UK Business News Today: 14 September 2026 | Economy, Markets & Insolvencies

Cash flow is the defining theme for UK SMEs today. Enterprise Nation’s Growth On Hold report shows businesses postponing investment, recruitment and expansion as VAT, wages, energy and other costs absorb money that would otherwise fund growth. Crucially for businesses selling on credit, the report highlights the additional strain created by late payment, with £26bn outstanding at any one time and 1.5 million businesses affected each year. Against that backdrop, stronger-than-expected UK GDP growth offers some encouragement, but cautious hiring, higher energy prices, uncertainty over interest rates and continuing insolvency activity all reinforce the need for careful credit management.

James Salmon, Operations Director.

Key Developments

• Late payment is draining SME cash flow: £26bn is owed at any one time, with 1.5 million businesses affected annually and 38 businesses reportedly closing every day while waiting to be paid.
• Growth is being sacrificed to cover costs: 69% of businesses surveyed by Enterprise Nation delayed or cancelled growth plans, rising to 77% among high-street firms.
• UK GDP grew 0.4% in July, beating expectations, although borrowing costs and weak household conditions continue to cloud the outlook.
• Hiring remains subdued: manufacturers are pulling back recruitment while youth unemployment, AI and employment costs are squeezing entry-level opportunities.
• Energy risk has intensified: Brent crude has climbed above $107 and European gas prices have surged as geopolitical disruption adds to existing UK energy-cost pressures.

SME & Business Environment

Small businesses sacrifice growth as cash flow comes under pressure

Enterprise Nation’s Growth On Hold report, produced with Square and EDF Small Business, provides a stark picture of the pressures confronting smaller firms. The survey of 526 businesses found 69% had delayed or cancelled a growth plan, while 27% had considered closing altogether. Among high-street businesses, 77% had put growth plans on hold. VAT and wages were the two most commonly cited major cost pressures, followed by employer National Insurance, supply costs, business rates, energy and rent.

The picture is particularly important because many of these businesses are not necessarily failing to generate sales. Instead, rising costs are consuming the funds that would ordinarily support hiring, equipment, marketing and expansion.

Why it matters: Businesses selling on credit need sufficient working capital to fund operations while invoices remain unpaid; when margins and cash reserves are already squeezed, even a modest deterioration in customer payment times can become significant.

Late payment removes £26bn from business cash flow

The same report identifies late payment as a direct threat to SME resilience. Away from the high street, 41% of businesses surveyed were paid mainly by bank transfer or invoice, rising to 82% among business-services respondents. Businesses paid by invoice must continue meeting wages, tax, suppliers and overheads while waiting for customers to settle.

Government-backed research cited by the report estimates that late payment costs the economy almost £11bn annually, affects 1.5 million businesses each year, leaves £26bn outstanding at any one time and costs affected firms an average 86 hours annually chasing payment. It also links late payment with 38 business closures every day.

The report recommends properly funding enforcement of the Commercial Payments Bill, publishing sanctions against persistent poor payers and setting a clear path towards potentially shortening maximum contractual payment terms.

Why it matters: When customers use suppliers as an unofficial source of finance, the supplier carries the funding risk. Prompt follow-up and structured escalation can prevent overdue invoices becoming long-term debts or write-offs.

Access to finance remains another constraint on growth

Access to capital was named as the single biggest growth barrier by 29% of businesses, level with energy and overhead costs. Around 130,000 smaller businesses apply for bank finance each year, with roughly half declined, while another 130,000 are reportedly discouraged from applying altogether.

This creates a difficult combination: businesses can struggle to borrow while simultaneously providing free credit to customers who pay late.

Why it matters: Better payment performance can reduce reliance on external borrowing and release money already earned back into the business.

Economy & Policy

UK economy grows 0.4% in July

UK GDP grew 0.4% in July, outperforming expectations for no growth. Services led the expansion, supported particularly by computer programming and AI-related activity.

Chancellor John Healey described the economy as resilient despite global uncertainty. However, economists remain cautious, pointing to weak household conditions and the risk that higher government borrowing costs could reduce fiscal headroom ahead of the October Budget.

Why it matters: Better economic growth can support customer demand, but businesses should not assume stronger headline GDP will immediately translate into stronger customer cash flow or faster payments.

Burnham promises business leaders a “partner for growth”

Prime Minister Andy Burnham is meeting senior executives from companies including HSBC, Rolls-Royce and BAE Systems as his Government seeks to reset relations with business.

The Prime Minister is expected to position government as a “partner for growth” after a period in which many employers became increasingly frustrated by tax, employment and regulatory pressures.

Business leaders warn UK economy is trapped in a “straitjacket”

The Prosperity 2030 Alliance, led by NatWest chairman Rick Haythornthwaite, has identified five problems it believes are restricting UK economic performance: neglect, gridlock, discouragement, myopia and powerlessness.

The group argues that inadequate investment, excessive regulation and poorly designed taxation are discouraging private-sector growth and could leave Britain falling further behind other G7 economies.

George Osborne calls for closer EU trade relationship

Former chancellor George Osborne has argued that the economic impact of Brexit is still not being confronted sufficiently by political and business leaders.

He suggested that Britain eventually rejoining the EU Customs Union could provide a route towards reducing trade friction and improving economic performance.

Canada explores much deeper EU economic integration

Canadian Prime Minister Mark Carney is exploring closer integration with Europe as Canada attempts to reduce its economic dependence on the United States.

Ideas reportedly include strategic cooperation across energy, defence and AI, shared data-centre and infrastructure investment, and potentially more freedom for Canadians to live and work in Europe. The concept of an “Associate Member of the European Union” has also been floated.

Employment & Labour

Britain’s labour market increasingly divided between generations

More than 1.7 million people aged 65 and over are now working, with employment among older workers at record levels. The ratio of young workers to working over-65s has fallen from around 10-to-one in the early 2000s to roughly two-to-one today.

At the same time, almost a million 16–24 year-olds are outside employment or education, while entry-level opportunities have weakened substantially.

Better health, flexible working and financial pressures are encouraging people to remain in work for longer. But Britain’s “low hire, low fire” labour market means fewer vacancies are opening for younger workers.

Government reconsiders youth minimum-wage policy

Prime Minister Andy Burnham is reportedly reconsidering plans to increase the youth minimum wage amid concern about the effect on recruitment.

Youth unemployment among 16–24 year-olds has increased to 16.2% from 14.2% a year earlier, prompting officials to explore alternative wage structures.

AI cuts into graduate and entry-level opportunities

AI is becoming an increasingly important factor in the weakening graduate job market. The proportion of computer-science graduates entering coding roles reportedly fell from 40% to 28%, while economics graduates are also encountering redesigned roles and fewer traditional entry points.

Separate Work Foundation research indicates that more than one in three employers have reduced entry-level positions, while total job vacancies are around 45% below 2022 levels.

AI can perform some of the routine analytical, coding and administrative work previously allocated to junior employees, potentially increasing demand for experienced workers while reducing traditional training routes.

Older jobseekers face their own employment barriers

The Centre for Ageing Better estimates almost one million over-50s were struggling to find work at the end of last year — a similar scale to the difficulties facing younger workers.

Fidelity International’s Longer Working Lives Index reportedly places Britain last among G7 countries for supporting older workers, prompting calls for stronger action against age discrimination and greater investment in retraining.

Manufacturers sharply reduce recruitment intentions

Only 3% of UK manufacturers now plan to increase recruitment in Q3, down from 15% in Q2.

Manufacturing vacancies have also fallen 6.2%, with Make UK blaming high employment, energy and regulatory costs alongside uncertainty ahead of the Budget.

Energy & Costs

Businesses call for removal of energy levies

More than 120 organisations, including Energy UK and Age UK, are urging the Government to remove policy levies embedded in energy bills.

Campaigners claim the move could reduce household bills by up to £250 a year and potentially cut business electricity prices by around 20%. They argue that energy costs remain around 70% higher than in 2021.

Enterprise Nation’s research reinforces the pressure: 45% of small businesses surveyed said rising energy prices had cut net margins by at least 10% during the previous six months, with the average estimated reduction among those able to quantify it around 18%.

Grid delays could add billions to energy bills

The National Audit Office has warned that delays in expanding Britain’s electricity grid risk increasing costs and restricting economic growth.

Constraint costs associated with balancing the electricity system could reach £12.7bn by 2030, with around £1.9bn a year potentially added to bills if infrastructure does not keep pace with the energy transition.

Energy industry presses for Jackdaw approval

Companies in the UK energy supply chain are urging the Government to approve the Jackdaw gas development off Aberdeen.

The project is said to represent around £10.8bn of private investment, with suppliers warning that continued uncertainty is delaying recruitment and investment and pushing opportunities overseas.

Tax & Government

VAT becomes the biggest individual cost pressure for many SMEs

In Enterprise Nation’s survey, 60% of respondents placed VAT among their three biggest costs, with 29% ranking it as their single heaviest pressure. Wages were also in the top three for 60%, followed by employer National Insurance at 46%.

Among high-street respondents, 54% said reducing the standard VAT rate should be the Government’s priority.

The findings underline how little room some businesses have to absorb additional cost increases without sacrificing investment or passing them on to customers.

BoE policy changes proposed as route to reducing Budget pressure

Economist Gerard Lyons has suggested the Bank of England could halt gilt sales to reduce upward pressure on government bond yields.

He has also argued for a tiered system for paying interest on commercial-bank reserves, potentially saving around £10bn.

Lyons believes Chancellor John Healey has limited scope for further taxation and argues that spending restraint and supply-side reforms offer a more sustainable route towards stronger growth.

IEA criticises increasing intervention in business

Institute of Economic Affairs economist Christopher Snowdon has criticised what he describes as “command capitalism”, arguing that quotas, targets, price controls and regulation increasingly turn private firms into “agents of the state”.

The Government rejects that characterisation and says its aim is to provide greater certainty while reducing unnecessary burdens.

International & Trade

US consumer sentiment falls as inflation expectations rise

The University of Michigan’s preliminary consumer-sentiment index fell to 47.8 in September from 51.7, below expectations.

Its expectations component fell from 51.5 to 45.8, while one-year inflation expectations increased from 4.0% to 4.6%. Expectations over five to ten years edged up to 3.4%.

Weak US confidence matters internationally because softer consumer spending can affect exporters and global demand, while elevated inflation expectations reinforce the risk of higher interest rates.

AI leaders call for slower development of advanced models

Anthropic CEO Dario Amodei has called for a deliberate slowdown in the development of frontier AI systems to allow more time for safety testing.

OpenAI’s Sam Altman backed proposals for deeply embedded independent safety evaluators, while Elon Musk said Amodei was right. Google DeepMind’s Demis Hassabis also supported the direction while saying implementation details require further work.

The intervention follows cybersecurity tests in which AI agents successfully breached external systems and comes as concerns rise over labour-market disruption, electricity consumption and broader systemic risks.

OpenAI has also indicated it will not pursue an IPO in 2026.

Global Market Summary

Markets began Monday with a sharp divergence between energy-heavy UK equities and technology-exposed markets elsewhere.

The FTSE 100 rose 0.63% to 10,717.31, helped by oil and commodity companies. In continental Europe, the STOXX Europe 600 slipped 0.06% to 638.70, the Euro STOXX 50 fell 0.70% to 6,280.66, Germany’s DAX declined 0.41% to 25,462.68 and France’s CAC 40 fell 0.47% to 8,141.53.

US cash markets had closed higher on Friday, with the S&P 500 up 0.86% at 7,656.98, the Dow Jones up 0.98% at 52,573.29 and the Nasdaq 100 up 0.91% at 29,368.44. Monday futures subsequently weakened as investors reassessed the outlook for AI investment and interest rates.

In Asia, Japan’s Nikkei 225 fell 0.81% to 63,492.99, while Hong Kong’s Hang Seng rose 0.35% to 24,892.48. South Korea was particularly weak, with semiconductor-heavy markets hit by concern that slower frontier-AI development could reduce demand for chips and infrastructure.

Market drivers

Two issues dominated sentiment. First, the weekend call by senior AI executives to slow development of frontier models challenged expectations for continued explosive spending on chips, data centres and power infrastructure.

Second, attacks affecting Saudi Arabia’s East-West oil pipeline intensified energy-supply concerns. Brent moved back above $107 a barrel while European gas surged, renewing fears that expensive energy could keep inflation elevated and delay monetary easing.

Government bond yields also remain a concern. The US 10-year Treasury yield approached 5%, while UK gilt yields increased as investors priced the inflationary consequences of higher energy costs.

Interest rates

The Federal Reserve meets this week with markets assigning a high probability to another 25-basis-point increase.

In the UK, economists broadly expect the Bank of England to keep Bank Rate at 3.75% when the Monetary Policy Committee meets. The decision is complicated by renewed energy inflation and the risk that higher oil prices feed through to business costs.

For SMEs, the combination of expensive energy and borrowing costs matters more than day-to-day market volatility: both can weaken customer cash flow and increase the likelihood of delayed payments.

Currencies

GBP/USD stood at 1.3481, down around 0.32% from Friday as the dollar strengthened on higher US yields.

EUR/GBP stood at 0.8557, equivalent to approximately GBP/EUR 1.169, leaving sterling stronger against the euro.

A weaker pound against the dollar increases the sterling cost of dollar-priced imports, particularly energy and commodities.

Commodities

Brent crude: $107.74, up 2.99%

WTI crude: $102.64, up 2.59%

Gold: $4,312.53 an ounce, down 0.84%

European natural gas also surged sharply as traders reassessed supply risk.

For UK SMEs, the most important transmission route is through fuel, freight, electricity and supplier prices. Businesses unable to pass those increases immediately to customers may experience further margin and cashflow pressure.

Insolvency Watch

Administrations (4)

• MGE KOREA LIMITED
• PFP CONTRACTORS LTD
• SOUTH HATCH SURREY LTD
• ST. CLAIR LAMB YARD LTD

Liquidations (23)

• A C BENNETT CONSTRUCTION LIMITED
• A.P. PLANT LTD
• BARBER HARRISON & PLATT PROSPER LIMITED
• BEDA TECHNOLOGY LIMITED
• BELLINGHAM ESTATES LTD.
• BOLLITREE CASTLE ESTATE LIMITED
• BUILDING SAFETY SERVICES UBIQUE LTD
• ELIZABETH HENDERSON DEVELOPMENTS LIMITED
• GALEBRIDGE PROPERTIES LIMITED
• HAMSTER’S WHEEL PRODUCTIONS LIMITED
• HELPFIRST LIMITED
• IMPREMIS LTD.
• L MORRISON (ALMOND) LIMITED
• LONHAM GROUP LIMITED
• LONGMOOR FARM CONSULTING LTD
• MY MONEY OPTIONS LIMITED
• PARAGON LAND DEVELOPMENT LIMITED
• R THOMAS CONSULTING LTD
• RMC ABERDEEN LIMITED
• SAPPHIRE DUST LIMITED
• STOCKBRIDGE ESTATES LTD
• THOMAS ELDER & SONS (STIRLING) LIMITED
• XTRAVA GROUP LIMITED

Winding-up Petitions (10)

• CHIPPY CHIPS EDINBURGH LTD
• DERISK TECHNOLOGIES LTD
• EMERALD LAW SOLICITORS LTD
• IUCON LTD
• LINTON PRODUCTS LIMITED
• LYNNWOOD HOMES LIMITED
• MAC AUTO INVESTMENTS LIMITED
• MOBI HUB INTERNATIONAL LIMITED
• R&F REINFORCEMENT AND CONSTRUCTION LTD
• THE CEDRUS BUTCHERS LTD

Keeping cash moving when growth is on hold

Today’s Growth On Hold report gets to the heart of the challenge facing businesses that sell on credit. A company may be profitable, busy and winning work, but that does not mean the cash has arrived.

When £26bn is outstanding at any one time and businesses affected by late payment spend an average 86 hours each year chasing money already earned, stronger credit control is not simply an administrative issue — it is part of protecting the ability to trade, invest and grow.

CPA can help businesses use CreditCare credit reports and debtor monitoring to identify changing customer risk, strengthen credit-control processes and improve payment performance.

Where invoices become overdue, CPA can support recovery through the professional and considerate approach of its Overdue Account Recovery Service designed to secure payment while preserving valuable customer relationships.

Early intervention matters. As costs rise and customers face their own financial pressures, allowing overdue balances to age can increase both the risk of non-payment and the amount of management time spent pursuing them.

Call CPA on 020 8846 0000 during business hours, Monday to Friday, 9am to 5pm.
Email: PaidQuick@cpa.co.uk
Visit: https://cpa.co.uk/contact-us/

When you see your money come in, you will be so glad you used CPA.

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

Open this guide in a new tab

.