We talk to the bank of England
17th November 2009
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This week we met with KATE BARKER from the Bank of England MPC.

Kate Barker is a member of the Bank's Monetary Policy Committee (MPC).  The MPC sets interest rates monthly to hit the government's inflation target of 2% on the CPI measure of consumer prices.  As part of their economic information gathering, MPC members make regular visits to businesses, and their representative organisations, across the UK.

From 1994-2001 Kate was Chief Economic Adviser at the CBI. She was previously Chief European Economist at the Ford Motor Company (1985-1994), and before that a Research Officer at the National Institute of Economic and Social Research (1981-1985).

Joining Kate was Graeme Chaplin, The Bank of England representative for the West Midlands region.

As part of their economic information gathering, MPC members make regular visits to businesses, and their representative organisations, across the UK.  This event was arranged to give Kate an opportunity to hear about the challenges and opportunities faced by entrepreneurs.

In the group, meeting with Kate were David Whittle, Christian Chandler, Bruce McMichael, Emma Jones, Fay Easton and Gaynor Gravestock.

Firstly I would like to say that it is somewhat reassuring that efforts are being made to gather feedback from businesses on the front line and to hear first hand about what is actually important to us and the things which really do affect us rather than assumptions made on our behalf.

I make no apologies for stealing one of Fay Eastons quotes - "It's the big businesses that got us into this recession but it's the small businesses that are going to get us out of it". This is so true.

It was no surprise that there is still a lack of trust being voiced with regard to the banks. More than this, it is evident that there is little respect for the banks and interestingly, Emma Jones, who I believe to be a great authority on businesses run from home (Emma's most recently publishes book - 'spare room start up) talked about the level of home businesses who simply bypass the banks when it comes to borrowing money to start or develop new businesses.

Although the panel reflects only a small part of the business community it was clear that the downturn in the economy has affected us all to some degree and none of us are recession proof. Businesses which would have expected 2009 to be a good growth year are holding their own and showing only small if any growth.

Business is still being done and Shropshire continues to have a vibrant business community but many businesses are holding their breath and waiting for better times. Other businesses are clearly fighting back and being innovative, developing new areas to their business or simply making sure that they get a bigger slice of a smaller cake. This could well explain that during this recession our own business has continued to perform well as businesses look at fresh and innovative marketing routes which give tangible results moving away from traditional marketing which hasn't served them well.

It is clear that any recovery we might be seeing is very fragile and businesses and consumers are still very nervous about the future. This nervousness will of course delay any solid recovery as the whole market needs business and consumer confidence to fuel growth. We all know that it will come but the recovery will be slow and the first half of next year needs to be steady as she goes without any curved balls to knock the economy back.

We could not get Kate to comment on interest rates and whether they will be held low for the longer term but it was certainly worth asking the question.

On a separate note and I know that this is not in Kates remit, I did ask her to have a word in the ear of Goverment to stop messing about with VAT. Changes to VAT have not improved the economy and have cost small businesses £millions in time and administration. Apparently I was not the first person to voice this complaint but I guess I'm not surprised by that.

As I said, it was reassuring that we were invited to talk to Kate and give her direct feedback and my thanks to both Kate and Graeme from The Bank of England for visiting us here in Shropshire and also to Fay from EHQ who continues to do an amazing job supporting our local SME's.


About the Author

Mark Luckman

Member since: 10th July 2012

I champion the best businesses in Telford and Wrekin, businesses recommended by you. If you run a local business or know a really great local business that you think deserves to be known by more local...

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