Lessors should expect less business from the financial services
sector in the next year, according to a business confidence survey
released today. Some 34 percent of financial services firms expect
capital expenditure in vehicles, plant and machinery to be lower in
the next twelve months than in the past year. Only 6 percent of
firms expect investment in IT to be fall.
Although capital expenditure is expected to be lower in the next
twelve months than in the past year, the CBI/PricewaterhouseCoopers
quarterly survey said that there was “less concern” about the cost
or availability of finance. Only 9 percent of firms expect to see a
shortage of finance, and 13 percent expect that the cost of finance
will be a barrier to investment.
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Lai Wah Co, head of economic analysis at the CBI, said that with
a steep fall in business volumes, the survey “painted a gloomy
picture”. Volumes have fallen at the most rapid pace since the
survey began in 1989, and as firms cut back to save costs,
investment in business equipment is predicted to drop.
John Cridland, CBI deputy director-general, warned,
“Difficulties in this crucial sector will have huge implications
for the rest of the UK economy. Decisive action needs to be taken
by the Government soon, or British industry will be in a difficult
situation.”
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