Business News Round Up (29/01/2021)
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Scottish Budget: Significant new investment to drive economic recovery, bolster public services and support families
Finance secretary Kate Forbes announced support for jobs and skills totalling around £1.1 billion when she presented the Scottish Budget 2021-22 yesterday. In an effort to prioritise job creation, measures in the Budget included a commitment to launch a new Green Workforce Academy to help people secure work in the low carbon economy, a £100 million Green Jobs Fund over the next parliament, £7m towards making Scotland a world class hub for digital business and an additional £115m for the Young Person’s Guarantee. Health receives record funding of over £16bn, an increase of 5.3% on 2020-21, along with a further £869m to continue tackling coronavirus, including funding for the vaccination and test and trace programmes. This means that, over the course of this parliament, investment in health has increased by £1.8bn in real terms – more than tripling the commitment to increase health funding by £500m more than inflation.
North West M&A volumes fall by 20%, but overall values double during 2020
The North West closed 2020 on a positive note for mergers and acquisitions activity, according to the Experian M&A Review 2020 for the UK and Ireland. Having experienced a sharp drop in deal volumes in the second quarter as the impact of COVID-19 first started to take hold of the market, Q3 and Q4 both saw an upward trend in volume, as the region’s professionals adapted to deal making in exceptional circumstances. The last quarter of 2020 saw the announcement of 205 deals, an increase of 20% on the 171 deals in Q3. Overall, the region recorded 695 deals in the year, approximately 20% fewer than the 861 done in 2019, but deal values bucked the trend, with the £15bn-worth of deals in 2020 double the value recorded in 2019. The region logged four mega deals in 2020, of which two were announced in December, as people looked forward to a day’s respite from the harsh restrictions imposed for much of the year.
Scottish SMEs are gloomier about growth prospects than anywhere else in the UK – research
Leaders of small businesses in Scotlandare much gloomier about the prospects of growth than anywhere else in the UK. Research from Hitachi Capital Business Finance suggests that small firm owners here are half as confident about growth than their counterparts in London and significantly short of the UK average. Wales ranks slightly above Scotland in the number of small firms expecting growth. Overall, in the UK 26% of small business owners predict growth in the three-months to 31 March – just a 1% change on Q3 2020 and Q4 2021, respectively. But only 17% of owners in Scotland and 18% in Wales are forecasting growth over the quarter. Following a crash in small business growth forecasts during the first lockdown in March 2020 – falling from 39% to 14% overnight – the proportion of small business owners UK-wide predicting growth doubled the following quarter and has remained at a similar level ever since. Nationally, 29% of small businesses in the retail sector feared contraction or collapse in the next three months, and the hospitality/leisure sector emerged as deep in crisis – with only 9% predicting any form of growth over the next three months and a record 53% predicting contraction or collapse.
https://www.insider.co.uk/news/scottish-smes-gloomier-growth-prospects-23405355
North West businesses kickstart year with some increased confidence by remain in negative territory
Business confidence in the North West rose eight points during January to -5%, according to the latest Business Barometer from Lloyds Bank Commercial Banking. Companies in the North West reported higher confidence in their own business prospects month-on-month at -3%, up nine points on December. When taken alongside their views of the economy, up five points to -7%, this gives a headline confidence reading of -5%. The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide. Three fifths (60%) of firms said current Covid-19 restrictions had caused a fall in turnover but they expected the effects of the vaccine programme to boost trading prospects for 2021, with 60% saying the rollout had made them feel more confident about the year ahead. However, only 38% expect trading levels to return to pre-pandemic levels in the next twelve months.