Businesses give their verdict on Budget

Here is a sample of their key reactions collected at the breakfast, outlining how last week's budget will impact on different businesses throughout the Borough.

PETER HULMES, Chief Executive St Helens Chamber of Commerce, Training and Enterprise had this to say: "Looking at the 1997-98 Budget overall, the Government has shown broad support for our TEC activities - our key priorities being to create and maintain dynamic local economies with strategic partners, in particular with local authorities, to support competitive business and build a world class workforce.

"As a Chamber we shall watch very carefully to see whether interest rates begin to rise. It is, however, positive news that Unified Business Rates have been frozen. Any help to companies has to be welcomed.

"I think this has been a budget of no real surprises, - as David Richardson, President of British Chambers of Commerce, has commented:- "A penny cut in income tax will do nothing for business and investment. Only time will be the test of the inflationary consequences of this cut."

BILL RATCLIFFE, Universal Arches, Manufacturing Company - 18 employees: "In my opinion, this budget offers no real incentives for job creation. It doesn't provide any great certainty for the future and makes it difficult to plan with confidence. The phase out of Profit Related Pay is particularly disappointing as I feel that this initiative was valuable in controlling company overheads, whilst providing an employee bonus related to the success of the business."

BILL GAYWOOD, Fraser Communications, Advertising and Marketing Company based at Rainhill: "In general this budget does nothing to promote growth. There are a number of hidden cuts which have been cleverly disguised, particularly in infrastructure and health."

PAUL LOCKLEY, Fleming Smith, Architects and Civil Engineers: "The reduction in corporation tax for small firms is welcome. I'm also pleased to see that Business Rates have been frozen. Obviously the true value will depend on the final clarification of the size of businesses who will benefit. Overall, I see this as basically a 'nothingness' budget." ANDREW TAGGART, runs Andy's School of Motoring: "Fuel charge increases are disappointing. This will have an adverse affect in my industry. As a new business, my prices are already very competitive and this will increase continue to erode profit margins and encourage undercutting prices."

RICHARD SHARLAND, Groundwork Trust: "The Chancellor's 25 per cent reduction in National Gas Duty underlines the Governments commitment to a Green Policy. This, and the commitment to consider the reduction in vehicle excise duty in 1998 on HGV's that meet emission targets, will encourage businesses and the local authorities to take account of the impact of their transport activity on the environment. Groundwork is delighted to hear this."

ALAN BATE, Branch Manager, Midland Bank, St Helens: "A budget which was much as I expected. Demand from my customers to borrow money has increased perceptively this year on all fronts, particularly for House Mortgage facilities, and this Budget is not likely to change consumer spending patterns. Indeed, with windfall gains from several building society flotations available next year, retail sales should be buoyant. Most economists anticipate this is likely to lead to increased interest rates to suppress inflation, but, interestingly, Midland's parent company, HSBC, predicts that the Government will be able to go into the election with base rates still at the present level of six per cent.

"Locally we need to await St Helens MBC's 1997 budget proposals to see whether the net give-aways (for most people) in the Chancellor's Budget, will result in a claw back from other directions."

CHRIS FLETCHER, Area Small Business Adviser, NatWest Bank, St Helens: "Running the Budget changes affecting small businesses through the NatWest/Manchester Business School tax model that there has been a five percent drop in the impact of taxation, on both unincorporated firms and small companies since 1993.

"Overall this Budget is warmly welcomed for small businesses because it supports their need for long term macro-economic stability. Given this, the Chancellor's specific Budget measures are targeted more towards consumers than at encouraging long-term business growth. The most disappointing aspect of the Budget is the continued refusal of the Chancellor to give business owners more incentive to retain profits and invest in their own business. Taxing profits both reduced the amount of cash available for investment and encourage owners to withdraw surpluses to take advantage of tax-free savings schemes such as PEP's". JOE WEST, Chief Executive, St Helens College said: "The Budget's effect on public expenditure for further education is not as bad as expected. However we won't know the full picture until actual allocations are confirmed.

"The Chancellor's growth forecast doesn't look right to me.

"Altogether a moderate budget which hasn't done anything to interfere with the "Feel Good" factor."

JOHN SHINNICK, partner in Grant Thornton, Chartered Accountants, who sponsored the Budget Breakfast added: "It was a pleasure to be able to present to such a responsive group of St Helens business representatives and the attendance was a credit to the revitalised Chamber and recognition of the Effectiveness of Business Link.

"The Chancellor suggested that we are taking part in a Rolls Royce recovery - built to last. Certainly, Kenneth Clarke, in my view, has proved to be one of the most effective Chancellors in living memory. I share concerns that growth which he is now targeting for the UK economy will have an inflationary effect which will need to be quenched through higher interest rates. Whether Kenneth Clarke or any other Conservative Chancellor is in power to take that action remains to be seen.

"On the taxation front, the gradual withdrawal of PRP, will be felt by around 3.7 million people, to one extent or another. It is a pity that he is withdrawing the scheme, rather than encouraging its usage, because it links pay reward with business profitability.

Converted for the new archive on 14 July 2000. Some images and formatting may have been lost in the conversion.