“not as severe as other recessions – business news 9 March 2021.

James Salmon, Operations Director.

Andrew Bailey predicts this pandemic will not be as severe as other recessions,  retail growth, cyber crime threatens SMEs, hospitality optimistic and other news.

Pandemic effects ‘not as severe as other recessions’ – BoE

Bank of England governor Andrew Bailey has predicted that the coronavirus pandemic’s economic effect will not be as severe as those seen under previous recessions.

He said “there is light at the end of the tunnel” as he pointed to falling virus infections and a successful vaccine rollout. But he suggested the economy would need to adapt as people work and shop from home more. Those spoken to by the Bank expected some degree of home working to become the “new normal”.

Stating that government spending had been a “a necessary and sensible response,” he noted: “It means that the economic impact of COVID will be spread over time – how long we don’t know because it is too early to predict. But that cost has to be managed, and it will be easier to do that with a higher trend rate of growth, boosted by stronger investment.”

The Bank’s outlook was cautious, Bailey added, noting that a planned further £150bn of quantitative easing was expected to be completed by around the end of 2021.

UK retail sales return to growth despite lockdown

Retail sales in the UK grew 1% last month compared with the same period last year, according to KPMG and the BRC, a sharp reverse of a 1.3% year-on-year contraction in January. But Paul Martin, UK head of retail at KPMG, said Rishi Sunak’s budget last week offered only short-term help for retailers. “Conditions will continue to be incredibly challenging as they face subdued demand, thinner margins and rising logistics costs, alongside the accelerated structural changes to the sector,” Martin said.

Over 1m small firms at risk of collapse due to cyber attacks

Research commissioned by Vodafone has found that the equivalent of 1.3m small businesses would go bust if they were targeted by hackers, leading to calls for the Government to put more money into cyber defences. The report urged the Government to expand a dedicated business cybersecurity within the National Cyber Security Centre and introduce a 5% VAT cut on cybersecurity products for small companies.

Hospitality firms ‘optimistic’ about bounce back in trading

Leisure and hospitality firms are feeling optimistic about the future, a survey by Haysmacintyre has found. Hotel businesses had the most positive outlook, with 83% saying they were confident about future prospects; 53% of restaurants said the same but 59% of pubs were uncertain or lacking in confidence for their prospects looking forward. Overall, 69% believe that trading levels will return to normal either by the end of this year or the first half of 2022. Gareth Ogden, partner in the hospitality team at Haysmacintyre, said: “The hospitality industry has undeniably been hard hit by the COVID-19 crisis. However, despite the challenges, this Survey reveals that many in the sector remain positive.”

One in eight recent UK graduates hit by unemployment

ONS data show 12% of recent graduates were unemployed in the third quarter of 2020. This compares with an unemployment rate of 4.6% for the wider graduate workforce and 5.1% for the working age population overall.

Slow recovery could see need for more tax hikes

If the economy does not make a swift recovery from the pandemic the Chancellor may have to raise taxes further to balance the books, according to Professor Sir Charlie Bean. The Office for Budget Responsibility expert told MPs that if the “scarring” from Covid is wider than expected then more consolidation would be required. However, if the UK returned to its pre-pandemic trajectory the tax hikes announced last week “would, in theory, no longer be necessary to restore sustainability.”

The tax implications from buying and selling crypto-assets

David Britton, a tax partner at BDO, answers some of the key questions regarding crypto-assets in light of the recent trading activity in Bitcoin. He says there is a popular misconception that the profit or gains arising from crypto-assets transactions are tax-free. Individuals buying and selling Bitcoin could be subject to CGT while those considered to be trading cryptocurrencies may need to pay tax on the profits as trading income. Additionally, income tax and NIC will apply to crypto-assets received from an employer as a payment for services performed in the UK.

Greensill files for administration

Greensill Capital has collapsed into insolvency after admitting it could not meet a $140m repayment demand from its Swiss bank backer. The supply-chain finance specialist was thrown into crisis last week after its main insurer refused to renew a $4.6bn contract and Credit Suisse froze $10bn of funds linked to the firm. A lawyer for the company said yesterday that Greensill had about $5bn of exposure to metals magnate Sanjeev Gupta’s GFG Alliance, which had started to default on its obligations. GFG said its operations were continuing as normal. Its UK business, Liberty Steel, employs about 5,000 workers at plants including Rotherham and Hartlepool. Worldwide, GFG employs 35,000 people. GFG’s situation could now see Apollo Global Management buy parts of the business with the US private equity group offering $59.5m for Greensill’s intellectual property and IT systems. A spokesperson for Greensill’s administrators, Grant Thornton, said: “The joint administrators are in continued discussion with an interested party in relation to the purchase of certain Greensill Capital assets.”


ITV reported a fall in annual profit amid a ‘challenging’ advertising environment, but said annual performance was ahead of expectations, driven by a strong end to the fourth quarter and cost cuts. For 2020, pre-tax profit fell £325 million from £530 million year-on-year as external revenue slipped 16% to £2.78 billion.

Domino’s Pizza

Domino’s Pizza reported a rise in annual profit as strength in its delivery business more than offset pandemic-led weakness in its collection business. The company also set out a new plant to grow its delivery business, targeting medium-term total system sales of £1.6 billion to £1.9 billion, supported by the opening of an additional 200 new stores.

WH Smith

WH Smith said it was burning through less cash than feared after its high-street business performed better than hoped in January and February. WH Smith also announced that it had extended the maturity of two existing £200 million term loans to October 2023 and agreed new minimum liquidity covenants.

John Menzies

John Menzies swung to a deep annual loss after the pandemic hit the travel sector. Pre-tax losses for the year through December amounted to £120.5 million, compared to a year-on-year loss of £17.3 million. Revenue tumbled 38% to £824.2 million amid a 49% reduction in flight volumes.John Menzies did not declare any dividends for the year.


Oil prices passed $70 for the first time following a missile attack on a refinery in Saudi Arabia.

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