Consumer confidence is the key to a sustained recovery, according to Geoff Cooper, chief executive of builders merchant group Travis Perkins.
Cooper was speaking in an interview to news organisation James Davey.
“We should be boosting areas of the economy which generate domestic activity and domestic production. From that point of view construction’s an ideal thing to do, investment in infrastructure, investment in housing,” he said.
Cooper said his wish list for Finance Minister George Osborne’s autumn statement on November 29 would include the re-introduction of mortgage interest relief for first time buyers to stimulate the housing market and measures to boost the consumption of green building products.
“I would tend to the view that we shouldn’t worry too much about direct action to boost consumers’ wallets, I think we should do things to boost consumers’ confidence because I think confidence is a big problem at the moment,” he said.
“Fear of unemployment and fear of things getting worse is constraining a lot of people.”
Cooper expects that the UK will miss entering a double dip recession even though the risks have increased as the European sovereign debt crisis has deteriorated.
“No one should believe that the recovery’s going to bounce back very quickly, it will be a slow grind from here,” he said.
Cooper said he is confident Travis Perkins will continue to outperform an overall UK merchanting market he anticipates will be down a low single digit percentage in volume terms and an overall home improvement market he anticipates will fall about 7-8 percent.
He also believes that conditions are ripe for further consolidation in Travis Perkins’ markets.
“I think that represents a slow strangulation of weak players in the sector,” he said. “I do think there is a prospect of further consolidation amongst merchants, in particular, and probably amongst independent DIY retail.”