Lockdown hits growth hopes – business news 3 November 2020.
James Salmon, Operations Director.
Lockdown hits growth hopes, borrowing to hit £500 billion, extra support for the self employed, extension to BBLs & CBILs, flexible and home working, employee fears, covid-19, market and other business news.
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.
Lockdown hits growth hopes
Experts at the National Institute of Economic and Social Research (NIESR) have warned that the second coronavirus lockdown could see GDP fall by 12% in November, a decline that would mark the second biggest monthly dip on record after the fall seen in April.
NIESR says the economy is also likely to slip by 3.3% across Q4, the steepest quarterly fall since 1955 bar the record 19.8% decline seen in this year’s second quarter.
Elsewhere, Goldman Sachs has cut its fourth-quarter forecast from an expansion of 3.6% to a contraction of 2.4%, while Credit Suisse cut its forecast from growth of 1.5% to a contraction of 5%.
Oxford Economics foresees a 3% fall in Q4, with a 10% decline in November driving this.
Meanwhile, Morgan Stanley said that the shape of the recovery had changed from an “asymmetric V” to a “wonky W”.
Borrowing could hit £500bn in 2020
Government borrowing could hit a record £500bn this year as the country looks to cover the cost of the coronavirus crisis. If the forecast put forward by Douglas McWilliams, deputy chairman of the Centre for Economics and Business Research, proves correct it would far exceed the £158bn deficit recorded during the financial crisis a decade ago and push the national debt further beyond the £2trn mark. With growth hopes hit, the debt burden will weigh even heavier.
Chancellor confirms extra support for the self-employed
Chancellor Rishi Sunak has announced that self-employed workers will be able to claim state aid of up to 80% of their average earnings during England’s four-week lockdown amid the growth hope fears. This is an increase on the 40% currently offered via the Self-Employed Income Support Scheme (SEISS).
Critics have questioned the eligibility criteria, however, warning that as many as 2.9m freelancers, contractors and newly self-employed people will remain excluded.
Derek Cribb, CEO of the Association of Independent Professionals and the Self-Employed, says it is “deeply troubling” that ministers have not fixed “devastating gaps” in SEISS.
The Federation of Small Businesses has also warned that too many self-employed people are excluded, with chairman Mike Cherry saying: “Fundamentally, the business support landscape still remains too much of a mixed picture”.
Treasury extends emergency business loan scheme
The Treasury has announced that applications for the Bounce Back Loan Scheme (BBLS), Coronavirus Business Interruption Loan Scheme and Coronavirus Large Business Interruption Loan Scheme will now be open until the end of January.
The extension, which carries support before the previous end point of November 30, also applies to the Future Fund, an initiative aimed at UK start-ups. It was also confirmed that small businesses that already received funds through the BBLS programme – which offers firms cheap loans worth up to £50,000 – will also be able to top up existing loans if required.
The changes were confirmed after the Treasury convened an emergency meeting with Britain’s largest banks in order to review the terms of the Government-backed loan programme.
With growth hopes hit, the credit risk of these loans will be heavy.
Half of firms expect permanent move to flexible working
A Confederation of British Industry (CBI) / Ipsos Mori poll shows that almost half of UK firms expect staff to be on flexible working arrangements in the future.
The survey saw 79% of respondents say staff worked entirely or almost entirely in offices in 2019, with just 29% thinking this will be the case in 2021 and 47% saying they expect staff to split their time evenly between home and the workplace going forward.
CBI deputy director-general Josh Hardie said remote working has brought “huge benefits” and has not led to a collapse in productivity. He added that while the coronavirus outbreak has triggered a mass migration from workplaces, “talk of the death of the office is premature.”
Firms return staff to home working
City firms have told thousands of staff to work from home as England prepares to enter its second coronavirus lock-down. PwC has told its 22,000 employees in the UK that its default position is for them to work from home unless there is an essential business or personal need to come into the office, with the Times reporting that EY and KPMG have taken the same approach. Banks Goldman Sachs and Deutsche Bank are also returning non-essential staff in their London offices to home working.
Third of staff ‘fear catching Covid at work’
More, According to a study by the Resolution Foundation think tank, more than a third of workers are concerned about catching covid-19 at work.
The lowest paid are particularly worried, the research found, but also the least likely to speak up about it.
The Resolution Foundation said that younger workers are also among those less likely to raise a complaint.
Lindsay Judge, research director at the Resolution Foundation, said: “More than one-in-three workers are worried about catching coronavirus on the job, despite the extensive steps employers have taken to make workplaces Covid-secure. Given many workers’ limited ability to get employers to address Covid concerns, the UK needs a strong enforcement regime to ensure that workplaces are as safe as can be. But instead health and safety resources have been cut, inspections have been slow, and Covid-related enforcement notices are few and far between.”
Covid-19 general news
The UK announced 18,950 new cases on Monday. Globally 360,608 cases were added raising total numbers to 46.8 million with 1.2 million deaths.
Prime Minister Boris Johnson said there’s “no alternative” to imposing a lockdown across England to stop the NHS being overwhelmed and revealed plans for whole cities to be tested.
Boris Johnson also announced a doubling of support for the self-employed during England’s new lock-down, and has extended the deadlines for government-backed business loans. He announced that the government would double the current support for the self-employed. It will now pay 80% of normal trading profits, as opposed to 40%.
France reported record daily coronavirus cases on Monday with 52,518 confirmed new infections.
Markets.
Stock markets rebounded yesterday with the FTSE 100 rising 1.4% and the Eurostoxx 50 up over 2% as bargain hunters picked up on stocks after last weeks rout. Despite the hit to growth hopes, investors still remain positive. Still many are waiting on the sidelines ahead of tomorrows US election and watching the latest lock-down to see the economic effects and in particular how they will affect the christmas celebrations. The Oil Price fell with Brent at $38on worries that widening coronavirus lockdowns in Europe would weaken fuel demand while gold gained to $1893. Overnight, with the election looming, the S&P 500 rose 1.23% and the NASDAQ rose 0.42%. In Asia, the Nikkei rose 1.39%, the Hong Kong HSI rose 1.96% and the Chinese CSI 300 rose 1.2%. The pound has strengthened to 1.11 Euros and 1.299 US dollars.
No-Deal Brexit unthinkable amid second wave, says CBI
Business leaders have warned of the risks of a No-Deal Brexit at a time when the UK is battling against the coronavirus crisis and with growth hopes have already taken a hit. Dame Carolyn Fairbairn, director-general of the Confederation of British Industry (CBI), said: “It would be unconscionable to unleash a no-deal Brexit on the countries of Europe – the UK and the European Union – as we are facing this vicious second wave.” Speaking at the CBI’s annual conference she added: “I’ve always felt and argued that a good deal was an economic necessity, I now think it’s a moral necessity as well.”
FCA announces extension of loan holidays
With England entering a second coronavirus lockdown on Thursday, the Financial Conduct Authority (FCA) has told mortgage, loan and credit card providers to offer borrowers extended repayment holidays. Consumers who have not yet had a credit payment deferral for a mortgage can request one that lasts for up to six months, while those who have had a deferral will be able to apply for a second. Figures from industry body UK Finance show that 2.5m people have already taken a payment holiday on their mortgage since March. The FCA also said that for high-cost, short-term credit such as payday loans, consumers can apply for a payment deferral if they have not already done so.
Over 55s raid savings
New HMRC data has revealed the number of over-55s accessing their pension savings has increased in recent months. The report said that through July, August and September 2020, 347,000 individuals chose to withdraw from their pension. This marks a 6% increase on Q3 2019.
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 nsm@cpa.co.uk 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.
You put up with the PAIN – now claim the GAIN!
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.
Did you know that your business is entitled to a minimum of £40 for every commercial invoice paid late to you over the past 6 years?
How many of your invoices are paid late each month – 20, 50, 100 or more?
At £40 per invoice that’s claim of £57,600, £144,000, £288,000 plus interest. The more invoices the bigger the claim!
At £100 per invoice it’s £144,000, £360,000, £720,000 plus interest.
For over 20 years, CPA has calculated and recovered Late Payment Compensation on behalf of Clients!
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.
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 extra 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.