Waitrose is to put bottles of champagne behind locked glass before the end of the year, as the upmarket grocer escalates its fight against an unrelenting wave of shoplifting that has swept through Britain’s high streets.

The John Lewis Partnership-owned chain has told its 50,000-strong workforce of partners that it will pilot so-called “smart cabinets” to protect premium spirits and champagne, marking one of the most striking acknowledgements yet that organised retail crime has begun to reach into the aisles of Britain’s most genteel supermarkets.

The cabinets, already trialled at rivals including Sainsbury’s, typically require shoppers to navigate a multi-step process on a touchpad before the doors will release. Some retailers have gone further, demanding customers scan a loyalty card or enter a mobile telephone number to gain access, creating a digital paper trail that can later be cross-referenced if stock goes missing. The technology can also log how long a cabinet door has been open, flagging suspicious behaviour such as bulk emptying to staff in real time.

Waitrose has declined to disclose the precise mechanics of its own system, but the move comes alongside a broader package of measures: protective “meat nets” wrapped around premium joints, reinforced screens at tobacco counters to deter the increasingly common practice of vaulting kiosks to grab cigarettes, and an expanded rollout of body-worn cameras for staff on the shop floor.

In an internal communication to partners, Lucy Brown, the John Lewis Partnership’s director of central operations, framed the investment as proof that the business was not “standing still” in the face of what she conceded had been characterised as “a tide of retail crime and epidemic of shoplifting”. She acknowledged the frustration felt by staff who watch thieves walk out unchallenged, but warned that intervention was rarely the safer option.

“It may feel like standing back is us not acting, but this isn’t the case,” Ms Brown wrote, urging partners to resist their “first instinct” to detain suspects or wrestle back stock. Detaining “potentially volatile” individuals in front of other customers, she said, risked escalating an already fraught situation.

The guidance follows a bruising month for Waitrose’s public image. The retailer faced sharp criticism in April after dismissing Walker Smith, a 17-year veteran of the chain, who said he had been sacked for confronting a shoplifter attempting to make off with Easter eggs. The Partnership declined to comment on the specifics, citing employment confidentiality, but said it had followed “the correct process” and pointed to the “serious danger to life in tackling shoplifters”.

Jason Tarry, the John Lewis chairman who joined from Tesco last year, has since written in The Telegraph that the answer to the crime wave was emphatically not to “encourage” workers to take on thieves themselves. Trained security personnel would “intervene to challenge shoplifters”, he said, “but only if they’ve been trained and it’s safe to do so”.

The retreat into hardened technology reflects the scale of the problem confronting British retailers. Industry body the British Retail Consortium has repeatedly warned that shop theft has reached levels not seen in a generation, with the cost to retailers running into the billions and assaults on shop workers rising sharply. For a chain such as Waitrose, whose brand has long traded on a relaxed, customer-trusted shopping experience, the optics of placing Bollinger behind a touchscreen-controlled glass door represent a notable cultural shift.

A spokesman for John Lewis confirmed the direction of travel: “We are currently investing in a range of advanced technology, including smart technology to deter theft. As part of this we are planning to pilot lockable smart cabinets for areas such as spirits and champagne soon. We already use smart shelf technology in our health, beauty and spirits aisles, which are able to sense unusual customer behaviour, so this would provide an additional layer of security.”

For Britain’s SME retailers, who lack the capital to deploy comparable systems, the message from Waitrose is sobering. If a chain of its size and security spend has concluded that its most prized stock now needs locking up, the implication for the independent off-licence or village convenience store is uncomfortable indeed.

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Waitrose places champagne under lock and key as retail crime wave bites

Britain’s labour market is bracing for its sharpest contraction in years, with more than 160,000 roles forecast to vanish over the course of 2026 as anaemic growth and stubbornly high energy bills combine to squeeze employers across the country’s industrial heartlands.

The grim assessment comes from the Item Club, the independent forecaster that runs its projections through the very same economic model used by the Treasury to stress-test government policy. According to its latest analysis, a net 163,000 jobs will disappear this year, representing a 0.4 per cent decline in total employment and dealing a fresh blow to a workforce already feeling the strain of 18 months of cooling demand.

For Britain’s small and medium-sized employers, the report makes for sobering reading. The pain, the Item Club warns, will fall disproportionately on energy-intensive manufacturers, the construction trade and the high street, three sectors that between them prop up tens of thousands of SMEs and the supply chains that orbit them. As disposable incomes are eroded, consumer-facing businesses in retail, hospitality and food service are expected to feel a secondary shockwave.

“The hit will be felt in lower-income regions where consumers typically have less rainy-day savings, which will reduce spending in the retail and hospitality sectors,” said Tim Lyne, an adviser to the Item Club, in a candid assessment of how the downturn will play out beyond the M25.

The geographical pattern of the squeeze will be uneven and, in places, severe. Birmingham’s unemployment rate is forecast to climb from 6.7 per cent to 7.8 per cent over the year, while Glasgow is on course to break through the 5 per cent mark from a 4.3 per cent average in 2025. Cambridge stands as the lone exception among Britain’s major cities, with overall employment expected to edge modestly higher on the back of its knowledge-economy base.

Nationally, the jobless rate, which brushed 5 per cent at the close of last year, is heading for 5.1 per cent in the coming months, up from 4.9 per cent in the most recent official figures published by the Bank of England.

Official growth data due this week is expected to confirm that the economy expanded by around 0.3 per cent in the first quarter of 2026, a modest improvement on the 0.1 per cent recorded in the final three months of 2025, but hardly the kind of momentum that creates jobs at scale.

A separate survey from KPMG and the Recruitment and Employment Confederation lends weight to the gloomier outlook. Permanent placements across the economy fell in April at their fastest rate since the start of the year, while demand for temporary staff climbed to its highest level since 2023, as employers hedged their bets on hiring commitments.

Neil Carberry, chief executive of the REC, said the trend reflected a “preference for short-term staff at some firms who wanted to push ahead with business development and expansion plans” against an uncertain backdrop. “Businesses will be particularly concerned about the impact on inflation, their borrowing costs and any disruption to wider supply chains,” he added, alluding to the lingering aftershocks of the conflict in Iran.

For business owners, the message is one many will recognise from the past two years: keep options open, keep headcount flexible, and assume that the cost of capital will remain elevated for longer than is comfortable.

The Item Club expects the only meaningful employment growth this year to come from publicly funded corners of the economy, education, health and social care, but its analysts are blunt that this expansion is “unlikely to offset losses in larger, more demand-sensitive sectors”. In short: the state will hire, but it will not hire enough.

For SMEs, the most worrying signal in the report is the speed at which higher interest rates and elevated inflation feed through to recruitment freezes and redundancies. With wage settlements still running ahead of productivity gains, and with energy contracts due for renewal across thousands of mid-sized industrial businesses this summer, the path of least resistance for many owner-managers will be to thin payrolls rather than expand them.

One silver lining is the gradual improvement in economic inactivity rates, as more people who left the workforce during and after the pandemic are now returning to look for work. But with vacancies falling and the labour market loosening, that fresh supply of jobseekers may find conditions tougher than they were even a year ago.

The Item Club’s projections, drawn from the Treasury’s own model, are typically used by policymakers to scrutinise the government’s claims about its economic agenda. On this occasion, they offer ministers little political cover and Britain’s job creators even less.

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Britain set to shed 160,000 jobs as energy costs and stalling growth bite

National Grid has unveiled what amounts to the most ambitious capital programme in its history, pledging a further £70bn over the next five years to rewire the energy systems of Britain and the north-eastern United States.

The FTSE 100 utility, which has spent the past two years reshaping itself into a pure-play networks business, said the fresh commitment would accelerate its march towards a net-zero electricity system on both sides of the Atlantic. The announcement, made alongside its full-year results, builds on a record £11.6bn of capital expenditure in the prior year and signals that the group sees no let-up in the structural demand for grid investment.

Of the headline figure, some £31bn will be funnelled into UK electricity transmission, expanding capacity to absorb the surge of offshore wind, solar and nuclear coming on stream this decade. The company described the spend as the foundation of a “decarbonised electricity network” by the 2030s, and the bill will, in part, be underwritten by Ofgem’s new RIIO-T3 framework, which has formally cleared the way for the heavier outlay.

Across the Atlantic, £17bn has been earmarked for New York and a further £12bn for New England, with around 60 per cent of the US allocation flowing directly into National Grid’s own networks. The group expects a 10 per cent uplift in returns from its asset base by the 2030/31 financial year on the back of the programme.

Zoe Yujnovich, who took the helm as chief executive earlier in the year, said the company was “embarking on the largest investment programme in our history… to modernise and expand energy networks across the UK and the US Northeast, networks that underpin economic growth, strengthen energy security and enable the transition to a cleaner, more flexible energy system.” She added that the group was “building the skilled workforce needed to deliver this investment at pace, creating thousands of jobs across our markets” — a message likely to play well in Westminster and Whitehall, where ministers have been pressing infrastructure operators to demonstrate the employment dividend of the green transition.

The growth ambitions came against a softer revenue backdrop. Total turnover slipped four per cent to £17.6bn from £18.3bn the previous year, a decline the company attributed to storm-related costs and the divestment of its renewables arm and US grain liquid natural gas business. Pre-tax profit, however, jumped to £4.2bn from £3.6bn, while earnings per share rose eight per cent to 78p.

Shareholders were rewarded with a final dividend of 32.1p, taking the full-year payout to 48.9p, a 3.8 per cent increase pegged to UK inflation. The market responded warmly, with shares climbing 1.5 per cent in early trading to 1,297p, leaving the stock up 11.9 per cent since January and comfortably outpacing the wider FTSE 100.

Looking ahead, National Grid expects UK electricity transmission revenue to rise by roughly £850m in the year ahead, with RIIO-T3 doing much of the heavy lifting. In New England, top-line growth of around $450m is forecast, driven by rate resets, though partially offset by the costs of the expanded build-out. New York is expected to follow a similar trajectory.

For SMEs reliant on a stable, predictable power supply, from manufacturers wrestling with energy-intensive processes to data-hungry tech firms, the scale of the commitment is significant. A more capacious, modern transmission network underpins the kind of long-term industrial planning that has been sorely lacking since the energy shock of 2022, and it puts hard numbers behind the government’s grid-connection reforms.

Yujnovich struck an appropriately customer-focused tone in her closing remarks. “Through… transforming our capabilities we will be able to meet the rapidly growing demand and enable a more efficient energy system, one that supports long-term affordability and reliability for customers,” she said.

For investors, the calculation is straightforward: a regulated, inflation-linked income stream married to a multi-decade capex story. For the wider economy, the prize is a grid finally fit for the century it has to serve.

Read more:
National Grid commits record £70bn to power the next decade of energy networks

Five of the world’s largest publishing houses have launched a class-action lawsuit against Meta Platforms in a Manhattan federal court, accusing the Mark Zuckerberg-led tech giant of pirating millions of copyrighted works to train its Llama artificial intelligence models, a development that throws fresh fuel on one of the defining commercial disputes of the AI era.

Elsevier, Cengage, Hachette, Macmillan and McGraw Hill, joined by the bestselling American author Scott Turow, filed proceedings on Tuesday alleging that Meta knowingly used pirated copies of textbooks, peer-reviewed scientific journals and novels, among them N.K. Jemisin’s The Fifth Season and Peter Brown’s The Wild Robot, to train the systems that now underpin the Silicon Valley group’s generative AI products.

The complaint, which seeks unspecified damages and class-action status on behalf of a far wider pool of rights holders, marks the first time that academic and trade publishers have moved against Meta as a unified front. It also signals a deliberate escalation by an industry that, until now, has largely watched from the sidelines as authors, newspapers and visual artists fought their own corner.

Maria Pallante, president of the Association of American Publishers, did not mince her words. “Meta’s mass-scale infringement isn’t public progress, and AI will never be properly realised if tech companies prioritise pirate sites over scholarship and imagination,” she said.

Meta has signalled it will mount a robust defence. “AI is powering transformative innovations, productivity and creativity for individuals and companies, and courts have rightly found that training AI on copyrighted material can qualify as fair use,” a spokesperson said. “We will fight this lawsuit aggressively.”

The case opens yet another front in a war that is rapidly redrawing the commercial map for content owners on both sides of the Atlantic. Dozens of plaintiffs, from The New York Times, which is pursuing OpenAI and Microsoft, to a coalition of authors, news outlets and visual artists, have already filed suit against the leading AI developers. The legal questions hinge on whether ingesting copyrighted material to produce new, “transformative” output qualifies as fair use under American law, and the early rulings have been anything but uniform. Two of the first judges to grapple with the issue reached opposing conclusions last year.

The first major scalp came when Anthropic, the AI company backed by Amazon and Google, agreed in 2025 to pay $1.5 billion (£1.18 billion) to settle a class action brought by a group of authors, a sum that could have ballooned into multiples of that figure had the matter gone to trial.

For UK small and medium-sized enterprises operating in publishing, marketing, education and the creative industries, the implications are far from academic. The absence of a coherent licensing regime has left British rights holders exposed to the same alleged practices, while AI-dependent businesses face mounting uncertainty over which models can be deployed without inheriting legal liability.

Benjamin Woollams, chief executive of TrueRights, argues the sector urgently needs commercial infrastructure capable of matching the speed at which AI models are being built. “Every one of these lawsuits points to the same underlying problem: there’s no standardised way to license creative work and likeness for AI,” he said. “Tech companies aren’t villains for wanting training data, and creators aren’t luddites for wanting to be paid, but the infrastructure to connect them simply hasn’t existed until now. This represents a huge opportunity for those in the industry to build a transparent and trusted licensing framework that allows innovation and creator rights to coexist commercially.”

He points to the influencer marketing economy, worth tens of billions of pounds globally and constructed almost entirely on rights licensing, as evidence that the commercial template already exists. “Brands and talent collaborate every day on an enormous scale. The commercial appetite for licensed content is there, the economic model is proven, and creators are increasingly aware of how their likeness and IP are used. What’s been missing in AI is a transparent, trusted way to license at the speed and scale these models require.”

Without such guardrails, Woollams warns, the drumbeat of litigation will only grow louder. “This sort of friction and litigation will continue to plague the industry, which will have negative knock-on effects on the kind of collaboration that should be powering the next generation of creative work, where AI platforms, advertisers and talent can actually build together.”

For Meta, the stakes extend well beyond the immediate price tag. A successful class certification could expose the group to claims from thousands of rights holders, while an adverse ruling would reverberate across an industry that has built its competitive edge on the unrestricted ingestion of vast corpora of human-authored work. For Britain’s SME publishers and creators, the case is a reminder that the rules of engagement with generative AI remain very much under construction, and that the courts, for now, are doing the drafting.

Read more:
Publishers take Meta to court in landmark AI copyright showdown

Britain’s rural economy is buckling. Hauliers, hoteliers and farmers up and down the country are warning that the cost shock unleashed by the Iran war has tipped thousands of small businesses into what one Somerset operator describes as “total survival mode”, and that, without urgent intervention from the Treasury, the pain will inevitably be passed on at the till.

Even as diplomats in Washington and Tehran inch towards what officials describe as a “largely negotiated” peace deal, the damage on the ground is already done. Hauliers report fuel bills running tens of thousands of pounds a week higher than at the start of the year. Farmers say the economics have become so distorted that some are quietly selling stockpiled fertiliser rather than planting crops with it. And in Britain’s off-grid hotels, the cost of a litre of heating oil has very nearly doubled inside a fortnight.

It is, by almost any measure, a textbook cost-of-doing-business crisis, and one falling disproportionately on the small operators who keep rural Britain ticking.

A 76 per cent jump in heating oil, overnight

Shaun Whitehouse, co-owner of Lanes Hotel, a 35-strong boutique spa in Somerset, has worked in hospitality for almost half a century. He has never, he says, seen anything quite like this.

“We’re struggling to keep our heads above water,” he told Business Matters. The price of heating oil at the hotel, which sits off the national gas grid, has rocketed from 81p to 143p a litre in a fortnight — a rise of more than 76 per cent at exactly the moment his payroll has been inflated by the national living wage uplift and his business rates bill has risen again.

“There’s not a lot we can do. We have got to heat the place, and water, so we just have to absorb it,” he said. “Today I am covering three jobs; seven days a week of this and not being able to pay yourself enough money at the end of the month is just grim.”

His frustration with Whitehall is undisguised. “It seems that rural communities are just swept under the carpet by the government … that’s the feeling post-pandemic when this happened then.”

It is a story playing out across the off-grid hospitality sector, where operators have been navigating energy procurement as a strategic boardroom issue for some time, but where the speed and scale of the latest move has left even experienced buyers exposed.

‘Colossal’ costs on the farm

In the Hodder Valley, on the Lancashire–Yorkshire border, Rod Spence farms 1,000 acres and runs a butchery. The arithmetic, he says, has gone from tight to “colossal”.

“We’ve just come out of the lambing season. Even the petrol prices cost us an extra £10 to £15 a day just to check the sheep,” he said. “Contractors’ fees are all going up because of the price of the fuel, and fertiliser has absolutely rocketed. Food prices for the cattle have risen simply because it’s costing more to deliver it. When you live somewhere quite rural, it’s ten miles to the nearest garage, so those extra costs to get fuel for quad bikes all mount up.”

The distortion at the field gate is starkest of all. “I’ve listened to some of these cereal guys and they say, ‘Well, we’re going to sell the fertiliser rather than plant the crop because there’s more guaranteed profit.’”

Like many family operators, Spence is leaning on diversification, the butcher’s shop, a simulated clay pigeon shoot, a fencing arm — to keep retail prices stable and shield customers from the worst of the input shock. How long that can hold is another question.

A short drive away in Clitheroe, Charles Bowman, who runs the Inn at Whitewell, said heating oil and gas had risen by almost 30 per cent on top of fixed-price contracts agreed six months ago. “We are facing the living wage increase, we are now at a bottleneck,” he said. “It feels like the chancellor has strangled us.”

£40,000 a week, and rising

The picture in road transport is no less stark. The Road Haulage Association says fuel costs are running roughly 40 per cent higher than before the conflict, with the cost of brimming a 600-litre lorry tank up by £300, and a 300-litre coach tank by £150.

“For operators in our space, this can be the difference between viability and closure,” the trade body said, citing one member now absorbing an extra £40,000 a week in fuel expenditure alone. Coach operators are typically swallowing between £15,000 and £20,000 more.

It is a familiar refrain in an industry where margins have been wafer-thin for years; Business Matters has previously reported on haulage bosses contending with a £20,000-a-year fuel bill simply to keep a single lorry on the road. This time, that figure is being eclipsed inside a week.

Tina McKenzie of the Federation of Small Businesses warned that the impact ripples well beyond firms with their own fleets. “Higher fuel costs affect pretty much every business, even if they don’t have their own vehicles to run,” she said. “Spikes in fuel costs suppress economic activity and raise the risk of a downturn, something we as a country cannot afford.”

The FSB is calling for an emergency temporary cut in fuel duty of 5p per litre, a move the organisation has long argued would deliver fast, broad-based relief to the country’s 5.5 million small businesses.

The wider squeeze: contracts, rates and wages

The fuel shock is landing on a sector already weakened by overlapping cost pressures. Ofgem estimates that up to 10 per cent of UK businesses were forced to renegotiate fixed-price energy contracts in March and April, with a further 10 per cent up for renewal in May and June — locking thousands of SMEs into materially higher rates just as oil prices spiked. By industry estimates, some 180,000 firms have already signed more expensive energy deals since the war began.

Many of those same operators were already absorbing the national living wage uprating and another business rates increase. The compounding effect, as Business Matters reported earlier this year, has already prompted hospitality firms to cut shift hours by close to a third as they trim back to survive.

Kate Nicholls, chair of UK Hospitality, said several of her members were “already seeing prices spike, particularly those that are coming to the end of fixed contracts.” She added: “Rural hospitality and tourism businesses that are off grid will be particularly impacted by hikes to heating oil prices. Ultimately, it will result in price rises at the till, further driving inflation.”

The macro warning

Ms Nicholls’ point goes to the heart of the macro story. The International Monetary Fund has warned that Britain will be the worst-hit advanced economy from the Iran war, and is on track for the joint-highest inflation in the G7 this year alongside the United States. The Bank of England, which held the base rate at 3.75 per cent last month, has signalled that further tightening cannot be ruled out if the inflationary fallout persists; one well-known think tank is now pencilling in headline inflation above 4 per cent.

British households have already started to brace, cutting pension contributions and lifting precautionary savings in anticipation of higher prices to come. The cost of filling a typical 55-litre petrol car has gone up by £14 since the conflict began; a diesel tank now costs £27 more.

For now, the country’s rural SMEs, the hauliers moving the freight, the farmers producing the food and the off-grid hotels housing the visitors, are the shock absorbers. Whether they can keep absorbing is the question that should be exercising ministers this week.

As Whitehouse puts it from his Somerset reception desk: “We just live day to day and keep putting out fires.”

Read more:
Hauliers, hotels and farms warn they are ‘in survival mode’ as fuel costs spiral

Britain is hoovering up the wrong sort of records. In the wake of the Iran war, the economy is staring down the heaviest growth downgrades in the G7, the most stubborn inflation, the greatest exposure to volatile gas prices and some of the thinnest storage capacity in Europe. It is a sobering tally for any prime minister, never mind one whose backbenches are openly muttering about regicide.

Sir Keir Starmer’s insistence on Friday that he will not “walk away” from Downing Street steadied the ship for an afternoon. David Lammy, his deputy, urged colleagues against “changing the pilot during the flight”. Even John McDonnell, never knowingly off-message when there is mischief to be made, could only manage a tart “sometimes you do if you’re in a nosedive” before being reminded that Jeremy Corbyn’s hard-Left prospectus delivered Labour its worst drubbing since 1935.

But beneath the Westminster choreography, something more consequential is unfolding in the gilt market, and it is the small and medium-sized businesses that keep this country running who will feel it first.

Since hostilities flared in the Gulf, UK 10-year gilt yields have climbed by roughly three quarters of a percentage point, briefly nudging above 5 per cent, territory not seriously visited since the 2008 financial crisis. Thirty-year yields have hit their highest level since 1998. The moves have outpaced those in the United States and most of Europe, a worrying decoupling for an economy that has long depended on the goodwill of overseas capital.

This is not a Truss-style detonation. It is something arguably more troubling: a slow, persistent grind higher that is steadily reshaping the cost of borrowing for every business in the land.

Jim Reid at Deutsche Bank reminds clients that the UK’s structural fragility is the real story. Britain runs a negative net international investment position, foreigners own more of us than we own of them, leaving the country, in his elegant phrase, “reliant on the kindness of strangers” with “limited buffers against external shocks”. Recent Bank of England research suggests the position has been broadly stable since the 2016 referendum once foreign direct investment is stripped out. Reassuring, perhaps, but not exactly a fortress.

Markets have broken governments before. During the eurozone debt saga, Greek, Irish and Portuguese yields nudging towards 7 per cent forced their respective administrations into the arms of the IMF. Britain, mercifully, is not Greece. Simon French, chief UK economist at Panmure Liberum, points out that we control our own currency and therefore always have a buyer of last resort in Threadneedle Street. The Bank can, in extremis, simply print more pounds.

The trouble is the bill that arrives afterwards. “You’d pay a cost in terms of inflation and currency devaluation,” French notes. “So it’s more a slow death of a productive economy than a crash moment.” It is the entrepreneur staring at next quarter’s overdraft facility, not the hedge fund manager, who tends to do the dying in that scenario.

French sees a psychologically loaded threshold lurking just above current levels. “If the 10-year were to hit 5.5 per cent, the pressure would become very, very significant for the Bank to act.” With yields already at 4.9 per cent, the cushion is wafer thin. Andrew Bailey acknowledged the dilemma in a recent New York speech, conceding “more scope for conflict between the public good interest and private interests” when financial stability hangs in the balance — central banker shorthand for an unenviable judgement call.

The numbers tell their own story. The UK is now paying around £100bn a year servicing its debt, equivalent to nearly 8 per cent of all government revenues. Fitch, the ratings agency, points out that this is more than double the 3.7 per cent average for countries with a similar credit rating, and well in excess of France and Germany. “Sustained higher-than-expected yields are a key risk to our medium-term debt projections,” the agency warned in February.

For Britain’s 5.5 million small businesses, every basis point matters. Higher gilt yields ripple swiftly into commercial lending rates, asset finance, invoice discounting and the cost of fixed-rate mortgages held by the directors who, more often than not, are personally guaranteeing those very facilities.

In the meantime, the cast list of would-be successors lurks in the wings. Angela Rayner, the former deputy; Andy Burnham, the Mayor of Greater Manchester; and Wes Streeting, the Health Secretary, are each said to be quietly mapping their respective routes to No. 10.

Bond traders are watching closely, and not all combinations are equally palatable. Neil Mehta at RBC BlueBay warns that “if it’s Rayner or Burnham, the general reaction from bond markets is not going to be positive”. A Rayner-Burnham ticket with Ed Miliband as chancellor is the City’s particular nightmare. “This could actually linger for a while,” Mehta says, “and in that period, I think gilts will continue to underperform versus other markets.”

What the market wants, he adds, is rather prosaic: cost savings, restraint on spending, the unglamorous arithmetic of fiscal discipline. “If it’s going to lurch more to the Left, then the two options are you either borrow more or you tax more, which don’t seem like the solutions that would be most ideal.”

A more sanguine City voice suggests personalities are beside the point. “It’s all about fiscal discipline and delivering economic growth. The market will look through everything else.” Others are blunter. “Some of these people are so stupid they can’t even spell ‘bond,'” mutters one executive. And there is a further camp, moving in Labour circles, who have all but given up on incrementalism: “It’s the only way we will ever get serious change. Only a crisis will reset Britain.”

For now, investors are still showing up. Foreign buyers have been net purchasers of gilts for seven consecutive months and DMO auctions are still drawing roughly three bids for every bond offered. As French drily observes: “I’m not sure it’s a vote of confidence. I think all it’s telling you is that people like more money than less money.”

That may yet prove a slender thread on which to hang an economy. For Britain’s SMEs — already battered by inflation, energy costs and the ratchet of regulation — the message from the bond market is unambiguous. Whatever Labour decides to do next, it had better be priced in.

Buckle up, indeed.

Read more:
Bond markets sound the alarm as Labour wobbles and gilt yields climb

Bradford-based grocer pitches its Myton manufacturing arm to Sainsbury’s and other supermarket rivals as it tries to grind down a £3.1bn debt pile inherited from its 2021 private equity takeover.

Morrisons is in advanced conversations with rival British supermarkets to start supplying them with own-brand pies, meat and eggs produced by its Myton manufacturing division, as chief executive Rami Baitiéh hunts for fresh sources of revenue to ease the grocer’s heavy debt burden.

The Bradford-based chain, one of the so-called Big Four, is understood to have ushered buyers from competing retailers into a Myton factory in recent weeks, with Sainsbury’s among the grocers to have toured production sites previously. The push marks a notable shift in posture: Morrisons has historically guarded the output of its 17 UK manufacturing sites as a competitive moat, but is now willing to feed rivals’ shelves if it brings in profitable third-party volume.

Myton is one of the country’s largest food manufacturers and produces Morrisons’ sweet and savoury pie ranges, while also sourcing meat, fish, eggs and even flowers for the supermarket. It already serves a clutch of independent retailers and is now being pitched to large hospitality groups as well, with showcase events held in recent months to highlight its British-made credentials.

£3.1bn debt overhang from the CD&R takeover

The wider strategic context is hard to ignore. In its most recent set of accounts, covering the 52 weeks to 26 October, the grocer posted a pre-tax loss of £381m after absorbing a £281m interest bill on its borrowings. Net debt stood at £3.1bn at the year-end, an overhang from the £10bn leveraged buy-out by US private equity firm Clayton, Dubilier & Rice in 2021.

Morrisons has been steadily chiselling away at that figure, gross debt is down roughly 46 per cent from its 2022 peak, helped by a series of sale-and-leaseback deals, but the interest cost still dwarfs reported profits. Underlying earnings of £835m and twelve consecutive quarters of positive like-for-like sales growth, as detailed in the company’s full-year results, suggest the operating business is in markedly better shape than the bottom line implies.

That is where Myton comes in. While Morrisons does not break out the division’s numbers, it is widely understood inside the business to be profitable, with spare manufacturing capacity that executives believe could be sweated harder by serving a broader customer base, at home and overseas.

Closures, cafés and a streamlined estate

The supply-side push lands alongside an aggressive cost programme. Morrisons has confirmed plans to close 100 convenience stores, shuttered a swathe of in-store cafés, counters and florists, and has been trimming head office headcount as it leans into automation and AI. Earlier this year, Myton itself closed its loss-making Wakefield bakery in a sign that no part of the empire is sacrosanct.

Competitive pressure has not abated either. Discounters Aldi and Lidl continue to nibble at the heels of the traditional Big Four, with Aldi having overtaken Morrisons to become Britain’s fourth-largest supermarket by market share, a shift that has sharpened the urgency behind any plan capable of widening the grocer’s margin pool.

Sale considered, then parked

The latest outreach follows an episode earlier in the year, first reported by The Telegraph, in which Morrisons received an unsolicited approach for Myton and held talks with at least one private equity bidder about an outright sale. The Grocer subsequently reported that the supermarket was no longer in active negotiations to offload the unit.

Mr Baitiéh has been notably bullish on keeping manufacturing in-house. In January, the Frenchman, who joined from Carrefour in 2023, said vertical integration was “part of the DNA of Morrisons, it’s going to stay”, arguing that owning the factories gives the grocer a point of difference against rivals reliant on a patchwork of external suppliers.

For SME food producers watching from the sidelines, the move is double-edged. Morrisons remains a major buyer from British farmers and small food businesses, but a more commercially aggressive Myton, selling pies and meat into Sainsbury’s, hospitality chains and beyond, could either crowd out smaller competitors or open up new co-manufacturing opportunities, depending on how the contracts are structured.

A spokesman for the supermarket said: “Myton is a high-quality food manufacturing business and has always served other customers as well as Morrisons. We have been growing this area of the business over recent years by attracting new customers in retail, food service and food manufacturing, to build a broader base for the business both in the UK and internationally. Myton does not comment on the detail of its customer relationships.”

What it means for the turnaround

Strip out the headline loss and the picture at Morrisons is one of a grocer slowly clawing back relevance: solid Christmas trading, a 17.4 per cent jump in sales of its premium “The Best” range, and a debt pile that is shrinking rather than spiralling. Pushing Myton’s produce onto rival shelves is unlikely, on its own, to crack the debt problem, but it is a low-capital lever that uses existing assets, and one that Mr Baitiéh appears determined to pull.

If the early site visits convert into supply contracts, expect Morrisons’ annual report to start carving out Myton’s contribution more explicitly. Investors, lenders and, eventually, any future bidder would all want to see it.

Read more:
Morrisons courts rival grocers in bid to widen Myton supply deals

Burberry has quietly knocked a decade off the urgency of its climate plan, becoming the latest FTSE 100 heavyweight to soften the green pledges that defined corporate Britain at the start of the decade.

In its 2025-26 annual report, the trench coat maker confirmed it now expects to hit net zero emissions “no later than” the 2049-50 financial year, a full ten years later than the 2039-40 deadline it set with great fanfare in 2021. Back then, the Riccardo Tisci-era management team promised to go further still, declaring Burberry would be “climate positive” by 2040 and insisting it was “helping protect our planet for generations to come”.

Four years on, the language is markedly more sober. The Macclesfield-based group described the rewritten target as a “pragmatic response to external factors”, while arguing the new timetable still reflected its view of climate change as “a principal risk” to the business. Translation: the City wants margin recovery, the supply chain is not decarbonising as quickly as anyone hoped, and Washington has stopped pretending to care.

From outlier to the herd

Burberry is hardly alone. Unilever, owner of Dove and Marmite, used its 2024 strategic reset to dilute a string of ethical commitments, including the pace at which it weans itself off virgin plastic. Nestlé walked away from the Dairy Methane Action Alliance last year, taking the air out of one of the food sector’s more ambitious decarbonisation coalitions. And the two London-listed oil majors, BP and Shell, have spent the past eighteen months unpicking renewable energy targets in favour of a frank return to barrels and cubic feet.

The political weather, of course, has shifted with them. President Trump’s return to the White House has emboldened US-listed peers to pare back ESG disclosures, and stock market investors – tired of paying a “virtue premium” on shares that have lagged the index – are pushing UK boards in the same direction. As I argued recently in my column on why UK businesses must not retreat from net zero in 2026, the danger is that short-term capitulation in the boardroom papers over a hard cost when capital markets, customers and regulators inevitably swing back.

What burberry actually said

In the small print, Burberry insists the revised goal takes account of the “observed and projected speed and scale of decarbonisation” across the luxury industry and in the economies in which it operates. The group also reiterated a near-term commitment to deliver “significant emissions reductions” by 2030, a deadline that still falls within the current chief executive’s likely tenure and remains broadly consistent with the Science Based Targets initiative’s 1.5°C pathway.

For sustainability professionals, that 2030 milestone is the one to watch. A 2050 long-stop date is now table stakes; the credibility test is what happens in the next 1,825 days.

The schulman turnaround – and the £12.2m question

The climate rewrite lands in the middle of a delicate turnaround under Joshua Schulman, who became chief executive in 2024 and has used aggressive marketing, sharper price architecture and an unapologetic return to the brand’s British heritage to steady the ship. Shares are up roughly 17 per cent over the past twelve months, although they remain a long way below the peaks of 2023.

Schulman’s reward for the recovery, also disclosed in the annual report, is a new long-term incentive plan that could lift his total package to as much as £12.2 million in future years, subject to share price and performance hurdles. Coming in the same document as a softer climate pledge, the optics are uncomfortable – particularly for investors who recall that Burberry recently warned it would cut 1,700 jobs in a global savings drive amid the wider luxury slowdown.

The SME angle

There is a longer-tail story here for the small and mid-sized firms that make up Burberry’s supplier base, and the wider FTSE 100 ecosystem. When a flagship brand stretches its decarbonisation runway, the Scope 3 pressure on tier-two and tier-three suppliers eases – at least on paper. In practice, the regulatory ratchet is moving in the opposite direction, with the new UK Sustainability Reporting Standards bedding in from this financial year. As we have flagged previously, SMEs face a widening net zero divide as 2026 reporting rules loom, and the businesses that mistake a softer corporate mood music for permission to pause investment may find themselves locked out of supply chains within two reporting cycles.

For now, Burberry’s message to the City is straightforward: ambition, yes, but on terms the market – and the share price – can live with. Whether that proves to be pragmatism or short-sightedness will be judged not in 2050, but well before the next general election.

Read more:
Burberry pushes net zero target back a decade as luxury sector cools on climate pledges

Sam Altman has executed one of the most striking rhetorical U-turns of the artificial intelligence era, telling an audience in Sydney that the technology he helped unleash on the world will not, after all, trigger the “jobs apocalypse” that doomsayers, including, until recently, himself, have spent the past three years forecasting.

Speaking at a Commonwealth Bank of Australia conference, the OpenAI chief executive conceded that his predictions about how quickly ChatGPT would hollow out the white-collar workforce had been “pretty wrong”. It is an unusually candid admission from a Silicon Valley founder more accustomed to selling the future than apologising for the one he predicted.

“I’m delighted to be wrong about this,” Altman said. “I thought there would have been more impact on entry-level white-collar jobs being eliminated by now than has actually happened. I don’t think we’re going to have the kind of jobs apocalypse that some of the companies in our space advocate or talk about.”

For Britain’s small and medium-sized businesses, many of whom have been wrestling with whether to bet the farm on AI tooling, or to hold their nerve and keep hiring graduates, the comments will land somewhere between reassuring and infuriating, depending on how much capital they have already redirected into the technology on the strength of earlier warnings.

The human factor altman says he underestimated

Altman’s explanation for his change of heart is, on the face of it, refreshingly mundane. The chief executive recounted experimenting with using AI to handle his own Slack messages, only to find the exercise served as “an amazing example to me of we really do care about people”. The interactions he most values, he said, were “not something that I can imagine myself outsourcing to an AI anytime soon”.

It is a far cry from his earlier suggestion that entire categories of work, customer support roles in particular, would be wiped from the economy. The pivot is consistent with a 19th-century paradox economists have long pointed to: the more productive machines become, the more valuable distinctly human attributes, judgement, empathy, accountability, seem to grow. As Business Matters has previously reported, a sizeable cohort of technologists has consistently argued that AI is a tailwind for skilled labour rather than the destroyer-of-worlds presented in some quarters.

Not everyone in silicon valley has got the memo

The trouble for Altman is that his peers do not appear to share his newfound optimism. Dario Amodei, chief executive of rival lab Anthropic, warned only last year that AI could wipe out half of all entry-level white-collar jobs and drive unemployment to between 10 and 20 per cent within five years, a forecast he set out in a widely discussed interview with Fortune that has aged uncomfortably well for those tracking corporate redundancy announcements.

The list of household names cutting headcount and citing AI as a reason has lengthened considerably in recent weeks. Standard Chartered confirmed plans to eliminate roughly 7,800 back-office positions, about 15 per cent of the affected workforce, by the end of the decade, with chief executive Bill Winters describing the cuts as a replacement of “lower-value human capital” with technology. The phrase prompted such a backlash that Winters was forced to send a clarifying memo to staff within days.

Meta, meanwhile, has begun another sweep of layoffs, shedding 8,000 roles, roughly a tenth of its workforce, while Amazon, Microsoft and Jack Dorsey’s Block have all announced significant cuts this year. According to industry tracker Layoffs.fyi, more than 140 technology companies have collectively let go of in excess of 111,000 staff since January.

The UK picture: graduate schemes feeling the pinch

For the SME owner-managers who form the backbone of Business Matters’ readership, the more telling indicator is what is happening at the entry-level end of the talent pipeline in the UK itself. Graduate vacancies, particularly in professional services, have softened markedly, and entry-level job postings have fallen by close to a third since ChatGPT’s launch, with retail, IT and finance bearing the brunt. The big four accountancy firms have trimmed graduate intakes as junior tasks are absorbed by automation.

Whether that constitutes an apocalypse or simply a structural reset is a matter of vocabulary. What is harder to dispute is that the bottom rung of the corporate ladder is shorter than it was three years ago, and one in six UK employers now expects to make further AI-related cuts within the next twelve months, according to recent industry surveys.

What the Goldman numbers actually say

The most reliable view of the labour market sits, as so often, with the bean-counters at Goldman Sachs. The bank’s economists estimate that AI has trimmed monthly US payroll growth by roughly 16,000 jobs over the past year, and nudged the unemployment rate up by around 0.1 percentage points. Roles most exposed, telephone operators, insurance claims clerks, financial administrators, are seeing measurable contractions in headcount. Conversely, jobs where AI augments rather than replaces human effort have added around 9,000 positions over the same period.

In aggregate, these are not the numbers of an apocalypse. They are the numbers of a slow, asymmetric shake-out, the kind of structural change that hits the unprepared hardest and rewards those who adapt early.

What this means for British SMEs

For the owner of a 50-person accountancy practice in Manchester or a marketing agency in Bristol, Altman’s volte-face is less an instruction to relax than an invitation to think more clearly. The replacement-by-AI thesis is plainly happening at the largest, most process-heavy employers, banks, the Big Four, hyperscale technology firms. It is happening considerably less, and considerably more selectively, in the small and medium-sized businesses that employ around three-fifths of the UK’s private sector workforce.

The lesson, if there is one, is that the question is no longer whether AI replaces people. It is which people, doing what tasks, in which businesses. Altman, for now, thinks his earlier prediction was the wrong one. SME leaders watching their hiring pipelines, redundancy budgets and graduate schemes would be wise to draw their own conclusions, and to act on them before the next U-turn.

Read more:
Altman backs away from AI ‘jobs apocalypse’ warnings as OpenAI chief admits he was ‘pretty wrong’

The German utility giant Eon has agreed to buy the retail arm of Ovo Energy in a transaction that will create Britain’s largest household energy supplier and end the 17-year run of one of the country’s best-known challenger brands as an independent operator.

The deal, the value of which has not been disclosed but is understood by industry sources to be worth up to £600 million, will hand Eon roughly four million additional customers and lift its UK book to about 9.6 million households. That tally vaults the combined business past Octopus Energy, which had emerged as the market leader after absorbing the remnants of Bulb in 2022.

For Ovo, the sale draws a line under a torrid 18 months in which the Bristol-based supplier warned in its most recent annual report of “material uncertainty” hanging over its future. The company had been struggling to meet the financial resilience benchmarks introduced by Ofgem after the wave of supplier failures that swept the sector in 2021 and 2022, and had drafted in advisers at Rothschild to shore up its balance sheet.

Ofgem had previously granted Ovo additional time to rebuild its capital buffer on the condition that the company set out a credible road map back to compliance. A sale to a deep-pocketed European utility removes that constraint at a stroke.

Stephen Fitzpatrick, the entrepreneur who founded Ovo from a flat in Notting Hill in 2009 and who built it into one of the few genuine British challengers to the so-called Big Six, said the writing had been on the wall for some time. “Energy retail is now more regulated, more capital intensive and increasingly dependent on long-term investment and scale,” he said. “In that context, bringing Ovo together with Eon is the right next step for customers, for colleagues, and for the long-term commitment that decarbonisation requires.”

The transaction is a striking reversal of fortune for a business that, only six years ago, was itself the consolidator. In 2020 Ovo paid roughly £500 million to take over SSE’s retail arm, a deal that quadrupled its customer base overnight and briefly made it the country’s second-largest supplier. The integration proved bruising, however, and the energy price shock that followed Russia’s invasion of Ukraine left the company badly exposed.

In a separate but parallel transaction, Ovo has agreed to sell its home services arm, which provides boiler insurance and servicing contracts, to the British energy services firm Hometree. That carve-out leaves Ovo Group with Kaluza, its technology platform, which licenses customer-management and flexibility software to third-party utilities including the French group Engie. Kaluza is widely regarded as the more strategically valuable half of the business and is not part of the Eon deal.

Marc Spieker, chief operating officer for commercial at Eon, framed the acquisition as a long-term bet on the British market’s role in the energy transition. “The United Kingdom is an important growth market for Eon, particularly for flexibility and customer-focused energy solutions,” he said. “Energy flexibility and electrification are becoming increasingly important and are critical to the success of the energy transition.”

Eon, headquartered in Essen, already operates in Britain through Eon Next, the rebranded successor to the old Npower retail business it acquired as part of its 2019 takeover of Innogy. The Ovo deal will give it a commanding presence in the heat-pump, smart-tariff and electric-vehicle charging markets that are expected to drive growth as households electrify.

The acquisition is subject to clearance from regulators including the Competition and Markets Authority and Ofgem, and is expected to complete in the second half of the year. Industry analysts will be watching closely to see whether the combined entity’s 9.6 million customer base attracts close scrutiny from competition authorities, given that it would account for roughly a third of all British households.

For SME suppliers and the smaller challengers still battling for market share, the message is unambiguous. The era in which a charismatic founder with a clever app and a hedged book of supply contracts could disrupt the British energy market appears, for now at least, to be over. Scale, balance-sheet strength and the patience of a European parent are once again the prerequisites for survival.

Read more:
Eon swallows Ovo in £600m deal that crowns Germany’s biggest energy giant as Britain’s largest supplier

The number of Britons stuck out of work for more than a year has surged to its highest level since 2016, with small employers warning that successive tax rises and the looming Employment Rights Act are quietly choking off the next generation of hires.

Fresh figures from the Office for National Statistics show that 474,000 people are now classified as long-term unemployed — meaning they have spent more than twelve months out of work. It is the highest tally since January 2016 and an unwelcome milestone for a labour market that, until recently, had been a rare bright spot in Britain’s stuttering recovery.

The deterioration has been sharp. Since Labour swept to power in July 2024, an additional 129,000 people have tipped into long-term joblessness, a sobering measure of how Chancellor Rachel Reeves’s £26bn raid on employer National Insurance has rippled through payrolls, particularly in the SME-heavy retail and hospitality sectors that are the backbone of high streets up and down the country.

A cooling labour market with a long tail

For owner-managers, the headline statistic is alarming because of what economists call “scarring”. The longer a candidate is out of work, the steeper the climb back becomes — skills atrophy, networks fray and confidence drains. That, in turn, blunts productivity, erodes the tax base and dulls consumer spending, the very engine many small firms rely on.

Stephen Evans, chief executive of the Learning and Work Institute, did not mince his words. “Even if some of the rise is cyclical because of the weak economy, the risk is that should the economy pick up they’ll find it more difficult to get back to work,” he said. “Nipping long-term unemployment in the bud really is massively important for the prospects of the economy, as well as for those individuals.”

Evans was particularly exercised about the under-25s, where, he argued, even brief spells of unemployment can leave a lasting dent on lifetime earnings and career prospects, a concern echoed in our earlier reporting on how Reeves’s tax rise has stalled hiring across the SME economy.

Young workers bear the brunt

The figures bear him out. The unemployment rate for 16-to-24-year-olds has climbed to 16.2 per cent, its highest level since January 2015, and the number of 18-to-24-year-olds in long-term unemployment has more than doubled since 2016. The Institute for Fiscal Studies estimates that almost 640,000 people in that age band are now claiming out-of-work benefits, up from 556,000 at the end of 2022.

Fergus Jimenez-England, an economist at the National Institute of Economic and Social Research, said young people were bearing the brunt of the chill. “There is a risk that labour market entrants become discouraged should they fail to find work quickly enough,” he warned, raising the spectre of a fresh wave of economic inactivity as discouraged jobseekers retreat to the benefits system.

The warning chimes with mounting evidence that Britain’s youth jobless crisis is deepening as AI and higher taxes hit hiring, with entry-level roles among the first to be axed when employers tighten the purse strings.

SME hiring budgets squeezed from every angle

For small businesses, the maths has rarely been more punishing. Employer National Insurance contributions have been ratcheted up, the National Living Wage has climbed again, and the Employment Rights Act has piled fresh compliance costs onto firms that often lack a dedicated HR function.

Andrew Wishart, an economist at Berenberg, summed up the corporate mood with characteristic bluntness. “By making companies more cautious about hiring, higher employer National Insurance, minimum wage and the strengthening of worker protections in the Employment Rights Act have probably raised the structural rate of unemployment.”

The result is plain to see in the official data: vacancies recently slumped to a five-year low and UK unemployment hit a 12-month high as job vacancies declined. Retail and hospitality — sectors that traditionally absorb school-leavers and second-jobbers — have shed more than 150,000 roles in the year to April 2026, according to ONS payroll data.

A political headache and a policy puzzle

The figures landed awkwardly in Westminster. Helen Whately, the shadow work and pensions secretary, accused ministers of allowing welfare to become “a long-term alternative to work”, arguing that prolonged spells out of employment exact a toll “not just on the unemployed and their families, but also on the taxpayer”.

Pat McFadden, the Work and Pensions Secretary, pointed to the ongoing fallout from the Iran conflict as “casting a shadow on the labour market”, while insisting that 416,000 more people are now in work compared with a year ago. “Boosting opportunity and tackling youth unemployment in every area remains our priority,” he said.

For Britain’s 5.5 million small and medium-sized businesses, however, the political back-and-forth offers cold comfort. With margins compressed by higher wage and tax costs, and with the structural rate of unemployment apparently drifting upwards, the prospect of a meaningful rebound in hiring before the next Budget looks slim.

The danger, as Evans put it, is that today’s cyclical squeeze hardens into tomorrow’s structural problem — and that a generation of young workers ends up paying the price long after the current economic chill has lifted.

Read more:
Long-term unemployment climbs to a decade high as Britain’s hiring engine stalls

The taxman’s reliance on private debt collectors has reached fresh heights, with HMRC spending more than £5.2m in a single month with its principal recovery partner, a sum that critics warn is being prised from already battle-worn small businesses.

Analysis by the Parliament Street think tank of HMRC’s transparency disclosures shows the department paid TDX Group £5,289,528.65 in February 2026, the company’s debt recovery and insolvency management arm. That marks a leap of just over £2m on January’s bill of £3,236,829.26, and dwarfs the £4,070,045.89 spent in December.

The escalation comes as Chancellor Rachel Reeves leans ever harder on tax compliance to plug Treasury gaps, with wage growth across the wider economy continuing to flatline.

For TDX Group, the boom in government instructions has translated into healthy returns. The company’s most recently filed accounts at Companies House reveal turnover climbing from £63.2m to £79.7m over the past two financial years, with operating profit doubling from £3.7m to £7.5m in the same period.

That trajectory is unlikely to reverse soon. In the Autumn Budget 2024, the Chancellor confirmed that 5,000 additional HMRC compliance officers would be phased in by 2029-30, a recruitment drive the Treasury expects to deliver around £7.5bn a year in extra yield once fully operational. A further 500 officers were rubber-stamped at the Spring Statement 2025, with hiring beginning in the 2025-26 financial year.

For smaller firms, already wrestling with employer National Insurance rises, stubborn borrowing costs and softer consumer demand, the intensified pursuit of arrears is being felt acutely.

Kenny MacAulay, chief executive of accounting software platform Acting Office, said the figures would land badly with owner-managed businesses already on the ropes. “These figures will rub salt in the wound of struggling businesses forced to tackle higher taxes, operating costs and surging interest rates,” he said. “Faced with sizeable overheads, companies will be looking to make use of AI and technology to cut costs and balance the books.”

Patrick Sullivan, chief executive of the Parliament Street think tank, was more pointed. “It beggars belief that the Chancellor’s debt collectors are raking in millions whilst hardworking taxpayers are struggling to make ends meet,” he said. “It’s time for a radical rethink of government expenditure, with a clampdown on millionaire debt collectors who are getting rich at the expense of working people.”

TDX Group declined to comment on the specifics of its arrangements, citing the confidentiality of its contractual relationships.

A spokesman for HMRC defended the department’s approach, stressing that enforcement was a last resort. “Most customers meet their tax responsibilities, with 90 per cent paying in full and on time,” he said. “We take a supportive approach to dealing with customers who have tax debts and do everything we can to help those who engage with us to get out of debt, including offering instalment plans.”

For SME owners weighing whether the squeeze will ease any time soon, the direction of travel from Whitehall suggests otherwise. With thousands more compliance officers set to come on stream and outsourced collection activity scaling rapidly, the cost, both financial and reputational, of falling behind on a tax bill is rising fast.

Read more:
HMRC’s monthly debt collection bill balloons to £5.2m as compliance crackdown bites British businesses