Businesses anxious ahead of Spending Review
Oct 19 2010
Business fortunes are in the balance with cuts on the table
Businesses fear the upcoming Spending Review could be a hammer blow to their companies.
According to a poll by SmallBusiness.co.uk of 216 business owners, 70 per cent report that they are fearful of damage the proposed cuts could do to the economy, with 43 per cent admit to being ‘very’ worried.
Some 17 per cent report that the outcome of the review ‘could send us back into recession’.
Andrew McErlane, director of online luxury brand retailer EliteMarket.com, says: ‘It’s not just the public sector cutbacks – it’s the climate it creates. When economic times are tough people don’t necessarily make that high-end purchase even if they can afford it because they may feel it’s not the right time.’
Peter Briffet, UK managing director of marketing company LivingSocial, agrees with McErlane. ‘I would worry that too much money is taken out of the consumer’s pockets. There is a real fear the economy will dry up, especially if too many jobs are cut in the public sector.’
Some managers stress the importance of encouraging entrepreneurialism. Mark Peatey, founder of car leasing company FinanceACar, says: ‘It would be helpful if there was a redirection of finances towards investment in start-ups because new companies are the future and unless they have some help many will end up dying in this market.’
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