Big Question - Cutting interest rates would help, say FDs

Finance directors are firmly in favour of cutting interest rates to improve conditions for business.

In response to the Big Question, 39% of the 200 FDs surveyed by Accountancy Age and Reed Accountancy Personnel said they would definitely back a reduction.

Les Campbell, FD of manufacturer Unilodge, said: ‘There is a definite need to lower the value of sterling to imp-rove the competitiveness of UK exporters. We are at a distinct disadvantage, particularly in the Far East.’

Twickenham Plating Group’s Robert Dearing added: ‘Because of the level of borrowing and replacement costs of our plant machinery and equipment, we can only benefit.’

Another 29% said they would probably back a reduction. Clive Scott, of Cranstoun Drug Services, said a drop would be beneficial, ‘providing rates can be reduced gradually without increasing inflation.’

Of the sample, 15% remained neutral on whether interest rates should be dropped.

The number of FDs against reducing rates was just 17%. Alan Bosson, of costume jewellery manufacturers Sphinx and Femina, said: ‘In our business situation, we want high rates but accept that other businesses on the whole would want lower rates’.