Unit 1 Business Purposes

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Presentation transcript:

Unit 1 Business Purposes P4- outline the role of government in creating the business climate

Aim of this presentation Understand the business context in which organisations operate

Business Context Understand the business context in which organisations operate Things outside the business that influence the decisions that it makes. One component of this business context is: The way in which government affects business through its handling of the economy.

Government Who are they? Groups of people who have been chosen by voters to represent them.

Role of Government There are 3 main layers of government which affect businesses in this country European Union government - consists of 3 main decision making bodies European Commission Council of Ministers and European Parliament National Government Decisions made by the government of this country and approved by the House of Commons Local Government Local Council in your area

European Union 27 countries or member states They have the power to pass laws and make decisions which affect businesses in every EU country. Some rules made by the EU allow some countries to opt out. Countries in the EU Britain has chosen not to join the Eurozone – the single currency

The European Union http://www.youtube.com/watch?v=VvIPSY_Sbfg&feature=related

National The British government makes laws about what businesses can and cannot do. In Wales, Scotland and Northern Ireland, there are regional assemblies that also make important decisions that affect businesses in these countries.

Local Local representatives or councillors are chosen. Local councils pass laws which affect local businesses.

Role of Government Government European National Local Makes decisions Regulations and other rules are created by European Union decision-making bodies Laws created by Parliament Local rules created by local councils that affect businesses Example, setting a minimum wage that businesses must pay their employees setting out pollution controls and environmental standards that must be met Example, setting out how businesses and charities must register and the paperwork they have to create Example, covering opening hours of nightclubs and discotheques

Government Policies Government policies and actions affect businesses in many different ways: Growth – the number of units produced. The more goods are produced, the more people are employed, they earn more, they spend more and so on. Growth is measured by GDP = gross domestic product ie the total value of goods produced in a country in a given year.