Business news 8 January 2025

Director of 400 firms banned for insolvency scheme ruse. Job insecurity on the rise. Over a third of young adults worry about their finances daily. Inflation, Government borrowing, construction, house prices, markets, insolvencies & more business news that we thought would interest our members.

James Salmon, Operations Director.

Director of 400 firms banned for insolvency scheme ruse

A man who was paid to be the sole director of more than 400 companies has been banned from being a company director for nine years after playing a key role in a scheme designed to undermine the UK insolvency system. Atherton Corporate (UK) Ltd paid Neville Taylor more than £250,000 to run the companies, 12 of which had ceased trading but not yet entered liquidation. The Insolvency Service said that when the firms eventually entered liquidation, more than £7.6m in assets was unaccounted for. “Neville Taylor hampered efforts by liquidators to identify assets, caused a widespread loss to creditors and breached his duties as a director to act in the best interest of the companies and creditors,” said Dave Magrath, director of investigation and enforcement services at the government agency

Job insecurity on the rise

According to a recent City AM Freshwater Strategy poll, nearly one in seven workers in the UK feel insecure about their jobs, particularly among those earning less than £30,000, where 18% reported feeling this way. Neil Carberry, Chief Executive of the Recruitment and Employment Confederation, said Labour’s Employment Rights Bill will only increase the level of insecurity as businesses are left less able to provide it.

Over a third of young adults worry about their finances daily

According to a survey by Santander UK, some 80% of 18 to 21-year-olds have never created a budget, with 31% seeking financial advice from social media influencers. The research, conducted by Savanta, revealed that 35% of young adults worry about their finances daily. Alarmingly, 76% have never paid a bill, and 77% have not saved for unexpected expenses. William Vereker, chairman of Santander UK, stressed the importance of financial education, stating: “Young people’s understanding and effective management of money is essential in their own lives, but also for wider society and economic growth.” Santander UK plans to launch a financial education programme in 2025 to address these issues.

Household staples face 20% price hike

The Chartered Institute of Procurement and Supply (CIPS) has warned that the prices of household staples, including food and drink, could increase by as much as 20% this year due to ongoing challenges in sourcing and transporting goods. Ben Farrell, the chief executive of CIPS, said: “What is clear is that there are a number of strategic challenges that are likely to disrupt the smooth flow of goods and services.” Factors contributing to these rising costs include geopolitical instability, supply chain disruptions, and potential tariffs from the US.

UK’s long-term borrowing costs hit highest level since 1998

Yields on 30-year gilts rose by 0.08 percentage points on Tuesday to 5.25%, surpassing the level hit after the Liz Truss mini-budget in 2022 and the highest in 27 years. Borrowing costs on ten-year gilts also climbed to a 14-month high of 4.68%. The rise in gilt yields will mean a higher borrowing bill for the Treasury and put the Chancellor’s fiscal rules at risk. “Reeves could soon face a nasty choice of breaking her fiscal rules or announcing more tax rises and or spending restraint at a time when the economy is already weak,” Gregory said. “We suspect she would choose the latter.”

More borrowing and tax rises ahead, Deutsche Bank warns

Deutsche Bank has warned UK businesses that more borrowing and tax rises will be likely this year as a result of a flatlining economy and fewer interest rate cuts. In a note to investors, Sanjay Raja, Deutsche Bank’s chief UK economist, said: “We think Chancellor Reeves will likely need to lift taxes at least one more time following last year’s historic tax raising event. More stealth tax increases are likely in our mind.”

Markets

Yesterday, the FTSE 100 fluctuated between gains and losses on Tuesday to close broadly flat, down 0.05%  at 8245.28 and the Euro Stoxx 50 closed up 0.50% at 5011.82.

Overnight in the US the S&P 500 dropped 1.11% to 5909.03 and the NASDAQ fell 1.89% to 19489.68 as traders reassessed the heightened risk for US inflation and what that holds for stocks and bonds.

This morning on currencies, the pound is currently worth $1.2439 and €1.2056. On Commodities, Oil (Brent)  is at $77.12 as oil climbed above $75 for the first time in 3 months & Gold is at $2652. On the stock markets, the FTSE 100 is currently up 0.2% at 8261 and the Eurostoxx 50 is up 0.38% at 5031.

UK stock funds face record outflows

British stock funds experienced their worst year on record in 2024, with a net withdrawal of £9.6bn, according to Calastone. This decline highlights a significant investment drought in the London Stock Exchange, as UK-focused funds are increasingly shunned by investors. The situation has led to a surge in foreign takeovers, reaching a 14-year high, as UK equity valuations remain low. Additionally, only 6.6% of pension pots are now allocated to UK stocks, down from 48% in 2008. Despite changes by the Financial Conduct Authority to attract listings, UK funds continue to struggle, with £27.2bn flowing into global equity funds instead.

Construction industry sees slowest growth in six months

Britain’s construction sector experienced its slowest growth in six months in December, with the S&P Global UK Construction Purchasing Managers’ Index (PMI) dropping to 53.3 from 55.2 in November. This decline was attributed to a reduction in housebuilding activity for the third consecutive month, driven by high borrowing costs and weak consumer confidence. Tim Moore, economics director at S&P Global Market Intelligence, noted that “concerns about the demand outlook” adversely impacted growth forecasts. Despite the challenges, nearly half of the surveyed firms anticipate output expansion in 2025, with only 15% expecting a decline.

House prices set for modest growth

Halifax anticipates “modest house price growth” in 2025, despite a slight dip of 0.2% in December. The average UK house price now stands at £297,166, reflecting a 3.3% annual increase. Amanda Bryden, head of mortgages at Halifax, noted that the housing market remained steady at the start of 2024, with growth expected to resume in the summer. Changes to stamp duty, effective from April, are likely to motivate first-time buyers, as the “nil rate” band decreases from £425,000 to £300,000. However, Bryden cautioned that mortgage affordability will continue to challenge many buyers, especially with the Bank of England’s base rate expected to decline slowly.

One in 10 plan to increase pension contributions this year

According to research commissioned by the Pensions and Lifetime Savings Association (PLSA), one in ten defined contribution (DC) pension savers plans to increase their contributions this year. The study indicates a growing awareness of the importance of building a solid retirement fund, particularly among those over 55, where 23% intend to reassess their pension plans. The survey also highlighted that 25% of respondents plan to review their spending, while 22% aim to save for specific goals. Overall, the findings suggest that proactive measures are essential for DC pension savers to secure their financial future.

NCA probes Siddiq over links to money laundering

Tulip Siddiq, the Economic Secretary to the Treasury, is facing scrutiny from the National Crime Agency (NCA) regarding properties linked to her family. The NCA is investigating a London flat and a £2.1m semi-detached house owned by Siddiq, although there is no suggestion of wrongdoing on her part. The inquiry is part of a broader investigation into money laundering and the alleged misappropriation of funds by the regime of her aunt, Sheikh Hasina, the former Prime Minister of Bangladesh. Siddiq has referred herself to the Government’s ethics adviser, Sir Laurie Magnus, stating: “I am clear that I have done nothing wrong.” Despite the controversy, Prime Minister Sir Keir Starmer has expressed confidence in her, while the Conservatives are calling for her resignation until the inquiry concludes.

Shell

Shell reported that it expects to report a decline in Integrated Gas output for the fourth quarter, weaker trading & optimisation results for the unit, and well write-offs. The oil major expects to report final-quarter Integrated Gas production between 880,000 to 920,000 barrels of oil equivalent per day, a decline from 941,000 in the third quarter of 2024. Trading and optimisation results in the unit are “are expected to be significantly lower” than in the third quarter. This is driven by the non-cash hit from the expiration of hedging contracts.

Meta

In a reaction to Trump winning the election, Meta said it would abandon its fact-checking programme in favour of crowdsourced checks similar to those used by X, its social-media rival. Mr Trump has long been a critic of Meta’s content moderation on platforms such as Facebook and Instagram. Last year he called Facebook the “enemy of the people”.

Pension age rise: A looming crisis

Changes to the state pension age next year could significantly impact many individuals. Currently set at 66, the age is scheduled to rise to 67 between 2026 and 2028, and then to 68 between 2044 and 2046. However, there are discussions about accelerating this increase. Mark Screeton, CEO of SunLife, said that if the age rises to 68 by the early 2030s, “millions could be left struggling with no private pension savings to fall back on.” He pointed to barriers for those over 50, including health issues and age discrimination in the job market.

Next faces £67m wage cost surge

Next has reported a £67m increase in wage costs for the year ending January 2026, primarily due to the Labour Government’s plans to raise employer national insurance contributions and the minimum wage. The retail giant anticipates a “unwelcome” 1% price rise to mitigate these costs. Despite a strong 5.7% rise in underlying full-price sales for the fourth quarter, Next expects sales growth to slow to 3.5% in the upcoming financial year, with profits projected to rise by 3.6% to £1.05bn. The company stated: “We believe that UK growth is likely to slow, as employer tax increases, and their potential impact on prices and employment, begin to filter through into the economy.” Additionally, overseas sales growth is expected to decline as marketing expenditures are curtailed.

Football clubs at risk from Labour’s tax changes

Twenty-four professional football clubs are currently in arrears to HMRC over PAYE debt, with concerns that this number may increase due to Rachel Reeves’s Budget. Clubs such as Reading and Southend United have received winding-up petitions from HMRC in 2024. Graham Caddock, tax investigations director at Lubbock Fine, warned that changes to employer National Insurance contributions could exacerbate financial difficulties, stating: “The finances of so many football clubs are already precarious so the sudden burden of the extra NICs is going to push many of them dangerously into more debt.” The situation is further complicated by potential changes in tax regulations affecting overseas earnings for players, which could lead to an exodus from the Premier League. Sophie Dworetzsky from Charles Russell Speechlys noted: “The lack of an attractive longer-term tax regime for individuals moving to the UK from abroad might be regarded as an own goal.”

Latest Insolvencies

Appointment of Liquidators – RESOPTIMA LIMITED
Appointment of Liquidators – WEST CARD LIMITED
Appointment of Administrator – PHYTO NOURISHMENT LIMITED
Appointment of Administrator – HART MILLER DESIGN LTD.
Appointment of Administrator – IT HARDWARE AND SOFTWARE LIMITED
Appointment of Liquidators – LEWIS CHARLES WEALTH LIMITED
Appointment of Administrator – PRICE & FRETWELL LIMITED
Appointment of Administrator – ROSE & GREY LIMITED
Petitions to wind up (Companies) – PRAXIS CONSTRUCTION CONTRACTORS LIMITED
Appointment of Liquidators – CONNEELY SERVICES LTD
Appointment of Liquidators – MATRIKON UK LIMITED
Appointment of Liquidators – GREENING CONSULTING LIMITED
Petitions to wind up (Companies) – KINGSWAY PROPERTIES NORTHWEST LTD
Appointment of Administrator – EDAM GROUP LIMITED
Petitions to wind up (Companies) – FILTEX LIMITED
Petitions to wind up (Companies) – GARETH MCFARLAND INTERIORS LIMITED
Petitions to wind up (Companies) – ELITE STUDENT LETS LIMITED
Appointment of Liquidators – OLD OAK FLORAL DESIGNERS LTD
Appointment of Liquidators – FINNVALLEY FORMWORK LTD
Appointment of Liquidators – DAIWA KASEI EUROPE LTD
Petitions to wind up (Companies) – QUALITY STREETS EXCLUSIVE SALES & LETTINGS LTD LTD
Petitions to wind up (Companies) – SPIRIT 10 LIMITED
Petitions to wind up (Companies) – MARINER CAY LTD
Petitions to wind up (Companies) – HOPE SPRINGS VILLAGE LTD
Appointment of Liquidators – MAGI AIRCRAFT MANAGEMENT LIMITED
Petitions to wind up (Companies) – EAST WEST CLEARANCE (UK) LTD
Appointment of Administrator – CREDIT REPAIR LTD
Petitions to wind up (Companies) – ACCENT UMBRELLA LTD
Petitions to wind up (Companies) – SKR IT CONSULTING LIMITED
Appointment of Liquidators – NOVAR (TWYFORDS) LIMITED
Petitions to wind up (Companies) – ASTRO GYMNASTICS
Petitions to wind up (Companies) – THE GRILL STORE LTD
Appointment of Administrator – EASI-DRIVE LIMITED
Petitions to wind up (Companies) – 08112018 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:

1. 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.
2. Our monitoring service will alert you to any significant changes in the status of those customers.
3. 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.