Now time to talk up all the positives

Apr 28 2009 by Neil Warwick, The Journal

IT is probably still (just) topical to write about the Budget and whether or not this is New Labour’s final chance to save the economy or whether it is designed to be a toxic gift to the next Conservative administration.

Obviously the focus has been on the 50% tax rate and whether this is a move from new Labour back to old Labour. This increase will affect fewer than 1% of the population and is anticipated to generate £3bn in additional revenue. With the country facing between £100bn and £200bn of debt, it seems fair that the higher earners should help pay off some of the debt more quickly.

Other measures, such as the carbon copy of the German incentive to buy new greener cars, smacks of desperation. No one can seriously believe that buying a new car and scraping an old one at the same time can be beneficial to the environment.

Clearly if the incentive encouraged everyone in this region to go and buy a new Nissan, this would be a good thing. An incentive which potentially encourages us to buy a new Mercedes (built in Germany) may not be so helpful.

A lot of the commentary has been on Alistair Darling’s optimistic predictions about the economy. Again this is a one-size-fits-all mentality to economic recovery, assuming recovery in the North East will happen in the same way as other parts of the country.

While it is vital to get stimulus into the first-time buyer market for domestic properties, most professionals are reporting significant increases of transactions at other levels in the domestic property market.

Confidence is vital and the Press need to play a part in this. Last week the Evening Standard (an excellent “regional” paper) was reporting that the economy was still falling, only not as quickly.

In the same week The Journal (an equally excellent regional newspaper) was reporting positive stories of potential new jobs for the region.

Put to the back of your mind that our three football teams continue to struggle and focus on the fact that Fabulous Flournoy’s Newcastle Eagles could be entering the final four for yet another record- breaking season.

Neil Warwick is partner and head of the Kudos department at Dickinson Dees LLP