A senor member of the Office of Budget Responsibility, Geoffrey Dicks, told the Treasury select committee that spending cuts will hurt growth and increase the chances of a double-dip recession occurring. He said that the OBR had taken 0.5% off GDP and the near term outlook for GDP was not as good as it was before the Budget.
The Chief Economic Advisor at the Chartered Institute of Personnel and Development, John Philpott, warned that a double-dip recession would mean “reduced demand for staff in the private sector and increased redundancies; it would hit people who were kept on during the first recession and who have made sacrifices in terms of pay freezes and so on; and those people who were still left at the end of fresh redundancies would be more insecure and less willing to make sacrifices having trusted their employers initially.\”
Gartner Five Point Plan
Recently Gartner produced a five step plan for CIOs concerned about pushing forward with expensive projects in the face of another slowdown. Gartner recommended CIOs to:
- Act Now: The Company recommends senior staff to convene now as most official national recession declarations are only announced well after the actual start of a recession
- Focus on the current Financial Year: CIOs should determine which projects to approve, postpone or cancel
- Focus on the next Financial Year: Once all projects for the current financial year have been sorted CIOs should determine which projects to approve, postpone or cancel in the following financial year
- Use Zero Based Budgeting: Zero Based Budgeting should be adopted for projects in 2011
- Use Zero Based Budgeting for existing applications: Zero Based Budgeting should be applied to existing applications
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