AFTER months of economic turmoil, a measure of confidence is returning to the economy says accountancy professional body ACCA (the Association of Chartered Certified Accountants). A poll of accounting professionals found they were more positive about the economic impact of recent the recent UK government’s March Budget compared with the Autumn Statement in late 2022.
Scottish based members appear to be feeling more confident than their counterparts in the rest of the UK. The survey was completed by ACCA members working across various sectors of the economy, including practitioners representing over 8,500 clients in Scotland.
In the poll, conducted in the second half of March and following the Chancellor’s Spring Statement, 45% of Scottish respondents felt the measures announced in the March budget would have a positive impact on the UK economy, while the figure for the UK as a whole was lower at 36%. A third (33%) felt the budget wouldn’t make a difference, while around a fifth (22%) felt the impact would be negative. This contrasts with feedback after the Autumn Statement in late 2022 which suggested that only 18% of UK respondents felt optimistic about growth potential.
Nevertheless, optimism appears fragile and does not yet appear to have translated into firmer investment or hiring intentions. For the majority, (71%) the budget had no impact on recruitment plans, with only 6% more likely to recruit as a result. Similarly, measures had limited impact on investment plans for almost two thirds (65%) in Scotland, though 16% were more likely to invest and, positively, over half (55%) felt that their, or their clients’ organisations, would make use of changes to capital allowances, including new rules allowing full year expensing.
Commenting on the feedback from members Head of Scotland for ACCA Susan Love said:
“After months of financial turmoil these findings suggest accountants and finance professionals may cautiously feel the worst is behind us. However, this optimism is tentative and would suggest firms are still exceptionally cautious about investment and hiring intentions.
“With trading conditions still exceptionally tough, between high inflation and interest rates and the cost-of-living crisis hitting consumers’ pockets, governments in Edinburgh and London need a laser focus on tackling these challenges. It’s clear that individual announcements won’t be enough to restore business confidence – a long-term approach to boosting business investment is needed. The new First Minister’s commitment to the continuation of the National Strategy for Economic Transformation (NSET) is welcome but a whole-government approach to effectively delivering upon the NSET objectives is required.”
