A survey by the manufacturing industry body EEF, reported that UK manufacturers are finding it easier to gain access to loans from high street banks.
However, the availability of funding from the banks comes at a price to manufacturers. EEF warned that companies must be prepared for high costs of credit, with one-in-five businesses reporting an increase to the overall cost of credit in the past two months.
Lee Hopley, chief economist of the EEF, said: "For the first time since the recession ended, manufacturers are reporting improving access to finance.
"Hopefully, this will translate into better news on new lending in coming months. But availability of is only part of the story and we also need to see costs coming down.
"Ensuring companies have access to the finance needed to invest and grow is critical for the recovery. We need to see a sustained improvement before concluding that the actions taken by banks and Government are bearing fruit and that no further measures are required."
The positive news for lending comes as the British Chambers of Commerce (BCC) downgrades their forecasts for economic growth. The BCC cut its forecasts for growth for 2011 from 1.4 per cent to 1.3 per cent, and have also reduced the figures for 2012 from 2.3 per cent to 2.2 per cent.
The BCC has also raised its predictions for inflation rates for 2011, from 4.2 per cent to 4.5 per cent.
News of an increase to the availability of lending for manufacturers will hopefully encourage SMEs to apply for the much-needed funding from the banks, which will in turn encourage economic growth.
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( 3 / 170 )Big Society tsar, Nat Wei stepped down from his unpaid post as driver of the project’s agenda this week after claiming that he could not devote the time to it that he had hoped.
Lord Wei had already cut down on the time he could devote to the Big Society initiative from three days a week to two and has now quit to work with the Community Foundation Network to drive "practical development of Big Society ideas."
The resignation must be a blow to Prime Minister David Cameron, who has described the Big Society as his “mission in politics”.
In a speech in Milton Keynes, Mr Cameron said: "The Big Society is not some fluffy add-on to more gritty and more important subjects. This is about as gritty and important as it gets - giving everyone the chance to get on in life and making our country a better place to live.”
Initiatives will include donating at cash machines and by mobile phone, and the use of social networking sites to promote volunteering. And Government policies will also be tested for social value as well as value for money.
However, the project has been criticised by the opposition and in the voluntary sector.
Referring to the idea that Ministers are to undertake a day of voluntary service with a charity or community group, John Low, of the Charities Aid Foundation, said: "While the move to encourage Ministers to volunteer is a step in the right direction, Government could have encouraged them to pledge money as well as time, helping to shape social norms around giving."
Commenting on Lord Wei’s departure, Mr Cameron said: "Nat has worked incredibly hard over two years to develop policies that support the Big Society… I wish him every success in his new role with the Community Foundation Network.”
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( 3.1 / 150 )The aptly named ‘Ostrich Generation’ is a generation of people who are facing pension poverty because they continue to bury their heads in the sand and are not making plans as to how they will fund their retirement, according to a HSBC report.
The members of the ‘Ostrich Generation’ are fully aware that traditional state and company pensions are not going to be as generous as past generations experienced, and know they will be living longer.
According to the report - The Future of Retirement: the future of planning - they are unproductive in working against this change and making preparations for their financial future. Alarmingly, the majority have made no plans as how they will fund their retirement.
HSBC questioned 1,000 working age Britons and found nearly one-in-five do not know what their main source of retirement income will be, with a further 21 per cent saying they will rely solely on the state pension.
Just under half expect to be worse off in retirement than their parents – three-in-five believe this is due to state and company pensions not being as generous as previous generations. And only 27 per cent believe they will be better off.
Overall, 68 per cent of those surveyed are worried about coping financially and 48 per cent fear they are not saving enough for their retirement.
However, despite all this, slightly fewer than four-in-ten Britons have actually got a financial plan in place that will provide for their future retirement.
Joanne Segars, chief executive of the National Association of Pension Funds, said: “Far too many people are trapped in the headlights when it comes to their own retirement. They know they'll need money in their older age, but they're doing nothing to prepare for it.”
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( 3 / 133 )The figures for Government borrowing were released yesterday and with it they revealed a particularly bad start to the new fiscal year, with the highest figure ever recorded for April.
The Chancellor George Osborne will no doubt feel the pressure from the Conservative party right-wingers to take tougher action on spending cuts, as borrowing hit £7.7 billion, compared with £5.3 billion last April.
The new fiscal year got off to a bad start due to a fall in tax receipts and extra spending to finance the Treasury’s debts, the Office for National Statistics said.
As the angered public begin to feel the impact of the austerity measures taken out by the Government, on the other end of the spectrum the right side of the Conservative party believe the Chancellor needs to take an even tougher stance on cuts to services. This is due to the prospect of having a considerable rise in the UK’s public sector debt and to enable Mr Osborne to hit his debt reduction targets.
Mr Osborne has also been criticised by Labour who believe the cuts to spending were the cause of the fall in growth and tax receipts.
Recently, the National Institute of Economic and Social Research warned that lower growth over the next two years would hit tax receipts and the Government’s plan for debt reduction would be knocked off course.
At £54.1 billion, Government spending in April was 5 per cent higher than a year ago. This was mainly caused by a 26 per cent rise in interest payments to £1 billion as the Government services its growing debts and interest rates rise along with inflation. Tax receipts also came down by 0.8 per cent to £42.9bn.
David Hanson, Labour's shadow Treasury minister, said: "Cutting too far and too fast risks a vicious circle. Slow growth and more people out of work and on benefits will make it harder to get the deficit down. That's why the Government is now forecast to borrow £46bn more than they were expecting last autumn."
Samuel Tombs of Capital Economics was feeling more optimistic about the latest figures, saying: "These are just one set of figures and the trend in borrowing should improve as more of the spending cuts kick in later this year. What's more, last year's borrowing figures have been revised down from £141.1bn to £139.4bn.
"Together with last month's better figures, this has left borrowing in 2010/11 nearly £7bn lower than predicted by OBR back in March."
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( 3 / 171 )With businesses continuing to struggle through these tough economic times, it would be beneficial for businesses to make changes in order to save money on energy bills that are continuing to soar. However, a new survey by British Gas Business has revealed that businesses are failing to take measures to reduce their energy costs by “ignoring energy efficiency”.
This news follows a warning from Centrica, the owner of British Gas Business, who said that energy bills are set to rise even further during the upcoming winter months. This is because its margins are being squeezed as the price of gas and power soars. Therefore, businesses should make changes now to avoid hard-hitting bills during the forthcoming winter.
The survey questioned 900 medium-sized businesses and found that 70 per cent are not currently carrying out energy efficiency measures, and one in three said they had no plans to carry out such measures in the future.
For those surveyed, energy bills represented almost a fifth of their annual operational running costs.
Following world events, such as the unrest in the Middle East and the earthquake in Japan, energy prices have already risen by 25 per cent in the last six months.
Even though energy prices are soaring, British Gas Business believes that the higher costs of energy did not “automatically” mean higher bills for businesses.
So what methods can companies use to ensure their energy bills are lowered, if high bills are not the fault of energy suppliers?
The survey found that 70 per cent of the companies had devices which allowed them to monitor usage and analyse data to control their consumption - these companies saw a return on their investment within 18 months.
If companies used devices such as this combined with employees making behavioural changes (i.e switching off unnecessary lighting and turning off plug sockets), British Gas Business said companies could expect to lower their energy bills by 10 per cent.
Help is also at hand from The Carbon Trust who is asking SMEs to use its online certification tool to recognise where they can cut their energy bills. And it would appear to be beneficial for small businesses to do so as the organisation claims small firms using the service had cut their energy costs by an average of £2,000 per year.
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