Business news 13 June 2025
Economy shrinks 0.3%. Reeves refuses to rule out tax rises. Four in 10 entrepreneurs could exit UK. Worker supply surges. Plus markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
Economy shrinks 0.3%
Office for National Statistics (ONS) data shows that the UK economy shrank by 0.3% in April. This marks a decline on the 0.2% growth recorded in March and is the steepest fall since October 2023. Analysts had forecast a 0.1% decline. Analysis shows that the services sector contracted by 0.4% while manufacturing dropped 0.9%. Chancellor Rachel Reeves described April’s GDP figures as “disappointing” but “not entirely unexpected, given the uncertainty that is out there in the world at the moment.” Yael Selfin, chief Economist at KPMG UK, said trade tensions would have “weighed on the economy” while trade deals will likely not prevent “sluggish” growth throughout the rest of the year. Suren Thiru, of the ICAEW, said: “These figures suggest that the UK’s economic fortunes took a notable nosedive in ‘Awful April’.” Capital Economics’ Paul Dales commented: “We’re still expecting GDP growth of just 1% for the year as a whole, which would be no better than last year and is a little weaker than the consensus.”
Reeves refuses to rule out tax rises
Rachel Reeves has refused to rule out future tax rises after Office for National Statistics figures revealed that the economy shrank by 0.3% in April. The Chancellor told the BBC: “No Chancellor is able to write another four years of Budgets within a first year of government, you know how much uncertainty there is in the world at the moment.” This came after Paul Johnson, director of the Institute for Fiscal Studies think-tank, said: “With spending plans set, and ‘ironclad’ fiscal rules being met by gnat’s whisker, any move in the wrong direction will almost certainly spark more tax rises.” Meanwhile, Ruth Curtice, chief executive of the Resolution Foundation, suggested that the Chancellor “will likely need to look again at tax rises in the autumn.” Lindsay James, investment strategist at wealth management company Quilter, commented: “With the economy now weakening, we can expect to see concerns around further tax rises increase as we near the autumn Budget – which is likely to weigh on growth even more.”
Britons lose faith in tax spending
According to a survey by Adam Smith Insights, only 5% of Britons are confident that their taxes are being spent effectively. The poll of over 1,000 people revealed that 52% believe taxes are too high, while 58% feel their tax burden has increased in recent years. It was shown that 57% of respondents support tax cuts, with 28% willing to back cuts even if it means reduced public spending. James Lawson, Chairman of the Adam Smith Institute, said: “Brits are being overtaxed and underserved.”
Four in 10 entrepreneurs could exit UK
According to the latest Business Owners Sentiment Survey by S&W, 39% of UK entrepreneurs are contemplating relocating their businesses overseas due to the Government’s stringent tax policies and the stagnant economy. Nearly half of the respondents, 47%, believe that these policies are hindering their growth. The survey highlights the impact of a £40bn tax raid announced in the Budget, with 43% of entrepreneurs indicating that changes to inheritance tax could prompt them to leave the UK.
Worker supply surges
Research by KPMG and the Recruitment and Employment Confederation (REC) reveals that the number of jobseekers surged to its highest level since 2020 in May, with a notable increase in candidate availability. While there was a decrease in permanent placements, the availability of candidates increased at the quickest rate in nearly four-and-a-half years. It was also shown that salary growth for full-time staff rose at the quickest pace in nine months and pay for part-time workers increased at the fastest pace in a year. Jon Holt, group chief executive and UK senior partner at KPMG, said: “Employers are still holding back on hiring, which meant last month the number of jobseekers increased at the steepest rate since 2020.” Neil Carberry, REC chief executive, said: “More encouraging signs in temp billings, vacancies and stabilising private sector demand offer a measure of optimism as we head into the second half of the year.”
Markets
Yesterday, the FTSE 100 closed up 0.23% at 8884.92, having got close to 9000 during the day and the Euro Stoxx 50 closed down 0.60% at 5360.82. Overnight in the US the S&P 500 rose 0.38% to 6045.26 and the NASDAQ rose 0.24% to 19662.48 as investors shrugged off Trump’s latest tariff salvo and focused on a further cooling of US inflation.
This morning, markets reacted to Israel’s attack on Iran with oil and gold soaring! Focus is on the 21 million barrels of crude going through the straights of Hormuz daily. On currencies, the pound is currently worth $1.356 and €1.175. On Commodities, oil (Brent) is up over $4 at $73.5 & Gold is at $3416. On the stock markets, the FTSE 100 is currently down 054% at 8836 and the Eurostoxx 50 is down 1.1% at 5301. US futures are predicting a 1.3% sell off in the US.
FTSE 100 sees record high
The FTSE 100 index closed at a record high yesterday, rising 0.2% to 8884.92. This saw the index exceed the previous closing record of 8871.31, which was set on March 3. The index also beat its previous intraday high after hitting 8,892.36. Charles Hall, head of research at UK investment bank Peel Hunt, said the UK and Europe have benefited from the fact that investors “have been allocating away from the US,” while Trevor Greetham, multi-asset portfolio manager at Royal London Asset Management, noted that the UK market “has a lot going for it.” Dan Coatsworth, investment analyst at AJ Bell, said: “The UK stock market has been a star performer this year.”
Lawyers voice concern over employment rights reform
Ministry of Justice data shows that employment cases at the Tribunal surged by 32% in Q1 compared to the same quarter last year. The Employment Lawyers Association has urged the Government to allocate resources to Tribunals before the Employment Rights Bill comes into force, with chairman Caspar Glyn KC saying: “The past figures are of real concern, but of yet more concern is the future.” The Bill, if passed, will deliver 28 reforms, including a change that would enable employees to issue claims on the first day of employment. Under the current system, employees must have two years of service before filing a claim. Mr Glyn KC said the Tribunal “cannot cope with the rising tide of employment litigation,” adding that the it “will drown under the weight of the increased litigation created by the new rights” if they come into law.
Court delays are denying victims justice
Nikhil Rathi, chief executive of the Financial Conduct Authority (FCA), has expressed concerns over delays in the UK court system that hinder justice for victims of financial crime. He said: “Justice deferred is sometimes justice denied,” highlighting the impact of prolonged court battles on the FCA’s investigations. The FCA has faced criticism for its slow progress in high-profile cases, with the All-Party Parliamentary Group on Investment Fraud having accused the City watchdog of “leaving more than 500,000 people in the dark” due to a lengthy investigation into disgraced fund manager Neil Woodford. Mr Rathi noted that some cases require extensive digital evidence and can take years to resolve, with trial dates for certain cases not expected until 2026 or later.
Pandemic fraud cases face collapse
Investigations into pandemic fraud cases have been put in jeopardy due to improper evidence gathering by the National Investigation Service (NATIS). A report by Mazars revealed that only three of NATIS’ 108 investigators had the necessary powers, raising concerns that “if officers had been exercising powers with expired secondments, their actions could be legally challenged.” NATIS, which was tasked with investigating the £46.5bn bounce-back loan scheme, secured only 14 convictions after receiving £38.5m in taxpayer funding. The Department for Business and Trade said that ongoing viable cases would be transferred to the Insolvency Service, asserting confidence that no convictions would be overturned.
Poundland sold for £1
Budget retailer Poundland has been sold for £1, with Pepco saying it has sold the brand to US investment firm Gordon Brothers for a “nominal” sum. Gordon Brothers is investing a total of £80m in Poundland which includes an existing secured loan of £30m and a further £30m overdraft. The business will continue to be led by Barry Williams, the current managing director of Poundland. The chain has 825 UK stores and it has been suggested that around 100 are at risk of closure, while rent reviews are also expected to be negotiated with landlords.
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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!