The budget - our response

We were unsurprised but also underwhelmed by the chancellor’s budget announcement. Perhaps with the election looming we shouldn't expect much else, but it’s always disappointing to see politics obscuring the real issues.

We are also sceptical of how each headline translates into everyday life, in particular when it comes to support for small and medium-sized businesses. For example, while a £200 million fund for fast growth businesses may sound like an excellent boost to economic growth, the reality is likely to shatter this illusion rather quickly. As some business leaders may remember, we saw a similar promise with the R&D tax credits that on the surface offered a full tax rebate for all research and development work. Unfortunately once HMRC was involved all claims were challenged aggressively and this was soon followed by strict criteria that strangled the tax credits and essentially disallowed many companies, in particular, software firms, from successfully making these claims.

Unfortunately we have to accept that there is a filtering process for every pledge. We fully expect that the banks, who are currently extremely risk-averse, will introduce lending criteria for pledged amounts, so that the £94 billion available for smaller businesses is unlikely to get through to those that need it.

The gap between soundbite and reality is one that applies to any Government and who’s to say that any other party could have done better given the same circumstances, both politically and economically? We're simply tempering any potential excitement with a note of caution. Be aware that the budget may not live up to expectations, but keep this in mind whatever you hear and whoever you hear it from.