Covid-19 lock-down business news update 24 June 2020.

24 June 2020.

James Salmon, Operations Director.

We look at the changes to Covid-19 restrictions and other covid-19 news, suggested tax tweaks, house sales, the future for the financial sector and a lot lot more.

Here are CPA we want to  share the business news stories we have seen that we think will affect our members and readers. Many of us are busy fighting to protect our businesses and therefore might have missed some of the news that could impact small businesses, their owners and those that sell on credit.

Covid-19 general news

Boris Johnson announced yesterday that the hospitality sector could re-open on 4th July, raising a cheer among pubs, hotels, cinemas, museums and restaurants. Although gyms were upset not to be included. Johnson today said a dramatic fall in the rate of infection means “we can now safely ease the lockdown in England”.

He also announced that the 2 meter distancing rule was being reduced to 1 meter where it wasn’t practical to stay 2 meters on the proviso that other measures such as masks be used.

Downing Street also said it would be halting the daily press briefings, as the country begins to emerge from months of lock-down.

The UK’s chief medical officer, Chris Whitty said he expects coronavirus to persist into 2021. “I expect there to be a significant amount of coronavirus to be circulating at least” until next Spring, “We should be planning for the long haul into 2021”

The White House’s coronavirus task force, warned that America was experiencing a “disturbing surge” in new covid cases and called for increased testing. U.S. virus cases are surging in hot spots including California, Florida, Texas and Arizona, and “creeping up” in New Jersey, throwing the process of reopening local economies into disarray. Anthony Fauci also noted rising rate of cases in young people


The FTSE 100 was up 75 points to 6320 on the lifting of restrictions. The US markets were up yesterday despite rising US cas numbers as the NASDAQ hit another record with Apple leading the charge after it said it would switch from intel chips to its own (designed by ARM) in the Macs

The fourth of July can’t come soon enough

Kate Nicholls, the chief executive of UKHospitality, said “70% to 80%” of the sector will open on July 4th after Boris Johnson relaxed social distancing rules yesterday.

However, Ms Nicholls added that reopening sites remains challenging because operators have so little time to prepare.

Elsewhere, Federation of Small Businesses chairman Mike Cherry has also welcomed the government’s decision to further ease lockdown restrictions, stating that without cutting the two-metre social distancing rule one in five small firms would have to remain shut.

Mr Cherry added: “We’d encourage everyone to support their local small businesses over the weeks ahead as more and more are able to reopen. This has been an incredibly difficult time, but there is now some light at the end of the tunnel. The fourth of July can’t come soon enough.”


Tax policy tweaks that could kickstart the economy

In City AM today they speak to six tax experts to glean their ideas on how the UK Government could make changes to tax policy to help the economy bounce back from the coronavirus crisis.

Among the responses are proposals to abolish corporation tax, treat capital investment in the same way as running costs, and creating an alternative minimum tax, requiring everyone earning more than £100,000 to pay at least a 35% tax rate on their income plus capital gains.

Justine Delroy, head of tax and structuring at Addleshaw Goddard, said that, with wages deductible against profits for corporation tax, an increase in the deduction for every guaranteed day of work per week someone earning under the average wage is contracted to work could be introduced. Targeted at industries where zero-hours contracts are most common, the revenue could be used to provide some of the key workers in society with the predictable income streams.

House sales slowly recovering from COVID-19 lockdown

House sales showed signs of slow recovery in May, increasing 16% on the month before, but they were still at only half the level seen a year earlier.

The figures from HMRC show that an estimated 48,450 residential property transactions took place across the UK during the month.

This was 49.6% lower than the number seen in May 2019, when there were 96,050 sales recorded.

HMRC said the figures should be taken with caution, as they were “provisional” and – due to the lockdown – based on incomplete data.

Transaction numbers in the second quarter of this year have fallen to levels similar to those seen in late 2008 and in early 2009, following the financial crisis.

IHS Markit survey reveals UK economy is likely to see return to growth

IHS Markit’s flash purchasing managers’ index (PMI) has shown that the UK’s economic output reached a measure of 47.6 in June, up from 30 in May and close to the 50 level which signals growth.

The firm’s chief business economist, Chris Williamson, remarked: “June’s PMI data add to signs that the economy looks likely return to growth in the third quarter, especially given the further planned easing of the lockdown from 4 July.”

He went on: “June saw a record rise in the PMI for a second successive month, confirming that the economy is moving closer to stabilising after the worst of the immediate economic impact from the COVID-19 pandemic was felt back in April.”


European PMI’s

The release of better-than-expected purchasing-managers’ indices from France and Germany raised hopes that Europe’s economy is on the mend after the pandemic (see main stories). IHS Markit manufacturing PMIs rose in France to 52.1 in June from 40.6 the month before and in Germany from 36.6 to 44.6. Any figure above 50 indicates expansion.

Glen promises progress with financial services diversity

City minister John Glen has pledged to speed up progress on diversity in financial services stating at the launch of third annual review of the Women in Finance charter that “real challenges that still remain” and that “we cannot afford to miss out on the best talent and leadership.”

The Treasury’s work on the initiative was disrupted by the coronavirus outbreak. In an accompanying statement, Mr Glen said: “I look forward to seeing more firms meet their targets this year, and will continue to hold senior leaders accountable for delivering a more diverse and stronger workforce.”

The Treasury’s annual review of progress found that of the 187 firms signed up to the charter before September 2018, 14% have set a goal to have an equal number of men and women in senior roles. Meanwhile, nearly 60% of firms set a target of 33% or above for female representation. On average women make up 32% of senior management – just below the 33% target the Treasury set for its signatories.

UK’s post-Brexit financial rules add pressure on EU over market access

The Treasury has set out how it intends to regulate banks, asset managers, and derivative traders when the Brexit transition period ends, putting pressure on the EU to decide if it is sufficient to allow British groups continued access to its markets.

Chancellor Rishi Sunak said the government plans to bring forward a review of EU capital rules for insurers, known as Solvency II and make existing retail customer disclosure rules known as PRIIPs function better.

Mr Sunak added: “The government continues to believe that comprehensive mutual findings of equivalence between the UK and the EU are in the best interests of both parties, and we remain open and committed to continuing dialogue with the EU about their intentions in this respect.”

The UK and the EU have committed to complete a review into equivalence by the end of the month.

Investors have faith in the City, but financial services must remain protected

Omar Ali, head of UK financial services at EY, comments on the state of play vis-à-vis Brexit negotiations and financial services. He notes recent figures showing the City remains the preferred destination for FDI and argues that London’s status as one of the world’s leading financial hubs is the result of decades of work.

“Beyond FDI, we know from our Financial Services Brexit Tracker that 45 global banks, insurers, asset managers, and fintech firms have reaffirmed their commitment to the UK since the referendum in 2016,” he adds. The UK “should not be complacent,” continues Mr Ali, adding that “it remains essential that the sector is protected in the negotiations.”

Intu battles for survival in crunch talks with lenders

Shopping centre owner Intu Properties has put KPMG on standby in case it cannot reach agreement with its creditors. Intu is seeking a standstill agreement on its debt and is in emergency talks with seven banks behind its £600m revolving credit facility. Rothschild and PwC are advising Intu, which has an extremely complicated debt structure. The Times notes that analysts predict that perhaps only 10% of retailers in Britain will pay their rent in full at June’s quarter payday tomorrow.

JD Sports buys back Go Outdoors in pre-pack deal

Outdoor clothing chain Go Outdoors has been bought back from administrators by owner JD Sports in a £56.5m pre-pack deal. Deloitte was hired to run the administration for Go Outdoors, which employs about 2,400 people across 67 stores. The chain was reporting heavy losses even before the coronavirus outbreak and JD Sports said it would need to be “fundamentally restructured”.

Thousands of UK steelworkers told to seek possible pension compensation

The Financial Conduct Authority has written to 7,700 former and current British steelworkers warning that those who have transferred out of the British Steel Pension Scheme since 2017 may have received unsuitable advice.

In a review of advice given to scheme members, the regulator found only 21% of cases saw acceptable advice given. The remaining 79% was either unsuitable, or unclear.

Megan Butler, executive director of supervision of the investment, wholesale and specialists division at the FCA, said: “Our findings are sufficiently concerning that we have taken the formal step of contacting you directly and encouraging you to act. You should check the advice you were given and, where appropriate, complain in order to seek any compensation you are potentially due.”

Ms Butler added: “We encourage you to act, if you do nothing, you may end up with less money during your retirement than you should have done.”

ABI revives call for flat rate pension tax relief

The Association of British Insurers has called on the government to simplify the pension tax relief system, arguing it has worsened existing inequalities. ABI-commissioned research found the current system benefitted higher earners in particular and was less favourable towards women, the lower paid and younger workers.

Ex-Wirecard CEO is arrested on suspicion of false accounting

Wirecard’s former chief executive Markus Braun has been arrested on suspicion of false accounting and market manipulation, Munich based prosecutors have said. Mr Braun resigned last Friday after auditor EY refused to sign off the German payments firm’s 2019 accounts over a missing €1.9bn ($2bn). Wirecard said the missing sum was supposedly held in accounts at two Asian banks and had been set aside for ‘risk management.’ EY said after an audit of the business that banks had been unable to provide the account numbers for where the money was held, and yesterday Wirecard admitted the €1.9bn simply may not exist. Mr Braun had been in charge of Wirecard since 2002.

Accountant loses mansplaining claim

A trainee accountant at KPMG who accused her boss of “mansplaining” when he asked her to dress more professionally has had her claims for unfair dismissal, harassment and disability and race discrimination dismissed. Zhihui Lu’s managers had raised concerns about her performance and erratic behaviour after she joined the company’s graduate trainee scheme. On one occasion, Ms Lu burst into a “loud and aggressive” tirade after she came into the office wearing jeans and a jumper and was told to wear smarter, more appropriate clothes by her male manager.

Watchdog urged to probe Lendy auditor

The Financial Reporting Council is being urged to probe work undertaken by Moore Stephens for Lendy, the collapsed P2P lender which left about 9,000 investors nursing losses of nearly £152m. Moore Stephens, which is part of BDO, is facing questions over whether it failed to spot transactions totalling £6.8m made to entities registered in the Marshall Islands, which were allegedly made for the benefit of the company’s founders, Liam Brooke and Tim Gordon; why no warning was given over the poor state of Lendy’s finances in its final set of accounts; and whether it had fundamentally misunderstood the nature of the business. Lisa Taylor, of the Lendy Action Group, comprising about 1,700 investors, said: “Lendy’s auditors failed to accurately portray the company’s financial condition and risks.” A BDO spokesman said: “Due to our professional duty of confidentiality, we are unable to talk about the specifics of any individual audit.”

Don’t let Covid-19 bust your business!

 It will if your cash flow dries up, either sooner or later.

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 sometime to come.

CPA eases cash from tardy debtors – Efficiently, Effectively, Economically and Ethically. Above all tactfully, because maintenance of goodwill is paramount.

To meet the needs of creditors in the current crisis, we have designed a “critical care” package especially tailored for the situation.

  • The annual package costs start at very low rates
  • A minimum performance warranty is provided
  • Several complimentary services included

Clients instruct CPA on-line via their PC or phone, completely user-friendly. Your late paying customers are told to pay you direct (not to us).

A very recent report shows a 23% increase in the number of unpaid invoices since March 11th THIS YEAR – are you getting a build-up of late payers?

 Right now, overdue accounts must be a concern and CPA has a great track record of encouraging slow-payers to pay their suppliers quickly.

It takes less than 17 minutes to see how you would benefit, do you have the time now?

No face-to-face meeting required – 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.

Do you sell on credit?

With pressures on the cash flow it is essential that you stay on top of the credit limits you grant customers and watch carefully for any late payments.

Those customers will look for the easiest option  to boost their cash-flow. Don’t let it be you.

You can’t just assume your customers can and will pay you eventually, no matter how big their name is.

It is essential to have credit management systems in place to monitor and check your customers credit worthiness.

It is also best practice to use a trusted third party like CPA to make sure you are paid on time by customers, no matter how good a name they have.

About CPA

The Credit Protection Association can help!

Formed in 1914, CPA has been providing credit management services to SMEs for over 100 years.

At the Credit Protection Association, we provide first class credit information that can help you avoid being over extended to customers who are at risk. Our monitoring service can flag up warning signs long before the end, giving you the chance to adjust and reduce your exposure. We provide recommended credit limits and credit scores on a traffic light system and can help you set appropriate credit policies for your customers.

We regularly publish lists of the latest insolvencies but by then it is too late. Our credit reports however predict approximately 96% of company insolvencies long before they arrive.

Companies in trouble usually have very bad cash flow and they try to deal with it by delaying payment to their suppliers, increasing your exposure to them.

If you supply on credit, help us help you identify the risks.

Why use a third party collector?

As a third party collector, we can also get your payments prioritised over those who are not as hot on collections. When your customer receives a letter from the Credit Protection Association regarding their outstanding account, they are going to want to get that resolved as a priority. Our overdue account recovery service can get your unpaid invoices to the top of their “to do” list and get your invoice paid.

Over the years we have collected billions in overdue invoices for our customers.

Our debt recovery and credit management services give our members the financial freedom needed to grow and prosper, while our new Late Payment Compensation department could unlock hidden potential and offer the compensation needed to springboard your business to success.

You might be hesitant about contacting a debt collection agency. What are they going to be like?

Can they help your particular type of business?

There is no need for concern. CPA are courteous, helpful and very probably have had direct experience of working with your type of business.

Debt collection agencies are not all alike.

Success lies in both recovering money and keeping customers happy. The Credit Protection Association was founded in 1914 and  has helped tens of thousands of UK businesses to collect outstanding payments and reduce the risk of incurring bad debt. We believe that creditors deserve to be paid for the work or goods they have supplied but we fully understand the need to maintain
the best possible relationship with customers!

At The Credit Protection Association, we provide solutions, advice and back-up in all areas relating to the supply of services or goods on account. Client-members receive everything they need from a single source to reduce debtor days and write-offs.

The Credit Protection Association has helped has assisted tens of thousands of UK businesses with their credit control requirements, since the First World War.

We are polite, firm and efficient when it comes to recovering outstanding debt.

“We have used CPA for a number of years now. The website is easy to navigate around with lots of helpful reports. The staff are always at hand and very friendly. CPA has  helped us reduce our debt over the years and keep track of potential issues with our customers.”
~ CPA client in Buckinghamshire

“The service from CPA has proved to be everything that you said it would be. We have already seen a huge benefit. We have had a number of overdue accounts paid promptly and directly to us. It is also a huge weight off our mind to know that once we have passed an overdue payment over to you, you take care of everything whilst keeping us informed.
~ Credit Controller client in Warrington

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections


Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

CPA is passionate about late payment

The Credit Protection Association has been protecting smaller firms against poor payment practices for over 100 years.

We are extremely passionate about breaking the late payment culture that holds back the UK economy and threatens many SMEs with cash flow difficulties being the single biggest killer of Britain’s small businesses.

If you were regularly paid late we can help. Those former customers used you to boost their own cashflow, regularly paying you late.

As a result you had extra costs, you had the distraction of having to chase payment, you had opportunity costs because your capital was tied up in their late invoices.

Under little used legislation, you are entitled to compensation for those late payments.

Now you can boost your own cash-flow.

CPA can help unearth the those hidden treasures.

We have the technology to reveal the compensation you are due and we have the extensive experience and expertise to then turn those claims into cash.

Yes, CPA can help you boost your business cash-flow.

Don’t let your bankers control you, contact CPA today.

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

Read our blog here on how to crack down on the late payment culture.

Read our blog here on how to give late payers the slap they need.

The “Why” of the late payment culture.

New PM should walk the walk and back small firms over late payments

Paying late is “crack cocaine” to big business.

Late payment culture risks “spiraling out of control”

visit our late payment compensation page

See our full blog and FAQ on late payment compensation

Do you realise you could be sitting on a fortune?

Late payments often result in a cash flow crunch and leave SMEs in need of a cash injection.

If you sold B2B on credit then there may be a hidden source of capital you can call on.

If you fancy an bit of extra cash in your business, rather than jumping through hoops with your bank, you could look to uncover the resources from an unexpected source within your own business.

Not many are aware but there could be a hidden fortune within your business, sitting there, just waiting to be uncovered and released.

We can help you uncover the pile of gold, you didn’t even know you were sitting on.

If you trade with other businesses and were often paid late then you could be entitled to significant compensation.

Under little known and under-utilised legislation your business could be due huge amounts in compensation that you didn’t even know about.

Let’s be clear – this is not a way to weaken any customer relationships you value. It is one that identifies who’s been paying late and then recover the potentially significant sums in compensation using Late Payment Legislation from businesses where the relationship has already ended.

You can pick and choose who you want us to follow up – but once we’ve agreed which companies you’d like to pursue compensation from it’s a fast process and there’s no financial outlay to you whatsoever. My team at CPA put its expertise to work to recover the compensation due and fight late payment culture.

That compensation could provide the cash boost your business needed.

But don’t delay, that compensation evaporates if not claimed within six years of the late payment.

How can CPA help?

CPA has developed a unique technology to dig into your accounting records and discover the cash injection you are due by means of compensation. The software does all the hard work. Our software interacts over the cloud with over 300 different software packages, working directly with your accounts package, just so long as it’s stored on a computer.

We recognise that most companies do not have the resources to spend time on the identification and calculation of Late Payment Compensation. Our service can produce an Analyses within just a few days with (usually) less than 30 mins of co-operation from our clients. We work directly with over 300 accounting packages but can also work with bespoke accounts packages. Indeed, speed is essential as the oldest invoices may fall foul of the 6-year time limit.

Once the Sales Ledger Analyses is made available to clients, all that is required is that management decide which commercially sensitive ex-customers to remove from the list and return it to us.

CPA then uses its years of collection experience to explain and recover the Late Payment Compensation Claims. Clients do not handle any part of the recovery process as our team will take all communications from the companies against who the claims has been made. Often, it’s simply a case of explaining the legislation, sometimes we have to go all the way and enforce the legislation through the courts.

The result is that we are realising clients’ claims worth tens and sometimes hundreds of thousands of pounds which, of course, is pure net profit.  You may also be among the recipients of “hundreds of thousands of pounds” should you elect to take advantage of our services.

We do the work, you receive the cash.

If you have supplied goods and services to businesses on credit and were regularly paid late then you could be due significant sums in late payment compensation.

We are talking to companies and unearthing claims in the hundreds of thousands from former business customers who paid them late. Large business customers who abused their power to inflict unfair and sometimes illegal payment practices.

We are helping business owners  who are looking to boost the returns from their business before they retire. We are helping businesses who have lost major clients after years of loyal service to get properly compensated for systematic late payment. We are helping companies that were looking to close down, who looked insolvent and finding that cash injection they need to avoid insolvency.

Those former clients who regularly paid you late can finally be made to pay.

Ready to speak to an advisor?

For help or advice on credit management, entirely without obligation.

Call us today

0330 053 9263

The Credit Protection Association is a credit management company established in 1914. If you supply goods or services on credit then we can help you!

The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections

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The Credit Protection Association – Prompting Punctual Payments – Ethical, Effective, Efficient, Economical collections