Business monitor VER 6:Layout 1 18/05/2009 14:46 Page 22
BUSINESS MONITOR
“
The 40% first year
allowance for expenditure
on plant and machinery
has been welcomed in all
corners as a pleasant
surprise. The machine
manufacturers supplying
the printwear industry will
be encouraged since this
gives them a sales story to
tell in tough times. Mind,
the budget didn’t benefit
the pound, so that may be
swings and roundabouts
for both buyers
and sellers
farm in the Irish Sea will be expanded and the the standard kick that all Chancellors expect,
”
project to build 300 turbines in the Thames estuary through “what could he do?” to “a mixed bag”.
is close to approval. That expenditure looks to be The biggest concern is that the predictions look –
working and better still most of the funding came still look – very optimistic. More honesty about
from the European Investment Bank. where the public finances are likely to take us
still now. That could benefit printwear – I hear that If you need new staff, the timing is propitious. The would have been appreciated. All budgets are
caravan parks, hotels and guesthouses throughout Chancellor announced a £3 billion jobs package. political as well as fiscal, but this one appears to
the country are experiencing their highest enquiry Some of this will be spent on recruitment subsidies have intentionally saddled the (likely) incoming
levels for years. Target your local tourist facilities. for companies taking on 18-24 year olds who Tory Chancellor with a major set of problems.
The housing market and the building industry in have been out of work for more than a year. An If the budget does have a £1 billion hole in it – as
general are central to economic prosperity and, existing scheme which helps the older unemployed many commentators have suggested – then there
sure enough, help was provided, but industry back to work was also refunded. A 20% upfront will either be cuts in services or further tax rises to
commentators say it was just far too little. The payment for hiring a long-term claimant is good cover the shortfall. We all knew already that this
stamp duty holiday was extended to the end of business – as long as the prospective employee is recession was going to be deeply nasty and
the year. My guess is that it will have to be capable of work. finding out straight after a budget that the
repeated thereafter or we’ll see price falls in the economy had contracted by 1.9% in the first
crucial sub £175,000 sector, just when stability of Fiscal benefits quarter was proof if it were needed.
prices is returning. The 40% first year allowance for expenditure on It is a deep concern that the International
plant and machinery has been welcomed in all Monetary Fund could publish figures within two
Building a future corners as a pleasant surprise. The machine hours of the Chancellor sitting down which
Stalled construction projects received a boost. To manufacturers supplying the printwear industry demonstrated that his figures were not only
replace bank finance, the government will will be encouraged since this gives them a sales optimistic, but hardly in touch with reality.
effectively buy shares in construction companies. story to tell in tough times. Mind, the budget
The weakness is that it will only result in an extra didn’t benefit the pound, so that may be swings
10,000 homes. Should your locality benefit, good and roundabouts for both buyers and sellers.
luck. Loss-making businesses received some fiscal help Paul Clapham is a marketing consultant with over
ISA investors received a long overdue boost. The allowing them to reclaim taxes paid on profits in 25 years’ experience covering a broad range of
annual maximum for these tax efficient savings the past three years. This only lasts until November business sectors and a full spread of marketing
structures is increased from £7,200 to £10,200. 2010, however and the expected average benefit disciplines. He works with small, medium and large
Still only half that figure can go into a cash ISA is not huge – £4,000. companies alike to increase their profitability
whereas the whole figure can go into stocks and Comment on Mr Darling’s budget has varied from through marketing. Tel: 01453 765432
shares. Presumably Mr Darling expects us to push
the Footsie back up.
Should you have connections with the oil industry Opportunity knocks
there is some good news. New tax incentives have
been put in place to encourage extraction of an This column aims for the optimistic note so here are some commercial opportunities which the
additional two billion barrels from smaller fields downturn is throwing up. Sales of sewing, knitting and other handicraft goods have been steadily
which are currently only marginally viable, due to rising, as has membership of associated clubs. Sales of home hair dye have jumped. Coach companies
the fall in the oil price. This is actually the are seeing rising sales. Cinemas are reporting more bums on seats. It is predicted that universities will
chancellor investing (as distinct from just fill all their places this year as teenagers decide to study rather than chase limited job vacancies.
spending) because it should generate £30 billion Target providers in these areas, but also be aware of the downsides: for instance, those hair dye sales
in tax revenues. mean hairdressers are less sound customers. I have also read the suggestion that a number of private
Similarly the green energy industry received a fillip schools will close – the tax rise won’t have helped. A school can’t simply contract to fit; it has to
with £4.5 billion funding to build offshore wind maintain critical mass or it’s not a proper school.
parks. It has already been announced that Walney
| 22 | June 2009 www.printwearandpromotion.co.uk
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