Friday, 1 April 2011

EDITOR'S COMMENT: By George, is budget good news?

I’m no economist (just ask my bank manager) nor a politician (either with a capital or small P) but I do have a positive feeling about the impact of the budget. As chancellor George Osbourne focused on growth, my first impression is that it could be good news for the kitchen and bathroom industry.
The house build market received a boost with £250million investment to support low-income first time buyers, with their mortgage interest payments. Some critics decried the amount as ‘paltry’ that it would only help 10,000 people when, according to HSBC, there are 200,000 first time buyers each year in the UK. But it is a start, and a positive attempt to get people moving home. And of course, what is the first thing that people tend to do when they have moved? Refurbish and replace either the bathroom or the kitchen. It’s potentially great news for bathroom and kitchen designers that serve the RMI (repair, maintenance, improvement) market.
Also good news for the high street independent bathroom and kitchen retailer is the reduction of the burden of red tape, along with extended rate holiday and increasing available credit. One of the major effects of the recession was a drastic reduction of bank lending to small companies. The 2011 budget has promised 15% increase in availability of credit for small businesses and has frozen small business rates for another year.
The budget also included measures designed to reward and encourage new enterprises. For those looking to move premises, the Government has now provided 21 Enterprise Zones, with reduced business rates, to bring businesses to areas where there is a need for jobs and investments. The Enterprise Zones include Birmingham, the Black Country, Manchester, London and Tyne and Wear.
All the measures seem to offer real support to small businesses but it’s often not the announcement of the budget but the weeks that follow that tell out the true story.

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