Impact of government spending review: CEO feedback
In response to the government spending cuts announced last week, AIPP’s Chief Executive Mark Sharp comments: “In general terms I agree that the consolidation of the amount of borrowing needed to be curbed, however this needs to be balanced by investment in innovation and research. Longer term sustainability must be encouraged by the government to ensure that not just confidence comes back to the market but the perception of sustained growth is replaced with assuredly responsible lending from financial institutions. This must be backed up with longer term commitment to ensure that exchange rates are not used to prop up a flagging economy especially where its long term affects can have global impact. In most countries construction and development accounts for approximately 8%-11% of GDP; the need to build is essential for prosperity and growth of any economy and never more so than as we seek to reduce debt and increase stability by the use of low interest rates.”
It is welcoming that the government also realises the importance of pensions, which has played an increased role in the overseas property industry of late with “SIPPable” products. Offering these services with personal allowances provision as well as full tax relief at the maximum rate can have a positive impact on commercial overseas investment which is good for the industry. “In general I support the reduction of debt, provided that long-term prosperity is facilitated by the government especially where small businesses are concerned” says Sharp.