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BCC calls recession bottom
But gov could still stuff it up
The British Chambers of Commerce has called the bottom of the recession.
In its latest survey of 5,600 companies the BCC found some confidence returning, but warned it was early days to talk of real recovery.
But the lobby firm warns that the government needs to act to protect their view that "the worst is over". The group noted that GDP figures were revised downwards just last week, and that a W-shaped recession remains a possibility.
David Frost, director general of the BCC, signs of improvement should not be seen as an excuse for the government to start raising business taxes and called for the immediate end of proposed increases in National Insurance contributions.
The small business lobby group said the strongest feature of its survey was improved confidence compared to last quarter - which was the worst ever.
Turnover confidence is up 40 points, from -38 last quarter, putting it in positive territory for the first time since Q3 last year.
There has been some improvement in expected employment too, although the BCC still expects unemployment to hit 3.2m (ten per cent of the workforce) by 2010.
David Kern, chief economist at the BCC, said: "The worst phase of the recession is over, but serious downward pressures persist across all sectors and regions. Recovery is now possible but it is not yet secure.
“Further corrective measures are still needed to support the economy. The marked improvement in confidence, albeit from exceptionally low levels, is welcome."
Kern said the benefits would only be maintained if short-term policy "stays expansionist" and "Quantitative easing should be pursued aggressively".
But he warned that maintaining Britain's international credit rating would require action to improve public finances which in turn would mean: "painful cuts to spending programmes must be the main tool for repairing our public finances”. ®