UK PLC Budget Blues…Glasgow Rangers in disguise?

UK PLC Budget Blues…Glasgow Rangers in disguise?

Budget Day. Again.

George Osborne’s 3rd budget.

Politics fighting economics. Again.

Growth pulling against Austerity.

The ratings agencies are threatening a points deduction and liquidation

Goal is fiscally neutral. Give tax to lowest earners balanced against taxing super-rich.

The super-rich’s accountants rub their hands with glee.

The 50p top tax rate to come down as Stamp Duty on Mansions rises – new house price average falls as 100’s of £2M+ houses sell for £1.99M

Will falling corporation taxes and cutting red tape for small businesses be offset by the Banks still failing to lend to those smaller dynamic businesses who need loans

Entrepreneurs & SME’s need to fuel growth.

Yet Fuel continues to power the HMRC coffers.

Will increasing the threshold before tax is paid boost spending or simply to allow people catch up on inflation?

Cutting family tax credits, freezing regional public sector pay & keeping VAT high will hardly give confidence to everyday spending forecasts on the high street.

This budget was prepared in a colander – so many leaked policies.

Will it stimulate growth or keep the Tories onside while the Coalition bickers?

My prediction…Politics 3 Economy 2…with UK still fighting relegation.

 

 

Like a Virgin. Still like a bank?

Like a Virgin. Still like a bank?

It will be interesting to see how the Virgin brand trickles into the new Northern Rock. The UK’s Chancellor George Osborne said: “The sale of Northern Rock to Virgin Money is an important first step in getting the British taxpayer out of the business of owning banks.” Quite right.

He then threw in “It represents value for money, will increase choice on the High Street for customers, and safeguards jobs in the North East.” Err – not so sure. The Value for money is debatable – Virgin may agree and jobs are indeed saved.

Key will be whether it will be a choice on the High Street. High Street Banking is in need of a boost. It needs to change – but most commentators are demanding the change reverts back to old school, safe, risk averse, boring banking. That is not Virgin.

Virgin will add a bit of fun, of freedom – customer service & easy, simple forms & processes and the like. Certainly, this will be differentiation from some of the dreariness we’ve witnessed since 2008’s collapse. Virgin have secured a big infrastructure, they’ve bought the backbone & the book to bring their upbeat philosophy into play without being niche. Virgin Money’s bank will be about 10% the size of the UK High Street duller offerings. Small enough to be flexible but big enough to make a noise and attract new customers.

They have a chance to test out what will work quickly before rolling out over the whole country – talking to their customers while developing the Virgin version of daily banking. Creating a different brand experience for banks. They will I’m sure take a positive view of lending to smaller entrepreneurial firms that the Bigger Banks are ignoring. That will make them stand out quickly – more than a new facia and interiors that will replace of the Rock.

So good news I hope – the sector needs it. We all do.