Raisin UK Co-Founder, Kevin Mountford, offers his thoughts on the July Budget Announcement
Reacting to the budget announcement, Kevin Mountford Raisin UK Co-Founder, said: “With today’s announcement focused around boosting the economy and initiatives around job protection and creation, there was little done to build consumer confidence that it’s safe to go out and work, spend and ultimately borrow, whilst we are still effectively in lock-down – so we may see these measures fall short of their target.
“On the jobs front, financial incentives for firms to take on younger staff in new roles plus the next phase of the jobs retention scheme, will of course help elevate consumer worry around money coming in. On the spending side, announcements on a temporary reduction in VAT, retail vouchers and also a stamp duty holiday, were all proven measures to help restart the economy, albeit slowly, after the crash in 2008. However, in terms of the last point, the challenge would be around timing, as any delay would stall current housing activity in a sector that is already struggling.
We know from our research that people are increasingly looking to build-up their savings pot and as a minimum create a buffer and this plays out in the fact that we are on track for a record savings ratio even though rates are so low.
“From a savers perspective, we know from our research that people are increasingly looking to build-up their savings pot and as a minimum create a buffer and this plays out in the fact that we are on track for a record savings ratio even though rates are so low. This again reinforces the fact that the Government needs to re-build confidence before UK consumers return to normal i.e spending and borrowing! Also if the likes of the housing market does get a boost, then in turn mortgage and loan applications increase and banks will then look to bolster their balance sheet to support any return to growth, which could see a slight improvement in rates.”