I’ve just completed the University of Lincoln November ‘Snapshot’ business questionnaire and once again found that my responses are completely normal!
As you might imagine we have a very good relationship with the University’s Faculty of Business and Law, having worked for them as consultants as well as with them on joint responses to a number of research tenders. Globe has been a participant in the faculty’s ‘Local Economic Snapshot Survey of Businesses in Lincolnshire and Rutland’ since Research Fellow Liz Price contacted us last November. I get instant feedback on the survey results when my responses are registered so it’s easy to see what the general view of the participating business is and compare it to my own. The broader comparison however comes through Liz’s analysis of the whole sample so it’s always interesting to read the faculty’s Business Briefing and look at the survey results in more detail.
As I commented in my post about ‘fear of banks’, small businesses are still working very hard to keep their heads above water, so every time I fill in Liz’s questionnaire I grimace at the thought that my responses will seem overly negative and out of step with other participants. As I said at the beginning, that’s not been the case; the instant feedback has consistently shown a general pattern of responses suggesting that my views and perceptions are typical of the businesses being sampled. As none of us like to think we are too far out of step or worse still being left behind, that tends to make me feel a bit better about some of the factors I’m commenting on as well as increasing my wider concern about the continuing economic problems of SME’s. Globe is fortunate in that it has always worked to a national market so whilst the local economic situation is very important to us we are still able to benefit from areas with higher levels of development and/or more rapid recovery. For businesses serving only a local or sub-regional market the challenges must be even greater and the need to see signs of growth ever more pressing.
To those who know Globe, it would be no surprise for me to be saying that Public Sector spending cuts have been a key concern for our business as this has historically been a significant part of our customer base. Similarly, the importance of a busy developer/construction sector to our planning and development work influences our view on the effects of recession and no growth in the economy, on our business. I’d be the first to accept however that we are a fairly unusual business type and as far as I’m aware, the only planning and economic development consultancy of our size in the study area, so the Snapshot sample is unlikely to include another business with the same characteristics and issues. Despite that, only 10% of the respondents in the September survey said that the recession was over for them and around a half (49-50%) said that the public sector cuts had already affected them. That means that the specific problems we are commenting on as public sector and town planning specialists are the same as those being faced by a whole range of other local businesses and sectors. Worryingly, this is also reflected in the November/December issue of Lincolnshire ‘Chambermatters’ which includes a report on the Quarterly Economic Survey undertaken by Lincolnshire Chamber of Commerce and Lincolnshire County Council. This survey has generally shown a more optimistic picture of the sub-region than the ‘Snapshot’ but the summary states that the Quarter 3 2011 shows weaker results than in previous quarters with local business confidence decreasing and an average of 54% of businesses now operating below full capacity.
You can read the November Newsletter of the Faculty of Business and Law here.
Let’s hope that the Government’s new £500m Growing Places Fund, which will be allocated directly to Local Enterprise Partnerships, quickly finds its way into effective and strategic projects that generate local economic activity. The big challenge, it seems to me, will be to ensure that, if the new Fund is to provide the intended rolling investment pot by lending funds in the early stages of infrastructure delivery and recovering the investment later on, there is a sufficiently robust strategy to direct investment and a very clear focus on viability and return.
At the same time as this Fund is being rolled out the revisions in the country’s planning legislation, which several of my colleagues have commented on, is being introduced. Whilst much of the clarification on the planning reforms is still awaited it raises some interesting questions in relation to the viability of developer contributions through the planning process. In areas with low business and population densities, the retention of business rates may not be sufficient to offset the loss of central government funding and maintain an active infrastructure development programme (it’s already pretty tough). With the introduction of a development viability test within the planning process to ensure that development isn’t hampered by unrealistic demands for infrastructure contributions there could be a temptation that the new funds end up filling gaps. I like to think that won’t be the case and that the LEPs will set the bar high and that the Government will be as robust as the current news releases suggest about only releasing funds once they are satisfied that the LEPs can deliver the goods – my slight worry from having worked with a number of grant regimes is that the focus could be too much on partnership organisations and the grant/loan process and not enough on the viability of the overall investment.
For Globe, which now generates more than 70% of its turn over assisting private sector clients with planning and/or development proposals, we are still waiting to see growth in the housing and development sector, so the Government’s announcement of its Strategy for Housing was very welcome news. Hannah Fearn of The Guardian published a summary of the Strategy’s development measures on Monday and you can also read the post on the Strategy by our Laura Hudson.
Kick starting housing development would be excellent news for us so we are following all of the current policy strands carefully to ensure that we can offer the very best advice to our clients and make the most of any opportunities that arise. In the meantime the team here are coming to terms with the idea that, despite what they may think, my responses are completely normal.