Business News Round Up (14/09/2023)
North West second only to London in start-up loans
The British Business Bank has delivered almost £122 million to the North West through its Start Up Loans programme to 13,020 across the North West at an average of £9,341. The Start Up Loans programme was designed to provide under-represented groups who are excluded from mainstream finance by helping them start a business. Of the £1bn loans, nearly 40% have been lent to female business owners, with a total value of £371m, and 20% have been lent to people from Black, Asian and Other Ethnic Minority backgrounds (not including White Minorities), with a value of £201m. Just 4% of the UK’s small businesses in 2021 were majority-led by people from an ethnic minority group and only 20% of new businesses had female founders according to The Rose Review. The fund has also sought to support young people aged between 18-24. Though the figures released this week show that 70% of lending to be outside London & the South East, the capital is still the highest recipient with 21,614 loans worth over £201m. The top three regions receiving Start Up Loans outside of London and the South East are the North West (£121.6m), Yorkshire and the Humber (almost £90m) and the South West (almost £85m). The North West local authority areas with the largest number of loans made were Manchester with £11, 683, 631 across 1,195 separate deals, and Liverpool with £9, 031, 285 to 1,091 different businesses.
Fall in new home starts mask increase in completions, builders warn
An increase in housing delivery in the past year has been offset by a continuing downward trend in the number of new starts, Homes for Scotland has warned following the release of new quarterly statistics from the Scottish Government. Scottish Government figures published yesterday report that there were 23,346 all-sector new build homes completed in Scotland in the year to end June 2023. This is an increase of 7% (1,481 homes) on the 21,865 completions in the previous year, and the highest annual figure to end June since 2008. Increases were seen for private-led new build completions (9% or 1,342 homes) and housing association new build completions (18% or 728 homes), whilst local authority new build completions dropped by 23% or 589 homes. Meanwhile, the number of new build homes started across all sectors decreased by 12% (2,340 homes), with 17,425 starts in the year to end June 2023, down from 19,765 starts in the previous year, and the lowest annual figure to end June since 2016. Private-led new build starts decreased by 7% (1,085 homes), housing association new build starts dropped by 21% (599 homes) and local authority new build starts decreased by 32% (656 homes).
UK economy shrinks more than expected as rain and strikes hit
The UK economy shrank more than expected in July, driven by strike action by NHS workers and teachers, according to official figures. Wet weather also hit the construction and retail industries, the Office for National Statistics (ONS) said, causing the economy to contract by 0.5%. The figures were worse than analysts had predicted and continue a trend of weak economic growth in the UK. But the ONS said the “broader picture” for the country looked “more positive”. Darren Morgan, director of economic statistics at the ONS, said that while July saw the economy shrink, output across the services, production and construction sectors had grown 0.2% in the three months to July. He said “a busy schedule” of sporting events and increased theme park visits had provided a slight boost to the economy. The drag on the economy for July was partly due to a fall in output from the services sector, which includes the NHS. The ONS said the drop was driven by the industrial action, with senior doctors and radiographers striking over pay on two days each, and junior doctors walking out on five days in the month. Chancellor Jeremy Hunt said the latest economic figures showed “many reasons to be confident about the future” and that the UK economy was now on course to grow faster than Germany, France, and Italy.
https://www.bbc.co.uk/news/business-66785572
Scotland’s care home sector faces 10% contraction
Scotland’s care homes sector is facing an uncertain future due to mounting financial and operational pressures, including shortfalls in local authority funding, with further closures and a contraction in capacity likely. Around 1,050 care homes in Scotland, with 40,000 places, currently look after an estimated 33,500 residents. However, the number of available places could contract by up to 10% during the next five years, according to Blair Milne, restructuring and insolvency partner at Azets in Scotland. “Critical issues affecting Scotland’s care homes include staff shortages, high agency fees, inflationary pressures – in particular a sharp rise in food and energy bills – increased compliance costs in the post-pandemic landscape, falling occupancy levels and a shortfall in public funding, with contract rates lagging well behind inflation,” he explained. “Significant numbers of entrepreneurs who entered the sector in recent years are considering whether to remain invested, while prospective new entrants are being deterred by the scale of the problems.” Milne added: “For the last 40 years the care home industry can be summarised by expansion, consolidation, contraction and now closures. A new care home financial model is needed, and government and the public sector are key to ensuring that the sector has a long-term future. “
https://www.insider.co.uk/news/scotlands-care-home-sector-faces-30937115