2nd weekly blog of Philip King, CEO of the ICM - skills and risk

A few days ago, Rebecca Smithers, consumer affairs correspondent of The Guardian wrote that British manufacturing is at risk of 'collapse'. The reasons she cited included a worsening skills shortage that will leave thousands of hi-tech jobs unfilled over the next five years. More recently, a leading academic also stated that it is not just in the high-tech industries that skills are missing. He warned that all areas of business need the right, relevant skills to be successful, and this includes skills in credit management.

It is comforting to know, I hope, that there are organisations out there - the ICM foremost among them - who take such warnings seriously. The successful and ongoing development of our qualifications, and our work with employers, practitioners, and industry is aimed at ensuring the industry becomes more professional, and that the right skills are available to help Britain through the recovery.

The property and environmental services giant Connaught has collapsed into administration, putting thousands of jobs at risk. In June, the company warned that public spending cuts, designed to reduce the government's budget deficit, would impact 31 projects, reducing its revenues by £80m this year. This hit, it said, "would push the company into the red." Public sector cuts are going to hit businesses across all sectors, and many of those will be our customers.

In another annoucement that links closely with this theme, I note that the "time to pay" scheme has now reached its peak as HMRC appears to be rejecting an increasingly large number of applications to take part in the initiative. "Time to pay" allows businesses to defer tax payments during the recession. Syscap, an independent finance provider, says that in the last few weeks, a good many businesses have been in contact to secure loans to meet tax obligations either becuase HMRC has rejected their application to the scheme or because they have taken a business off the scheme. Perhaps this should not come as a surprise, but credit professionals are going to see their customers under greater cashflow pressure as a result, and the number of insolvencies is likely to rise as I've been predicting for several months now. Knowing our customers - and their customers in turn - is going to be more important than ever in the months ahead. Close monitoring of risk will enable creditors to take action to avoid or at least minimise potential bad debts.