Business news 4 December 2024
Some of the business news we have seen today that we thought would interest our members.
James Salmon, Operations Director.
Households cut back on spending
Data from Barclays shows that households cut back on essential spending at the fastest pace in five years in November. Essential spending fell by 3.1%, with this the sharpest monthly fall since 2019, while non-essential spending was up 0.8% on November 2023. The analysis shows that card spending fell by 0.5% year-on-year, marking the first decline since July. Jack Meaning, chief UK economist at Barclays, said: “A number of factors weighed on consumer spending in November, notably easing consumer confidence post-summer, and expectations that post-budget, inflation and interest rates will stay higher in the coming months.” The report also highlighted a decline in consumer confidence in the economy, which dipped to 25% in November from 31% in October.
Rail Nationalisation
Three rail firms are to nationalised by the Government next year after a law was passed allowing it to do so. South Western Railways ( in May 2025) C2C (in July 2025), and Greater Anglia (in autumn 2025), will be the first three to be nationalised, the transport department has confirmed. Although the Governments plan is nationalise all the rail services as their operator contracts either end or reach a break.
Reeves refuses to guarantee end of tax rises
Chancellor Rachel Reeves has refused to commit to her recent pledge to not raise taxes further. Speaking at the Confederation of British Industry conference in November, the Chancellor told business leaders there would be no repeat of the £40bn tax hikes announced in October’s Budget, saying: “I’m really clear, I’m not coming back with more borrowing or more taxes.” However, when asked to re-commit to no more borrowing or taxes in the Commons, Ms Reeves would only say that the Government will “never have to repeat a Budget like that.” Shadow Chancellor Mel Stride asked if Ms Reeves “spoke without thinking” when she said there would be no more hikes. He went on to argue that there is a risk of future tax increases, “given how tight the Chancellor’s fiscal headroom is.” John O’Connell, chief executive of the TaxPayers’ Alliance, said taxpayers will be “genuinely fearing” a fresh tax raid next year.
MPs support NI hike for employers
The Government is moving forward with an increase in employer National Insurance contributions (NICs) after the House of Commons voted 332 to 189 in favour of the Bill which aims to raise NICs by 1.2 percentage points to 15% as of April. The shake-up will also lower the threshold at which liability starts to £5,000 from the current £9,100. The Treasury estimates this policy could generate £25.7bn annually, although the Office for Budget Responsibility predicts a more conservative £16.1bn by 2029/30. While Treasury Minister Tulip Siddiq emphasised the need for these measures to restore economic stability and support long-term growth, shadow Chancellor Mel Stride has voiced concerns over potential job losses and wage reductions.
Goldman Sachs says tax hikes will hit employment and inflation
Analysts at investment bank Goldman Sachs have warned that tax hikes introduced in the Budget could have a bigger impact on employment and inflation than official estimates suggest. Chancellor Rachel Reeves increased employer National Insurance to 15% and lowered the threshold at which firms start paying it to £5,000. Office for Budget Responsibility (OBR) forecasts suggest that workers will be hit by the changes as firms cut wages and increase prices. Analysts at Goldman Sachs have warned that the risks to employment are “skewed to the upside,” saying that in the short term, unemployment will rise by around 0.2% as a result of the Budget, peaking at 4.6% at the end of 2025. On inflation, Goldman Sachs believes consumer prices will increase by 0.3% due to the tax increase, whereas the OBR expects a 0.2% increase.
Qatari Green investment
Qatar and the UK announced a new partnership to invest in climate technologies plus a plan to deepen cooperation in financial services, as Keir Starmer continues a push to spur economic growth. Qatar will invest £1 billion in the climate arrangement with the UK, with the funds going into start-ups in both Britain and Qatar focusing on energy efficiency, carbon management and green power.
Prison rebuilding costs almost double
Britain’s prison building program, a project aimed at easing the overcrowding crisis will be five years late and cost almost double the original estimates, according to the National Audit Office. The cost of delivering 20,000 new prison places will cost at least £4.2 billion more than planned, 80% higher than initially expected. The delays in completing the program mean there is expected to be a shortage of more than 12,000 prison places by the end of 2027, the NAO said.
Nuclear power
Four UK nuclear reactors are going to stay online for longer than expected to support decarbonizing of the grid. The extensions, announced by a unit of operator Electricite de France SA and partner Centrica Plc, include a one-year reprieve for the Hartlepool and Heysham 1 sites that were previously scheduled to shut in 2026. While the Heysham 2 and Torness power stations will be kept open until 2030 instead of closing in 2028.
Meanwhile, the first new reactor in 30 years was fitted at Hinkley point C was fitted when the 500 tonne, 13m long cylinder, the first of two reactors was put into place. When it opens in 2030 it will power million homes.
Markets
Yesterday, the FTSE 100 closed up 0.56% at 8359.41 and the Euro Stoxx 50 closed up 0.66% at 4878.51. Overnight in the US the S&P 500 rose 0.05% to 6049.88 and the NASDAQ rose 0.4% to 19480.91.
This morning on currencies, the pound is currently worth $1.2697 and €1.2067. On Commodities, Oil (Brent) is at $73.83 & Gold is at $2649.
The UK stock market
London’s stock market is shrinking at its fastest pace in over a decade as 45 companies de-list due to M&As and foreign Private Equity firms buying bargains among UK mid-caps.
Foreign buyers in £7.8bn raid on UK firms
Figures from the Office for National Statistics show that foreign buyers targeted UK companies in Q3, launching deals worth £7.8bn. While foreign spending on UK companies rose by 16% between July and September, there was a downturn in M&A activity between UK companies, with British firms spending just £2.1bn acquiring domestic targets across 191 deals. This was down by £3bn on Q2 and the lowest level since the opening quarter of 2023. Overall, the total number of M&A transactions fell to 435 between July and September, down from 479 in the previous quarter. Meanwhile, data from investment bank Peel Hunt shows that the value of takeover bids for firms listed on the London Stock Exchange has hit £52bn in 2024, with 45 London-listed firms approached over, agreeing to or completing acquisitions since January.
Lord Mayor calls for rule reform to boost the City
Alastair King, the Lord Mayor of the City of London, has urged ministers to accelerate reform of City rules, arguing that a more supportive tax and regulatory environment will help boost investment into London-listed firms. Calling for a rethink over the stamp duty of 0.5% levied on UK share trading, he said rectifying this “misalignment” would provide a “shot in the arm for homegrown companies looking to scale-up.” Mr King has also called for measures to encourage more retail investors into stocks and shares ISAs, as well as suggesting that the Chancellor should look at further reform of pension funds.
City rents rise as prime demand increases
With City businesses increasingly bringing staff back into the office following the pandemic-era shift to remote and hybrid work patterns, availability across City of London offices has fallen. Data from property consultancy Knight Frank shows that availability in newly constructed office buildings has fallen to 0.3% in the West End and 0.5% in the City of London. By comparison, vacancy rates across all London office stock currently stands at 9%. The analysis shows that prime rents in the City have risen 16% over the past 12 months to £90 per sq ft, while prime West End rents are up 7% to £150 per sq ft. Knight Frank said London’s “robust occupier market reflects the city’s business resilience despite wider macroeconomic volatility over the past few years.”
Civil service WFH increases under Labour
Since Labour came to power, office attendance among civil servants has significantly decreased, with a notable drop in key departments such as the Treasury, housing and justice. Analysis by the Telegraph shows that attendance at 13 government departments has fallen. Between January and May 2024, in the months before July’s General Election, attendance across Whitehall was 77% on average. By September the rate had fallen to 72%. While attendance across Whitehall departments is down, the private sector is demanding more in-office presence, with analysis focused on 50 of Britain’s biggest companies showing that employees are now expected to work an average of three days in the office, up from two last year. Public services productivity – which estimates how much economic output is generated per £1 of taxpayer cash – remains 8.5% below pre-pandemic levels. However, total productivity, as measured by output per hour across the economy, remains 1% higher in the three months to September, with the private sector driving up the total.
Drivers set for insurance savings
A recent change to the personal injury discount rate (PIDR) is expected to benefit motorists significantly. Starting from January 11, 2025, the PIDR will rise to 0.5% from the current rate of -0.25%. This adjustment is anticipated to alleviate some cost pressures on insurers, potentially leading to a £50 average decrease in motor insurance premiums. Mohammad Khan, head of general insurance at PwC UK, said: “This change is good news for drivers as it will further intensify the competitiveness of the motor insurance market.” Motor insurance premiums have surged by over 20% in the last two years, with drivers currently paying an average of £612 for insurance.
Rolls-Royce
Rolls-Royce Holdings Plc’s valuation reached £50 billion for the first time as the stock extends a surge on the back of buoyant demand for long-haul jet engines.
Diamond battery
Maybe diamonds are forever after all. UK scientists have invented a battery made of lab-grown diamonds and radioactive carbon-14 that could power pacemakers and satellites for thousands of years, according to the Telegraph.
Thames Water
Castle Water has offered to inject £4 billion into the struggling Thames to save it form Administration. Castle, a relatively small firm that bought Thames’ non-household water and sewerage retail business in 2016, is looking to take a majority ownership in Thames.
Thames Water’s creditors told the utility and Ofwat that the proposed emergency loan cannot be used to pay fines, the FT reported.
Covid Corruption
Rachel Reeves is to appoint a health service and regulatory veteran, Tom Hayhoe, a former Conservative cabinet adviser, as her Covid corruption commissioner with the remit of clawing back billions in fraudulent contracts.
Farmers vow to fight tax raid
Farmers are determined to oppose proposed inheritance tax changes, with Tom Bradshaw, president of the National Farmers’ Union, saying agricultural businesses will “fight for as long as it takes.” Reforms set out in the Budget will impose a 20% tax on inherited land and property valued over £1m, which the Government claims will only impact the wealthiest landowners. However, the NFU warns that this could jeopardise UK food production and affect many family farms. Shadow Environment Secretary Victoria Atkins said farmers “feel betrayed” and is urging Labour MPs to support the farming community.
Tax turns rural voters against Labour
More than half of rural voters have lost trust in Labour following the Budget, according to a poll by the Country Land and Business Association (CLA). The poll saw 57% of respondents say the imposition of a 20% inheritance tax on some farms has diminished their trust in Labour. Victoria Vyvyan, president of the CLA, warned that the change “threatens business viability and the future of our rural communities.”
Hospitality faces tax hike hit
Celebrity chef Tom Kerridge says the Government’s tax hikes could have a “catastrophic” impact on the hospitality sector. Mr Kerridge estimates that the increase in employers’ National Insurance could cost businesses an additional £800-850 per employee annually, a significant burden for smaller firms. Over 200 major hospitality businesses have warned that the tax hike could lead to job cuts and reduced investment, while Andrew Higginson, chair of the British Retail Consortium, said the increased costs would be “too much for the industry to bear.”
Latest Insolvencies
Appointment of Liquidator
RICHARD UTLEY LIMITED
WOSL SPV 1 LIMITED
EDEN JAKE LIMITED
YGGDRASIL GAMING UK LTD
NORGH HOLDING COMPANY LIMITED
KAPPATURE LTD
DATAWOOD SERVICES LTD
BROOKSON (5189F) LIMITED
TTWP LTD
MEWINE LIMITED
BETTER CLOUD SOLUTIONS LTD
JANE KELLY HOLDINGS LIMITED
GARC CONSULTING LIMITED
BEECH BROTHERS LIMITED
CLOUDQAIT LIMITED
HYNDPARK LIMITED
NEXX (UK) LIMITED
SN STRATEGICS LTD
TESSELLATE TRIANGLE LIMITED
KEITH VINCENT LIMITED
PRICE CORP LTD
VW PROPERTY HOLDINGS LIMITED
EXCEL SOFTWARE SERVICES LTD
RHOSSILI LEISURE LIMITED
STEELCAD DETAILING LIMITED
SUDELEY INVESTMENTS LIMITED
TOPSORT LIMITED
APTIV LATIN AMERICA HOLDINGS (UK) LLP
Appointment of Administrator
LIBERTY STEEL EAST EUROPE (HOLDCO) LIMITED
TEAM TEX (UK) LIMITED
PROJECTS LIMITED
COGNITIVE PUBLISHING LIMITED
BAMBINO MIO LIMITED
CALEDONIAN LOGISTICS LIMITED
AKJ ENTERPRISES LIMITED
CYRIL LUFF (METAL DECORATORS) LIMITED
Winding Up Petitions
G.V.B LTD
SPIDER ENTERTAINMENT SERVICES LTD
FODAL BRIXTON LIMITED
TUNGSTEN CAPITAL UK LIMITED
WESTEND UNITED LTD
LL EUROPE LTD
PRO-TEC AUTOMOTIVE LTD
GSK WHOLESALE LIMITED
WWIZARD LTD
FOX AIR CONDITIONING LIMITED
EUROPA ES LTD
EASTCOTE BATHROOMS LIMITED
GRANT AND MCLAREN LTD
GENTLEGAIN LIMITED
ANACONDA CAPITAL LIMITED
SEVEN SEAS EXPORTS S.L LTD
PURE RENEWABLE SOLUTIONS LTD
RAM ESTATE LTD
GLENBRAE TRADING LTD
PARKVIEW M&E LTD
SKYROCKET ENTERTAINMENT LIMITED
THE BRIT GIFTS LIMITED
MUCK AWAY GROUP LTD
V.P. CIVILS LIMITED
TECHNOLOGY SPARE PARTS LIMITED
W. H. COX & SON (REMOVALS & STORAGE) LTD
Winding Up Order Notices
COLLISION CARE LIMITED
DILLON LLOYD LIMITED
TOLKACHI LTD
BA-PM ANALYTICS LTD
A J B SKIP HIRE LTD
YOUNGS SCHNAUZERS LIMITED
AMANI GLOBAL SERVICES LTD
ITR GLOBAL LIMITED
ASIPER LIMITED
BLACKSTONE BUSINESS GROUP LIMITED
TYSON MANOR LIMITED
S.A.H. PROPERTY DEVELOPMENTS LTD
CINELOGIC DIGITAL UK LIMITED
SNAI1 PRIMARY PRODUCTS 2023 LIMITED
A.A.T WELDING ENGINEERS LTD
PHONE HOME LTD
MADE IN LONDON CLOTHING LTD
DIOCLETIAN TECH LTD
RIGBY’S EXECUTIVE COACHES LIMITED
INC (MANAGEMENT OPS) LTD
IVANKA SOLUTIONS LTD
YOUNG HEAVEN SERVICES LTD
SIMPLE SOLUTIONS INVESTMENTS LIMITED
SABT2 LIMITED
HYDROSYS LTD
CLARITY STACK LIMITED
CONNELL OPERATIONS LTD
SYPR LTD
TYLER COLIN ANTHONY LIMITED
FLEXITECH SOFTWARE LIMITED
ST.NICHOLAS SECURITIES LIMITED
PAUL SARGENT SHOES LIMITED
13 SOUTH SAINT ANDREW STREET LTD
UNITISED LIMITED
LANISAN LTD
MULLEN BROTHERS UTILITIES LTD
Why you should become a member of CPA!
The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have supported our members through all sorts of difficult trading environments. With high interest rates and a struggling economy and elevated insolvencies, our services can help your business navigate these difficult waters.
Unlike other credit management and debt collection companies, we offer a range of services to our members that are all included as part of a fixed annual subscription, tailored to your needs.
Under your annual subscription you will have access to our main services:
- Our Creditcare credit reports provide credit ratings and limits along with a host of detailed information on your potential customers to enable you to trade with confidence and set appropriate credit policies for new customers.
- Our monitoring service will alert you to any significant changes in the status of those customers.
- Our Overdue account recovery service can be used to chase up payment on any invoices to those customers that have not been paid on time. Unlike other debt collection companies, this service directs your customer to pay direct to you and allows you to maintain your goodwill with them, rather than inserting ourselves into your relationship with you customer and insisting they pay CPA instead. Our Overdue account recovery service resolves over 80% of accounts referred to us.
All of the above services and other complimentary services such address verification, are included in your subscription!
And for the small minority of debts not resolved through our Overdue account recovery service, you can refer the debt to our collections department to escalate the late payment collections process.
CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. And we provide credit information so you can monitor and assess your key customers and be warned of any potential risks. CPA has been improving business cash flow for over 100 years, by tackling late payers and campaigning against the late payment culture in the UK.
Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the value of their debts maybe!
Rather than to borrowing more money to improve your cashflow, CPA suggests that business owners tackle the problem at its source. If late payments are a strain on your cashflow, then talk to CPA about how we can help you reduce those late payments.
Just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email nsm@cpa.co.uk today.
When you see your money come in, you will be so glad you used CPA.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections
Do you have a commercial late payer that is causing you grief? Use CPA’s no-win, no-fee, commercial debt recovery service!
If you have a particular business customer who is late paying and causing you sleepless nights, why not offer it to CPA’s collection department for purchase on recourse?
CPA’s collection department will then pursue the debt. We will be liable for any costs incurred and then when we have recovered the debt, we will pay you the net principle debt recovered less our percentage.
Once you have enjoyed that success then you can consider the more cost effective membership which includes our Overdue Account Recovery service and Status/Credit reports as well as a range of other complimentary services.
Just call 020 8846 0000 and ask for Godfrey Nelson or Cris Shirley (business hours) or email debtpurchase@cpa.co.uk today.
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.
Get compensated for previous late payments
Have you been paid late by business customers in the last six years?
Maybe you no longer work with them. Under legislation, you are entitled to compensation you for those late payments you have suffered.
You put up with the PAIN – now claim the GAIN!
Claim late payment compensation (LPC) from former business customers who paid you late in the last six years!
CPA (LPC) Recoveries is using our bespoke software and decades of experience to do just that for our clients
Check our compensation calculator to see how much your business could be owed!
Discover NOW the potential value of late payment compensation hidden in your sales ledger!
The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections.