Tuesday

June

For political junkies, in the ranks of which I include myself, the last few weeks have been of almost unprecedented interest.

The results of the election and the wholly unexpected coalition government which it produced have been pored over in minute detail by all sections of the media and beyond, and there is little point revisiting them here.

Suffice to say, whatever your view of the government we have ended up with, no one can deny that both the Lib-Con coalition and the general public are faced with immense economic problems for years to come.

This coalition government will have to implement big cuts in public spending which will need to take account of the huge expansion of public borrowing that took place during the economic crisis and the offsetting fiscal contraction to that necessary boost will need to be greater than the value of the initial spending.

In short, hard times are ahead.

But in the biggest economic downturn since the Great Depression, FWD members have weathered the storm, with a number of our members seeing sales growth. And sustaining this recovery needs policies which enable the wholesale sector to continue to prosper and grow.

We fully understand that in the current economic context, the Government is facing a number of critical challenges. However, while reducing the budget deficit is a key priority, these demands need to be carefully balanced against creating an environment that fosters sustainable economic growth for our members, given our irreplaceable role in an effective supply chain.

In our submission to George Osborne ahead of his first Budget later this month, we said that Government should focus on opportunities for revenue raising through combating alcohol and tobacco fraud, as well as urging them not to increase the headline rate of VAT or extend it to food.

Another recommendation is for no further increases to fuel duty, which has risen substantially in recent years, and no introduction of road pricing mechanisms, which would significantly impact on FWD members.

We also support the Government's proposed ban on the sale of below cost alcohol. Where we want clarity is on how 'cost' is calculated. We are meeting the Home Office team responsible for this policy next week to urge them to heed our view that the ban on sale of alcohol below cost should at the very least be duty plus VAT plus an industry standard cost of production. Anything less would be pointless.