Yesterday, Chancellor of the Exchequer Rishi Sunak unveiled the contents of his Budget in the House of Commons.
Here’s what a selection of South West and national business leaders had to say…
Phil Smith, Managing Director of Business West
“The Chancellor praised the “imagination and drive” of businesses as key to the continued recovery of the UK economy and gave an upbeat Budget of higher spending and optimistic messaging. But many businesses will remain muted in their enthusiasm given the scale of the challenges they face.
“Avoiding a spending squeeze was important given the fragility of the overall economy and individual firms. However, businesses will have watched the budget with a less resolved question over whether the government will be doing enough to sustain the economy and tackle the significant challenges that businesses still face.
“Many businesses are in a tough period, with Covid recovery needing to be nurtured and companies looking to ‘make up for lost time’ in recouping lost income in the months and years ahead. They also face strong head winds in the face of skills shortages and rising costs, from supply chain and labour market inflation and additional business tax burdens from National Insurance and corporation tax.
“Our region also continued to broadly lose out from the Chancellor’s largesse. With a very long list of individual projects and schemes announced, dominated by northern constituencies and the devolved nations of Scotland, Northern Ireland and Wales. We are still not getting cut through in central government for the support our region needs.”
Claire Ralph, Policy Manager at Business West
“Business West regularly meets businesses whose growth is being slowed by being unable to find the right staff – leading to lost income for the region.
“Whilst the Chancellor listed a good number of schemes and initiatives in the further and adult education area, for example a new numeracy scheme called ‘Multiply’, more money has been allocated for apprenticeships based on forecasts of more young people remaining in education through their college years.
“The Chancellor’s greater focus on Further Education and post 16 skills is welcome given the neglect and underfunding of this sector in the past meaning too often our young people’s potential is wasted and employers struggle to secure the skilled staff they need to run and grow their businesses.
“Whilst any new money is welcome, the scale of the skills challenge especially for employers looking to hire new staff is massive. There is much to do to roll out, and businesses require consistency of policy delivery and financial support. The latest focus has been on the phased roll out of the new T Level qualification which is currently poorly understood by young people and employers.
“Some existing, better understood, vocational qualifications such as BTecs will be defunded where they overlap with T levels in the coming years, which risks cutting off choice for young people and their future employers.”
Mike Cherry, National Chair of FSB
“This Budget has delivered some measures that should help to arrest the current decline in small business confidence. But, against a backdrop of spiralling costs, supply chain disruption and labour shortages, is there enough here to deliver the Government’s vision for a low-tax, high-productivity economy? Unfortunately not. Where inflation and forthcoming tax hikes are concerned, the clouds are gathering.
“Much more will be needed to support small employers in the months ahead. Our call for an increase in the Employment Allowance to £5,000 would have made a real difference to efforts to increase wages, retain staff and create jobs as we head into the critical festive season.”
Sam Holliday, FSB Development Manager for Gloucestershire, Bristol, Bath & South Glos
“There is no such thing as a perfect Budget or indeed one that can be properly fully assessed until we’ve all had the opportunity to delve into the detail and the full implications. However, the first indications are that this is a Budget which has made some genuine progress to support some business concerns but perhaps hasn’t gone quite as far as many local small businesses would have hoped as they struggle to battle against rising costs and future tax rises. Many were hoping for a game changing Budget – and this doesn’t feel like that.
“In saying that the announcement about cuts and discounts to business rates – particularly for our hard-pressed hospitality businesses – is to be welcomed as is the increased support for the skills and innovation sectors but with increasing inflation and tax rises on the horizon many businesses may be feeling this Budget has done little to help their bottom line at a time when it is under pressure like never before due the long reach of Covid.”
Dominic Bourquin, Tax Consultancy and Corporate Finance Partner, at accountancy firm MHA Monahans
“The Government hasn’t done enough for businesses. The changes to business rates – a 50% relief for hospitality, retail and leisure and the cancellation of the multiplier increase – are welcome, but cannot be called reform. These measures are clearly introduced as a reaction to the pandemic, to help those businesses that have suffered most. Rightly so, but let’s not pretend this is the reform that has been talked about for more than a decade.
“The simple fact is that our business rates tax is inequitable in the modern world. There was no mention of taxing online businesses more highly, for example, although we understand a digital sales tax is coming. And, because these are reliefs they can be taken away at any time. I welcome the boost to businesses that this will offer, but I would suggest what is needed is a change to the entire system, not a sticking plaster.”