'Put the crayons away and start delivering' – that was one of the clear messages to ministers from Manchester economic experts after they reported the city's business confidence had wobbled.
The reborn Greater Manchester Chamber of Commerce (GMCC) has revealed that its key business confidence measure has fallen again as businesses are uncertain as to what the future holds, and are fearful about what might be announced in the Budget.
Its latest Greater Manchester Index of business confidence for the quarter stood at 13.3 – down 2.7 points on Q2, and its third quarterly decline in a row.
Chamber and business leaders spoke out on Friday at the Greater Manchester Economic Update event at Alliance Manchester Business School, which they organised in partnership with The Growth Company. And while they said there were no imminent “cliff edges” on the horizon, they said that businesses in the region and beyond needed some certainty from Sir Keir Starmer and Rachel Reeves to give them the confidence they needed to plan for growth.
GMCC policy director Chris Fletcher said ministers needed to get on with projects such as Northern Powerhouse Rail, and should continue to back key local projects such as transport improvements at Atom Valley. And he said the Government needs to “Put the crayons away and stop drawing plans and get on with delivering the stuff”.
The event was the first QES event since the Chamber was reborn from administration, and the first to be held in partnership with the Growth Company. Subrahmaniam Krishnan-Harihara, GMCC’s deputy director of research, began Friday’s event by taking the audience of business leaders through the results of the quarterly survey.
It showed domestic demand had declined and export sales remained weak, while investment remains low and firms are still worried about high inflation. Mr Krishnan-Harihara noted that growth remained low and said: “It’s a new chamber, a new venue – but it’s the same old economy.”
And referring to ongoing uncertainty about what might be in the Budget, he said: “We should have one question at the QES: Do you expect the Chancellor to put taxes up.”
He said the manufacturing sector was having a tough time, and warned that while the services sector was more upbeat, it could be hit hard by any tax rises or cuts to public services. He added: “We need to do two things – get business investment unlocked… and get stability in terms of taxation and stability for business investment.”
Rupert Greenhalgh from the Growth Company said his organisation’s research showed confidence among Greater Manchester businesses “remains steady but fragile”, with more confidence in finance and professional services than in other sectors.
He said that despite a tough 12 months in business, there were no “cliff edges” expected and that businesses were determinedly ploughing on, adding: “We tend to be confident in the face of adversity and difficult times.”
Both speakers were later asked about their hopes for the fourth quarter. Mr Krishnan-Harihara noted the famous quote from economist JK Galbraith that “the only function of economic forecasting is to make astrology look respectable” – but said he hoped for a small uptick in the GM Index, driven by Christmas spending.
Mr Greenhalgh said he hoped: “We’ll probably have cautious optimism and steady-as-you-go growth in all sectors of the economy,” though said B2B sectors would likely be stronger than consumer-focused ones.
Susana Córdoba, head of international trade services at GM Business Growth Hub, warned on the impact of tariff uncertainty. In particular she highlighted the removal of the $800 (£590) “de minimis” threshold, meaning companies sending small parcels to the US now face tariffs and duties. She said those changes could have the impact of a “second Brexit” on some exporters.
Mark Hughes, CEO at the Growth Company, said the Government's decision to push the Budget back to November, with the associated uncertainty over what its economic policies might be, was “making it difficult for people to make decisions”.
He said ministers needed to stop “kite flying” and floating policies in public just to see what the reaction is, adding: “You’re raising people’s expectations and then nothing happens.” And he said: “I think trying to predict what’s in it (the Budget) is fool’s territory at the moment.”
Chris Fletcher added: “I personally would like to hear from Government about what they want to do with Northern Powerhouse Rail and the Liverpool-Manchester railway.”
