Tag Archive | "investments"

Could public sector cuts benefit small businesses?

It’s not all doom and gloom in the business sector. In fact some firms believe that they will profit from the government austerity measures.

Admittedly many businesses are going to lose public sector contracts, but the job losses could well create outsourcing opportunities. Last week, the government announced that £236bn of public sector contracts would be made more accessible to SMEs. In a bid to ensure that 25% of public sector contracts do in fact go to smaller businesses and limited company contractors, all government departments will be required to publish details of all the contracts they award, and how many go to small firms.

The coalition is also looking into a more open framework to tackle the closed procurement system which generally means contracts are awarded to preferred bidders which are usually bigger organisations.

Other good news came recently when figures were released showing the economy grew at twice the expected rate in quarter 3. Experts say a double-dip recession is less likely as data from the ONS showed the economy is growing at the fastest rate for 10 years.

However, these figures do not take into account the public spending review and the impact it will have on the country.

Nevertheless, the better than expected picture could encourage investors to start thinking about expanding their portfolios. The stock market can seem to be contradictory in times of economic crisis. In 2009, the UK was in recession and yet the stock market rose by around 30%.

Before contractor accountants rush out and pile all their money into stocks and shares, they may want to consider talking to a specialist financial advisor.

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Image: Go with the flow – 080920099255 by roland

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Pension apathy in the UK

Out of the UK’s 17 million strong workforce, nearly half of them haven’t even reviewed their pension plans, according to new data released recently by asset manager Barings. Contractor accountants might want to consider whether their clients fall into this bracket!

ISM Research conducted the poll on Barings’ behalf and found that 48 per cent of those interviewed had never reviewed their pension plan. 21 per cent of respondents admitted to reviewing their plan sometime in the previous year.

The survey, gathered information from 1,478 workers, weighing the answers by population, found that a full one third of the people who answered that they had indeed reviewed their pension plan couldn’t recall if they had chosen the default contribution option or not contributions.

Nearly 20 per cent of respondents that had no knowledge of where their pension funds were invested were either at the age of 55 or older.

Barings conducted similar research last year, and in a comparison of the findings, more UK workers are making their own investment decisions than in 2009, but there was also a 43 per cent increase in the amount of people neglecting to review their plans as well.

Marino Valensise, chief investment officer for Barings, stated that it was concerning to see so many people, including limited company contractors, have either a reduced interest – or no interest at all – in planning financially for their elder years.

Mr Valensise also commented on the responsibilities of the investment industry, calling for an improvement to the methods in which pension advice is given in order to ensure people have a more through understanding of risk levels and the kind of return they can expect from their investments.

In related news, the Fair Investment Company’s head of investment and pension research, George Ladds, recently recommended younger members of Britain’s workforce should consider retirement planning that includes investing in ISAs by contributing at least £50 on a monthly basis from age 30 and afterwards.

© 2010 All rights reserved. Reproduction in whole or in part without permission is prohibited.

Image: What the world is coming to by Saucy Salad

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