Bosses’ cheers for upbeat Phil
BUSINESS leaders cheered the Chancellor’s commitment to tackle the “scourge” of late payments, funding for apprenticeships and bringing forward a review of business rates.
Philip Hammond’s announcement of a consultation on late payments was hailed as a “turning point” on a crisis which sends tens of thousands of firms to the wall every year. The UK’s poor payment culture, which affects eight out of 10 small companies, was highlighted by the collapse of construction giant Carillion.
The Federation of Small Businesses said tackling the issue could add £2.5billion to the economy annually and help close the productivity gap.
Adam Marshall, pictured, director general of the British Chambers of Commerce, said: “Previous attempts to tackle late payment have not had the desired effect, because affected firms are often unwilling to jeopardise customer relationships by calling out bad practice. The Government must use its convening power to tackle this issue in sectors where it is clear that problems exist.”
The Government’s new apprenticeship levy, which aims to help deliver three million apprenticeship starts by 2020, has faced growing complaints from businesses that the funds raised do not cover training costs, while official figures show it is yet to increase the number of people trained.
Mr Hammond said he “recognised the challenges” for some small businesses and said up to £80million of funding support would be provided.
Mr Marshall said the levy’s “lack of flexibility and complexity” were stifling training aspirations of companies of all sizes, and the extra funding would need to be accompanied by reform of the levy.
Businesses have long called for more frequent business rates revaluations to help reduce huge changes in rates bills, and Mr Hammond said the next one would be brought forward by a year to 2021.
But FSB chairman, Mike Cherry, warned: “It’s absolutely crucial that more frequent business rates revaluations aren’t used as an excuse to increase tax revenue or place additional admin burdens on small firms.”
Mr Marshall added: “The current system already generates a huge number of appeals, and if it is not made easier for companies, more frequent valuations would simply make this backlog mushroom.”