Business

Lloyds Banking Group has cemented its position as the most complained-about name in British financial services, racking up more grievances with the City regulator than any other lender during the second half of 2025, as the wider sector handed nearly a quarter of a billion pounds back to disgruntled customers.

Fresh figures from the Financial Conduct Authority show the FTSE 100 banking giant fielded a hefty 187,516 complaints across its subsidiaries between July and December last year. The black horse brand itself bore the brunt, accounting for 90,837, while its Edinburgh-based commercial arm Bank of Scotland was not far behind on 79,508.

The scale of the figures partly reflects the sheer footprint of the group, which counts roughly 28 million customers and remains the country’s biggest financial services provider. Santander, which serves around 14 million Britons, came in a distant second with 124,919 complaints.

Despite the eye-catching numbers at the top of the table, the wider picture is one of relative stasis. Total grievances across the industry edged up to 1.9 million, a rise of just under one per cent on the first half of the year and broadly consistent with the trend that has prevailed since early 2021, when figures have fluctuated between 1.7 million and 2 million.

There was, however, a measure of good news for the sector. The proportion of complaints upheld in the customer’s favour slipped from 57.9 per cent to 55.5 per cent, while the total bill for redress fell to £236.2m, down sharply from £283.7m in the first half of 2025. The average payout also tracked lower, dropping to £215 from £238.

The findings come at a sensitive moment for the high street, with both Lloyds and Santander under fire from consumer groups for the pace at which they are pruning their branch estates. Analysis by Lightyear shows the Spanish-owned lender has shuttered close to 500 sites over the past two years and announced a further 44 closures in January, fuelling accusations that vulnerable customers are being left stranded.

Lurking behind the headline numbers is the motor finance mis-selling scandal, which continues to cast a long shadow over Britain’s lenders. Lloyds has set aside £2bn to cover potential redress linked to so-called secret commission arrangements between car dealers and banks, while Santander has earmarked £461m. Both are among the most heavily exposed names in the sector.

The FCA’s pause on motor finance complaints, in place since January 2024 after volumes surged on the back of concerns over discretionary commission arrangements, is due to be lifted on 31 May 2026, raising the prospect of a fresh wave of grievances landing on lenders’ desks this summer.

Elsewhere, motor and transport insurance proved the standout pain point of the period, with complaints leaping by more than a third to 340,000. That surge helped drive a 10 per cent jump in overall insurance and protection grievances to 790,329. Current accounts remained the single largest category, although the volume eased to 492,149 from 541,493 in the first half.

For Britain’s biggest banks, the latest data offers little immediate respite. With the motor finance reckoning still to come and branch closures continuing to draw political heat, the pressure on customer service teams looks set to remain firmly elevated through 2026.

Read more:
Lloyds tops the league of shame as Britain’s finance firms pay out £236m to aggrieved customers

The United Arab Emirates has announced it is to withdraw from Opec and the wider Opec+ alliance after nearly six decades of membership, in a move that analysts warn could herald the unravelling of the world’s most powerful oil cartel and usher in a fresh wave of price volatility for British businesses already grappling with stubborn energy costs.

The Gulf state, which joined the Organization of the Petroleum Exporting Countries in 1967, said the decision reflected its “long-term strategic and economic vision and evolving energy profile”. Abu Dhabi’s energy minister suggested that operating outside the cartel’s quota system would afford the country greater flexibility to pursue its own production ambitions, free of the collective discipline that has long shaped global crude markets.

For the UK’s small and medium-sized enterprises, the immediate consequences are far from academic. Energy-intensive sectors, from manufacturing and logistics to hospitality, have spent the past three years contending with input costs that swung wildly on the back of geopolitical shocks and Opec+ output decisions. A weakened cartel could mean cheaper oil in the short term as producers compete for market share, but it also raises the spectre of greater price swings as the disciplinary mechanism that has historically tempered volatility begins to fray.

Saul Kavonic, head of energy research at MST Financial, did not mince his words, describing the move as “the beginning of the end of Opec”. With the UAE’s departure, the cartel loses roughly 15 per cent of its production capacity and what Mr Kavonic called “one of its most compliant members”. The UAE currently pumps approximately 2.9 million barrels per day, against Saudi Arabia’s nine million.

“Saudi Arabia will struggle to keep the rest of Opec together, and will effectively have to do most of the heavy lifting regarding internal compliance and market management on its own,” he warned, adding that other members may yet follow Abu Dhabi’s lead. He went further, characterising the development as a “fundamental geopolitical reshaping of the Middle East and oil markets”.

The departure leaves Opec with eleven members. Founded in 1960 by Iran, Iraq, Kuwait, Saudi Arabia and Venezuela, the cartel was created to coordinate production and stabilise revenues for member states. The current line-up also includes Algeria, Equatorial Guinea, Gabon, Libya, Nigeria and the Republic of the Congo.

For SME owners watching from Britain, the message is clear: hedging strategies, fixed-price energy contracts and supply chain stress-testing are no longer the preserve of FTSE 100 boardrooms. The post-Opec era, if it does indeed dawn, promises a more fragmented and unpredictable global energy market, and the businesses that prepare now will be best placed to weather what comes next.

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UAE’s shock Opec exit signals a new era of energy market volatility for British business

The lurid purple shopfronts that ushered a generation of British teenagers into their first ear piercing have, quite literally, gone dark.

Claire’s Accessories has confirmed the closure of all 154 of its standalone stores in the UK and Ireland, with more than 1,300 staff handed redundancy notices in one of the most emphatic high-street collapses of the year so far.

Administrators at Kroll said trading ceased across the estate on 27 April after the chain tumbled into administration for the second time in barely twelve months. The 350 concession counters that Claire’s operates inside other retailers will continue to trade for now, but the standalone model, for decades a fixture of British shopping centres from Bluewater to Buchanan Galleries, is finished.

For the SME-heavy ecosystem of suppliers, landlords and shopping-centre operators that depend on anchor tenants of this kind, the implications are sobering. Claire’s was not a marginal player: it was, until recently, one of the most reliably trafficked footfall generators on any mid-tier high street, hoovering up pocket money from a demographic that few competitors knew how to reach.

That demographic, it turns out, has moved on. The chain has been outflanked on price by the Chinese-owned ultra-fast-fashion platforms Shein and Temu, whose algorithmically curated trinkets land on teenagers’ doorsteps for a fraction of Claire’s shelf prices. It has been squeezed on the high street itself by Primark and Superdrug, both of which have aggressively expanded their value accessories ranges. And, perhaps most damaging of all, it has been culturally outmanoeuvred.

“We’ve moved away from novelty, colourful jewellery for the most part, which is what Claire’s are best known for,” Priya Raj, a fashion analyst, told the BBC. Today’s teenagers, she noted, take their cues from TikTok and Instagram rather than from a Saturday-afternoon trawl of the local Arndale, and their tastes have shifted to “minimal jewellery, sometimes chunky, sometimes with a more curated look, basically not the cutesy, juvenile look that Claire’s is known for.”

The retail analyst Catherine Shuttleworth was blunter still. Gen Alpha, she argued, has more competing claims on its disposable income than any cohort before it — matcha lattes, bubble tea, gourmet desserts, in-app purchases, and a shop “just selling ‘stuff’ simply doesn’t cut it” any longer.

The collapse will reignite the increasingly fractious debate over the Government’s tax treatment of bricks-and-mortar retail. When Claire’s owner, the private-equity backed Modella Capital, first put the chain into administration in January, it pointed to “alarming” Christmas trading and singled out the rise in employers’ National Insurance Contributions as a material drag on viability. Trade bodies including the British Retail Consortium and the Federation of Small Businesses have warned for months that the cumulative weight of higher NICs, business rates and the National Living Wage uplift is pushing marginal store-by-store economics into the red — a warning that Claire’s now embodies in unusually stark form.

The structural picture is no kinder. Town centre footfall has yet to return convincingly to pre-pandemic levels, the Treasury’s long-promised business rates overhaul has under-delivered, and landlords are still struggling to re-let space vacated by the likes of Wilko, The Body Shop and Ted Baker. A 154-unit hole in the property market is not one that will be filled overnight.

Across the Atlantic, the picture is little better. The American arm of the business filed for Chapter 11 in 2025, its second bankruptcy in seven years, after an earlier failure in 2018 — underlining that Claire’s troubles are global rather than peculiarly British.

What was once a rite of passage has become a case study in how quickly retail brands can be rendered obsolete when consumer culture, cost inflation and online disruption converge on the same balance sheet. The bright purple frontages will be gone within weeks. The questions they leave behind for Britain’s high streets will not.

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Claire’s pulls down the shutters: 154 stores shut and 1,300 jobs lost as gen alpha turns its back on the high street

The Tony Blair Institute has called on ministers to pull an “emergency handbrake” on Britain’s runaway sickness benefits bill, urging Whitehall to strip cash entitlements from claimants with mild depression, ADHD and other conditions the think tank argues are compatible with work.

In an intervention that will land squarely on the desks of finance directors and HR chiefs across the country, the institute founded by Sir Tony Blair has proposed a new statutory category of “non-work limiting conditions” covering anxiety, stress-related disorders, lower back pain, common musculoskeletal complaints and certain neurodevelopmental conditions. Claimants would receive treatment and employment support in place of benefits, in a shift the TBI insists could be introduced without primary legislation.

The proposals arrive at a critical moment for British employers. The Office for Budget Responsibility forecast in March that spending on health and sickness benefits for working-age adults will hit £78.1bn by 2029-30, a 15 per cent jump on this year’s outlay. With around 1,000 people a day becoming newly eligible for health and disability payments, business groups have grown increasingly vocal about the squeeze on the labour market and the corresponding drag on productivity.

The TBI’s report lands in awkward political territory for the Labour government, which last year tabled plans to tighten disability benefit eligibility only to gut its own proposals after a backbench revolt. Whitehall now points to a review led by Social Security Minister Sir Stephen Timms, expected to report later this year, as the vehicle for any further reform.

Dr Charlotte Refsu, a former GP and the institute’s director of health policy, said the welfare system was “drawing too many people into long-term dependency for conditions that are often treatable and compatible with work, and not doing enough to support recovery”. She added: “A system that leaves people on benefits without timely treatment or a route back to work is not compassionate. It is bad for the country and bad for people’s health.”

Under the TBI blueprint, every claimant would require a formal diagnosis before applying for benefits, and those already on the books would face more frequent and rigorous reassessment. The think tank stopped short of estimating either fiscal savings or the number of claimants who would lose entitlement, but argued any windfall should be ploughed back into employment support and NHS treatment for mental health and musculoskeletal conditions, the two clusters that have driven much of the post-pandemic surge in claims.

YouGov polling of more than 4,000 British adults, commissioned by the institute, found that 54 per cent of voters believe the welfare system is too easy to access and fails to prevent misuse, a finding likely to embolden ministers minded to revisit reform.

For SME owners contending with stubborn vacancies and rising employment costs, the report sharpens a debate that has been simmering in boardrooms since the pandemic. Smaller employers have repeatedly flagged the difficulty of recruiting from the economically inactive cohort, particularly the more than 2.8 million working-age people currently signed off long-term sick. The TBI argues that supporting claimants into “appropriate work” would not only ease the fiscal pressure but also reduce social isolation and improve mobility and independence, a framing that aligns with the back-to-work rhetoric increasingly heard from both Labour ministers and the Conservative and Reform UK opposition.

The proposals have, however, drawn fierce criticism from the disability sector. Jon Holmes, chief executive of the learning disability charity Scope, branded the report “deeply unhelpful and ill-informed”, arguing it ignored “the lived reality of people with a learning disability and plays to a populist trope about welfare”. He warned: “Slapping labels on people and denying them benefits will not tackle the root cause. It will push people into deeper anxiety, misery and poverty. That’s not reform, it’s a recipe for making things worse.”

The Department for Work and Pensions said it had already “rebalanced” Universal Credit to deliver £1bn of savings, with the health-related element for new claimants cut by up to 50 per cent earlier this month. A spokesperson said the department had “increased face-to-face assessments and improved use of NHS evidence, all while ensuring those who genuinely can’t work are always protected”, adding that ministers would “consider the TBI’s report”.

For Britain’s small and medium-sized employers, the question is no longer whether reform comes, but how quickly, and whether it will deliver the workforce uplift that has eluded successive administrations.

Read more:
Blair think tank urges ’emergency handbrake’ on sickness benefits as bill races towards £78bn

British founders are being urged to think twice before accepting cheques from investors lured by tax breaks, after fresh analysis revealed that companies relying on the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS) are overwhelmingly failing to scale.

Antler, the Singapore-headquartered early-stage venture capital firm, has crunched the numbers on more than 40,000 UK funding rounds over the past decade and concluded that the schemes, long held up by successive chancellors as the jewels in the crown of British start-up finance, are doing the opposite of what was intended.

Just 12 per cent of all UK companies raise follow-on capital after their initial round, according to Antler’s research. For those backed exclusively by EIS or SEIS money, the picture is bleaker still: a mere 3.7 per cent ever go on to secure further investment.

Adam French, partner at Antler and a familiar face on the British venture scene, did not mince his words. The schemes, he argued, prioritise “quantity over quality” and fail to provide founders with the strategic backing they need to grow into the kind of businesses that genuinely move the dial.

“If you were an investor in an SEIS fund, you’re primarily excited about the fact that you’re going to get 30 to 50 per cent of your investment back as a tax benefit in your tax return, and you don’t care as much about the outcome of the business that you’re investing in,” Mr French said.

The contrast with conventionally backed start-ups is stark. Where a company secured at least one institutional co-investor or an active angel in its opening round, the proportion going on to raise more capital leapt to 25.7 per cent, almost seven times the rate seen by the tax-relief-only cohort.

“The only way to do a good job in venture capital is to find the companies that go on to be outliers, and the tax-incentivised funds don’t have that mandate,” Mr French added. “They’re not looking to take insane amounts of risk because that’s ultimately what you have to do in venture to make a lot of money.”

The SEIS was introduced in 2012 by then-chancellor George Osborne to turbocharge the flow of capital into Britain’s fledgling start-ups, building on the older EIS, which dates back to 1994. Both offer generous reliefs designed to compensate investors for the considerable risk of backing unproven businesses.

Under current rules, investors can deploy up to £1 million per tax year, rising to £2 million for so-called knowledge-intensive companies that pour resources into research and development. Hold the shares for at least two years and any losses can be offset against income tax, an arrangement that, in effect, allows the Treasury to underwrite a significant chunk of the downside.

For more than a decade the schemes have channelled billions of pounds into the British innovation economy, and they have plenty of defenders in Whitehall and the City. But Antler’s findings will reignite a long-simmering debate about whether tax-led investment is genuinely building the next generation of British scale-ups, or merely creating a cottage industry of tax-efficient portfolios that quietly run aground.

Antler’s analysis did find that companies raising $1 million or more in their opening round were more likely to attract further backing, suggesting that cheque size remains a meaningful signal. But Mr French was emphatic that the calibre of the investor on the cap table mattered more than the headline figure.

His message to founders is blunt. “My advice to founders is to make sure you’re very selective about who you’re taking money from,” he said. “Don’t go for the first capital that lands on your table, make sure you go for the right capital.”

For Britain’s army of seed-stage entrepreneurs, the warning lands at a delicate moment. With venture funding still well below the highs of 2021 and the cost of capital biting across the board, the temptation to grab whatever money is on offer has rarely been greater. Antler’s data suggests that succumbing to that temptation may be the surest route to a dead end.

Read more:
Beware the tax-break brigade: founders warned over EIS and SEIS investors who ‘don’t care about the outcome’

Santander has doubled the financial firepower it commits to the University of Sunderland each year, signing a renewed partnership agreement that will channel £100,000 annually into scholarships, bursaries and start-up grants until the 2026-2027 academic year.

The deal, agreed between the Spanish-owned high street lender and one of the North East’s largest universities, builds on a near eight-year relationship that has already supported hundreds of Sunderland students. For Santander, it represents a further bet on the regional higher education sector at a time when many universities are tightening belts in response to mounting financial pressure.

Under the new arrangement, Sunderland will distribute ten £1,000 Brighter Futures Awards to ease day-to-day financial pressure on undergraduates, alongside six £5,000 Education Awards to cover tuition fees, course materials and accommodation. A further 120 £250 Employability Awards will help students meet the unexpected costs that come with launching a career, from interview travel to placement essentials. Six £5,000 Entrepreneurship Awards complete the package, open to students, staff and graduates seeking to grow fledgling businesses.

All Sunderland students, graduates and staff will also gain access to Santander Open Academy, the bank’s free global e-learning platform offering online courses, grants and expert-led content designed to align learners with skills currently in demand across the labour market.

Sir David Bell, the University’s Vice-Chancellor and Chief Executive, sealed the agreement alongside Santander UK’s National Partnerships Director, Jonathan Powell.

“Our partnership with Santander Universities has been running for nearly eight years and has brought immense benefit to students and staff alike,” Sir David said. “These new awards will provide the next generation of Sunderland’s most talented people with the opportunity to achieve even greater success in the future. I am enormously grateful to Santander Universities for the continuing trust and faith they have in our university.”

For Santander, the Sunderland tie-up is part of a far larger global education programme that has assisted nearly 8.3 million people and businesses over the past three decades. The bank has invested more than €2.5 billion through collaboration agreements with over 1,000 universities and institutions across 13 countries, with £115 million committed to UK university partnerships alone since 2007.

Mr Powell said the renewed deal reflected an unusually productive working relationship. “At Santander we believe strongly in the power of collaboration, and that has been strongly evident in our partnership with Sunderland. This new agreement provides more opportunities for people to prosper through our support of education, employability and entrepreneurship.”

The commercial logic for the bank is as much about brand visibility on UK campuses as it is corporate philanthropy. With graduate banking competition fierce and customer acquisition costs rising, sustained presence at universities offers Santander a route to a generation of future current account holders, mortgage borrowers and small business banking customers.

The impact on individual recipients is already visible. Among the dozen students recently presented with £60,000 of Santander Education and Entrepreneurship awards was Kirsty Knott, a 2010 Business and Financial Management graduate from Ryton, who has used a £5,000 Entrepreneurship Award to develop Expansions Coaching, a podcast and emerging events business she runs alongside her husband Anth. The venture is preparing to launch face-to-face networking through the Crack on Club, a small business meet-up at the Twenty Twenty Bar in Newcastle from 14 May.

Kieran Harley, 25, a first-year Electronic and Electrical Engineering student from Sunderland, was awarded one of six £5,000 Santander Education Awards. As a carer for his mother who also works part-time, he said the funding would directly translate into reduced working hours and more time to focus on his degree.

“My long-term goal is to work in the renewable energy sector, and winning the award will make a significant difference to my studies,” he said. “The Santander Education Award will allow me to reduce my working hours, giving me more time and flexibility to focus both on my degree, and to better support my mum.”

For Sunderland, which has built a reputation for widening participation among students from non-traditional backgrounds, the doubling of Santander’s commitment is a welcome counterweight to a sector grappling with frozen tuition fee income, falling international student numbers and rising operating costs. With more than half of UK universities now reporting deficits, corporate partnerships of this scale are becoming increasingly central to balancing the books — and to keeping the door open for students who would otherwise struggle to fund their studies.

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Santander doubles University of Sunderland support to £100,000 a year in renewed partnership

A British artificial intelligence company founded by one of the architects of fintech unicorn Tide has written to every Member of Parliament warning that the political debate over children’s smartphone use has descended into a “false choice” between blanket bans and unrestricted access.

SafetyMode, the London-headquartered child safety technology firm led by Tide founder George Bevis, has used the parliamentary intervention to press ministers to consider a third path, arguing that on-device technology can give parents meaningful control without locking children out of the digital economy altogether.

The timing is not accidental. The letter lands in Westminster postbags days after a landmark American court ruling found that several of Silicon Valley’s largest platforms had knowingly engineered addictive products for young users, a judgment that has sharpened the appetite among legislators on both sides of the Atlantic for tougher action.

In Britain, the political mood music has shifted markedly over the past eighteen months, with cross-party support building for tighter restrictions on under-16s. Yet SafetyMode’s pitch to MPs is that the conversation has narrowed prematurely.

“Right now, the entirety of the conversation around social media and phone safety seems to pretend all we can achieve is either to open the floodgates entirely or to ban them completely, losing all benefits these technologies may offer,” the company writes in its letter, copies of which have been seen by Business Matters.

The firm, founded by Mr Bevis alongside Bertie Aspinall and product specialist Dan Barker, has spent the past two years developing what it claims is one of the most sophisticated parental control platforms on the market. Unlike rival products that route children’s data through cloud servers, SafetyMode’s technology runs artificial intelligence directly on the device, filtering harmful content in real time while keeping personal information off external servers.

The product was built in partnership with parenting forum Mumsnet, whose research underpins much of the company’s commercial thesis. More than 90 per cent of parents surveyed told Mumsnet that current smartphones are not safe enough for children, while 86 per cent expressed concern about the impact of devices on their child’s mental health and attention span.

Speaking to Business Matters, Mr Bevis said the political class risks reaching for the bluntest available instrument. “We are at a turning point in how society views children and smartphones. There is clear agreement that there is a problem, but the solutions being discussed are too narrow. Regulation matters, but it takes time, and it cannot be the only answer.”

Mr Aspinall, the firm’s co-founder, struck a more pointed note. “The courts, governments, schools and parents all recognise the risks. But companies at the heart of this won’t fix it themselves. So the question becomes, what do we do next? On the one hand is regulation. But if we want to protect children now, the answer is simple. You build safety into the device itself and put control back in the hands of parents.”

The company’s technology has been designed to read context rather than merely scan for prohibited keywords, identifying when conversations turn abusive, sexualised or otherwise damaging, even when those exchanges would slip past conventional filters.

For now, SafetyMode is available only on Android handsets. The firm has been openly critical of Apple, arguing that the Cupertino giant’s restrictions on third-party developers prevent meaningful parental controls being built for iPhone users, a complaint that echoes broader regulatory scrutiny of Apple’s walled garden in both Brussels and Washington.

There is also an industrial strategy dimension to the company’s lobbying. SafetyMode is positioning Britain as a potential global hub for what it calls the “safe tech for kids” movement, arguing that ministers could combine child protection with a fresh wave of innovation, investment and skilled job creation if they chose to back domestic firms developing protective technologies.

Whether MPs will be receptive remains to be seen. Backbench pressure for outright restrictions on under-16s using social media has hardened in recent months, and Whitehall has shown limited appetite for technological solutions that depend on parental engagement. But with the American courts now exposing platform behaviour in unprecedented detail, the case for action of some kind appears unstoppable.

The question Mr Bevis and his colleagues are putting to Parliament is whether that action should empower parents or simply slam the door shut.

Read more:
SafetyMode warns MPs of ‘false choice’ on child smartphone safety as global pressure mounts

The British Business Bank has committed $20m to Ineffable Intelligence, the London-headquartered artificial intelligence venture, as part of a landmark $1.1bn seed round that ranks as the largest in European history.

In a move that signals a sharpening of the Government’s industrial strategy around frontier technology, the state-owned development bank has co-invested alongside the Sovereign AI Fund, the Treasury-backed vehicle established to keep strategically significant AI businesses anchored on these shores. The Sovereign AI Fund has put in further capital on top of the Bank’s contribution, although the precise figure has not been disclosed.

The British cheques sit within a syndicate that reads like a who’s who of Silicon Valley capital. Sequoia, Lightspeed, NVIDIA, Index Ventures, Google, EQT, Evantic, Flying Fish, DST Global and BOND have all joined the round, lending weight to the argument that Britain remains capable of attracting deep-pocketed foreign investors to its homegrown technology champions despite persistent concerns about the country’s appetite for risk.

Ineffable Intelligence is the brainchild of David Silver, the University College London professor widely regarded as one of the most influential reinforcement learning researchers of his generation. Silver previously ran the reinforcement learning team at Google DeepMind and is credited with pivotal work on AlphaGo, AlphaZero, AlphaFold and AlphaProof, the systems that successively rewrote what machines were thought capable of in domains ranging from board games to protein folding and mathematical reasoning.

His new venture has set itself a deliberately audacious mission: to build what Silver calls a “superlearner”, a system capable of discovering knowledge from its own experience rather than relying on the data humans feed it. If realised, the technology would represent a step change beyond today’s large language models, which remain heavily dependent on training material drawn from the internet.

For the British Business Bank, the investment marks the latest in a steady cadence of AI commitments. The lender has now made nine AI deals over the past twelve months, with recent backing for autonomous driving outfit Wayve and conversational AI specialist PolyAI. The Bank has also been a quietly significant force behind the commercialisation of British academic research, supporting almost a quarter of all university spinout deals struck between 2022 and 2024.

Charlotte Lawrence, managing director of direct equity at the British Business Bank, described Silver as “a generational talent who has consistently been on the cutting edge of AI development“. She added: “Ineffable Intelligence has the potential to produce a paradigm shift in our scientific and technology landscape, and we are incredibly excited to be supporting him and his team in this endeavour.”

George Mills, the Bank’s investment director, said the company was tackling “one of the most significant opportunities within AI”, citing potential applications spanning advanced problem solving and new product development. “The UK produces world-class AI talent, and we are pleased to back strategically important businesses to scale and stay in the UK,” he said, in remarks that will be read as a pointed reminder of the Government’s determination to stem the flow of British intellectual property to American owners.

Josephine Kant, head of ventures at Sovereign AI, was equally bullish. “Very few founders in the world could credibly set out to build a superlearner, a system that discovers new knowledge from its own experience rather than ours. David is one of them,” she said. “From AlphaGo to AlphaZero to AlphaProof, he has spent nearly two decades turning reinforcement learning from a research idea into the results the rest of the field builds on. Ineffable is being built in the UK, and that matters.”

The deal arrives at a delicate moment for British technology policy. Ministers have repeatedly stressed their ambition to position the country as a global hub for safe, sovereign AI development, but they have faced criticism for the relative scarcity of late-stage growth capital available to scaling deep-tech businesses. A seed round of this magnitude, anchored by domestic public capital and topped up by the world’s most prolific venture investors, will be cited by Whitehall as evidence that the strategy is beginning to bear fruit.

For SME founders watching from the sidelines, the headline figures may feel a world away from their own funding realities. Yet the structural shift is significant: the British Business Bank’s growing willingness to write meaningful equity cheques into frontier technology businesses, in concert with private capital, suggests a more interventionist posture that could in time filter down to a broader cohort of high-growth British companies.

Read more:
British Business Bank backs record-breaking Ineffable Intelligence raise as UK doubles down on superintelligence ambitions

Grosvenor, the property company controlled by the Duke of Westminster, has broken ground on a £40m repositioning of The Hive in Manchester’s Northern Quarter, in a move that takes the group’s directly managed flexible workspace model outside London for the first time.

The Lever Street landmark, which extends to 78,000 sq ft, will be reimagined as a destination office building anchored by 25,500 sq ft of flex space and a hospitality-led amenity offer. Ground-floor units fronting Lever Street will house a deli and a restaurant, both run by what Grosvenor describes as “well-known Manchester names”, with a launch pencilled in for autumn 2026.

For Grosvenor’s UK property arm, the project is the most visible test yet of a regional strategy launched in 2020 that now stretches across roughly 500,000 sq ft in Manchester, Birmingham, Bristol and Leeds. The portfolio is currently 90 per cent let, a figure that compares favourably with a regional office market still wrestling with hybrid working and a flight to quality.

The group has appointed x+why, the B Corp-certified workspace operator, to run more than 22,000 sq ft of the flex floors under a management agreement. The deal extends a partnership that began in 2023 at Fivefields, Grosvenor’s social-impact workspace in Victoria, and signals a growing appetite among traditional landlords to plug operating expertise into their own buildings rather than cede space to third-party flex providers on conventional leases.

Interiors will be designed by x+why’s in-house team, whydesign, with a deliberate nod to local craftsmanship. Pieces by Manchester-based furniture designers and artists including Aiden Donovan, Jesse Cracknell, Matt Dennis and Mima Adams will be woven into the scheme, while elements from the fit-out installed by previous tenant The Arts Council are to be repurposed, a small but pointed gesture towards the building’s creative heritage.

The bet on Manchester reflects a wider conviction inside Grosvenor that the city’s office market remains one of the most resilient outside the capital, underpinned by a deep talent pool, inward business migration and a structural shortage of grade-A space. The landlord’s nearby Ship Canal House is, it says, close to full occupancy following a run of new lettings and renewals.

Fergus Evans, office portfolio director at Grosvenor Property UK, said the Hive scheme typified the group’s regional playbook of taking “a prime asset in a great location and repositioning it to meet the evolving needs of today’s occupiers”. He added: “Manchester continues to perform strongly for us, and our investment in The Hive reflects sustained demand for well-located, high-quality offices, particularly from the city’s growing digital and creative economy. Combining x+why’s experience in creating design-led, community-focused workspaces with our approach to active asset management, we are well placed to deliver a distinctive, flexible offer that responds to local demand.”

Rupert Dean, chief executive and co-founder of x+why, said the operator was “delighted to be partnering with Grosvenor again to bring The Hive into its next chapter”. He added: “The Northern Quarter is one of the most exciting and entrepreneurial parts of the UK, and The Hive will reflect that energy, offering a workspace that is not only functional, but inspiring and socially driven.”

For SMEs and scale-ups in Manchester’s digital and creative cluster, the very occupiers Grosvenor and x+why are courting, the arrival of a higher-end, hospitality-led flex product on Lever Street is likely to sharpen competition with established players such as WeWork, Bruntwood and Department, and could nudge headline rents in the Northern Quarter higher when the doors open next autumn.

Read more:
Grosvenor takes flex workspace model out of London with £40m bet on Manchester’s Northern Quarter

The 50-strong flooring chain backed by Sir Richard Harpin’s Growth Partner has appointed restructuring advisers, raising the prospect of store closures and redundancies as the cost-of-living squeeze continues to drag on consumer spending.

Flooring Superstore, which employs around 300 people from its Bishop Auckland headquarters in County Durham, has drafted in Begbies Traynor and the restructuring arm of Santander to weigh its options. People familiar with the matter said a company voluntary arrangement (CVA) or a full administration are both on the table, controversial routes that typically squeeze landlords and suppliers while preserving the equity of incumbent owners and senior creditors.

The retailer was co-founded in 2012 by Dan Foskett and sells vinyl, laminate and wood flooring alongside artificial grass through its branded showrooms and online channels. Growth Partner, the investment vehicle established by Harpin, the entrepreneur behind home emergency repair group HomeServe, backed the business in 2020 with a £5 million injection that allowed Foskett to crystallise a portion of his shareholding. He retains a 22 per cent stake, while Growth Partner holds 25 per cent. The remainder is split between three individual investors.

Harpin, who last year published “How to Make a Billion in Nine Steps”, focuses on British and European retail names primed for scale. His portfolio includes pizza oven specialist Gozney and bathroom retailer Easy Bathrooms. However, several Growth Partner-backed businesses have collapsed in recent years, among them Crafters’ Companion, co-founded by Dragons’ Den investor Sara Davies, and Yorkshire-based Keelham Farm Shop.

Flooring Superstore was a pandemic winner, riding the wave of home-improvement spending while consumers were confined to their properties. That tailwind reversed sharply once lockdowns eased, as the chain was forced to absorb spiralling energy and raw material costs and unwind the additional capacity it had built. The cost-of-living crisis has since hammered demand for big-ticket household refurbishments.

Connection Retail, the parent company that also owns Direct Wood Flooring, Grass Direct and Snug Carpets, posted turnover of £49.3 million in the year to the end of July 2024, down from £51.8 million a year earlier. Pre-tax profit nonetheless swung from a £3.3 million loss to a £619,000 profit, while net debt stood at £3.5 million at the year-end.

Santander shored up the group’s balance sheet last June with a debenture, a secured loan agreement under which the lender acts as security trustee. Filings at Companies House show Connection Retail has two outstanding charges, having pledged its property and overall business assets as collateral to both Growth Partner and the high-street bank.

The disclosed restructuring talks mark a striking pivot from the expansion blueprint Foskett set out only twelve months ago, when he told The Times that he intended to grow the estate to as many as 150 stores, deepen the brand’s marketing reach and continue building its exclusive product range.

Growth Partner and Flooring Superstore had not responded to requests for comment at the time of publication. Santander and Begbies Traynor declined to comment.

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Harpin-backed Flooring Superstore weighs restructure as sales slip