Yorkshire Report: Public sector cuts present opportunities
YORKSHIRE businesses have been urged to act in an “entrepreneurial manner” in order to survive and thrive in the wake of the Government’s austerity measures, according to BDO’s 2011 Yorkshire Report.
The report, produced by accountants and business advisers BDO, investigated the performance of the region’s top 150 companies.
Ian Beaumont, managing partner of the Leeds office of BDO, said the £83bn of “real terms cuts” in UK public expenditure by 2015/16 presented a “game-changing landscape” for companies in Yorkshire.
However, Mr Beaumont said despite public spending cuts there were still opportunities for companies to succeed.
He said: “In order to succeed, businesses in our region will need to embrace the reform agenda rather than battle against it.
“Partnership models with the voluntary sector that reflect the Big Society agenda will become more sought after, and we may start to see ‘payment by results’ become the norm.
“What our region’s businesses can’t do is simply retrench and wait for the storm to pass. What is certain is that the way public services are delivered and commissioned will change and those that act in an entrepreneurial manner in respect to these changes will better survive that storm.”
Mr Beaumont said there were opportunities not only for those who supply to the public sector or depend on the spending power of public sector employees, but also for those who rely on transport and other infrastructure that is supported by government investment.
He added: “However, with the start of the financial year only just beginning, we are only just starting to see the real effect of the cuts now.
“Since the Second World War we have never had more than two consecutive years of overall reduction in public spending. Now we are facing six so it is hard to predict what the overall impact will be.”
Mr Beaumont concluded: “I expect that we will see opportunities for new models of service delivery and there will be new ways of working with the public sector to be explored.
“Cuts in government funding don’t mean that demand for new schools, hospitals, social housing and economic infrastructure simply evaporate, and changing demographics do mean that demand for services such as social care or waste collection will continue to increase.”
