Business news 18 December 2024
Roofers complain about sky high late payments, budget sparks insolvencies, pay growth leaps, markets, insolvencies & more business news that we thought would interest our members.
James Salmon, Operations Director.
Roofers complain about sky high late payments
THE National Federation of Roofing Contractors (NFRC) is calling for ‘real consequences’ to help address the ‘endemic culture’ of late payment within the UK construction industry. Their CEO James Talman said poor payment practices continue to unfairly strain the finances of roofing and cladding businesses during a period of record insolvencies.
Their latest industry report showed 45% experienced delays in getting paid in Q3, 2024. The proportion of those not paid within 45 days of a project’s completion rose to 39% – up from 29% in Q2. This follows a trend that has seen the proportion of NFRC members not paid within 45 days steadily increase since the survey began in 2020.
“Late payments put firms at risk of never being paid and numerous NFRC members experienced heavy losses when ISG collapsed,” James Talman said. “Some companies exploit the lack of accountability and consequences for late payment at the expense of those smaller businesses they subcontract to, and it harms the sector’s productivity.”
While the NFRC was encouraged by the launch of the new Fair Payment Code, Talman said the government will have to go ‘much further’ than a voluntary code and badges to combat endemic late payments that unfairly benefit those who exploit agreed terms. NFRC stressed that poor performance in payments must have a direct impact on who is awarded government contracts.
Budget sparks 13% November leap in business insolvencies
The number of business insolvencies in England and Wales rose by 13% last month, with data showing that almost 2,000 firms collapsed in November. While November saw a month-on-month increase in business insolvencies, the total was 12% lower than November 2023. November also saw the number of administrations rise by over a third, while court-driven compulsory liquidations were up 37%. Tim Cooper, president of insolvency and restructuring trade body R3, said: “Fallout from the Budget and ongoing cost issues have driven corporate insolvencies,” while Mark Ford, a partner in Evelyn Partners’ restructuring and recovery team, noted that even before the Budget, some businesses “were already under significant strain and saddled with debt following a long period of high borrowing costs, high inflation and low consumer confidence.” David Hudson, restructuring advisory partner at FRP, said: “Despite a year-on-year fall, a shorter-term ramping up of insolvencies amid the festive season is a stark reminder of the perilous financial position many firms find themselves in.” The Insolvency Service data shows that individual insolvencies rose by 25.5% year-on-year and 12.2% month-on-month.
Pay growth hits 5.2%
Office for National Statistics (ONS) data shows that regular pay growth hit 5.2% between August and October, marking the first acceleration in more than a year. Private sector pay grew at an annual pace of 5.4%, while across the public sector, pay growth came in at 4.3%. Analysts say the data on pay means the Bank of England is unlikely to cut interest rates when officials meet this week. Gora Suri, economist at PwC UK, believes that rates are “highly likely” to be kept at 4.75%, while Thomas Pugh at RSM UK, said: “The jump in wage growth puts another nail in the coffin of an interest rate cut.” The ONS also reported that unemployment rate was unchanged at 4.3%, while the number of job vacancies fell by 31,000 to 818,000 in the September-to-November period. Joe Nellis, an economic adviser to MHA, said the unemployment rate holding steady “is not a significant cause for celebration,” warning that long-standing problems in the labour market “continue to undermine attempts to reignite a flatlining and underperforming economy.” Looking ahead, Yael Selfin, chief economist at KPMG UK, said: “We expect labour market activity to ease over the coming year as employers look to get ahead of the upcoming rise in National Insurance contributions, which should put further downward pressure on wage growth and employment.”
Badenoch’ criticised over flat tax comments
Conservative leader Kemi Badenoch has faced criticism for suggesting that a flat tax rate is an “attractive idea.” Critics argue that such a move would disproportionately benefit the wealthy while increasing the tax burden on low earners. Ms Badenoch, speaking at an event protesting Labour’s inheritance tax changes, said: “We cannot afford flat taxes where we are now. We need to make sure we rewire our economy so that we can lighten the burden of tax and the regulation on individuals and on those businesses that are just starting out, in particular.”
Markets
Yesterday, the FTSE 100 closed down 0.81% at 8195.20 and the Euro Stoxx 50 closed down 0.09% at 4942.58. Overnight in the US the S&P 500 fell 0.39% to 6050.61 and the NASDAQ fell 0.32% to 20109.06.
This morning on currencies, the pound is currently worth $1.272 and €1.121. On Commodities, Oil (Brent) is at $73.7 & Gold is at $2647. On the stock markets, the FTSE 100 is currently up 0.13% at 8205 and the Eurostoxx 50 is up 0.38% at 4961.
UK inflation rose to an eight-month high of 2.6% in November, marking the second monthly increase (last month it was 2.3%) and drifting further above the BOE’s 2% target and effectively ending any hope of a rate cut at tomorrow’s meeting.
National Grid
National Grid has published the RIIO-T3 business plan for its National Grid Electricity Transmission business, covering the period from April 2026 to March 2031. It said the plan includes “an unprecedented level of investment” of up to £35 billion, of which over £11 billion will go towards maintaining and upgrading its existing networks, alongside construction works for the first three of its Accelerated Strategic Transmission Investment projects. It will also invest around £24 billion, including around £15 billion to increase its network capacity.
Nissan & Honda
Nissan shares soared 24% on news the Japanese carmaker is in talks of a merger with Honda. The companies already cooperate on EV’s. It would be the largest merger between automakers since that of Fiat Chrysler and PSA Group in 2021. Foxconn, the iPhone manufacturer, has also made an overture to Nissan. Other auto stocks rallied as well.
Boeing
Boeing has resumed full production at aircraft factories in the Pacific Northwest after a lengthy strike. Returning to output is crucial for Boeing as the company tries to stabilize its finances. The stock has lost a third of its value this year.
225k retail roles lost since 2019
Analysis by the British Retail Consortium (BRC) shows that 225,000 retail jobs have been lost over the past five years, with the workforce falling from 3.1m to less than 2.9m since 2019. There were 2.81m jobs in retail in September 2024, Office for National Statistics data shows, with this 40,000 fewer than last year and 225,000 fewer than five years ago. Retailers have warned that they face a hike in costs due to the increase in employer National Insurance, which was announced in the Budget, saying it will cost them £7bn next year. The BRC has also called for reform of the business rates system, with chief executive Helen Dickinson saying: “Without this, more stores will be forced to close, meaning fewer retail jobs.”
Small firms hardest hit by post-Brexit drop in exports
UK exporters experienced a significant £27bn decline in goods sales to the European Union following Brexit, with smaller firms disproportionately affected. Research from the Centre for Economic Performance revealed a 6.4% drop in the UK’s global exports and a 3.1% decrease in imports. Since the UK left the EU’s customs union and single market in January 2021, many smaller companies have struggled, with exports to the EU falling by 30% for the smallest firms. Despite these challenges, the UK’s services exports have shown resilience, with a trade surplus of £40bn this year. The report suggests that larger exporters adapted to the new trade barriers, mitigating some of the anticipated economic costs of Brexit.
UK firms mull overseas listings
According to Teneo’s CEO and investor outlook survey, over half (56%) of British public limited companies have contemplated relocating their listings overseas in the past year, a significant increase from 27% the previous year. Despite this trend, 68% of UK chief executives believe the value of being listed in the UK has risen, up from just 5% last year. Furthermore, 78% anticipate that the value of a London listing will improve in the next year. The Financial Conduct Authority has initiated major reforms to attract companies to UK markets, including a simplified listings regime. However, the London Stock Exchange Group reported a net outflow of 70 companies from the main market this year, the largest since 2009, indicating that the reforms have yet to reverse the trend of companies leaving London.
Latest Insolvencies
Appointment of Liquidators – INCANDENZA CONSULTING LIMITED
Appointment of Liquidators – LUNER.IO LIMITED
Appointment of Administrator – AVEBURY AVENUE LIMITED
Appointment of Liquidators – BARLEY PROPERTIES HOLDINGS LIMITED
Appointment of Administrator – MAN COED VM LIMITED
Appointment of Liquidators – DALTON HEALTH LTD
Appointment of Liquidators – AMELIA (IPSOFT UK) LIMITED
Appointment of Liquidators – ADAMANT DIAMOND LIMITED
Appointment of Liquidators – MESHPOINT LIMITED
Appointment of Liquidators – ROUNDSTONE PARTNERS LTD
Appointment of Liquidators – JVM EQUIPMENT LIMITED
Appointment of Administrator – CAMBRIDGE SOLAR LTD
Appointment of Liquidators – PALMLEAF LIMITED
Appointment of Liquidators – KEELDEEP ASSOCIATES LIMITED
Petitions to wind up (Companies) – THISTLE PROPERTY HOLDINGS GROUP LTD
Appointment of Liquidators – BARBROOK GREEN LIMITED
Winding up Order (Companies) – W.A.K WHOLESALERS LTD
Petitions to wind up (Companies) – 4ICG LTD
Appointment of Administrator – IN PRACTICE SYSTEMS LIMITED
Petitions to wind up (Companies) – IMPERIAL CATERING SERVICES LIMITED
Petitions to wind up (Companies) – YOOBOX LTD
Appointment of Administrator – LUXURY LOCKSTITCH UK LIMITED
Appointment of Liquidators – PORT CONSULTANCY SERVICES LIMITED
Appointment of Liquidators – RGB LM I LIMITED
Winding up Order (Companies) – QUINN INFRASTRUCTURE SERVICES LIMITED
Petitions to wind up (Companies) – YOUR SHORTLIST LIMITED
Petitions to wind up (Companies) – BAVARIA AUTO WERKE LIMITED
Appointment of Liquidators – CAMPBELL HARRISON LIMITED
Appointment of Liquidators – KANARI INTERNET LIMITED
Appointment of Liquidators – CHARACTERS (DRAMA BASED LEARNING) LIMITED
Petitions to wind up (Companies) – BIG CAT FILMS LIMITED
Petitions to wind up (Companies) – FORSYTH MARINE CONSULTANCY LTD
Appointment of Liquidators – 99 METRICS LIMITED
Appointment of Administrator – CLIFFORD JONES TIMBER LIMITED
Petitions to wind up (Companies) – IMMACUWALL LTD
Petitions to wind up (Companies) – PURSUIT MARKETING LIMITED
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.