Day 072 - 12 Jan 95 - Page 58
1 Q. Right, a budget that is set for the coming year that is,
2 say, between -- if Mr. Rampton would stop interrupting
3 I will ask some questions.
4
5 MR. RAMPTON: If Mr. Morris would not keep misinterpreting the
6 witness's answer I might keep quiet.
7
8 MR. JUSTICE BELL: If I may respectfully say so, I think it is
9 better to keep quiet until the question has been asked, and
10 then if there is an objection I can deal with it. Start
11 again. What we have got, just supposing your figures were
12 right, 15 per cent of 1.6 million is £240,000, so if it is
13 15 to 16 per cent we are talking about a quarter of a
14 million pounds?
15 A. Yes, sir.
16
17 Q. You call that a budget?
18 A. Yes.
19
20 Q. Ask whatever question you want in relation to that.
21
22 MR. MORRIS: The budget figures or percentages that you are
23 budgeting for, is that set by the regional supervisor or
24 supervisory team or from head office?
25 A. It is set by the accounts office in head office.
26
27 Q. If you go over that budget, what is the usual response of
28 the accounts department or whoever is responsible to make
29 sure he stays within that budget? What is the response
30 normally?
31 A. They look at profitability of the store overall; they
32 do not just look at one account. We are in a business, so
33 they would give us advice, my supervisor would give me
34 advice on my profitability. We discuss areas in which
35 there may be room for some improvement or there may be room
36 for some extra spending.
37
38 Q. But if you continually went over the budget guidelines,
39 say, for labour costs, what would they do?
40 A. As I said, it is a budget. Generally they do not make
41 direct comparisons to the budget. They do not say "You
42 have gone over your budget so you have to bring it down."
43 What they do is they assess your monthly P&L accounts, your
44 profit and loss accounts, and they would assess the
45 profitability of the store.
46
47 MR. JUSTICE BELL: So if you have exceeded the figure for wages,
48 if it was a figure in pounds or a percentage, but, for
49 instance, even though the percentage was higher than they
50 wanted, you have increased the turnover by 50 per cent you
51 might get browny points rather than criticism, is that
52 right?
53 A. Yes. The whole objective, one of the main objectives
54 of any business is to increase the sales. Therefore, you
55 would take more bottom line profit. So, they would not
56 just assess the profit figure; they would assess the
57 operations in the store and how well the store is running,
58 because that is directly -- the amount of money you spend
59 on labour directly affects your operations.
60
