IoD West Midlands chairman John Rider said the message from the
region was "We need jobs, jobs, jobs".
"While we are broadly encouraged by the support for the SME
sector we are very concerned about the impact that forthcoming job
cuts in the public sector in the West Midlands is going to
have.
"It is a big ask for small to medium sized companies to take up
the slack. It should be noted that a lot of new companies fail - up
to 40 per cent in the first two years - and so it is really the
established businesses with growth potential that we must look to
for job creation," he said.
In the West Midlands he said the focus had to be on inward
investment to help create jobs, skills and graduate retention.
He said he felt a mixed reaction to the Budget.
In a snap survey of over 1,200 IoD members taken within an hour
of the Budget, 45 per cent assessed the overall budget to have a
negative effect on the UK economy and only 12 per cent thought the
Budget would have a positive impact on reducing the fiscal
deficit.
"We would have liked to have heard more on deficit reduction but
it looks as though we will have to wait until the Autumn Spending
Review.
"I think the VAT increase of 2.5 per cent will dampen demand and
that in these circumstances the new GDP growth forecasts remain on
the optimistic side.
"I don't feel the Chancellor has gone far enough both to protect
and also to help create jobs. The IoD is a non-political
organisation but I am concerned about the dogma inherent in
statements like 'those who choose to work' as it does not do much
for those who have lost their jobs and are desperately seeking new
employment."
He acknowledged that there would be a White Paper on regional
support for businesses but urged the Chancellor and the Business
Secretary Vince Cable not to throw out the Regional Development
Agency structure in the West Midlands just for the sake of it.
"We welcome the Chancellor's support for Regional Growth Funding
but I shudder somewhat at the thought of 33 West Midlands councils
fighting over the available money.
"He has said he will consult widely with business and the IoD in
the West Midlands will certainly be making its views heard."
He pointed out that while the Chancellor had announced that he
was not increasing the duty on alcohol, fuel or tobacco, these
would in any case be subject to the VAT increase from 17.5 per cent
to 20 per cent from January 4, 2011.
"We are pleased he has broadly gone for the 4:1 ratio
recommended by the IoD in tackling the deficit with 80 per cent
focus on cuts and 20 per cent increase in taxes.
"Interestingly, he mentioned a 'New Model for Economic Growth'
but no detail.
"We would very much like to see what he means by this but
overall our message would be that it must focus on Jobs, Jobs,
Jobs," said Mr Rider.