BusinessCompany NewsBusiness sceptical of Brown’s growth targets

Business sceptical of Brown's growth targets

UK businesses think that chancellor Gordon Brown's growth targets for the next year are unlikely to be met, according to two recent surveys.

Link: In depth: The pre-Budget

In the pre-Budget report, chancellor Brown forecast that following growth of 1.6% this year, the economy’s growth rate would accelerate to between 2.5% and 3% next year. However a report from the Confederation of British Industry showed that the services sector remains deeply pessimistic over the future of the UK’s economy.

The CBI survey showed that 31% of respondents in consumer services, such as hotel and restaurants, expected deteriorating economic conditions over the short term, compared to only 17% when the same survey was conducted in August. Professional services saw a pick-up since August but most in this sector still expect the economy to worsen in the next three months.

Another report by BDO Stoy Hayward, using its optimism index, said that a growth rate of only 1.2% was expected during most of next year, with a recovery unlikely until at least next autumn.

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