KIRKLEES firms have been urged to prepare for the impact of public sector spending cuts.
Companies with contracts for public sector work have been warned to ensure they have plans in place if the worst happens – and their customers dry up..
Tim Parr, president of West Yorkshire Society of Chartered Accountants, said: “These cuts are inevitable and businesses will have to accept them.
“However, there are actions that can be taken to soften the blow and ensure cutbacks will not mean a company goes out of business.
“It is clear that there are some deep-seated problems to address in the UK’s public finances and it is best to be prepared for this eventuality.”
The Institute of Chartered Accountants in England and Wales has called on businesses to review their current situation by:
l Checking when the contract is due to end. What are the penalties for either side if the contract is terminated or finishes early?
l Speaking to contacts at the department or contractors to see if they know if they are likely to face a reduction in budgets and if so, when
l Rethinking the business plan to see if there is too much focus on public sector contracts and not enough private contracts
l Looking to re-negotiate contracts
l Diversifying in terms of what the firm can offer local government?
l Ensuring services provided by the firm give value for money
l Looking at other areas of the public sector by checking www.supply2gov.co.uk
Said Mr Parr: “Some sectors, such as construction, are going to be harder hit than others. The key is to be flexible and not to panic if cuts affect your business. For businesses that have made it through the recession there are still tough times ahead.”