agreements ens ure that one or two businesses do notdominate a market and that competition is as fair as affirmable for examplesupermarkets such as Tesco, airline industry, energy industry, oil industry.Competition policy will therefore partake onan organisation such as Tesco directly and indirectly. Directly because it willcontrol their ability to merge or take over other businesses without governmentintervention and their case may even be referred to Europe for approval. Itwill also impact Tesco indirectly because of this government intervention toencourage and promote competition there will be more competition in the suchindustries and this will mean products and services which Tesco house will beavailable at cheaper prices.Market Power PoliciesThe government has policies in place to prevent and reduce the abuse of market baron. If a peculiar(prenominal) company has more than 40% of market share then it will be considered to have market supply. In addition, the OFT is much more likely to investigate companies which have a dominant market position. Abuse of market power can lead to market failure and this can be against the human beings interest therefore the government will be concerned to intervene and protect the interests of consumers. Evidence of ab apply market power includes charging excessively high prices, using predatory set which involves cutting prices and selling below fairish cost in order to force competitors out of business and there are vertical restraints which involve the monopoly firm imposing prices or restrictions on its suppliers. The government has policies in place such as marketing power policies which promotes competition and prevents excess pricing. These policies impact on Tesco as they will be unable to abuse the market power which they have a lot of as they are the vaingloriousst grocery supermarket in the UK. Tesco insists they do not raise prices or otherwise worsen our retail offer where there is less local competition. This show s that Tesco reacts to these policies by staying within their guidelines for example not increasing prices for a particular product or service because it cannot be bought anywhere else in that area. These types of policies are good for Tesco in that they control other businesses abusive power to charge inappropriate prices for goods and services which could drive Tesco out of business. However, it does mean that there are tight rules and regulations which Tesco must face in relation to Tesco so they must be very careful the prices they charge for goods and services and the quality of service they provide. Reductions in Import ControlsThis will be a decrement in import tariffs which is to encourage cheaper products from overseas. Increasing or eliminating import quotas will have the same effect as a result. Allowing new countries into the European Union single market will be increasing the contestability. This government policy has significant effects on Tesco. It means that Tesco h ave greater access to importing their goods cheaply from countries such as China and India. This means that their costs are decreased and allows them to make a greater profit. Allowing new countries into the European Union means that Tesco will have more competition so it makes a more competitive-market, but this makes it harder for Tesco to maintain the largest market share if new businesses are being allowed to enter the market from foreign countries. This policy will be good for Tesco as it means they can trade more intimately and freely with other countries and can import cheaply. However, it does mean that other countries have a greater chance of culmination in and taking over some of the markets which Tesco has been run in. Anti-Competitive Behaviour This is the problem of c heating plant or finding loopholes which will include to getting round the regulations by moving into an adjacent market. For example, a large grocery retailer which is moving into the convenience inc lose market can be seen as a way of avoiding competition policy. A major literary criticism is that single markets are inadequately defined. For example, in 2004 the Office of Fair Trading allowed Tesco to purchase Admin store (the owners of Cullens, Europa and Harts) because has been regarded as a convenience stores to be a bankrupt market from the grocery stores. This will give Tesco 6% of the convenience food market which also includes 26% of the grocery market. Tesco argued that the two markets are quite distinct, however critics have argued that the markets will be almost indistinguishable and also that Tesco shouldnt have been allowed to enter the convenience food market as well. Anti- competitive policies ensure that mergers, takeovers and the exploration of new markets are all gaine fairly and within the law. This impacts Tesco as it restricts what they can and cannot do in terms of what different markets they explore. This may mean that Tescos profits are restricted also what they contour a single market to be may be different to what the government class a single market to be. Having anti-competitive policies in place is good for Tesco as it gives them a framework of what they can and cannot do as well as the protective covering against other companies trying to take over them or put them out of business. These policies definitely protect Tesco, offer the business a sense of security and allow for a healthy competitive environment. industrial PolicyThe industrial policy of a country is itsofficial strategic effort to encourage the augmentment and growth of part orall of the manufacturing sector as well as other sectors of the economy.Changes in the international economy will mean an increase in both competitionand opportunities from the global markets. The government will want to enableUK companies to compete and grow. The UK government are developing anindustrial strategy which will be about setting out a long-term, whole ofgovernment approach w hich is into how they support companies. This will thengive confidence for investment and growth.As part of the strategy for industrialpolicy, the government aim tosupport emerging technologiesdevelop strategic partnerships with industrywork with business to help develop skillsthat businesses will inquirepublish government contracts to provideconfidence to business investmentimprove access to finance for businessesIndustrial policy is governmentpolicy focusing on helping and developing different industries such as theconstruction industry, IT industry, pack industry and tourism industry. Thiscould give tax breaks to particular industries for example rock-bottom corporationrates, reduced rates and lower VAT rates for tourism products. Industrialpolicy golf links very closely with economic policy.Corporation taxThis is a government policy which the government could change at any time. A rise in corporation tax (which is taxation on business profits) has the same effect on a company such as Tesco as an increase in costs. If the government increase corporation tax, Tescos costs ultimately increase. They can react to this by passing on some of this tax to consumers in the form of higher prices for goods and services but it will also affect the bottom line.Energy and infrastructureInvesting in infrastructure provides greater availability and access to skilled labour and intellectual property both in targeted growth industries as well as new and entrepreneurial industries. With labour costs being the highest costs of businesses, progressive improvements in the capability of the workforce and access to skilled workers are critical for innovation, service value, product quality, productivity, efficiency and operating costs. As a result of the government investing in infrastructure,Tescoultimately can gain access to greater skilled staff which improves theirproductivity and overall sales. Improved infrastructure for industries such asthe retail industry which Tesco l ies within can also lead to improved energyefficiency for stores and this decreases costs for Tesco allowing them toincrease profits withal.WagesA countrys industrial policy could also affect wages. When there are increases to the national minimum wage then this will benefit workers by allowing them to earn more money for the same work. Thats usually good for the workers, but it can be challenging for companies for example like Tesco and impacts them because it increases costs. Labour costs are usually a companys greatest expense. In addition, some corporations argue that they cannot compete against companies which are located in other countries around the world offering a much lower minimum wage.This can result in a business to transfer many job functions toforeign countries as a result. For example, Tesco reaction to changes innational living wages include sourcing products and services from othercountries at cheaper prices so that they can reduce their costs to make up forthe in creased wages.Transport PolicyTransportpolicy deals with government policy in relation to road, rail, air and sea merchant vessels and deals with issues such as access, congestion, the effect on theenvironment, vehicle tax and crime. This will includeDevelopment of roads, rail links, sea portsand airportsPolicies to ensure sentry duty and security on transportPolicies to reduce congestion on majorarterial routes. For example, congestion tax,road tolls and tolls for parking your car on the streetsTransport policy links closely witheconomic policy, environmental policy and regional policy and different areaswithin this policy have different impacts on Tesco.Transportation policies and projectsoften affect the employment, productivity and profits of specific industriesand businesses, and communities in which they are located. For example,policies that improve transport options and discourage motor vehicle travel mayreduce employment and profits in vehicle and enkindle production indu stries, andtherefore economic activity in areas where those industries are concentrated.Similarly, improving airport transit service may reduce taxi service demand.Advocates for the affected industries often lobby against such policies ongrounds that jobs and economic activity will decline, but such impacts are principally economic transfers (one industry, business or area benefits at othersexpense). Transportation policies can also affect the competitiveness of localindustries. Low transportation costs make locallyproduced goods less competitive compared with imports, harming localindustries. This could mean that products which Tesco source locally are doneaway with as the company is impacted by these cheaper meaning costs andsource their products from further afield. For example, some vegetables are cheaper to grow in California and Floridathan in Union Ireland, so low shipping costs leads to more importedvegetables and less local farm production.Belfast Rapid Transport System B RTBelfast Rapid Transit (BRT) is an innovative and ambitious project that will create a new and dynamic human beings transport system for Belfast. BRT will offer a high quality service providing people with better access to jobs, hospitals, shops, schools, colleges, and entertainment. With a more efficient and effective transport system in Belfast, Tesco are impacted. This government project will allow customers and employees of Tesco easier access to stores to subscribe out their shopping. Deliveries will also be delivered more quickly to Tesco stores from warehouses. This impacts Tesco as they are able to extend the breadth of their customer base as customers can get to and from their stores much more quickly and effectively. If customers find it easy to get to Tesco stores they are much more likely to shop in those stores than one which is thorny to get to and the BRT allows customers to benefit from this. With changes to this transport system, Tesco are then able to maximise their sales much further and subsequently increase their profits too. The BRT project will impact Tesco as infrastructure is improved and so relationships with new suppliers who can avail of this new infrastructure can be established. This could mean that Tesco could source some of their products more cheaply and this will also impact company costs as they are reduced.Belfast Transport HubThe Belfast Hub will be a world class multi-modal transport interchange acting as a high quality gateway for Belfast and beyond. The new Hub creates an excellent first judgment of Belfast as a confident and progressive capital city and will facilitate the areas regeneration as an attractive place to live, work and visit. The Hub will ensure the people of northern Ireland have the right infrastructure in place in order to attract more people to use public transport and active travel modes as a result. Along with other key projects, this will then be enabling a transformation into the public transp ort where they are making a positive impact for everyone in Northern Ireland. Due to the result of the government investing 150m in this new transport hub, businesses such as Tesco are impacted. Around eight million passengers a yr will currently pass through the Europa bus centre and capital of Seychelles Street railway station, but this figure is expected to rise to thirteen million over the next fourteen classs. This could importantly increase the come of customers who visit Tesco stores in the Belfast area and could drive their sales and subsequent profits, allowing them to increase their market share and grow the company as a whole. The Dublin endeavor train is hoped to be a part of the hub which would even help Tesco to increase their customer base from the south of Ireland as well as the north.Congestion chargesThe Northern Powerhouse Investment Fund (NPIF) will provide an additional 1.1 billion by 2021 in new reinforcement to relieve congestion and will then be deliveri ng much needed upgrades on local roads and public transport networks. Congestion charges could be introduced for motorists which are travelling into Belfast in the future, this is match to a document which was prepared by the city council. Its submission to the assemblys finance department was pointed to the success of the recent congestion charging which is in London and the road pricing in Durham. The council has said to the public that the local authorities should benefit from any revenue. However, Larne and Lisburn councils told the department that they believe this idea is unacceptable to the public as a result. The section of Finance is reviewing possible changes to rates. In the city of London, all revenue raised by congestion charging will be re-invested back into the citys transport system as a result. A Transport for London report has just found out that congestion levels in the zone are to be on an average 26% lower than in 2002 before the scheme had been implemented. I t will now be costing 10 to bring your car into central London on the day, or 8 if you pay ahead. If these congestion charges were implemented into the Belfast area, it may turn people off going to Belfast and shopping in Belfast. This impacts on Tesco as many of their customers like to travel to stores via their own cars for their own convenience. This may deter their customers from visiting Tesco stores in Belfast and this will have a significantly negative impact on the companys sales and overall revenue that it gathers each day. Tesco may react to this government policy by using incentives for customers to visit such stores. For example, offers or money-off coupons in stores where customers would have paid congestion charges to get to.Social PolicySocial policy means the policies that are introduced for welfareand social protection. It relates to the provision of social services andwelfare state. This includes issues such asEmploymentCommunitycareHealthCrimeHousingSocial disadva ntage.Within these issues lie topics suchas minimum wage, social security payments, pensions, fuel costs and redundancypayments. In general terms, it looks at the idea of social welfare, and itsrelationship to politics and society as a result. There are many differentgovernment policies within social policy which have an impact on businessessuch as Tesco.Housing benefitThe government may offer the people of the UK help with all or part of their rent. There is no set amount of housing benefit and what a person gets will appear on whether they rent privately or from a council. There may also be increased housing benefits for older and vulnerable people. Help to buy policy The government also have a policy in place which helps support peoples aspirations to own their own home. The Help to buy scheme enables people to buy a home priced up to 600,000 with a deposit of as little as 5%. Through this help via social policy, even businesses such as Tesco are impacted. If the government are financially assisting people to pay for their accommodation and housing, those people have a higher disposable income to spend in places such as Tesco. If there were no social policies in place with regards to housing, people of the UK would struggle a lot more with regards to making payments and would have a lot less money to spend around them. Tesco are impacted here as people simply dont have the money to spend with them and so they lose a lot of customers. Due to this, they may have to lower prices for goods and services which will ultimately damage the companys overall profits.Reducing/Increasing welfare benefitsIn the UK, unemployment benefits are also known as welfare benefits. This is where the government give a proportion of money to those who are unemployed and not working. Reducing and increasing welfare benefits have very different impacts on Tesco. Higher welfare benefits help to reduce disagreement and reduce relative poverty in the UK. Higher benefits will give thos e on low income a better living standard and help contribute to a more cohesive society. This impacts Tesco as people who are unemployed and receive a higher benefit will have a higher disposable income to spend with them. For example, a person who receives 60 per week may not have as much money to spend in Tesco as a person who receives a welfare benefit of 150 per week. Tesco may be happy that people receive a higher welfare benefit as they will increase their sales.However, it also has drawbacks forTesco too. Increasing welfare benefits creates a disincentive to work. Ifwelfare benefits are too generous, people may have a strong incentive to avoidwork or work fewer hours. This may impact Tescos employees who feel that ifthey do not work, they may real receive more money from welfare benefitsthan they do from their wages with Tesco. This could ultimately lead toemployees within Tesco becoming a lot less productive as they have a smallerincentive to work for money and may actuall y leave the company completely. Thisimpacts Tesco as if this occurs they have to spend time and money onrecruiting and training new staff to the same level as previous staff.Furthermore, higher welfare payments increase the burden on the governmentrequiring higher taxes and / or higher borrowing. Both taxes and borrowingplace economic costs on society and this can affect Tescos taxes as well astheir customers ability to afford their products if they are being taxed moreheavilyYouth unemployment policies such as the Youth ContractThe government have introduced policies to tackle an aspect of social policy which is youth unemployment. The Youth Contract will be aiming to expand the opportunities for young unemployed people for them to find applicable work experience which can be, hands-on training and they will be able to start the process of building a positive employment volume afterward they have left school or college. It will need to be seen in the wider context of other gover nment policies for example increasing the school leaving age to 17 and also requiring that all school leavers will have a suitable qualification in Maths and English so that they will have a prosperous career. The main aim of the Youth Contract is to assist as many young people as possible into sustained employment where they will have a meaningful career. This policy has a number of featuresApprenticeship Grant for Employers of 16-24 year olds. This government subsidy will pay 1,500 to employers who haveless than 50 employees that take on young apprentices.Support for 16 and 17 year olds Payments of 2,200 are made to providers who take on 16 and 17year olds who are not in employment, education or training and who have low or no qualifications,and also those from other disadvantaged backgrounds.Work experience These are placements which are available for 16-24 year olds,through Jobcentre Plus who have been claiming Job Seekers Allowance for atleast 13 weeks.The Youth Contract policy has impactson Tesco too. Tesco have the opportunity to recruit and be paid for it.Although it will cost to train staff, they may retain some of the governmentsmoney which they are minded(p) and use it for other operations of the business suchas improving customer car parking, customer service or facilities in-store.Tesco will also be impacted as they can be seen as having a better corporateimage if they are supporting 16 and 17 year old people who are not ineducation, employment or training or who come from disadvantaged backgrounds.Education and Training PolicyThis is the government policy inrelation to education and training such as STEM subjects, apprenticeshipschemes, internship, university fees and the school leaving age. The overallaims of education and training policy are to improve education and training andin turn society and increase economic growth. There are different governmentpolicies within this policy which have an impact on businesses such as Tesco.Skills focused training The investment by the government in skills focused training, for example through education and training in schools to prepare people for future aspects of the work place are essential in future innovation. Tesco require an adequate knowledge pool of skilled employees to develop a wide range of innovations. Through the government having such a policy in place, people become more educated and this has implications for Tesco. It will result in a more skilled-workforce being available for recruitment and once recruited, allows for more skilled workers within the company. This can improve the profitability of Tesco and impacts them by increasing their profits and market share.Increasing university feesThere was a 17% fall in the number of first year undergraduates at UK universities in the first year due to the higher tuition fees that has been imposed. This doesnt look good for the economy as it would seem that fewer people would graduate in specialised industries.However, it m ay have benefitted Tescoas more people looked for full time employment instead of going to university.This impacted Tesco as they had a greater number of people to need from whenrecruiting. They also had the option of more skilled people when recruiting asthey may have had a 17% increase in people to choose from. However, theincrease in university fees may have negative implications for Tesco. If peoplegraduate with greater debt with their education fees, they may spend less sothat they are able to pay off their debt. These cuts in their spending may bewith Tesco as they attempt to save money and this ultimately damages Tescosales which they will have to look for ways to improve again.Pathways to successPathways to Success is the Northern Ireland Governments over- arching strategy is in order to prevent exclusion and promote participation amongst young people who are not in education, employment or training, or at risk of becoming so. As the government do this, Tesco are impacted. There are implications such as Tesco introducing schemes to include young people in their workforce such as a scheme for 16-18 year olds who are not in work and take them on and train them up with necessary skills to succeed in a job role with Tesco. Pathways to success may also have implications on Tesco such as the company being able to recruit more specialised people for more specialised roles. For example, if a person has been in education and training through Pathways to Success which improve their marketing techniques, then Tesco may take on this person to help them with their marketing team. This impacts Tesco as they have a better work force who can market their products and services to an even greater level and subsequently, sales and profits could be increased further. Tesco may react to this policy by taking on employees via schemes for people who come from disadvantaged backgrounds and offering them a job within the company. This would also contribute to decreasing unem ployment figures.Environmental PolicyEnvironmental policy is to do withcaring for the environment. Every government now has to achieve CO2 targetsafter the agreement. This means that every government has to introduce policiesto achieve these targets. Environmental issues will affect companies whichinclude industrial waste, sustainable development of raw materials and waterand air emissions.These are issues which affect companiesdue to laws which require companies to change equipment and procedures to meet imposedstandards, which as a result cost businesses a lot of money. Many companieswill undertake stricter changes in an effort to preserve the environment anddo what is right. These companies will then pay for the protective andproactive environmental measures and will then also attempt to recoup theexpenses through consumer good will or the added consumer base which is gainedfrom an environmentally friendly policy. This policy links closely with transportand industrial policy.The Kyoto Protocol 1997 was the firstinternational treaty to set legally binding emissions reduction targets fordeveloped countries that ratified it. This would lead to a greenhouse gasemissions reduction of 5.2% below 997 levels between the years 2008 and 2012.Governmentenvironmental policy is led by the Department for Energy and Climate Change(DEEC). In 2008, the UK government greatly enhanced its environmental policy bychanging the law through the Climate Change Act. This act includes thefollowing targetsA UK wide mode change risk assessment mustbe completed every five yearsPublic authorities and some companies mustreport on what they are doing to reduce climate riskA climate strategy has to be publishedA programme must be put in place to reduceclimate change risksSome policies the government haveintroduced under environmental policy will be looked at below.Renewable energyThrough the government introducing policy in relation to renewable energy, they pay energy users who will be i nvesting in a small-scale, low-carbon electricity generation systems for the electricity they generate and use and provide incentives for businesses to install renewable heating instead of fossil fuels. This has implications for Tesco and Tesco respond to changes in this policy. Tesco have a long term goal to become a zero carbon retailer by 2050 and they have zero-carbon stores to meet this goal. Their special stores use a mix of environmentally-friendly design, materials and technologies to ensure that all energy-consuming equipment, no matter how big or small, is as efficient as possible whether that be the refrigeration system or the hand drier in the toilets. This shows how Tesco have responded to changes in the governments renewable energy policy and the impact of such a policy on Tesco.Energy wise schemesThe government has introduced many different energy wise schemes over the past number of years. The government once funded the Green Deal Finance Company, which was set up t o lend money to Green Deal providers. This although not directly linked to Tesco did actually have implications for the company and they reacted in different ways. The heating and cooling system in Tescos Ramsey zero-carbon store uses 66% less energy than a emblematic store of a similar size. They are designed to help Tesco reduce their carbon footprint. Introducing air conditioning to all stores reduces the need for extra heating or cooling and this also helps Tesco save energy by preventing heated air escaping outside their stores. Other reactions by Tesco to energy wise schemes introduced by the government are the introduction of sophisticated lighting control systems. These can automatically dim individual lights when the natural daylight increases and can be linked to timers and motion sensors to ensure that lights are not left on when they are not needed. This shows the lengths Tesco are going to in ensuring they stay ahead of the energy schemes which the government introdu ce and as they attempt to be the first zero-carbon retailer.Waste legislation and regulationsThe EU Waste Framework Directive will be now providing the legislative framework for the collection, transport, recovery and disposal of waste, and will also be including a common definition of waste. The directive will now be requiring all member states to take the necessary measures in order to ensure that the waste is recovered or disposed of without endangering human health or to be even causing harm to the environment and this will also include permitting, registration and inspection requirements. With such legislation in place, implications are in place for Tesco. Tesco have responded to this legislation by agreeing a deal to donate all the unsold food from its stores to charity. The supermarket giant has also announced plans for them to work with 5,000 local charities across the UK in an initiative with the aim to exterminate all its food waste by the end of 2017. Tesco have also re acted to this policy by drawing up a plan that by 2018, the store will have a 0% food waste figure and this shows how Tesco quickly and effectively react to implications position on them by government policy.fiscal PolicyFiscal policy deals with taxation andgovernment spending. This will cover things such ascutbacks in government spending andchanges in the way government spending is administeredchanges in taxation or example changes in incometax rates, VAT rates, Corporation Tax rates, airport duty and customs duties ongoods coming into the countrythe introduction of new taxes such assugar tax, fat tax and tax on bigger supermarketsUnder fiscal policy, the governmenthas many different measures in place and proposed measures to ensure it isfollowed effectively.Government spending cutbacksGovernment spending in a range of different areas is extremely important for things such as the economy and for business. Some government spending for example, on roads, infrastructure and transport will have an important effect on the long run productivity of the economy. If these areas of spending are cut, then the UKs productive capacity may suffer in the long term. Cutting spending in roads and transport may mean these areas become insufficient for use and can restrict people travelling to and from places. Tesco customers may not be able to use roads which they deem too dangerous due to insufficient repair and this impact Tesco as they lose customers and subsequent sales. It may also mean that Tesco cannot import products from other countries if transport isnt appropriate to do so which may mean they have to source their goods and services more locally and at a higher cost. However, capital spending is often the easiest place in order to make spending cuts this is because people dont lose out in the gyp term. If you reduce pensions, then people will notice straight away. If you reduce capital investment, then this action will affect people 10 or 20 years in the future. If the government make spending cuts to pensions for example, people may immediately try to save money for themselves in the future. This attempt as saving money for people may be reducing their spending on their weekly groceries and so ultimately Tesco suffer with a decrease in their sales. The government must ensure they give different policies equal attention as changing one will ultimately change another and this has implications for Tesco such as having to decrease their prices of their products and services so that people can afford to buy them.Increase in taxationThe largest source of revenue for the government is the income tax and this will then be levied against interest, dividends, capital gains and income. Therefore, the highest earners will then be paying high taxes. However, if there is an increase in tax then this will affect consumer spending in different ways including which will then be affecting the aggregate demand. Increase in tax reduces consumer spending. When t he taxes have been placed on specific products, then the consumers will tend to look for substitutes that are available at cheap prices. This has implications for Tesco as they may have to reduce the prices of their products to compete with other competitors such as ASDA and LIDL. This also impacts Tesco as a smaller price being charged means profits arent as high as the firm would wish for them to be. It is imperative to note that consumer spending is often two thirds of GDP. Therefore, the increasing taxes will then be reducing the disposable income. This will then mean that the consumers will only spend the money they have on essentials and no additional amounts. With the tax increases, the consumer spending reduces and this will then cause fluctuations in the economy because of the attitudes of clients or consumers towards the state of economy. This also has implications for Tesco who may have to compete in an economy which is struggling and so they will struggle too with import s and daily running of their stores.Increased rates for bigger supermarketsThe UKs largest supermarkets are being hit with increasingly disproportionate hikes in business rates that will bend more pain for them in times of recovering from an economic recession. Tesco, Sainsburys, ASDA and Morrisons face an additional bill of more than 110,000 per superstore in 2015-16 compared with 2010-11. This occurs at a time when small businesses have seen their bills reduced. This increase of rates for only the bigger supermarkets is seen as unfair and has many implications for Tesco. Changes in this policy impact Tesco as increasing their rates is an increase to their expenses and takes away capital which can be used to expand and which eats up the companys profits. It may also impact Tesco as they have to increase their price of goods and services to cope with these increased business rates and so consumers stop shopping with them and go to other smaller stores who dont have to increase thei r prices to cope with an increase in business rates.Regional PolicyRegional Policytargets all regions and cities in the European Union in order to support jobcreation, business competitiveness, economic growth, sustainable development,and improve citizens quality of life. Regional policies are policies inrelation to a particular region of the UK for example, Northern Ireland,Scotland, England and Wales. In 1994 the government divided the UK into anumber of different regions and developed policies according to the needs ofthose particular regions. Regional policy could includeDelegating powers to different regions. Forexample, Northern Ireland and England having different law and policingGiving more support to regions affected by floodingDesignating regions as Enterprise ZonesEnterprise Zones are areas regardedas being a disadvantaged area and are targeted by the government for growth anddevelopment. The government provides such areas with advantages in order toattract business to th e area. Some advantages provided could include a speedierplanning system, superfast broadband, business rates relief and enhanced capitalallowances. This would then help inward investment into the disadvantaged area.Stormont would like all of Northern Ireland to be designated as an enterprisezone with mini enterprise zones in struggling towns. This would help NI toreduce its dependence on government funding and develop more private sector jobs.Corporation taxSince 2010, the government has eased the regulatory burden onto companies and has also reduced the corporation tax rate from 28% to 20% with onshore tax receipts increasing by over 20% over the same period. To continue providing the certainty those businesses will need to make their long-term investments, then the government will be recommitting to the business tax road map which includes the principles that it sets out. This includes cutting the rate of corporation tax to 17% by 2020 which also includes reducing the burden of b usiness rates by 6.7 billion over the next 5 years. This has positive implications for Tesco as their tax is reduced and so they have the opportunity to use such capital on daily operations or even to expand, which otherwise would have been paid in tax. This also impacts Tesco as they are able to maximise their profits even further as an expense has been significantly reduced. This may enable the company to invest in other areas as seen in the past such as insurance and clothing. Another implication of this reduction in corporation tax is a better opportunity for Tesco to import goods from abroad as they are paying less tax on the money they are making and so can afford to import in greater volumes for cheaper pricesIntroduction of National Living WageIncreases to a national minimum wage will benefit workers by allowing them to earn more money for the same work as a result. This is usually great for the workers, though Tesco may find this challenging due to increased costs. Labour c osts are usually a companys greatest expense. There are some corporations who argue that they cant compete against other companies who are located in foreign countries which are offering a much lower minimum wage to their workers. This can result in a business to transfer many job functions to foreign countries such as Tesco responding by sourcing products from countries such as China and sourcing their clothing stock from places such as India.Increased and more in-depth trainingIntroducing and increasing more in-depth training to different job areas has helped shape a better economy and allows for better business practice. Thanks to EU funding around 21 million was made available under the PEACE II Programme farmers in Northern Ireland are being trained up to make todays technology work for them in their day-to-day administrative tasks. The overwhelming majority now acknowledge that the training they trustworthy has helped them to adopt better business practices. 80% of the part icipants stated that the training contributed to the use of better business practices. This training was given to 4,213 farmers and their family members. As the government introduce more in-depth training, businesses such as Tesco can benefit.Tesco may be impacted from this casefor example. Farmers (suppliers of Tesco) can now log communicate effectivelythrough the use of ICT with Tesco and this can make ordering products much more ingenuousr for Tesco. It also has implications for Tesco such as being cheaper tocommunicate with farmers via email instead of having to go to farms and gothrough gigantic orders. Changes to this government policy would impact on Tesco asthe farmers wouldnt be as heavily equipped with the skills necessary to carryout quick and simple business practice with Tesco and so more expensive methodsmay have to be explored by both Tesco and the farmer.ConclusionThis report successfully identifies arange of current government policies and their impacts on Tesco as anorganisation. The implications of these policies and changes in them have alsobeen analysed and ways in which Tesco may react to them has been looked at.Its clear that Tesco must endlessly be aware of current government policies andany changes in them so that they can make necessary changes such as to theirdocumentation and protocol to the way in which they carry out business whichwill ensure that it is positive for them and for the UK economy too.Bibliographyhttp//www.telegraph.co.uk/business/2016/11/23/autumn-statement-2016-telegraphs-business-panel-gives-verdict/ (accessed on 10/12/2017)http//economicsonline.co.uk/Business_economics/Evaluation_of_competition_policy.html (accessed on 10/12/2017)http//www.bbc.co.uk/news/technology-38304254(accessed on 10/12/2017)http//ec.europa.eu/education/policy/strategic-framework/indicators-benchmarks_en(accessed on 10/12/2017)http//www.hm-treasury.gov.uk/d/national_infrastructure_plan_051212.pdf(accessed on 10/12/2017)http//www.niassembly. gov.uk/Documents/RaISe/Publications/2013/enterprise_trade_investment/3613.pdf (accessed on 10/12/2017)http//www.telegraph.co.uk/business/2016/11/23/autumn-statement-2016-telegraphs-business-panel-gives-verdict/ (accessed on10/12/2017)http//www.investopedia.com/articles/economics/09/education-training-advantages.asp (accessedon 10/12/2017)http//ec.europa.eu/regional_policy/en/projects/united-kingdom/training-opens-new-doors-for-farmers (accessed on 10/12/2017)http//ec.europa.eu/regional_policy/EN/atlas/programmes/2014-2020/united-kingdom/2014uk16rfop003 (accessed on10/12/2017)