Business news 27 November 2023

James Salmon, Operations Director.

Small firms welcome support measures and can drive GDP.Inflation, the Bank of England, Manufacturing boosted, Black Friday, The PM on tax and austerity, job ads data, HMRC, minimum wage, pensions, mortgages, insolvencies & more business news that we thought would interest our members.

Small firms welcome support measures

The Federation of Small Businesses (FSB) has welcomed measures announced in the Autumn Statement, saying that they will help build future prosperity. The Chancellor set out a package of measures to boost small firms that includes ending late payments to small suppliers, offering relief on business rates, and cutting taxes for the self-employed.

The Chancellor said firms bidding for government contracts over £5m must prove that they pay invoices within an average of 55 days, reducing progressively to 30 days.

Additionally, there will be business rate relief worth £4.3bn over the next five years, while some retail, hospitality, and leisure companies will benefit from an extension of a 75% rates relief scheme.

FSB policy chair Tina McKenzie said: “This game-changing small business package shows the prioritisation of pro-growth measures where they will do most good, while getting the best bang for the taxpayer buck.” While the FSB welcomes the plans, big businesses are said to be disappointed that they were not offered any assistance with rates. Marks and Spencer chief executive Stuart Machin said the Chancellor “missed an opportunity to fix the broken business rates system.”

Small businesses can add billions to the economy

New research by GoDaddy and Frontier Economics highlights the direct impact of small firms, showing that each additional microbusiness – those with fewer than 10 employees – in regions across the UK raises the median income by around £1,400, representing a 4.4% rise in salaries. The Venture Forward report also found that an additional microbusiness per 100 people can contribute £37,000 to local GDP. Small businesses “have the power to add billions to the economy,” according to Andrew Gradon, head of GoDaddy UK.

Inflation not easing fast enough

Huw Pill, the Bank of England’s chief economist, has warned that while growth is slowing, it is not slowing inflation as fast as the central bank would have hoped. He said that while there is slower growth in activity and employment, because it appears to be “more supply-driven rather than demand-driven, the weakening of activity is not as associated with easing of inflationary pressures.” Looking at data on pay growth and services inflation, Mr Pill said he saw “more evidence of the sort of stubborn, high level rates of inflation or growth that are stronger than we would really see as compatible with price stability, 2% inflation, over the medium term.”

Lords report calls for Bank of England reform

Peers have warned that the Bank of England’s internal culture, governance and appointments processes need significant reform. Noting that the Bank’s powers have “expanded substantially” since it was made independent 25 years ago, the Lords’ Economic Affairs Committee has called for an overhaul in the way in which the Bank is held to account. The committee, chaired by Lord Bridges of Headley, says public confidence in the Bank “has fallen dramatically as inflation has remained well above the Bank’s target over the last two years.” The Peers noted that an inquiry to assess how the operational independence of the Bank was working revealed concerns regarding its “expanding remit” and that a “democratic deficit” has emerged. Among recommendations, the committee suggests that parliament could conduct a review into the Bank’s remit, operations and performance every five years. A Bank of England spokesperson said the recommendations will be given “careful consideration.”

£4.5bn boost for British manufacturing

The Government has announced plans for a £4.5bn funding package for key manufacturing sectors, with ministers looking to drive growth and boost investment in the UK. In a foreword to the plan, Business Secretary Kemi Badenoch said that while other countries “have embarked on large tax and spending sprees to claim a share of the global manufacturing market,” the UK “will not be drawn into a distortive subsidy battle.” Prime Minister Rishi Sunak said the plan “will not only give the industry the long-term certainty they need to grow and invest further in the UK, but it will also lay the foundations to create more jobs and opportunities.”

Black Friday ‘busiest shopping day on record’ ignoring inflation

Black Friday was the busiest shopping day on record, according to Nationwide Building Society. Nationwide members made 9.92m purchases on Friday, with this equivalent to more than 114 transactions every second. The figure is 2% higher than on Black Friday in 2022 and 12% higher than 2021’s event.

Meanwhile, data from Barclays shows that the volume of purchases leading up to Black Friday was higher than this time last year, with retailers launching sales earlier in the month. The report shows that spending volumes were up 1.4% in the week to Wednesday compared with the equivalent week last year.

However, others think that the spending spree was muted compared to previous years when inflation is taken into account. Although sales were up on 2022, when you consider prices have soared due to rampant inflation, it actually shows fewer items being sold. Footfall at shopping destinations was down over 5%, with regional cities and towns experiencing significant declines.

Labour proposes salary increase for foreign workers

Shadow Home Secretary Yvette Cooper says Labour would increase the salary requirements for foreign workers seeking to come to Britain. Although the annual salary threshold for a skilled worker visa is set at £26,200, roles on the shortage occupation list can be offered at £20,960 or at a 20% discount, whichever is higher. Ms Cooper said that under Labour, the salary threshold would be hiked based on recommendations from the migration advisory committee, the watchdog that advises the Government on immigration, while the 20% discount would be abolished. She added that Labour would also limit the ability of companies that do not pay “fair” wages to recruit from abroad.

PM: Tax cuts ‘start of a journey’

Rishi Sunak says the tax cuts announced in the Autumn Statement are “the start of a journey,” with the Prime Minister telling the Mail on Sunday that the Chancellor’s National Insurance cut comes as the Government looks to “shift gears” on fiscal policy. He said: “I always said I wanted to cut people’s taxes, but first we had to get inflation under control and stabilise the economy.” Mr Sunak said that while “everyone said we were going to have a recession … we have actually grown the economy.” He added: “This is the start of a journey. We will do more when we can, because I want to cut taxes, reward hard work, grow the economy and do so in a way that is responsible.” Arguing that people want to see “reformed public services that deliver for them, and high productivity,” the PM said: “That’s what you get in the private sector, and we need to see that in the public sector. We are at a point now where our priority going forward is to cut people’s taxes.”

PM rejects austerity concerns

Prime Minister Rishi Sunak has rejected warnings that the Autumn Statement will lead to austerity for public services, calling them “simply unfounded.” Speaking to Bloomberg TV, Mr Sunak rebuffed a suggestion that he will be presiding over austerity as “simply not the case.” Arguing that government spending is “at very high levels historically over this parliament,” the PM added: “we’re at a point now, given how people are feeling, given the amount that’s being spent, where I think the priority has got to be lowering the tax burden.”

Households face £44.6bn stealth tax hit

Households in the UK are facing a £44.6bn stealth tax hit, with the tax burden set to rise to 37.7% of national income, the highest since World War II. The freeze on tax thresholds means that more middle earners will be paying higher rates, resulting in a stealth tax that garners huge sums for the Treasury. The Office for Budget Responsibility predicts that nearly four million more people will be paying income tax by 2028/29 due to the freeze. Overall, income tax receipts are expected to surge to £363.5bn in 2028/29.

Advertised salaries fall but job ads increase

Advertised salaries in Britain hit their lowest level in six months in October, according to jobs website Adzuna. Annual advertised salaries averaged £36,946 last month, with this down 0.4% compared to September. The dip means advertised wages are down 1.9% since April. Andrew Hunter, co-founder of Adzuna, said: “Falling advertised salaries may not appear to be good news for jobseekers but it does signal that the menace of inflation is finally in retreat.” The report also shows that vacancies increased for the first time since June, suggesting a recovery in the labour market. Online job ads were up 0.35% to 1.03m, with pre-Christmas hiring driving the biggest month-on-month increase since June.

600k workers miss out on tax rebates due to outdated HMRC system

More than 600,000 workers are missing out on income tax rebates due to HMRC’s outdated system. Over five million workers mistakenly overpay income tax each year, resulting from changes in benefits or a drop in profits for self-employed individuals. HMRC sends a P800 letter to explain how to request a rebate, but if the refund is not claimed within 21 days, a cheque is sent to the address on file. As of November, 615,383 cheques worth £217m remained uncashed. Tax experts attribute the high number of unclaimed rebates to HMRC’s reliance on cheques and outdated practices. They suggest a more digital approach and automatic refunds to resolve the issue. It is noted that HMRC advises customers to request direct payment to their bank account for a quicker and more secure repayment.

OBR: Trade agreement will add just 0.04% to GDP

The UK’s entry into the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) is expected to add just 0.04% to GDP in the long run, according to the Office for Budget Responsibility (OBR). The OBR also stated that bilateral trade deals with Australia and New Zealand may increase real GDP by a combined 0.1% by 2035. However, these predicted benefits are significantly smaller than the 4% decrease in the UK economy due to Brexit. Trade expert David Henig believes that the effects of the UK’s entry into the CPTPP have been overhyped and that the UK should focus on boosting trade with the EU.

Government pumps £163m into HMRC to recover unpaid taxes

The Government is investing £163m in HMRC’s debt management team to recover £4.67bn in unpaid taxes over the next six years. The Treasury estimates that this cash injection will help the debt management team recoup £515m in taxes in 2024/25. Ministers are looking to resolve the tax gap between what is owed and what is being collected. Dawn Register, head of tax dispute resolution at BDO, said: “While this additional investment in HMRC’s debt management capability is very welcome it’s long overdue and probably insufficient to tackle the eye-wateringly high levels of tax debt currently owed to the Exchequer.” HMRC collected £788.8bn in tax receipts in 2022/2023, representing a 10.2% increase from the previous year.

Government accused of ‘backtracking’ over audit reform

Labour has accused the Government of “backtracking” on a manifesto pledge to clamp down on the audit profession and create a new regulator. This comes after Business Secretary Kemi Badenoch said the Government would not proceed with plans to create the Audit, Reporting and Governance Authority, a regulator that would replace the Financial Reporting Council (FRC) and have the power to investigate company directors for breaches of audit rules.

UK fifth in European minimum wage table

The UK ranks fifth when it comes to the highest minimum wage in Europe, at £1,667 a month. This trails only Luxembourg (£2,178), Germany (£1,734), the Netherlands (£1,732) and Belgium (£1,698). However, the UK has among the highest costs of living on the continent. A person on minimum wage in London will spend roughly two-thirds of it on living costs such as food, transport and utilities. This is before rent, with the average room in London reaching £971 per month in July.

Minimum wage hike will reignite inflation

Business leaders have warned that that the 10% increase in the minimum wage announced in the Autumn Statement will drive up costs and undermine efforts to reduce inflation. Steve Morgan, founder of housebuilder Redrow, says ministers “don’t realise the knock-on effect of wage rises on those higher up the pay scale.” Neil Carberry, chief executive of the Recruitment and Employment Confederation, said of the increase: “If you put that in the context of a hospitality firm or childcare provider, that’s a 20% rise in wages at a time when the top line isn’t growing magnificently and other costs are rising.” While Mr Carberry expects businesses to try to manage the increased costs by reducing opening hours and raising prices, some analysts expect businesses to cut jobs.

Employees opting out of workplace pensions soar

The proportion of new staff opting out of saving into their work scheme has increased by 56% in less than four years, with experts warn that opting out of pensions for several years could result in significant financial losses at retirement. Despite the rise in opt-outs, the overall proportion of employees paying into a pension scheme has increased since automatic enrolment was introduced in 2012.

Mortgage rates to stay above 4% this year

Experts do not expect mortgage rates to fall below 4% before the end of this year. Ross Murphy, senior adviser at Capricorn Financial Consultancy, says the outlook for mortgage rates for the coming year is “optimistic,” noting that with swap rates falling, the market is “increasingly seeing rates slide into the region of 4% – 4.5% as a result.” Iwona Hovenko, a real estate analyst at Bloomberg Intelligence, does not expect mortgage rates to fall below 4% this year but says it is a possibility in 2024, especially in the second half of the year. Chris Sykes, technical director at Private Finance, says the prospect of a deal offering a rate below 4% by the end of this year is “no more than a dream.” However, he says larger lenders might be able to price products as low as 3% – 3.5% by the end of 2024. Moneyfacts data shows that the average two-year deal is currently 6.08%, while a typical five-year deal is 5.68%.

Insolvency service pays £42m to former Wilko staff

The Government’s Insolvency Service has paid over £42m to nearly 10,000 former staff of retailer Wilko. The payments cover redundancy pay and statutory notice pay owed to employees affected by the collapse of the chain. Handled by its Redundancy Payments Service, the Insolvency Service said it began preparing for the influx of claims when Wilko went into administration.

UK ministers set out plans to make regulators better promote growth

Business Secretary Kemi Badenoch has told the Financial Reporting Council it “should contribute to promoting the competitiveness and growth of the UK economy, embedding its growth duty across its work.”

Latest Insolvencies

Appointment of Liquidators – 5 RED LIMITED
Appointment of Liquidators – HS05 LTD
Petitions to wind up (Companies) – THE RENEWABLE ENERGY ENTERPRISE LTD
Appointment of Administrator – LAND PROMOTIONS LTD
Appointment of Liquidators – C & D WINES LIMITED
Appointment of Liquidators – JEN SZETO DESIGN LTD
Appointment of Liquidators – PJJW ASSOCIATES LIMITED
Appointment of Liquidators – W & N DEVELOPMENTS LIMITED
Appointment of Liquidators – J & N SUPERFOODS LIMITED
Appointment of Administrator – THE GARDEN CIDER COMPANY LIMITED
Appointment of Liquidators – ABBEY COACHWAYS LIMITED
Appointment of Administrator – DESIGNER CHILDRENSWEAR LIMITED
Appointment of Administrator – SAC HARDWARE LIMITED
Appointment of Liquidators – JAIN MEDICAL SERVICES LTD
Appointment of Liquidators – PAUL ILIFFE LIMITED
Appointment of Liquidators – BSIMPLE CONSULTING LTD
Appointment of Liquidators – VANDT TECH LIMITED
Appointment of Liquidators – 1ST HOLDCO LTD
Appointment of Liquidators – WINE & FOOD PUBLICATIONS LIMITED
Appointment of Liquidators – MORCO HOLDINGS LIMITED
Petitions to wind up (Companies) – CARLISLE CONSERVATIVE CLUB LIMITED(THE)
Appointment of Liquidators – GDHW CONSULTANCY LIMITED
Appointment of Liquidators – E B HAULAGE LIMITED

Petitions to wind up (Companies) – MIDLAND TEMPERATURE LTD

Winding up Order (Companies) – STAMFORDIAN (CONSTRUCTION) LTD
Appointment of Administrator – REAL (HIGH LANE) LIMITED
Petitions to wind up (Companies) – TERKAN LIMITED
Appointment of Administrator – CHAIN REACTION CYCLES LTD
Appointment of Administrator – HOTLINES EUROPE LTD
Petitions to wind up (Companies) – IMAGE RUNNER HOLDINGS LIMITED
Petitions to wind up (Companies) – MD WASTE MANAGEMENT LTD
Petitions to wind up (Companies) – CARE AND COMMUNITY FOUNDATION CIC
Petitions to wind up (Companies) – TECH LEADERS CLUB LIMITED
Petitions to wind up (Companies) – NEURITEK THERAPEUTICS LTD
Appointment of Liquidators – BLOCKTURE LTD
Appointment of Liquidators – K. E. HIRST LTD
Petitions to wind up (Companies) – WE ARE MANY HANDS LTD

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.