Business confidence among the UK’s SME manufacturers has fallen sharply, as output and the volume of new orders declined in the three months to October 2022.
Category: News
The latest news affecting small and medium sized (SME) businesses in the UK
Britishvolt staves off collapse with funding boost and steep staff pay cut
Britishvolt has said it has secured a few weeks of funding and its 300 staff have agreed to take a steep pay cut, as the UK government-backed battery startup races to find a buyer or new longer-term investor to avoid collapse.
Morrisons to close 132 loss-making McColl’s stores with over 1,300 jobs at risk
Wm Morrison Supermarkets has said that it will close 132 lossmaking McColl’s convenience stores that it bought this year, putting about 1,300 jobs at risk.
Rishi Sunak’s stealth tax to cost middle earners £3,500 a year
Millions of middle earners will be more than £3,500 poorer because of plans by Rishi Sunak for a stealth raid on income tax that will last at least six years, analysis has shown.
Elon Musk set to charge Twitter elite $8 a month for blue tick
Twitter users have been bracing themselves to see Elon Musk’s vision for the platform. Now it seems he has his sights on the coveted blue tick.
![Jeremy Hunt hit the TV and radio studios yesterday like a whirlwind. Hours into his new job as chancellor, his task was to calm the financial markets, which had so brutally moved against his predecessor and triggered surging borrowing costs for homeowners. But has he done enough? Can his words calm turbulent gilt yields when trading opens on Monday morning? The risk is that markets will be hugely volatile on what will be the first time in two weeks that the Bank of England is not standing behind gilts, or government bonds, ready to buy them to ease pressure on pension funds. IN YOUR INBOX Business briefing In-depth analysis and comment on the latest financial and economic news from our award-winning Business teams. Sign up now Hunt’s media appearances were seen as an attempt to address the problems Kwarteng had created with the unfunded tax cuts in his mini budget. Acknowledging that mortgage rates have already rocketed — to as high as 7 per cent, according to some estimates — Hunt pledged credible tax and spending policies. “No chancellor can control the markets or should ever seek to do so. But the thing that is within your power is to demonstrate certainty in public finances,” he told the BBC. ADVERTISEMENT Rupert Harrison, an adviser to George Osborne when he was chancellor and now at BlackRock, said Hunt’s comments were a “turning point”. “Markets now have someone in the Treasury who gets it and who they can trust,” he said. There has been an unprecedented sell-off of gilts in the past two weeks amid fears that the tax cuts proposed by Kwarteng would fuel inflation and force the Bank of England to raise interest rates. Markets are pricing in a rise of a full percentage point from the Bank next month to take the base rate to 3.25 per cent. Even after Kwarteng’s replacement by Hunt on Friday afternoon, bond markets kept selling. Some analysts have suggested they will keep attacking until Truss resigns. Economist Julian Jessop, who has been advising the Truss camp, said Hunt’s pledge of fiscal discipline meant “Trussonomics” had been junked. SPONSORED “The whole point about Trussonomics was growing the economy ... not about a combination of tax cuts and big cuts in spending [the traditional approach]”. Jessop has previously said that Kwarteng’s mini budget went too far in announcing tax cuts, as this had spooked the markets. Hunt attempted to show yesterday that he would start work on plans to balance the books ahead of the budget planned for October 31. Unlike with the mini budget, the Office for Budget Responsibility will publish economic forecasts to accompany the government’s fiscal plans. He acknowledged to the BBC that two mistakes had been made by Kwarteng: abolishing the 45 per cent top rate of income tax; and the decision to “fly blind” without the OBR forecasts. On Friday, Truss also ditched plans to reverse a rise in corporation tax from 19 per cent to 25 per cent. That will raise £18 billion. ADVERTISEMENT Hunt also warned about “difficult decisions” on spending and taxes. “We’re going to ask all government departments to find efficiencies,” he said. “But we’re also going to have pressure on the tax side — taxes are not going to come down by as much as people hoped, and some taxes will have to go up.” George Buckley, economist at Nomura, said more detail was still needed. The reversal of the corporation tax move, he argued , “goes only a portion of the way”. Business leaders, as well as the financial markets, were watching Hunt’s performances closely. Dominic Blakemore, chief executive of FTSE 100 catering giant Compass, said the events of the past few days had been “pretty shocking”. “Throughout, we’ve needed robust, fully costed plans, because markets just can’t operate without that and in a vacuum,” he explained. Phil Urban, chief executive of FTSE 250 pub chain Mitchells & Butlers, called the situation “ shambolic”. “Business is probably realising that it can’t rely on government or politics to sort things out. So we’re just focusing on what is in our gift to do,” said Urban. One FTSE 100 boss, who did not want to be identified, resorted to expletives to describe his frustration. Describing Truss and Kwarteng as “goons”, he added: “Every single household is spending most of their time trying to balance their books, and our f***ing prime minister and chancellor don’t have to? Are you f***ing taking the piss?” His view was that Truss also had to go, to restore credibility. And that may be what the markets start to demand when trading resumes on Monday. ADVERTISEMENT Jessop said: “I don’t think Hunt did anything that would upset the markets or surprise them. But markets don’t like uncertainty. Uncertainty about economic policy — that’s maybe eased a little bit. But now we’ve got an increase in political uncertainty as we can’t be sure who the prime minister is going to be next weekend.”](https://b3935509.assetcdn.net/2.0/3935509/wp-content/uploads/2022/10/Jeremy-Hunt-230x129.jpg?lossy=2&strip=1&webp=1)
Government looking at proposals to expand windfall taxes
Windfall taxes on energy companies could be raised to 30 per cent and extended as much as three years, as Downing Street to scrambles to fill a £40bn black hole in the UK’s finances.
Musk appoints himself CEO of Twitter as employees brace for mass layoffs
Elon Musk has appointed himself CEO of Twitter and dissolved its board of directors, it was revealed in a company filing on Monday, as Twitter employees brace for extensive layoffs under a new restructuring that could target up to a quarter of staff.
Closure fear hangs over hospitality as cost of living soars
More than a third of businesses in the hospitality industry risk going bust early next year as running costs and dwindling consumer confidence push them to the brink.
Unemployment set to rise next year
A rise in unemployment above pre-pandemic levels next year will intensify the squeeze on household finances, which is already at its worst since the Second World War, a think tank says.
UK Esports team wins £7.4m in video game battle
More than 10,000 spectators cheered as a team of UK-based competitors won £7.4 million.
Bank of England, Home Office, MI5 and News Corp HQ targeted by Just Stop Oil vandalism
The Bank of England was among London landmarks targeted by environment activists this morning, along with the Home Office, MI5 and headquarters of News Corp.
Co-op to give all staff paid leave for fertility treatments
Staff at the Co-op will be able to take paid time off for fertility treatments, under a new policy launched by the retailer.
UK-backed battery firm Britishvolt considers entering administration
The UK government-backed battery startup Britishvolt is considering entering administration with the potential loss of almost 300 jobs after it struggled to find investors willing to fund its effort to build a giant £3.8bn “gigafactory” in north-east England.
Royal Mail workers union calls off planned strikes after legal challenge
Planned strikes by Royal Mail workers in the next two weeks have been called off after a challenge by the company.
MP’s urge Tottenham Hotspur to drop Chinese sponsor AIA for supporting abuses in Hong Kong
British politicians have called on Tottenham Hotspur Football Club to sever ties with its main sponsor, AIA, as they accused the club of “collaborating with supporters of human rights abuses in Hong Kong”.
