It’s a funny old world or is it?

Just when you think you’ve seen it all something else happens. A government with a Prime Minister who made his reputation pursuing Miss Prudence starts throwing money around like a lottery winner, the Governor of the Bank of England declares that nationalising the banks is an option and RBS/Nat West announce that they are going to start doing business again.

Let’s get the last point out of the way straight away. Well done RBS/Nat West, let’s hope that the others follow their example sooner rather than later. Unless and until all banks return to doing sensible business any hope of recovery is nothing more than a pipedream. I don’t mean returning to the target driven recent past where lending at any cost appears to have been the norm but a return to what many of us of a certain age would have regarded as “good business”. Sensible lending where all concerned understood the risks and where clients knew where they stood.

As for the Governors aside that nationalising the banks was “an option” something clearly needs to be done to get the them “out of neutral” but, as things stand at the moment, it would be difficult to say who would be worse, our under fire bankers or our government.

As for the measures announced this week by the Chancellor let me say that I, like everyone else in the country, really, really hope they work. Do I think they will? Well that’s another story. Actually I am far from convinced and certainly question some of the measures announced. Reducing VAT 2.5% might have some marginal impact but given the level of discounting one already sees on the High Street and elsewhere I really can’t see it having much effect.

What concerns me greatly is the thought that as the economy is recovering businesses will be hit again by increases in National Insurance. I know the so called “giveaways” need to be financed but raising NI thresholds is a measure which will ricochet around the system like a stray bullet. Adding costs to employing individuals will add to wage pressures and make businesses even more reluctant to take on new people.

Ultimately, of course, its always business that pays and I acknowledge some good things in the Chancellor’s statement. Reversing the decision to charge empty premises tax for which we have been campaigning for some time, is welcome and the increase in funding for the Small Firms Loan Guarantee Scheme (as long as the banks get behind it) will have some impact.

Overall though the statement brought out my curmudgeonly side (not usually far from the surface anyway) and I am inclined to view it in the same light as most budgets in recent memory. A mixture of “smoke and mirrors” and we’ll all pay for it in due course. If it does the trick though, along with everyone else I will be delighted.

Where there's muck there's...

The more observant will have noticed our recent event aimed at raising awareness of the environmental sector and to start a countywide debate on the issues. This week I was able to join an East of England Regional Assembly party visiting the Danish Region of Mid Jutland which is taking an extremely proactive approach toward seeking energy efficiency solutions.

Of the sites we visited one converting animal fat into bio-diesel and another turning all sorts of manure into bio-gas were the most interesting. They were both interesting for a number of reasons, not least because they were turning materials that would have otherwise would have been incinerated into valuable heat and power sources. Another interesting outcome was the fact they were adding value to what, at best, would previously have been regarded as nuisance materials.

In a short visit it would be foolish to think that one could discover the definitive answer to the debate on energy efficiency, indeed if anything, yet more questions were raised. How do you ensure that the supply of the relevant materials will be sustainable? Can you ensure that the cost of the raw material is kept at a reasonable level? Can you make the process commercial? And so on and so forth.

To support their research they had also set up an Agro-Science Research Park where they conducted a range of relevant research, hosted start-up research companies and also encouraged young people to develop their science and engineering skills.

Was I impressed? You bet. Envious? Oh yes.

Hertfordshire prides itself on its knowledge based industries and makes a variety of claims about innovation in the county but I have to say we could learn a great deal from the positive, energetic approach of our Danish colleagues. We also need to recognise that finding solutions to the environmental challenges we face will not only be good for the planet but will also provide enormous economic benefits going forward.

As I write I can hear the planners saying “we don’t want these nasty recycling plants” but, in reality, they were no more intrusive than other farm buildings we see in our countryside. What I found really impressive was that someone could take 50,000 tons of waste animal materials and turn it into 55 million litres of high grade bio diesel. Even more impressively any residual ash was used to make cement and bricks. Efficient or what?

Of course there are many questions to be answered. We need to find satisfactory long term answers. If we don’t someone else will.

Solving the conundrum will provide opportunities on a variety of levels. The Hertfordshire Chamber of Commerce & Industry intends to play a leading role in opening up the debate on this subject and I would be delighted to receive contributions towards it.

Ross, Brand or the Economy?

It’s been an interesting week; the fall out of the credit crunch rolls on, house prices continue to fall, various wars continue to take their toll around the world and what do the BBC, Gordon Brown and David Cameron choose to lead on? The rude and boorish activities of two overpaid radio presenters.

Oh well at least the Chamber has been doing it’s bit, meeting Members of Parliament, challenging the government on the payment of rates on empty business premises; calling for cuts in interest rates; and particularly looking at support for smaller businesses during the current economic upheaval.

Smaller businesses play a key role in the county employing high numbers of people , introducing innovative new ideas and as a vital link in the supply chain for their larger brethren. To many of the people running smaller businesses the word challenging no where near reflects the current situation.

Anyone who has put their house up as security to support a business will know the stresses on themselves, their families and life in general. People running small businesses can’t just lock up at night, go home and forget all about it.

Last Sunday I read the papers as usual and found myself becoming more and more angry as I read the various accounts of why we had got into the economic pickle in which we find ourselves. Angry because many of these so-called experts were the very people who had caused the problem. I don’t suppose many of them had put their house on the line.

Now the banks who largely caused the problem, those that courted the small companies whose businesses they so avariciously sought only a few months ago, are withdrawing their support. Not surprising I suppose when they don’t even have the confidence to do business with each other.

It is clearly naïve to expect things to return to normal overnight but surely the key ingredient we require now is confidence. Isn’t it about time the experts in the City and the banking community began to do something about it?

Oh, and what about Messrs Brown and Cameron? It’s probably better that they stick to worrying about the BBC.

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