Three tier system to cause disruption – business news 13 October 2020.

James Salmon, Operations Director.

The three tier system to cause huge disruption to business, UK unemployment, tax rises, negative interest rates, retail, hospitality, house prices, 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.

Three Tier system will deliver huge disruption

PM Boris Johnson has announced a new three tier system for covid-19 shutdowns in England setting out different rules for regions classified as being “medium”, “high” or “very high” alert.

U.K. Prime Minister Boris Johnson announced bars and pubs will be closed in the worst-hit parts of England to control a surge in covid cases, and his top health adviser warned more measures might still be needed.

Liverpool is to face the tightest restrictions with pubs and gyms closed and rules on mixing indoors. Retail, schools and universities will remain open nationally.

The number of covid-19 cases in Britain has risen significantly in October, especially in the north of England.

Mike Cherry, national chair of the Federation of Small Businesses, says the new three tier system for deeming a region’s coronavirus risk “will mean huge disruption for firms.” He says the system will only work if funding for business support and guidance to accompany it is “sufficient, crystal clear and timely”.

He adds that “far too many” people are excluded from the Government’s efforts to help business owners, including company directors and the newly self-employed, adding that a rescue package for such groups is “urgently needed”.

Mr Cherry says a world beating test-and-trace system is central to getting the small business community “firing on all cylinders again”, insisting that the sooner one is in place, “the sooner our economy can bounce back”.

UK Unemployment

UK Unemployment has surged to its highest level in over three years as the pandemic continues to hit jobs. The unemployment rate grew to 4.5% in the three months to August, compared with 4.1% previously, while redundancies rose to the highest level since 2009.

IFS: £40bn a year tax rises needed to stop debt ‘spiralling’

The Institute for Fiscal Studies (IFS) says the Chancellor will need to raise taxes by more than £40bn a year by 2025 to balance the books and “stop debt spiralling out of control”, with government borrowing set to hit £350bn this year. The IFS’ Green Budget suggests ministers should take advantage of cheap borrowing costs to provide further support to the economy for at least 18 months. The report says the Government has increased spending on day-to-day public services by £70bn in response to the pandemic, adding that even if three-quarters of that was to stop this year, it would still add £20bn to public sector borrowing by 2024/25. IFS director Paul Johnson said: “Tax rises, and big ones, look all but inevitable, though likely not until the middle years of this decade.”

BoE asks banks if they are ready for negative rates

The Bank of England (BoE) has asked banks how ready they would be for the rollout of negative interest rates, with deputy governor Sam Woods writing to commercial lenders asking what steps they would need to take if borrowing costs were pushed to 0.00001% or below zero.

He said: “For a negative bank rate to be effective as a policy tool, the financial sector – as the key transmission mechanism of monetary policy – would need to be operationally ready to implement it in a way that does not adversely affect the safety and soundness of firms.” Mr Woods, head of the Bank’s Prudential Regulation Authority, called on banks to offer “specific information” on their “current readiness to deal with a zero bank rate, a negative bank rate, or a tiered system of reserves remuneration”.

Meanwhile, BoE governor Andrew Bailey has said the coronavirus crisis means negative rates should be considered as part of its “tool kit” but that did not mean they would be used by the Bank. Lucy Burton in the Telegraph looks at the possibility of negative rates, noting that PwC warned banking clients in July that they had “no choice” but to “batten down the hatches” and prepare for negative rates.

Retail sales up in September

The British Retail Consortium-KPMG sales monitor shows that retail sales rose last month as shoppers started their Christmas shopping, with the biggest monthly sales rise in a decade.

Overall retail sales rose 5.6% in September, compared to the same month last year, with online sales seeing 36.7% growth.

The 5.6% increase is the best growth in total retail sales since December 2009. The report notes that sales between April and September were 1.1% lower in 2020 than in 2019.

Paul Martin, UK head of retail at KPMG, said: “The resilience of British retailers has been nothing shy of remarkable in recent months.”

House prices see rapid recovery

House prices staged a strong recovery in the third quarter, as lockdown restrictions eased. Prices rose 3.3% in the three months to September, according to the Halifax Property Index, the strongest increase recorded since the end of 2006. On an annual basis prices were 5.5% higher, the sharpest rate of inflation since the final quarter of 2016. The housing market has been buoyed by Government interventions such as the stamp duty holiday introduced amid the coronavirus crisis.


The UK Hospitality Industry will take legal action to stop local lockdown rules that could force pub, clubs & other venues to close. Trade body the Night Time Industries Association said there was no evidence that hospitality venues contributed to the spread of Covid-19.

Mitchells & Butlers, the pubs and restaurants group, has begun redundancy consultations with a number of staff as it struggles with the impact of the coronavirus pandemic. M&B, whose chains include Harvester and All Bar One, has about 1,700 pubs and restaurants and 44,000 employees. It has not yet disclosed how many jobs are at risk.

Covid-19 general news

Global cases pass 37.7 million and deaths pass 1.08 million

In the week ending 11th October, there were a reported record 2.2 million new cases and 39,000 deaths, according to the World Health Organization. Europe had the largest increase in infections, rising 34%, while deaths in Africa rose 27%.

Johnson & Johnson said it was suspending Phase 3 trials of its covid-19 vaccine following an unexplained illness in a study participant. The American drugmaker noted that so-called serious adverse events are to be expected during large trials. A rival vaccine being developed by the University of Oxford and AstraZeneca was paused and later restarted for similar reasons last month.

US President Donald Trump has returned to the campaign trail less than two weeks after testing positive for coronavirus.

A study in the Lancet showed reinfection can occur swiftly, and the second bout can be more severe

Boris Johnson clashed with his own government’s scientific advisers after documents were released showing they wanted tougher action against the resurgent coronavirus outbreak in the U.K. in September. After Boris announced his new three tier system (see lead story) England’s Chief Medical Officer Chris Whitty warned the new measures won’t be enough, and newly released papers showed the government’s Scientific Advisory Group for Emergencies (SAGE) recommended national or regional restrictions to slow the spread of the virus last month.


Coronavirus, US election and Brexit continue to drive the markets, more so than economic data. Yesterday the FTSE 100 fell 0.3% as the dollar stumbled. The S&P 500 rose 1.64% and the NASDAQ rose 2.56%. The NYSE FANG+ index jumped 3.3% for its best session in a month. Oil fell nearly 3%


European foreign ministers agreed to draw up proposals to impose sanctions on Russia over the poisoning of Alexei Navalny, a prominent critic of Vladimir Putin, Russia’s president. They also expressed willingness to impose more sanctions on those involved in the repression of protesters in Belarus, including Alexander Lukashenko, the country’s president, who stole August’s election.


A strong NY tech sentiment helped yesterday Apple jumped $7 to $124 in early trade after disclosing it had instructed its equipment makers to make 80m new 5G iPhones and ahead of a major PR effort today called “Hi, Speed” where the new iphone 12 is expected along with connect-ability to 5G.  This, analysts predict, will trigger a new iPhone “supercycle”, with sales growing at rates in the double digits. It’s Apple’s “most important product cycle” since 2014’s iPhone 6, according to broker Wedbush. Apple has returned to a $2.1trn valuation.


Amazon today kicks off its Prime Day—in fact lasting 48 hours—offering super discounts on a host of items.Delayed from July because of the pandemic, its expected to start the christmas shopping cycle.


Unilever’s shareholders overwhelmingly voted to end the consumer-goods firm’s 90-year-old dual British and Dutch listing, in favour of a London-only entity. In 2018 investors rejected a proposed change to a Rotterdam-only structure, fearing the effect of relinquishing its position on Britain’s FTSE 100 share index. A punitive “exit tax”, floated by Dutch politicians, may yet scupper the move.

UK lawyers and accountants risk losing in EU deal, warns report

The House of Lords’ EU services subcommittee has warned that the UK’s professional services industry could lose EU business after Brexit, having been overlooked in trade negotiations with Brussels.

Ethnicity pay gap lowest in 7 years

The pay gap between white and ethnic minority employees in England and Wales is at its smallest level for seven years, according to the Office for National Statistics (ONS). The analysis shows that there was a 2.3% gap in 2019, with white employees earning an average of £12.40 per hour, compared with £12.11 for those in 17 ethnic minority groups. The gap is the smallest since the 5.1% recorded in 2012. The report shows that white Irish workers are typically the highest paid, at £17.55 an hour, followed by Chinese workers (£15.38) and Indian employees (£14.43). Pakistani workers saw the lowest average hourly wage of £10.55, with this 16% lower than the £12.49 earned by the average white British worker. The ONS report also shows that ethnic minority men earned 6.1% less than white men in 2019, while ethnic minority women earned 2.1% more than white women. Ethnic minority employees aged 30 and over tend to earn less than their white counterparts, while those aged 16-29 tend to earn more, the ONS analysis of Annual Population Survey data found.

Tax cut call

Andrew Morrison, director of MCC Accountants, believes that the introduction of regional corporation tax cuts could help ministers deliver a “levelling up” of the regions. He says it would encourage large firms to move out of London and set up satellite offices in the rest of the UK.

HMRC urged to prosecute sellers of tax avoidance schemes

George Turner, executive director of think-tank TaxWatch, has written to HMRC calling for those who sell disguised remuneration tax avoidance schemes to be investigated for tax fraud. He wrote: “There is a myth that appears to have taken hold that the promoters of tax avoidance schemes have done nothing wrong as the promotion of a tax avoidance scheme is ‘not against the law’”. “This is simply not the case where someone is involved in the promotion of a scheme that is dishonest,” he adds.

OECD: No global digital tax deal this year

The Organisation for Economic Cooperation and Development (OECD) says agreement on global rules around the taxation of multinational tech firms will not be in place this year, saying talks over a deal on how to tax companies like Facebook, Amazon, Apple and Google in future will continue until summer 2021. The 137 nations taking part in negotiations that were hoped to deliver a deal this year have agreed to an extension due to the ongoing coronavirus pandemic. The OECD says a series of technical principles on how companies should be taxed have been drafted. Calculations suggest agreement over a digital tax could increase global corporate tax worldwide by between 1.9% and 3.2% – equivalent to around £38.4bn to £61.4bn a year. Angel Gurria, secretary general of the OECD, commented: “It is clear that new rules are urgently needed to ensure fairness and equity in our tax systems, and to adapt the international tax architecture to new and changing business models.” Charlotte Richardson of PwC said the proposed new framework had the potential to be a “once in a lifetime change” to t he corporate tax system. James Moore in the Independent reflects on the mooted global tax, saying that getting countries to agree in principle is one thing, but getting them to sign off on their implementation “is another matter entirely”. Philip Aldrick in the Times also looks at the plans, praising the OECD’s ambition but saying “corralling” 137 countries into a fundamental overhaul of global corporation tax rules “was always going to make herding cats look easy”.

Eddie Stobart back in black following accounting scandal

Trucking business Eddie Stobart has returned to profitability following an accounting scandal, seeing a £16.6m profit in the half year to May 31, having made a loss of £6.3m in the same period last year. Despite returning to profit, debts rose from £236.9m to £242.7m due to the cost of a loan taken out to secure a £55m rescue deal agreed last December. The accounting scandal arose last year, with it found that £2m was unaccounted for. The issue led to an investigation into auditors KPMG and PwC and saw shares in Eddie Stobart Logistics suspended.

Asda buyers see tax haven claims

The Mail’s Matt Oliver says Mohsin and Zuber Issa, the billionaire brothers who bought Asda for £7bn, are facing questions over their decision to transfer ownership of the supermarket chain to Jersey, a tax haven which charges a corporate tax rate of zero. Margaret Hodge, former chairman of Parliament’s Public Accounts Committee, said: “Why on earth would the parent company of Asda choose not to be incorporated in the UK?” “The answer must be that there is a lax regulatory approach in Jersey which, at best, facilitates tax avoidance.” A spokesman for the Issa brothers insists that Asda will “remain tax-resident in the UK and will pay all taxes that are due”.

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.

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.

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.