Budget ‘Fair share’ investment and Covid support on leaders’ wishlist
CHANCELLOR Rishi Sunak will deliver his second Budget of the year to the Commons today.
He is expected to end the yearlong public sector pay freeze for more than five million public sector workers and raise wages for people on low incomes from £8.91 to £9.50 an hour.
But Labour critics have said the recently announced hike in National Insurance Contributions to 1.25% and a freeze to the personal income tax allowance could leave some worse off.
Business minister Paul Scully said on Tuesday the economy was going through a “difficult time” in terms of cost-of-living pressures.
“The 6.6% increase is quite a substantial increase of the national living wage. It is still keeping us on target to end low pay by 2024,” he told the BBC.
“But it has to be balanced by businesses themselves because if we choke off the recovery then that’s going to reduce the number of jobs, reduce the number of opportunities for people on low pay.”
But what would the business community like to see from the Autumn statement? We spoke to senior leaders and business organisations from the South West about what’s on their wishlist.
Claire Ralph, policy manager of South West chamber of commerce
Business West, said the government needed to make sure its Covid support matched business needs, especially if restrictions to trading are reimposed on public health grounds.
“Businesses remain vulnerable, with depleted cash reserves, high inflationary pressures and paying down Covid-incurred debt such as bounce back loans,” she said.
She also called on the government to make sure it provided the South West with its “fair share” of funding as part of its so-called “levelling-up agenda”.
“Key issues like investment for local transport, investment in flooding defences, particularly for central Bristol where it is currently holding up several big redevelopment decisions, and money to help Bristol Temple Meads complete its long overdue overhaul, are all critical things on the local wishlist here.”
Ms Ralph has also called for reform of the business rates system, which she said was continuing to act as a “real drag” on the region’s high streets, dampening growth and investment.
“Budget day always gives a profile to the popular spending announcements the chancellor wants to claim credit for,” she said.
“But, given the tougher fiscal environment due to the battering of Covid, a squeeze in other areas is more likely. Business will be keeping an eagle eye out for any unwelcome surprises.”
Phil Smith, managing director of Business West, said he had seen “little to excite business” so far in the preliminary Budget leaks.
“The government seems to be exhorting business to invest but at the same time taxing them next year,” he said. “Business rates badly need to be reformed but there is no sign of that happening.”
Mr Sunak is expected to announce £1.6bn to roll out new T-Levels for 16 to 19-year-olds, and £550m for adult learning in England as part of a plan to boost skills.
There will also be £830m extra funding announced in the Budget as part of a five-year-scheme to refurbish colleges.
Mr Smith said the funding boost for colleges would be welcomed by higher education institutes. He said: “It will hopefully enable colleges to look at more re-training for displaced over-50s from furlough.”
Sara-Jane Watkins, principal of South Gloucestershire and Stroud College, agreed.
She said with businesses finding it hard to recruit, colleges were playing an “important” role with apprenticeships – and called for an increase in the base rate for 16- to 18-year-old learners.
“A base rate increase is the only way of recruiting and retaining quality vocational delivery staff who are so needed to inspire the next generation – especially in areas of digital, construction and health.”
The government seems to be exhorting business to invest but at the same time taxing them next year. Business rates badly need to be reformed
Phil Smith, Business West