Steve Robinson: get the money market working.
Can £600m really kick-start the housing market?
Published: 28 April, 2009
NEWCASTLE UPON TYNE: The announcement or £600m to kick start sites and housebuilding, including social housing and the stamp duty holiday extension..."The proof of the pudding is in the eating and key questions to be asked are how long will it take to feel any effects of these initiatives?" said Steve Robinson, managing director of JT Dove. "Will the majority of the benefit stay with the large contractors and national merchants, leaving only crumbs for the regional players?
"More assistance to get the money market working is welcome, but of no use if the banks continue to build margin and reduce risk.
"So far, the Government's efforts to improve liquidity for smaller firms has been largely ineffective. We need to know details of the credit insurance scheme, as this is becoming an issue across the industry, but if it is like the Government's liquidity initiatives, it is unlikely to help many firms.
"An increase in fuel duty of 2p/litre on 1 September 2009, and of 1p/litre in real terms each year from 2010 to 2013 will further increase our costs at this difficult time." Mr Robinson went on to state that the extension of corporation tax loss relief carry back "is a non-event as it is only worth £10 000, anyway.
"An increase in capital allowances only helps if you have access to the funds to invest."