Business news 18 April 2024

Bailey expects a “strong drop” in inflation next month. UK tax burden rising faster than any other rich country. Flexible jobs market booms despite vacancies falling.  Net Zero, tax & fraud loopholes, Thames, Royal Mail  & more business news that we thought would interest our members.

James Salmon, Operations Director.

Bailey expects a “strong drop” in inflation next month

The Governor of the Bank of England has predicted a “strong drop” in inflation next month despite official figures showing prices rose more quickly than expected in March. Figures from the Office for National Statistics (ONS) revealed that the consumer prices index (CPI) measure of inflation slowed to 3.2% in the 12 months to March – down from the 3.4% the previous month. It marks the lowest rate of inflation for two-and-a-half years but is still higher than forecast by economists. Andrew Bailey said inflation was on track to fall closer to the 2% target within months, driven by cheaper household bills as the energy price cap falls. Yael Selfin at KPMG commented: “The overall outlook for inflation remains broadly positive, however there are several risks which could cause a setback. Oil prices have rallied over the past month which has led to an increase in prices at the pump for consumers. Also, the hike in the National Living Wage could potentially contribute to persistence in services inflation which remains elevated.”

UK tax burden rising faster than any other rich country

Taxes are on course to hit their highest share of GDP since 1948, warns the Institute for Fiscal Studies (IFS). However, the IFS cautions that recent policies could drive up levies further as the Government continues to spend heavily. The difference between the UK’s tax burden compared with the G7 average will nearly halve to 2.8% lower in 2029 from 5.3% lower in 2001. Despite the increase in taxes, Martin Mikloš, an economist at the IFS, says revenues have not matched the growth in spending, resulting in rising debt and a need for further tax increases to stabilise the public finances. The Government has cut some taxes but has also implemented stealth taxation by freezing thresholds and increasing the corporation tax rate. The size of the state has significantly increased since 2001 when spending amounted to 35% of GDP – around eight percentage points lower than the average across advanced economies. That gap proceeded to narrow before peaking at around 50% during the pandemic. Following a recent fall, that figure is now expected to settle at around 43% of GDP.

Flexible jobs market booms despite vacancies falling

The flexible jobs market is booming with a 60% increase in job adverts compared to last year, according to Flexa. Despite vacancies shrinking across the labour market, there has been a 32% increase in flexible job posts this quarter. A third of all roles currently available are remote-first, but the number of these roles has declined by 26% since the start of the year. Job seekers are increasingly searching for fully remote roles, with a rise of 11% between January and March. Over half of UK workers would forgo a pay rise to avoid working from the office full time.

Supply shortages means UK will miss net zero targets

A government-commissioned report has warned that Britain will fail to reach its net zero targets because it is incapable of building the required infrastructure. This is due to a lack of ships, steel and concrete to build offshore wind turbines and an inability to connect them to the shore because it cannot produce enough high voltage cables. A shortage of skilled workers is also a problem, particularly for design and commissioning engineers, project managers, and installation technicians. The study was conducted by management consultancy Baringa. Authors Rob Gilbert and Stuart Williams said: “Achieving the renewables deployment ambitions outlined in the British Energy Security Strategy will be very challenging without significant coordination across industry and Government to resolve supply chain constraints.”

MPs call for anti-corruption ‘loopholes’ to be closed

MPs campaigning against corruption have called on the UK Government to take action on economic crime. The All-Party Parliamentary Group (APPG) on Anti-Corruption and Responsible Tax has published a manifesto urging the next government to close loopholes in anti-corruption laws and ensure greater transparency of company and property ownership. The MPs also called for a tightening of anti-money laundering regulations and increased resources for enforcement. Conservative MP Nigel Mills, co-chair of the APPG, highlighted the impact of economic crime on honest people and businesses and called for the UK to be “open for business” once again.

IMF boss calls for tax loopholes to be closed

The head of the International Monetary Fund (IMF) has called for the closure of tax loopholes to ensure the wealthiest pay their fair share of taxes. According to IMF research, ending tax avoidance by corporations could generate an additional $200bn annually while implementing a global corporate minimum tax would also boost revenues by an estimated $150bn per year. Additionally, Kristalina Georgieva said setting a minimum floor for carbon pricing could raise revenues by $150bn annually.

Thames Water creditor backs break-up plan

A potential break-up of Thames Water has gained backing from Luke Hickmore, a fund manager at Abrdn – which is a leading bondholder in the company. Thames Water bosses are reportedly exploring a break-up as part of a range of scenarios to avoid nationalisation. They are also thought to be considering a debt raise, but City sources told the Telegraph no one would buy into this idea. Mr Hickmore said he would support a break-up if this cut the risk of creditors losing out as this would knock confidence across Britain’s infrastructure sector. Meanwhile, major US hedge funds are taking up short positions against UK water companies amid fears over their levels of debt and the risk of contagion across the sector sparked by the problems at Thames Water.

Chancellor Jeremy Hunt said Thames Water customers should not pay for the company’s mistakes and debt problems. The Chancellor said there were lessons to be learned for all regulated monopolies. The Chancellor also made clear the UK government would not ‘insure investors against poor decisions’ suggesting the government would not cover Thames Water’s bond obligations.

Royal Mail

The  owner of The Royal Mail, International Distribution Services saw its share price advance by nearly 30% yesterday following news they had rejected a takeover proposal from Czech billionaire Daniel Kretinsky’s EP Corporate Group, which is a 100% direct shareholder of VESA Equity which already holds an around 27.6% stake in IDS. Although offer was rejected, EP Corporate said it looked forward to continuing to engage constructively with IDS and would consider “all options”.


US technology issues fell 1.15% due to elevated US bond yields and a drop in Nvidia shares


Workspace Group said it ‘maintained robust levels of viewings and lettings activity’ throughout the last quarter. The London-based provider of flexible working space said occupancy was stable at 88.1% during the fourth quarter ending March 31, from 88.4% in the previous quarter.


Oil Prices fell 56 cents to $86.73/ barrel in early London trading.


Rentokil reported Q1 revenues of £1.294bn a rise of 4.9% and said its integration of US based Terminex was proceeding well. The board clarified that Rentokil expected to spend £250m on bolt on acquisitions over 2024.


Taiwan Semiconductor Manufacturing Co. (TSMC) posted its first profit rise in a year, after strong AI demand revived growth at the world’s biggest contract chipmaker. expects a 30% rise in revenue during Q2 to between $19.6bn to $20.4bn with demand for AI related chips offsetting lower smartphone volumes.


Eurozone Inflation slowed to 2.4% in March, compared to 2.6% a month earlier, fuelling optimism that the European Central Bank could cut interest rates in June. Excluding food and energy, prices rose by 2.9% over the month, against 3.1% in February.

House prices fall, but rents hit record high

House prices in the UK fell by 0.2% on an annual basis in February, the smallest decline in eight months, while private rents reached their highest level on record. According to the latest data from the Office for National Statistics (ONS), the average price of a property was £281,000. London experienced the lowest annual inflation, with prices dropping by 4.8% in the 12 months to February 2024. Transactions increased by 1.2% between January and February. Iain McKenzie, chief of The Guild of Property Professionals, stated that sellers could expect modest house price growth, potentially leading to a return to annual growth. Meanwhile, rental costs in the UK rose by 9.2% in March, the highest level since 2015. London had the highest annual rent inflation at 11.2%.

Insurers slammed for excessive monthly charges

Car insurance firms are charging monthly customers excessive interest rates, leading to higher fees for those who cannot pay upfront. A recent investigation by Which? found that some firms were charging up to 34.75% APR on top of monthly premiums. This practice has been described as a “tax on the poor” by Matt Brewis, Head of Insurance at the Financial Conduct Authority. Rocio Concha, Director of Policy and Advocacy at Which?, slammed the practice and called for tougher regulations: “The regulator has been clear – paying for insurance monthly is a tax on being poor, and it’s shocking to see providers still trying to justify the practice.”

China ‘fuelling fentanyl crisis in US’ with tax breaks

China has been accused of contributing to America’s fentanyl crisis by providing tax breaks and subsidies to companies involved in producing chemicals to make the deadly opioid. An investigation by the House of Representatives select committee on China revealed that the Chinese Communist Party (CCP) grants tax rebates to anyone producing fentanyl precursors for export. The report concluded that the People’s Republic of China (PRC) harms Americans while enriching PRC companies through subsidies and grants. Fentanyl, a powerful synthetic drug, is now the leading cause of death for Americans aged 18 to 45. China reportedly produces 97% of the global supply of precursor chemicals used to make fentanyl.

Russia’s plots route away from sanctions

Russia is building links with Asia to avoid western saction’s by constructing two transport corridors linking Asia and Europe. The shipping and rail networks via Iran and an Arctic sea passage aim to strengthen Moscow’s links with Asian powerhouses China and India and away from Europe. Potentially looking to embed Russia at the heart of international trade frustrating the US and Europe’s attempt to isolate  Putin over the Ukrainian invasion.

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Why should you become a CPA member!

The Credit Protection Association (CPA) has been assisting thousands of UK businesses to get paid, since 1914. We have seen many financial crises, this one will be particularly deadly for suppliers for some time to come.

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.

Unlike other credit management companies, we offer our members a fixed annual subscription regardless of how high the debt value maybe!

Just call Peter Uwins, CPA’s National Sales Manager, on 020 8846 0000 (business hours) or email 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 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 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.