Business debt soars

The total value of adverse county court judgments (CCJs) recorded in England and Wales rose sharply during the first quarter of the year, according to figures released today by Registry Trust.

Registry Trust is the Registrar of Judgments, Orders and Fines in England and Wales (on behalf of the Ministry of Justice). In addition, it collects, verifies and publishes judgment information from jurisdictions across the British Isles and Ireland.

Registry Trust provides its licensed credit reference agencies with regular updates on outstanding judgment debts. This information affects the ability of all enterprises to borrow.

In Q1 2018, 32,003 CCJs were registered against businesses in England and Wales. Rising seven percent compared to Q1 2017, this bucked a four-year trend where the number of CCJs issued had fallen year-on-year. However an unusual feature affecting the numbers was the presence (recorded on April 20) of 2,125 judgments against easyJet.

The average value of an adverse business CCJ rose by 17 percent to £3,164. Combined, these changes caused the total value of CCJs to increase by a quarter.

A mammoth 41 percent increase in the total value of judgments against the generally smaller, unincorporated businesses disproportionally accounted for the scale of this increase; the total value of CCJs against companies rose 19 percent.

In the High Court 20 judgments were issued in Q1 2018, six more than during the same quarter of the previous year. However, the average value of a judgment plummeted, dropping by 96 percent. As a result, a 95 percent decrease in the total value of High Court judgments occurred.

As well as distributing judgment information under strict licensing to leading credit reference agencies, Registry Trust makes information publicly available through TrustOnline.

There were 56,881 public requests to search the register for England and Wales online during Q1 2018. TrustOnline allows anyone to search for judgments and similar information registered against businesses and consumers in jurisdictions across the British Isles and Ireland.

On behalf of TrustOnline, Malcolm Hurlston CBE, chairman of Registry Trust said: “The figures show an increasing tendency to take unincorporated businesses to court for debt leaving a lasting mark on their records.”


CCJs against all businesses Q1 2018 (compared with Q1 2017)

  • Total number: 32,003 (up seven percent)
  • Total value: £101.2m (up 25 percent)
  • Average value: £3,164 (up 17 percent)
  • Median: £1,013 (up 12 percent)

● CCJs against incorporated businesses Q1 2018

  • Total number: 24,156 (up 13 percent)
  • Total value: £70.7m (up 19 percent)
  • Average value: £2,927 (up six percent)
  • Median value: £958 (up six percent)

● CCJs against unincorporated businesses Q1 2018

  • Total number: 7,847 (down seven percent)
  • Total value: £30.6m (up 41 percent)
  • Average value: £3,894 (up 52 percent)
  • Median value: £1,145 (up 13 percent)

● High Court judgments against businesses Q1 2018

  • Total number: 20 (up six)
  • Total value: £5.3m (down 95 percent)
  • Average value: £264,500 (down 96 percent)
  • Median: £8,170 (down 96 percent)

Consumer debt judgments hot record high

More county court judgments (CCJs) were registered against consumers in England and Wales during Q1 2018 than any other quarter since current records dating back to Q1 2005 began, according to figures released today by Registry Trust.

Registry Trust is the Registrar of Judgments, Orders and Fines in England and Wales (on behalf of the Ministry of Justice). In addition, it collects, verifies and publishes judgment information from jurisdictions across the British Isles and Ireland. A judgment is incontrovertible proof that debt has not been managed successfully.

Credit reference agencies licensed by the Trust receive daily updates on judgments. This information affects lenders’ readiness to offer credit and can lead to difficulties with loans and mortgages as well as higher borrowing costs.

During Q1 2018, 305,877 judgments were registered against consumers in England and Wales – over double the 150,622 consumer CCJs registered during Q1 2005. Rising two percent on the first quarter of 2017, the total number of adverse CCJs has risen year-on-year for the past five years.

The average CCJ remained stagnant, decreasing just £6; the median CCJ also remained close to Q1 2017’s figure, dropping just two percent in value.

As a result, the total value of consumer CCJs marginally rose two percent.

In the High Court 44 judgments (HCJs) were registered against consumers in Q1 2018. The total value of HCJs soared by £100m to £115.2m. The scale of this increase was largely due to a single judgment worth £84.5m. By contrast, the median HCJ stood at £139,921 for the quarter.

In Q1 2018 Registry Trust received 56,881 requests to search the register for England and Wales online at TrustOnline allows anyone to search for judgments and similar information registered against consumers and businesses in jurisdictions across the British Isles and Ireland.


CCJs against consumers Q1 2018 (compared with Q1 2017)

  • Total: 305,877 (up two percent)
  • Total value: £455.5m (up two percent)
  • Average: £1,489 (down £6)
  • Median: £684 (down two percent)

High Court judgments against consumers Q1 2018

  • Total: 44 (up nine)
  • Value: £115.2m (up £99.6m)
  • Average: £2,618,908 (up £2,172,600)
  • Median: £139,921 (up £54,921)

Adjusted High Court judgments against consumers Q1 2018*

  • Total: 43 (up eight)
  • Value: £30.8m (up £15.2m)
  • Average: £715,759 (up 60 percent)

Second charge mortgage new business stable in Q1 2018

New figures released today by the Finance & Leasing Association (FLA) show that second charge mortgage new business fell 10% by value and 13% by volume in March, compared with the same month in 2017. In Q1 2018 as a whole, new business increased 1% by volume compared with the same quarter in 2017.

Fiona Hoyle, Head of Consumer and Mortgage Finance at the FLA, said: “March was a quieter month for the consumer credit markets in general. These latest figures show a stable picture for new business volumes in the first quarter overall.”

Consumer motor finance new business falls 5% in March

New figures released today by the Finance & Leasing Association (FLA) show that new business in the point of sale (POS) consumer car finance market fell 5% by value and 10% by volume in March, compared with the same month in 2017. In Q1 2018, new business grew 3% by value, while volumes fell by 1% compared with the same quarter in 2017.

The POS consumer new car finance market reported a fall in new business in March of 9% by value and 15% by volume, compared with the same month in 2017.

The percentage of private new car sales financed by FLA members through the POS was 89.4% in the twelve months to March, up from 88.5% in the same period to February.

The POS consumer used car finance market reported new business up 4% by value in March, while volumes fell by 1%, compared with the same month in 2017.

Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said: “Trends in the new car finance market in the first quarter of 2018 are likely to have been affected by the impact on demand for private new cars in Q1 2017 of changes to vehicle excise duty introduced in April that year. However, in the first quarter of 2018, point of sale consumer car finance new business volumes overall were only 1% lower than in the same period in 2017.”

It’s encouraging that mortgage arrears are at a record low but we could now see this trend start to shift

Commenting on figures out today, which show mortgage arrears are at a record low, Mark Pilling, managing director of Spicerhaart Corporate Sales, says: “It is encouraging to see the number of mortgages in arrears is at a record low and possessions are continuing the downward trend that we have seen since the financial crisis hit a decade ago.

“This is most likely because lenders are now making much more of a concerted effort to help those who are struggling to pay their mortgages get back on track – rather than moving to the repossession route – combined with a prolonged period of low-interest rates which has kept mortgages more affordable.

“However, we could now see things start to shift. Many of those who took out interest-only mortgages are coming to the end of their terms with no way of paying off the capital. And with house prices falling in many regions, they will find they have less equity in their homes than they had hoped. This could cause problems as they try to sell or remortgage to pay off the debt.

“There is also the Support for Mortgage Interest (SMI) issue. Last month, the SMI benefit stopped and was replaced by a loan. Around 124,000 homeowners were part of that scheme, and only a small number have signed a new loan agreement, so will have lost their payments. This could mean that thousands of homeowners may struggle to make their mortgage repayments in the coming months, with many even going into arrears.

“With this in mind, combined with the threat of a base rate rise and the fact wage growth remains stagnant, lenders need to be keeping a close eye on their clients’ ability to keep up their repayments and engage with third parties to look after every borrower’s best interests.”

Business in Scotland, Wales and Northern Ireland calls for improved mobile coverage

Business leaders in Northern Ireland, Scotland and Wales have called on the UK Government to improve mobile phone coverage.

The Federation of Small Businesses (FSB) has urged the UK Government to back Ofcom’s proposals to attach obligations to improve coverage to an upcoming sale of mobile spectrum. But – in a joint letter to the Secretaries of State for Northern Ireland, Scotland and Wales – FSB argues that Ministers must ensure these coverage targets are as ambitious as possible.

The most recent Ofcom data, published last week, shows that UK mobile phone coverage is poorer outside England.

Ben Francis, FSB’s policy chair for Wales, said: “Modern digital infrastructure is as important to business as good transport links. But for too long mobile phone coverage in Wales has lagged behind acceptable modern standards.

“As we look to the future, UK Ministers must ensure that ambitious mobile targets ensure that no community is left behind.”

Ofcom is currently consulting on coverage obligations in the award of the
700 MHz spectrum band. The regulator proposes that successful operators would provide good voice and data services across at least 92% of the UK’s total landmass. Obligations would also be attached to provide good coverage across 92% of Northern Ireland and England’s landmass, 83% of Wales’ landmass and 76% of Scotland’s landmass.

Andy Willox, FSB’s Scottish policy convenor said: “Mobile phone coverage in many parts of Scotland is unacceptably poor. This makes it more difficult to do business, and harms the experience of visitors.

“Ministers must ensure that Ofcom squeezes every drop of value from their upcoming sale – driving better coverage in areas that have been underserviced in the past.”

Tina McKenzie, FSB’s policy chair for Northern Ireland, said: “While progress has been made in closing the connectivity gap across the UK, there’s still much work to be done. Businesses in Northern Ireland must have access to mobile and broadband infrastructure fit for the 21st century.”

In the letter to the Secretary of State for Scotland David Mundell MP, the Secretary of State for Wales Alun Cairns MP and the Secretary of State for Northern Ireland Karen Bradley MP, FSB argues:

“Across the length and breadth of the UK, the Federation of Small Businesses (FSB) wants to see digital infrastructure which meets the needs of businesses and local communities. We expect that you share these ambitions, and we look forward to working with you to turn them into a reality.”

Invoice financing continues to set new records despite growth rate slowing

New figures released by UK Finance show that the balance of pure invoice finance reached £18.93 billion as of the end of Q4 2016. This marks an increase of 0.25% from £18.88 billion from the end of the previous quarter and a rise of 5.4% from £17.97billion at the end of 2016.

The growth further supports the view that invoice finance is the preferred method of business lending to small to medium businesses and suits an increasing number of business in the service-led economy, which is likely to drive continued development.

The quarterly figures also continue to support a close correlation with growth in UK GDP2, with the strength of the economy a crucial factor in how much businesses are willing and able to borrow. It is notable, therefore, that with UK GDP not growing as quickly as in previous years or at the rates seen across other global nations, that pure invoice finance has also seen a slowdown.

The UK economy grew by 0.39% in the final quarter of 2017 and 1.42% over the course of the year, a slower rate of growth than Q3 2017 (0.46%) and across 2016 (1.99%). Similarly, the increasing balance of invoice finance has experienced two consecutive quarters of deceleration from 4.46% and 1.57% in Q3 and Q3 2017 respectively, and substantially down on the 8.94% growth generated in Q4 2016.

Aaron Hughes, Managing Director at Equiniti Riskfactor, commented: “Usage of invoice finance continues to grow as per the latest quarterly UK Finance figures. This method of business lending offers quick, reliable access to cash often on flexible terms while minimising the risks inherent in the cashflow systems of many small to medium enterprises such as late payments.

“While the balance of invoice finance did not grow as rapidly as it has in many quarters, it is reassuring to see that borrowing remains in correlation with the UK economy, ensuring that businesses and lenders are not over-stretching themselves. We would expect to see borrowing surpass £20 billion in 2018 as invoice finance continues to power small to medium enterprise in the UK.”

A Mixed Bag of Concerns

The reported recovery in real wage growth has failed to promote optimism among households. The consumer confidence barometer by GfK, (Times 27th April) – the bellwether indicator which is tracked by the Bank of England and others – fell from minus 7 in March to minus 9 this month. It has now been negative for 28 months in a row. GfK’s survey revealed a steep decline in consumer confidence towards financial situations for the past 12 months, and the year ahead.

The above indicative figures arrived shortly after another bleak survey for retailers. The CBI distributive trades survey of 100 retailers showed sales volumes recovered weakly from the atrocious weather in March. The balance rose from minus 5 to minus 2, but fell a long way short of economists’ forecasts for plus 5.

To amplify the potential problems ahead, Britain’s growth rate weakened to 0.1% in the first three months of 2018, the lowest quarterly reading in more than five years, according to preliminary figures published today by the Office of National Statistics (ONS). The ONS stated that aforesaid weather in March had some impact on construction and some areas of retail, but the overall effect on GDP was limited. Rob Kent-Smith (ONS) stated: “Our initial estimate shows the UK economy growing at its slowest pace in more than 5 years, with weaker manufacturing growth, subdued consumer-facing industries and construction output falling significantly.”

Figures published by UK Finance on 25th April showed a 10% drop in mortgage approvals in March compared to the previous year, citing declining consumer confidence. In London market the hotbed of property price increases is stalling, and asking prices not being achieved. There is still slight growth in the provinces but there are early signs it is stalling as well.

The Bank of England has raised concerns over the risks posed by equity release mortgage books after its analysis found borrowers aged between 55 and 64 now make up 15% of the market, double the level in 2015. Householders who have a nest egg in their property are accessing their equity, sometimes unwisely with little regard to the future. This is happening as homes have become less affordable in the past year as house prices have risen faster than wages. ONS figures released on 25th April state that full-time workers spent around 7.8 times their annual salary on buying a home in England & Wales in 2017, a significant increase of 2.4% since 2016.

The economy is still extremely bumpy and there will be peaks and troughs over the coming 12 months. However the underlying trend is difficult times ahead for consumers, and with a potential slow down in house prices, equity values falling, and banks being more prudent and raising their credit granting cut-offs, the ‘Just About Managing’ (JAMs) consumers will find loans difficult to get. Politically this could be a ticking bomb as the JAMs are not all so-called ‘vulnerable consumers’, they are spread throughout all socio-economic groups.

Stricter regulation is starting to choke credit granting, at the same time as ‘smoothing finance’ is required. The CCTA continues to champion the cause for all creditworthy consumers to have access to affordable and responsible credit. It also champions the cause for a diverse delivery mechanism across large and small companies, to ensure that every loan is judged on merit, not by rote.


Greg Stevens


Together appoints new North West regional development director

Specialist lender Together has expanded its professional sector team by appointing Mel Fourie as its new regional development director.

Mel, who has nearly two decades of experience in financial services, joins from SME lending platform RateSetter, where she was strategic partnership manager, covering the north of England.

Previously, she worked as a regional development manager in the corporate and commercial sectors for Funding Circle and spent more than 13 years as a regional business manager for Barclays, where she was involved in business banking, delivering funding to clients across the North West, Scotland and Northern Ireland.

While working for the bank, she was heavily involved in building partnerships with banks such as Natwest, Santander and Lloyds, coaching and developing colleagues, and working with high net worth clients.

In her new role at Together, Mel will focus on building strong relationships with SMEs, property developers, investors and entrepreneurs across the North West.

Mel said: “I’m so lucky to already have such a huge network across the North West, with introducers, bankers and clients, which I have supported for many years. Together’s product offering, along with the group’s philosophy of common sense lending are something fresh in the market, that I can be really proud of and that I can share with all my contacts.”

Mel, who has a son and fosters children, also worked as an inspirational speaker and is a trustee of Holly Grove School for children with special needs in Burnley.

With her husband Tim, a former South African professional rugby player, she has raised tens of thousands of pounds for the school over the past nine years.

Daniel Owen-Parr, head of professional and auction at Together, said: “We have known Mel for a number of years and are delighted that she has now joined our business as we grow our presence across mainland UK.

“Her background in financial services speaks for itself. She will be a great addition to our team and we’re looking forward to working with her.”

UK public sector: Top 10 predictions for 2018

Working for SAS in the UK public sector is always interesting. This is due largely to the diversity of public sector activities and the innovative ways in which government agencies deploy analytics. Analytics can help reduce costs while protecting and improving delivery of the front-line services upon which we all, to one extent or another, depend.

Simon Dennis Director of Central Government, SAS UK

For example, the UK’s National Health Service (NHS) has an amazing array of data that could unlock significant efficiencies in integrated care, as multiple health care departments collaborate with private sector partners. Analysing health data also promises to improve patient care and biosurveilla.
Analysing health data promisesto improve patient care and biosurveillance.

The 2021 census in England and Wales, Scotland and Northern Ireland provides another example, with an electronic census that offers decreased costs, reduced latency and an accurate evidence base for policy analysis.

Brexit is UK’s opportunity for a generation to reinvent, and – wherever possible – to shrug off the encumbrance of legacy processes and outdated bureaucracy.

As we get further down the Brexit runway, the UK will start to reinvent the way it operates apart from Brussels, and this will almost certainly have a spirit of devolution as well as digitalisation. It’s the opportunity of a generation to reinvent ourselves rather as the former Soviet-bloc nations did in the 1990s.

All of these efforts will require joint service delivery, a system view of population needs, and a clear understanding of government service delivery capabilities and capacities.

How can we help the machinery of government to maximise efficiency and effectiveness? Consider my 10 predictions for the year ahead and let me know if you agree:

More analytics: Government agencies need to accelerate the shift from the dashboard reporting of lagging indicators to autonomous business processes, and embedded business intelligence and analytics capabilities that automate or help humans make better context-based decisions in real time.

Omnichannel citizen engagement: Improving the citizen experience requires a holistic approach to the citizen:
Using joined-up data to understand the needs and desires of the citizen.
Leveraging all channels, including location-based communications and social media to actively engage citizens.
Enabling the population to engage “their way” for inbound communications.
Understanding citizens to make use of the most cost-effective channel, taking account of capacity, effectiveness and their preferred outbound engagement channels.
Seamless transition among channels with consistent omnichannel application of corporate knowledge and analytic decision support.
Satisfying demand via a new set of citizen interactions that continuously feed into a citizen-centric information pool across all silos of government.

Digital citizen ID: The need for this to be resolved across government is now paramount, from its necessity for frictionless borders through to transactional enforcement by Universal Credit Counter Fraud.

Artificial intelligence-readiness (including GDPR compliance): For digital government to succeed, it needs citizens to embrace their digital initiatives, and this requires trust. For real AI or general AI to be deployed this is paramount. Government will need to demonstrate it is a trustable data guardian, and GDPR is a minimum standard. Perhaps it’s felt that the IT industry cried wolf a bit over the millennium bug, but I fear government organisations are sleepwalking into a disaster through false reassurances and the misinformation that abounds on this topic.

Internet of Things: Whether for management of internal assets or the maintenance of building stock and national infrastructure or telemedicine to minimise in-patient work-days, the IoT is here. And once early underspecified security protocols are re-engineered, it will be pervasive. Departments should be considering their blockchain strategy and opportunities.

Skills and training: The skills shortage across the economy as a whole will start to bite in 2018 and become critical in 2019-2022. Current practices of sharing someone from another department will not be acceptable as new technology proliferates.

Software-defined architectures: By adding a layer of software to abstract and virtualise the applications deployed in delivery of services, government will improve the manageability and agility of the code. This will make it a more holistic organisation that can respond to the fluidity requirements of digital government and the IoT. This will become a key enabler of secure cross-departmental service delivery.

A new security paradigm: The level of cyber hostility is forever increasing, and an ever-more robust risk-based approach will be required. As digital government becomes more reliant on the platforms and applications used, then the more damaging and hence more likely an attack against them will become.

Open data and open standards: Enough said!

Partnerships: Partnerships are vital for the pace and scale of change to be executed effectively. With a few exceptions government will need to pick some technology partners and work closely to deliver configured COTS (commercial off-the-shelf) capabilities to get the benefits that digital government promises. This will put the UK in the best possible position as Brexit changes the way we work and AI becomes a reality.