AccountingWEB caught up with ICAEW chief executive Michael Izza in Bristol on the day of the Autumn Statement and put to him a number of questions from our members.
Along with discussing the big news of the day prior to the speech, Izza spoke candidly about the state of the profession, a new Business Advisory Service and reaching out to smaller practitioners.
Is the Chancellor doing enough and what are the wider implications of the whole growth agenda?
“We at the ICAEW have been saying for a while that we always thought the Chancellor’s plans to deal with the structural deficit were ambitious for one parliament, we always thought this was a two-parliament task. What we’re going to hear today is going to reinforce that very strongly. Not only are we going to spend this parliament and perhaps the early part of the next parliament trying to remove the structural deficit, i.e. balance the budget, but at the end of that we’re going to have £1.4-£1.5 trillion of debt, and we’ve then got to start paying that down. So, this is a massive mindset for us and it’s hard to see the good news, because if we’ve got £1.4 trillion of debt by 2016 the interest charge on that alone is going to be over £70bn – twice what we spend on the Ministry of Defence. It is an enormous challenge and I don’t envy the Chancellor the task. The only way out of it is not by more and more cuts and more and more tax, it’s actually by stimulating growth. Could the government do more? Of course it could. They have made some good moves, particularly the emphasis they’ve placed on export, and that export should be focused on SMEs. Principally ‘M’s because there are more ‘M’s likely to do export than ‘S’s. The more the government can do to make it easier for these businesses to export, the better. These days you can use the web as a marketing window to the world. People who have the right mindset, of course the right product and are able to take the financial risk (or de-risk), can actually access a global market rather than just the 60 million of the United Kingdom, or a much smaller number just in the South West.
It’s all very well talking about the internet and marketing overseas, but is there an issue with understanding what those markets need – the insider knowledge in Africa, China or wherever – is that flow being catered for do you think?
About Robert Lovell
Business and finance journalist