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Great Yarmouth-based Pasta Foods has been awarded £500k from New Anglia LEP’s Growing Business Fund to support its expansion into a modern new factory in Norwich, protecting 140 jobs and creating 56 new ones. Pasta Foods is the UK market leader in the production of pasta used in the food industry for recipe dishes, canning, sauces, salads and snack pots. The business is also a global leader in the production of snack pellets typically made from materials like potato, lentil or chickpeas and trades with customers in 40 countries across the world.

Pasta Foods’ new factory will include a new production line, and leased warehousing will now also be brought into one warehouse in the new building. Karl Jermyn, Pasta Foods Managing Director, said: “The business has been growing successfully and the Board concluded that we should invest significant sums to add capacity to our current production facilities to capture the growth in demand for our products.”

“Ordinarily, the investment to deliver additional capacity would have been made at our Pasteur Road site, in Great Yarmouth. However, modern production line designs meeting our requirements and incorporating the latest technology are simply too large to fit within that facility. Norfolk County Council brought to our attention the factory at Forest Way, in Norwich.”

“The new facility is an excellent, modern unit with good roof height. We will run this site along with the factory at Pasteur Road. It is being funded, subject to contract, with £500k from New Anglia LEP’s Growing Business Fund. This will allow us to move forward with the project and will meet our objectives of supporting growth and employment in Norfolk and Suffolk.”

“The investment in the new factory is the first step in delivering our growth strategy. We are delighted to have been able to secure such a good facility and are grateful for the help and support from Norfolk County Council, Lloyds and New Anglia.”

Dr Andy Wood OBE, Chairman of New Anglia LEP, said: “This is an exciting development for Pasta Foods and we’re really pleased to offer a £500k grant to help the company expand and create more jobs for the future. We are also keen to talk to other businesses about how we could help fund their future plans for growth, through the Growing Business Fund that is supported by the Government’s Regional Growth Fund.”

Colleen Walker, Cabinet Member for Economic Development said “It’s so important that Pasta Foods is increasing its workforce in Norfolk. Not only are they protecting the 140 existing jobs, but adding another 56 over the coming three years. It is so encouraging to get this vote of confidence in Norfolk as a place to do business and toinvest and I’m proud of the fact that we and the Local Enterprise Partnership were able to help secure this.”

• BCC upgrades its short-term GDP growth forecasts from 1.3% to 1.4% for 2013 and from 2.2% to 2.7% for 2014, but slightly downgrades its 2015 forecast from 2.5% to 2.4%
• This will take UK GDP above its Q1 2008 pre-recession peak in the second half of 2014
• Household consumption (which accounts for two-thirds of UK GDP) is expected to be the main driver of growth in 2013 and 2014, boosted by the strong housing market
• But GDP will slow marginally in 2015 as household consumption moderates due to high personal debt levels
• The MPC’s 7% unemployment rate threshold will be reached in Q3 2015, one quarter earlier than previously forecast
• Public sector borrowing is forecast at £106.0bn in 2013-14, £5.2bn lower than the OBR predicted earlier this month

The British Chambers of Commerce (BCC) has today (Thursday) upgraded its growth forecasts from 1.3% to 1.4% in 2013 and from 2.2% to 2.7% in 2014, although the business group has marginally downgraded its 2015 forecast from 2.5% to 2.4%. John Longworth, BCC Director General, pays tribute to UK businesses for remaining ‘determined to compete and grow in the face of difficult circumstances’, but urges the government to do everything in its power to maintain the economic recovery. The BCC believes that an environment that fosters enterprise and wealth creation is essential so that UK firms can continue to trade the world, invest at home, and create jobs.

ECONOMIC FORECAST

• The BCC is raising its short-term GDP growth forecast to 1.4% in 2013 and to 2.7% for 2014, but we are marginally lowering our 2015 growth forecast to 2.4%
• In August 2013 we predicted GDP growth of 1.3% in 2013, 2.2% in 2014 and 2.5% in 2015.
• The upward revisions for 2013 and 2014 are mainly due to the stronger GDP growth in Q3 2013, the robust growth across all main sectors of the economy, a marked increase in household consumption (which accounts for two-thirds of UK GDP), and in part due to the strong housing market.
• However the strong growth in household consumption will moderate slowly, in reaction to high personal debt levels, and this will work to slow GDP growth in 2015
• UK GDP quarterly growth is forecast at 0.8% in Q4 2013, and 0.7% in Q1 2014, then slowing to an average of 0.6% per quarter until the end of 2015.

Caroline Williams, Chief Executive of Norfolk Chamber of Commerce said:

“It is really great that next year the UK economy is finally expected to bounce back from the deepest recession in modern times. Norfolk businesses have remained determined to compete and grow in the face of difficult circumstances, and the upgrading of our short-term forecast is testament to their sheer hard work, resilience and creativity.

However, we must acknowledge that longer-term challenges are still looming. As household consumption slows in the medium-term, we have to find ways of boosting business investment and exports as rebalancing the economy is critical to the long-term economic future. The confidence displayed by Norfolk firms must be nurtured through more government support. Young, growing firms, and many SMEs, continue to struggle with a lack of access to available credit, while consumers are getting the support they need to buy homes.”

John Longworth, Director General of the British Chambers of Commerce (BCC), said:

“Politicians must not take their eye off the ball in the run up to the General Election, and must ensure that the economy remains front and centre at all times. If we make important decisions to fix the long term structural failure in business finance, continue to deliver a major infrastructure upgrade and do more to support exports, it is possible to achieve not just a good recovery, but a truly great and sustainable economy.”

David Kern, BCC Chief Economist, added:

“We expect GDP growth to remain strong in the short-term, as the housing market continues to boost household consumption. But while it was necessary to rely on the consumer and on housing in the early part of the recovery, it must now become more balanced, particularly towards exports, as household consumption will slow. While we forecast a degree of rebalancing, net exports are not making enough progress, and risks still emanate from the eurozone where the present calm could be deceptive.

“Our own research shows that business confidence remains high, but policymakers need to ensure that the stable environment we are seeing at the moment isn’t choked off. Not raising rates ahead of time is critical to maintaining this confidence in the medium term. Any decision to raise rates should be based on a lasting improvement in wider economic conditions, while ensuring that meeting the 2% inflation target remains the MPC’s major objective.

“Although the budget deficit is being brought down gradually, the government still has a big task on its hands. The problems facing our financial sector, and the falls in oil and gas reserves have created a long-term shortfall in the economy’s ability to generate tax receipts. Plugging this gap will take some time, and cuts in current spending are still needed.

“We believe that in 2014 UK GDP will at long last move above its 2008 pre-recession level. But long term trends show we can do much better, and with the right policies in place we can expect a much stronger recovery in the second half of the decade.”

OTHER ELEMENTS FROM WITHIN THE FORECAST

Main components of demand

• We are expecting household consumption to grow by 2.2% in 2013, 3.1% in 2014 and 2.5% in 2015. The new forecasts are stronger than predicted in Q3 for 2013 and 2014, but slightly weaker for 2015.
• Business investment has been very volatile in recent years. Despite the 1.4% rise in Q3 2013, we expect business investment to fall by 5.3% in 2013, but this will be followed by strong growth of 5.7% in 2014 and 5.8% in 2015 as businesses look to rebuild their capital stocks as the UK economy continues to grow. However, business investment in 2015 will still be 7.5% below its 2008 level.
• The trade balance: rebalancing the economy towards net exports suffered setbacks in 2012 and 2013. However despite recent setbacks, the UK trade deficit in goods and services is now smaller than before the financial crisis, both in nominal and real terms, and it will continue to narrow gradually in the next few years, thanks largely to services.

Main sectors of the economy

• Total industrial output is forecast to decline by a further 0.4% in 2013, followed by positive growth of 1.6% in 2014 and 1.1% in 2015. These are all improvements on the Q3 2013 forecast (0.9% in 2013, 0.8% in 2014 and 1% in 2015).
• Growth in manufacturing has strengthened this year, with 0.9% recorded in the last two quarters. However longer-term trends show a weak performance, and output is still 9.0% below its pre-recession level. Output is expected to decline by a further 0.1% in 2013, followed by growth of 2% in 2014 and 1.4% in 2015.
• Construction output is still 13.2% below its Q1 2008 pre-recession level, but the housing market upturn has improved the outlook. We predict growth of 0.6% in 2013, 4.1% in 2014, and 1.7% in 2015.
• The services sector, the long-standing driver of the economic recovery, accounting for ¾ of total economic output, is forecast to record growth of 2% in 2013, 2.8% in 2014, and 2.7% in 2015, stronger than GDP. Only the 2015 forecast is a downgrade from our Q3 estimate (3%).

Unemployment and productivity

• We forecast that the 7% unemployment rate threshold will be reached in Q3 2015, one quarter earlier than we predicted in August. However the MPC’s suggestion that there is a 40% probability that this could be reached by the end of 2014 is too ambitious in our view.
• We expect UK unemployment to fall from 2.466 million (7.6% of the workforce) in Q3 2013, to 2.400 million (7.3% of the workforce) in Q3 2014, and to 2.304 million (7.0% of the workforce) in Q3 2015, a net overall fall of 162,000.
• This predicted fall is due to improved short-term growth prospects and increased labour market flexibility. However there is a risk of further public sector job losses, which would limit the size of any decline. In addition, there will be a rise in the number of inactive people returning to the workforce.
• We are forecasting that youth unemployment (people aged 16 to 24) will fall from 965,000 in Q3 2013 to 910,000 in Q4 2015, a net fall of 55,000.
• Productivity: Output per worker is forecast to regain more than half its losses over the next two years. But in Q3 2015, productivity would still be 1.7% below its Q1 2008 level, and more than 15% below where it would have been if it continued growing at its pre-recession average rate.

Public finances and inflation

• UK public finances: The new OBR forecasts announced at the time of the Autumn Statement confirm that the structural deficit remains unacceptably large, despite the drop in borrowing. For 2013-14 we are forecasting borrowing at £106.0bn, £5.2bn lower than the OBR predicted. For 2014-15 and 2015-16, we also expect borrowing to be £4-5bn less than the OBR has stated.
• In annual average terms, we are now predicting annual CPI inflation to be 2.6% in 2013, 2.5% in 2014, and 2.3% in 2015. This compares with a Q3 comparison of 2.7%, 2.4% and 2.3% respectively.
• For annual average RPI inflation we are now predicting 3.1% in 2013, 2.9% in 2014, and 2.8% in 2015. In Q2 we predicted 3.1% in 2013, 3.0% in 2014 and 3.0% in 2015.

Interest rates and Quantitative Easing (QE)

• Our central forecast is that UK official interest rates will rise to 0.75% in Q4 2015, following the 7% unemployment rate threshold being reached in the previous quarter. A further increase to 1.0% can be expected in Q1 2016. In Q3 2013 we predicted these rate rises one quarter later respectively.
• We expect the Quantitative Easing programme will stay unchanged until at least Q1 2016. Our view remains that more QE is unnecessary at present, as it would heighten risks of higher inflation and bubbles in the future.

As a follow up to the Norfolk Chamber’s ‘Audience with George Osborne, the Chancellor of the Exchequer’ event on the 7 November, we submitted a number of questions from our members to the Chancellor. Responses to those questions are now starting to be received from the relevant Ministers within Westminster.

Chris Conroy is one of two Managing Directors at Prior Diesel. Prior Diesel are based in Great Yarmouth and have been members of the Chamber for over 3 years.

Chris’ question to the Chancellor was:

“Whilst the financial and other assistance being offered to those who have never previously taken on an apprentice is to be applauded and encouraged. Could the Chancellor please tell me what is being offered to those established responsible employers who have continued to give such opportunities to young people throughout the recent tough economic times, who seem to be unable to receive any assistance?”

Find on the attached document the written response from the Department for Education.

As a follow up to the Norfolk Chamber’s ‘Audience with George Osborne, the Chancellor of the Exchequer’ event on the 7 November, we submitted a number of questions from our members to the Chancellor. Responses to those questions are now starting to be received from the relevant Ministers within Westminster.

Roger Tubby is the Sales Manager at Blackwell Print and Marketing in Great Yarmouth. Blackwell Print are one of the Chambers longest serving members having been members since March 1999.

Roger’s question to the Chancellor was:

“166,000 people across 24 countries were assessed for basic maths and English, among other things and it was found beyond any reasonable doubt, the more senior in age the greater grasp of arithmetic and grammar they had. In other words, when selection and grammar schools were available to all standards were higher. So when is the government going to stop worrying about the opinion of the Guardian and BBC and start putting the education of the nation first?”

Find on the attached document the written response from the Department for Education.

As a follow up to the Norfolk Chamber’s ‘Audience with George Osborne, the Chancellor of the Exchequer’ event on the 7 November, we submitted a number of questions from our members to the Chancellor. Responses to those questions are now starting to be received from the relevant Ministers within Westminster.

Peter Collins is the Business Manager at Reepham High School and College. Reepham High School have been members of the Chamber since October 2012.

Peter’s question to the Chancellor was:

“What guarantees can the Chancellor give that school funding will not be reduced particularly as agreement is being given for free schools leading to over-supply of places in some areas?”

Find on the attached document the written response from the Department for Education.

As a follow up to the Norfolk Chamber’s ‘Audience with George Osborne, the Chancellor of the Exchequer’ event on the 7 November, we submitted a number of questions from our members to the Chancellor. Responses to those questions are now starting to be received from the relevant Ministers within Westminster.

James Kearns is the Chief Executive of BUILD Charity. They are based on Redwell Street in Norwich and have been members of the Chamber since 2005.

James’ question to the Chancellor was:

“Big Society seems to have slipped off the political agenda. Is it still a key government objective, and how is it being supported at a time when many local councils are cutting funding to the organisations best placed to deliver it?”

Find on the attached document the written responses from the Department for Communities and Local Government and the Cabinet Office.

As a follow up to the Norfolk Chamber’s ‘Audience with George Osborne, the Chancellor of the Exchequer’ event on the 7 November, we submitted a number of questions from our members to the Chancellor. Responses to those questions are now starting to be received from the relevant Ministers within Westminster.

Ian Tubby is the Operations Manager at Mecca Bingo on Aylsham Road, Norwich. Mecca Bingo have been members of the Chamber since May 2012.

Ian’s question to the Chancellor was:

“Does the Chancellor recognise the important role that Bingo plays in this community and others? And will he back growth, investment and jobs by supporting calls for reduced tax on an industry that is currently subjected to an equivalent of 32%.”

Find on the attached document the written response from the HM Treasury.