Business News 5th June 2017

We hope you enjoy reading the business news compiled by the Credit Protection Association on Monday 5th June 2017 for its members and visitors.

Dawn raids by the FCA hit lowest level since 2009

The number of dawn raids carried out by the Financial Conduct Authority (FCA) has reached its lowest level since before the financial crisis. Just seven dawn raids were carried out last year – 81 per cent fewer than in 2009, at the height of the financial crisis. But rather than putting this down to weakening enforcement, this has been attributed to a wind-down in the number of financial crimes being committed.

City AM

Tories say Fallon misinterpreted on tax plans

Senior members of the  Conservative party have attempted to clarify statements made by Sir Michael Fallon which they say were misrepresented to appear as though he had promised high earners would not face tax increases if they voted Tory. A transcript of an interview was released showing he in fact said the only way higher income earners’ taxes would go up would be if they stayed at home on Thursday. Meanwhile, the Tories cited research that suggested that ten million homes with large gardens would be hit by Labour plans for a land value tax to replace council tax. They said that the majority of homes affected would be in the southeast where bills may rise by £4,000. “Under Jeremy Corbyn’s plans no one escapes Labour’s intention to squeeze homeowners dry,” Andrew Percy, the communities minister, said.

The Times, Page: 24   Daily Mail, Page: 32

HMRC told to tackle rogue employment agencies

Adrian Gregory, chief executive of London recruitment agency Extraman, is calling on HMRC to set up a specialist unit to tackle rogue employment agencies. He said employment agencies’ use of tax avoidance schemes was proliferating. “Combining the money removed from workers with the money avoided in tax, an educated guess would be that around 15% of the total income of the recruitment industry is misappropriated. This would amount to around £4.5bn each year. I would think this figure is conservative”. His comments were made to the GMB union, whose research reveals up to 10m people in the UK are in what it calls precarious employment – those in the gig economy, on zero or short-hours contracts, temporary workers, the underemployed and those at risk of false self-employment.

The Guardian, Page: 21

80,000 businesses would fold under rate rise

One in 25 businesses would struggle to live with an increase in interest rates of as little as a quarter of a percentage point, according to research by R3. It is thought that some 79,000 businesses would be unable to repay their debts if rates were to rise, four times as many as in September. Andrew Tate, a spokesman for R3, said: “This is the first increase in the number of businesses worried they would be unable to cope with an interest rate rise since 2014, and it coincides with a period of slower-than-expected growth and a small rise in corporate insolvency numbers.”

The Times, Page: 39

Small firms drive innovation in behemoths

The Telegraph’s Bradley Gerrard considers a report by the innovation foundation, Nesta which examines how large companies are being driven by small firms to innovate;’ Large firms are often hampered by their standardised processes and so are increasingly teaming up with more light-footed smaller rivals to drive innovation. Nesta’s study for the Department for Business, Energy and Industrial Strategy, said it identified 163 accelerator programmes in the UK, “considerably more than previously estimated”, with the vast majority funded by companies rather than the public sector. KPMG’s Kevin Smith points out that there is also a burgeoning number of incubators – companies that specialised in connecting large corporations with smaller start-ups – and growth in the co-working space industry.

The Daily Telegraph, Business, Page: 6

SMEs hurt by delays to rates compensation

Small business owners have hit out at delays to compensation promised to companies suffering from high business rates. The government set up a £300m “hardship fund” in the March budget but the package has not yet been pushed through, David Gauke, chief secretary to the Treasury, said. Mike Cherry, national chairman of the FSB, said: “The first order of business for the communities secretary in the next government should be to get a grip and make sure the promised help is delivered in the first month of office.”

The Times, Page: 47

European growth at 6 year high

Euro-area manufacturing and services continued to expand at the fastest pace in six years, powered by growth in the region’s two biggest economies — Germany and France. A composite Purchasing Managers’ Index held at 56.8 in May, unchanged from the previous month, IHS Markit said on Monday, confirming a May 23 estimate. A gauge for services slipped slightly, while one for manufacturing that was published on June 1 remained unchanged.


Macron trolls trump

After Trump announced on June 1 that the U.S. is withdrawing from the Paris Agreement on climate, French president Macron — in English — invited U.S. climate scientists to work in France and hijacked Trump’s signature slogan with a call to “make our planet great again.” The French foreign ministry got into the act by posting a video that, by scribbling in English on top of the White House’s own video, refutes point-by-point what it said were incorrect Trump statements about the Paris accord, all with a #MakeThePlanetGreatAgain hashtag. The video was viewed 11 million times, had 179,000 shares on Facebook, and was re-tweeted on Twitter 49,000 times.


Corbyn’s policies unpopular with business

A survey published by accountancy firm BDO reveals only 7% of medium-sized businesses back Jeremy Corbyn’s economic policies. Nearly three-quarters (73%) backed Tory policies instead, while 70% said they thought the Conservatives would get the best deal for business when the UK leaves the European Union.

Daily Mail, Page: 33

World Bank upgrades forecast for UK

The World Bank has upgraded its forecast for UK growth over the next three years. Economists at the World Bank expect the UK economy to grow by 1.7% this year. This is only slightly below last year’s expansion of 1.8%, and up from a forecast of 1.2% in January. Growth for 2018 and 2019 was also upgraded to 1.5% a year, up from previous projections of 1.3%. The revisions were driven by expectations of stronger growth in advanced and emerging economies, with a recovery in industrial activity and a rise in global trade expected to lift output around the world.

The Daily Telegraph, Business, Page: 1   The Times

 Demand from Europe boosts manufacturers

A study by Accountants BDO and the EEF has shown that manufacturing firms are enjoying a surge in performance amid “buoyant” demand from Europe. The survey found that three out of five manufacturers reported an increase in demand for goods from European markets. Orders were healthy, with the EEF now revising its forecasts upwards for the rest of the year and 2018, saying manufacturing was now expected to expand by 1.3% in 2017 and 0.5% next year.

Daily Express, Page: 50   The Times, Page: 39    Independent I   The Daily Telegraph, Business, Page: 3   Yorkshire Post, Business, Page: 17

U.S. Markets

U.S. shares rose to record levels as Wall Street shrugged off a jobs report that came in well below expectations

Asian Markets

Asian shares were mixed as investors turned cautious after deadly attacks in London at the weekend and the potential impact on parliamentary elections scheduled for 8th June.


The Royal Bank of Scotland might be forced to increase its settlement offer to relentless shareholders, who are suing the bank, after it emerged that they are close to securing sufficient funds to continue their court action against the taxpayer-backed lender. The shareholders claim that RBS and its directors misled them about the bank’s financial health in the prospectus for its ill-fated £12bn rights issue in 2008 prior to the banks collapse.


Facebook  has said it wants to make its social media platform a “hostile environment” for terrorists as politicians intensified their criticism of tech companies for not doing enough to crack down on extremist messages online following another deadly terrorist attack in London. UK Prime Minister Theresa May lashed out at internet companies, calling for international regulations to rein in terrorist planning and recruitment after Saturday’s attack in London, which left at least seven dead. “We cannot allow this ideology the safe space it needs to breed,” May said. “Yet that is precisely what the internet and the big companies that provide internet-based services provide.”


British Airways cabin crew have voted for four more days of strike action. The latest action in a long-running pay and benefits row will start on 16th June, with BA saying the crew’s pay and rewards are in line with competitors. Unite said the action is about benefits not being reinstated for crew who took part in earlier industrial action. The news ends a turbulent week for BA, which suffered an IT failure which left 75,000 passengers stranded over the bank holiday weekend.


Oil prices rose more than 1%, pushed up by tensions in the Middle East where top crude exporter Saudi Arabia and other Arab states cut off ties with Qatar, and as signs of falling OPEC supplies tightened the market.


Gold held steady after hitting its highest in over six weeks, buoyed by disappointing U.S. jobs data that appeared to dilute the prospects for an aggressive string of interest rate hikes in the United States

Previous News pages

Business News 2nd June 2017

Business News 1st June 2017

Business News – 31st May 2017

Business News – 30th May 2017

Business News – 26th May 2017

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Business News – 23rd May 2017

Business News – 22nd May 2017

Business News – 19th May 2017

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Business News – 17th May 2017

Business News – 16th May 2017

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Business News – 3rd May 2017

Business News – 2nd May 2017