ALEX BRUMMER: Business leaders must stop destroying Britain

Loose talk leads to panic: Business leaders must stop talking Britain out and start supporting recovery, says ALEX BRUMMER








Some UK trade groups and companies can’t help it. The willingness to destroy Britain as it recovers from the deepest recession since the 1930s is unbelievable.

Just the idea that the UK is somehow an exception and that supply bottlenecks cause more problems here than anywhere else in the world is a gross disturbance.

Midlands-based haulage firm Europa Worldwide Group is so outraged by the Road Haulage Association’s panicked briefings on fuel supplies and Brexit that it has sobbing from the trade association.

Twisting Facts: The idea that the UK is somehow an exception and that supply bottlenecks cause more problems here than anywhere in the world is a gross distortion

Twisting Facts: The idea that the UK is somehow an exception and that supply bottlenecks cause more problems here than anywhere in the world is a gross distortion

Delivery company Parcelhero shows it is anything but heroic by issuing a press release claiming we can ‘forget’ Christmas because the build-up in Felixstowe means containers will be diverted to EU ports instead.

It is if it wants to encourage shortages rather than accept that there are other UK container ports, such as Southampton. Obviously, with the right energy and willpower, the stock shortages will disappear.

The idea that this is all a strange British disease is a myth. We should be cheering from the rafters that UK production rose 0.4 percent in August when the EU stagnated. Industrial production fell 1.6 percent in the eurozone, while production in Germany fell 4.1 percent.

The US is also struggling with labor market data showing that deficits are worsening, pushing up wages (a good thing), but holding back the pace of the Covid recovery.

One of the reasons energy prices are high is that China is facing a power shortage and therefore sucks in liquefied natural gas and coal, driving up market prices.

In Britain we are good at highlighting the negative. The rise in GDP has made sterling rise in foreign exchange markets and foreign sovereigns are lining up to buy up UK government debt.

Crisis, which crisis?

Audit trail

Few more devastating reports shatter the integrity of a major accounting firm than the findings of the accounting watchdog tribunal about KPMG and its work on Silentnight’s insolvency.

The accountant is accused by the Financial Reporting Council of “untruthful” behavior, conflict of interest and hiding a trove of 2,367 documents from investigators. Some business was done via private email beyond the reach of regulators.

Remarkably, KPMG worked simultaneously for suppliers Silentnight and buyers private equity outfit HIG Capital.

This is unbelievable. It makes the controversial sale of BHS by Philip Green, which had advisors on both sides, look like a tea party.

An appalling consequence of the rude and unethical behavior of the partner involved, David Costley-Wood, is that low-paid retirees at Silentnight were deprived of their future income.

The fund was closed and transferred to the Pension Protection Fund, leading to valuation cuts of up to 30 percent.

What’s really disturbing is that before Costley-Wood stepped down from KPMG’s Manchester practice, he was paid £800,000 each for the past two years.

The arguments for legal action to recover profits are overwhelming.

Given KPMG’s abysmal record as an accountant, ranging from mistakes at the Co-op Bank to the collapse of Carillion, it’s astonishing that all of its customers are willing to let the company close to the books.

Weak standards, ineffective compliance and cover-ups make it unreliable. All things considered, the mistakes are of Arthur Andersen proportions and that company was forced to close shop.

The FRC has revamped its case and brought its case against KPMG before the tribunal, showing determination to put an ineffective past behind it.

How much better it would be if the Tories had taken steps to strengthen accounting regulations through the creation of a new audit, reporting and governance authority, as proposed more than two years ago.

The conflict of interest explains why the audit and advisory practices must be separated. A cleaner capitalism requires immediate reform.

Soft boiled

Will The Hut Group be the new WeWork? A deal with Softbank to continue tech offshoot Ingenuity was to add stardust. Instead, shares have plunged 57 percent since the beginning of the month.

Founder Matt Molding could begin repairing the roof by hiring an independent chairman and chief operating officer. That would give Molding room to develop the company. But he must act quickly.