Spending Review reaction


Yesterday’s Comprehensive Spending Review (CSR) has drawn a mixed reaction from business leaders.

Richard Glover, chief executive of Cornwall Chamber of Commerce: “While difficult, the Review could have been far worse for business. Spending on many of our key priorities, such as infrastructure, did not suffer the scale of cuts previously anticipated.

“The bigger impacts will not be known for a little while. 30%-plus cuts to local government budgets will have significant effects for many local businesses – some of those indirect and therefore somewhat hidden; the knock-on impact of job cuts on restaurants and shops for example.

“We still need to clarify the scale of cuts to some important areas. UKTI will see its core domestic programme activity cut by 25% over the next four years. With export a priority for economic growth, this is a challenge for us all and adds to the pressure to extract as much value from Convergence as possible.

“Adult social care is a significant private sector employer in Cornwall and the impact of possible reductions to that budget could have very far-reaching impacts – on jobs and care for us all.”

“The burden placed on the private sector to provide quality affordable housing is growing and will continue to do so”

John Walker, national chairman, Federation of Small Businesses: “We all know we are living in an age of austerity and that these cuts will affect us all. But our members understand that to reduce the public sector deficit, these cuts had to be made.

“The small business community continues to have a vital part to play in driving a credible recovery and taking on new members of staff to help tackle unemployment, so it is now vital the Government puts a Small Business Programme for Growth into action immediately.

“As our research shows, small firms are at tipping point and lack the confidence to take on the 500,000 people that will be made redundant as a result of these cuts. So it is up to the Government to incentivise the small business community – through extending the National Insurance Contribution holiday to existing firms and cutting VAT to 5% in the construction sector – to promote growth and help small firms take on new staff.”

Christopher Taylour, MD of Wycliffe Estates Ltd: “The Spending Review will hit the provision of Cornish social and affordable housing hard but it’s important to reassure people that the development at Castle Hill remains on track due to it being privately financed.

“The burden placed on the private sector to provide quality affordable housing is growing and will continue to do so for the next few years at least.

“It is therefore important that planning officers, councillors, residents and land owners across Cornwall work together to help the developers provide appropriate and high quality housing solutions for local communities.”

Charlotte MacKenzie, Truro and Falmouth Labour Party: “These Tory cuts won’t lead to fairness or growth. They are bad for the jobs and welfare of people in Cornwall.

“The cuts will have a hugely negative impact. They are bigger than they were made to sound because, for example, if Council funding falls by 7% a year that will mean a 28% cut by 2015.

“The announcements will have a particularly negative impact on young people – Educational Maintenance Allowances are vital for many families in Cornwall, and it is unclear how much of this much-valued support will be available in future.

“The job losses and massive cuts to spending by the public sector will have a negative impact on Cornwall’s economy.

“Relying on the private sector to deliver the switch to green technology will slow the pace of change that is needed and the growth of this economic sector which is important to Cornwall.”

“For employers in the private sector, this flood of talent into the jobs market does present a real opportunity to attract some strong candidates.”

Jo Lindsay, director at Reed Consulting: “With up to 490,000 public sector jobs likely to be lost, the UK’s employment market is about to enter one of its most turbulent periods ever as public sector workers seek to find jobs in an already pressured private sector, which is only likely to contract more as the impact of the cuts filter through to all businesses.

“The transition from public to private sector employment – which has already begun – is not easy, largely because candidates will have to demonstrate that they are commercially savvy and overcome a degree of prejudice from some organisations.

“For employers in the private sector, this flood of talent into the jobs market does present a real opportunity to attract some strong candidates. Public sector workers bring some highly valuable transferrable skills, such as managing large scale budgets and leading significant projects.”

Johnnie Andringa, MD of wind turbine manufacturer Gaia-Wind: “The introduction of the feed in tariffs has already led to very substantial investment in small scale energy – with plans for more to come. Any sign of reneging will damage the value of that investment and the prospects for thousands of existing and potential green jobs across the UK.”

Stuart Fegan, senior organiser for the GMB union’s South West Area Office: “This CSR is the biggest economic gamble with our future that we’ve ever seen. The South West is particularly reliant on public sector employment and we also have some of the most economically deprived areas which rely on services provided by the public sector.

“This CSR is ideologically driven and not by necessity. It doesn’t appear to be a fair budget but will hit the poorest hardest.

“Everyone knows that the bankers created this economic situation and yet the Government seems to have found it easiest to focus on the poorest and the most vulnerable, and harder to target the very rich and the bankers.

“It would have been a just and fair budget if it had targeted the rich who can bear the cuts better than the poor.

“We are up for hard times ahead.”

Debbie Walsh, Head of public policy and communications RICS West: “Here in the south west, the impact of CSR measures on housing provision is of particular concern given the already acute need for affordable housing and the very high earnings to house price ratio making it difficult for many to afford appropriate homes.”