2012 growth predictions to benefit those with private wealth?

UK growth will be slower than previously forecast next year but will be higher than expected in 2012, according to a new report that could affect those with private wealth. 

The British Chambers of Commerce (BCC) revealed it had revised downwards its predictions for 2011 because of the negative effects of public sector cuts, the financial crisis in Europe, next year's VAT increase and the sluggish housing market.

As a result, expected UK gross domestic product (GDP) for the next 12 months is now 1.9 per cent, down from the 2.2 per cent forecast in September.

There was more positive news for 2012, however, as the organisation upgraded its projected growth figures from 1.8 per cent to 2.1 per cent.

BCC director-general David Frost said the government must make helping enterprises thrive one of its top priorities in the coming years.

"British business is willing and able to drive the recovery, but it can only do so if the government will back its words with deeds," he added.

Last month, the Office for Budget Responsibility reduced its predictions for GDP growth next year by two percentage points to 2.1 per cent.

A recent report by marketing company Acxiom suggested the January VAT increase will cause a drop of £2.3 billion in income after tax across the country. ADNFCR-2318-ID-800273964-ADNFCR