We have enough information about the UK’s economic woes to keep us depressed for many years to come. Every week we are told why sustainable recovery from recession and its after effects is just round the corner. The problem is the “corner” is mobile, always just out of reach.
Which is why the current round of speculation about the UK economy is encouraging:
• We are told that thus far in the current fiscal year, the growth in tax receipts exceeds the growth in Government spending.
• The Bank of England is more optimistic about estimates for growth next year.
• Independent advisors are talking about real growth of 3% for 2014.
So are we getting closer to the elusive corner?
Back in the real world there is no doubt that many, structurally weak companies, have dropped by the wayside in recent years. Successful companies are working hard to expand, but carefully. Retaining profits and managing cash flow has become the mantra rather than maximising turnover and borrowings.
If the pundits’ present optimism proves to be realistic perhaps the next step for businesses is to seriously consider sustainable investment. The tax incentives are there: R & D relief, high levels of tax allowances for plant and equipment purchases. We must not become a nation of hoarders, especially, of our capital. Carefully planned and monitored investment may become the order of the day.
Let’s hope that the economists are correct and the numbers for the next year bear out the early glimmers of optimism. Time to talk up prospects for growth…