Gaining certainty in ensuring business investment

More firms across the UK are increasingly optimistic about economic recovery after the long-term financial recession. The most recent survey of the UK’s BDO shows that measure of optimism among business managers rose from 88.3 to 88.6 in March. However BDO stresses the need for more certainty among the main political parties in the process of recovery and the need for more business investment. Business investment in the UK is down by 4.3 per cent in the fourth quarter of last year compared with the third quarter, and was 23.5 per cent lower than the same period in 2008.
A careful study of the election manifestos by representatives of the private sector should bring more clarity to the future spending patterns. Public sector expenditure will have to be cut considerably regardless of whichever party wins the election. More certainty should enable businesses to properly work out short- and medium-term plans.
The four percent economic growth in the UK in the first quarter was mainly due to consumer and government spending. However this trend is likely to fade away during the year.