Business news 24 November 2021

James Salmon, Operations Director.

Small businesses won’t survive 2022 without bumper Christmas. Eleven more energy suppliers are set to go bust. UK business surveys point to Bank of England rate rise in December. Traders in £2bn bet against sterling.  And more business news.

Small businesses won’t survive 2022 without bumper Christmas
Research from business insurance provider Simply Business reveals that almost one fifth of SMEs will not survive next year without a bumper Christmas period, as around 36% of businesses make 20% of their annual revenue during the festive period.

“While much of the UK prepares for a period of well-earned festive cheer, the feeling among small business owners is likely to be rather more sombre this Christmas,” Simply Business’s chief executive Alan Thomas said. “Few have been harder hit in the last two years. They’ve faced the pandemic head-on, navigated supply shortages, and adapted to a new normal. They’ve shown resilience in abundance and done all they can to stay afloat. But without a bumper Christmas trading period, one in five small businesses will permanently close in 2022.”

Eleven more energy suppliers are set to go bust
More than 20 energy companies have collapsed since September and eleven more are at risk of going bust, according to a new report from Price Bailey. Since the findings were released, three firms have failed, including the seventh largest supplier Bulb, which announced plans to enter administration on Monday.

Price Bailey partner Matt Howard described the current situation in the energy market as “complete carnage”. Mr Howard said: “This time next year we will have far fewer suppliers and higher household energy bills. Every time a supplier goes bust the costs of the remaining suppliers increase, which makes those businesses more vulnerable.” It is estimated that a typical bill could rise to at least £2,000 next year, up from £1,277 as stands under the energy price cap.

UK business surveys point to Bank of England rate rise in December
The flash purchasing managers’ index published on Tuesday by IHS Markit and the Chartered Institute of Procurement and Supply showed that almost two-thirds of private sector companies reported rising costs in November.

This indicates the steepest rate of input price inflation in more than 20 years, driven by higher wages and bills for fuel, energy and raw materials. But despite supply shortages and rising price pressures activity remained strong with output across the services and manufacturing sectors virtually unchanged from October’s reading of 57.8, signalling a healthy rate of expansion.

“A combination of sustained buoyant business growth, further job market gains and record inflationary pressures gives a green light for interest rates to rise in December,” said Chris Williamson, chief business economist at IHS Markit, adding that the data pointed to “a welcome pick-up in GDP growth after the slowdown seen in the third quarter”.

Traders in £2bn bet against sterling
Since the Bank of England failed to deliver on a widely expected interest rate rise earlier this month, traders have bet £2bn that the pound will slump with shorts against sterling now at their highest level since June 2020. Francesco Pesole, currency strategist at ING, said: “Despite the tendency to show very wide swings, it seems to be signalling some worsening in market sentiment on the currency. There is a chance that part of the market is growing increasingly concerned about a resurgence in Brexit risk.”


The US and other nations are going to release 50 million barrels of oil from their strategic reserves in an unprecedented attempt to control price rises in energy.


The fourth wave continues to sweep across Europe as European deaths reached 1.5 million and Governments impose increasing restrictions despite backlashes. The World Health Organisation warned that 700,000 Europeans could die of covid-19 by March 1st.

United Utilities

United Utilities reported a rise in first-half profit as higher revenue and lower costs bolstered performance. For the six months ended 30 September, pre-profit profit increased by £12 million to £213 million year-on-year as revenue increased 4% to £932.3 million. The increase in profit reflected a £14 million increase in reported operating profit and a £2 million reduction in reported net finance expense.

Johnson Matthey

Johnson Matthey swung to a first half of loss weighed down by a £314 million write down of assets in its battery materials business as chemicals company exited the industry. For the half year ended 30 September, pre-tax losses were £9 million compared with a loss of £26 million year-on-year, while revenue was up 23% to £8.59 billion. Revenue was boosted by higher average precious metal prices.

Business leaders and donors reject PM’s tax policies
Boris Johnson has been told by the Confederation of British Industry (CBI) to “stop hiking taxes and focus on boosting investment” as disquiet over the Government’s policies spreads. Lord Bilimoria, president of the CBI, will today respond to the Prime Minister’s poorly received speech to the organisation. He will say: “The Government have said they want a high-wage, high-growth, high-investment, high-productivity economy. Business agrees. But right now, we are facing a high-tax economy.” Lord Bilimoria will highlight increases in National Insurance and corporation tax under Mr Johnson. He will tell the CBI conference: “All the while business rates still need fundamental reform and the burden of property tax in the UK is four times higher than Germany, three times higher than the OECD average, and higher than any other G7 country. Together, this all adds up to the UK having the highest tax burden in 70 years.” Meanwhile, donors are closing their cheque books as frustration over Johnson’s leadership boils over, according to the Telegraph.

House sales plunge after stamp duty relief ends
Figures from HMRC show the number of house sales in England fell 33.4% year-on-year to 66,830 last month, the lowest October level recorded since 2008. Across the whole of the UK there were 76,930 transactions – 28.2% lower than in October 2020 and a 52% drop since September, when buyers rushed to take advantage of the last of the stamp duty holiday savings. However, experts said the number of sales was still higher than in July, indicating low interest rates and a pent up desire to move home continue to sustain activity.

Home buyers gain £6bn tax break from Covid stamp duty holiday
The stamp duty holiday amounted to a £6.4bn tax break for homebuyers in England, according to analysis by Savills, with those who bought properties worth more than £500,000 benefitting from half of the savings.

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