An East Midlands Chamber of Commerce chief has described the Chancellor’s budget as encouraging for business in the area.
Commenting on yesterday’s Budget announcement by Chancellor George Osborne, Chris Hobson, Head of Representation at the Chamber of Commerce for Derbyshire, Nottinghamshire and Leicestershire, said: “There were some encouraging measures in today’s Budget, which business will take heart from.
He said: “What we need now is to see these policies - and those made in previous announcements - having a meaningful impact on the ground.
“An emphasis needs to be placed on the UK being a place where we make, build and sell to others. The first indications that this is happening will come from the East Midlands – the spine of the UK’s manufacturing and engineering industry.
“As we look to secure the economic progress to date – which has been hard won by businesses operating in difficult times – we welcome those initiatives which look to support increased investment and reduce the cost of doing business.
Mr Hobson said he welcomed the focus on reducing high energy costs for businesses – an issue which was highlighted by members as being a primary concern, but added: “We’ll need to see more detail about how this £7bn package of energy reduction measures will work in practice.”
He said doubling the annual investment allowance to £500,000 and keeping it available until 2015 could help to support the growth of those businesses on the verge of making big investment decisions.
Doubling the level of export finance lending to £3bn and cutting interest rates on it by a third would support smaller businesses looking to enter new markets, while extending the Apprenticeship Grant for Employers will also enable more firms to recruit young people as apprentices.
The announcement about investment in new start-up routes at regional airports was also welcome, although the chamber awaited to see the detail on this policy.
The Chamber had long believed that the playing field needs to be levelled to help the regional airports compete with the major hubs in the South East.
He said: “The OBR revised its growth forecast for 2014 by 2.7 per cent and is anticipating growth of 2.5 per cent by 2018. While these figures are low by historical standards, they remain above expected inflation and give businesses a solid platform to which to build. They now require the right support from Government to do so.”
Commenting on specific announcements within the Budget, Chris Hobson said:
On youth unemployment: “The Chamber told the Chancellor very bluntly that he needed to extend the Apprenticeships Grant for Employers if he wanted to see companies creating enough apprenticeship places to meet demand.
“His actions demonstrate that he was listening, to the benefit of businesses and young people alike. Helping companies take on apprentices is one of the best ways for a Chancellor to invest limited resources in Britain’s future.”
On business investment, he said:
“Consistent allowances help companies invest with confidence. Given that business investment remains far below its pre-recession level, it is fantastic that the Chancellor has responded to our call to extend the Annual Investment Allowance, and that he has doubled the amount covered to £500,000 from 2015.
“That will give many growing and medium-sized companies the confidence to push ahead with investments they’ve long wanted to get off the drawing board.”
On exporting, he added:
“Export finance problems stop many companies from getting their goods and services into new markets. To support our exporters, Britain’s export finance support must match that of our global competitors.
“The moves made by the Chancellor to increase the support available, and to lower the interest rates charged to companies, are a big step in the right direction.
“Ensuring awareness of this support amongst the growing and medium-sized firms that stand to benefit is crucial, however, to this policy’s success. Chambers of Commerce will continue to work closely with UKEF to help businesses get their goods into market with the best possible finance support.
“While finance for international transactions is important, so is the level of support for businesses looking to expand into new and fast-growing markets. Moves to improve international transport connections through regional airports, and to simplify Air Passenger Duty, are a good start.
“Yet we could do even more, particularly through the Overseas British Chambers and business groups that the Chamber and UKTI are linking together to form the first-ever global British business network.”
Regarding the subject of energy, he added:
“The Chancellor’s Budget clearly recognises the damage that unilateral measures can do to the competiveness of British businesses. Our members will welcome the cap in the Carbon Price Floor, which will help all companies, and the extension of compensation for energy intensive industries.
“Furthermore, by taking forward all the recommendations contained in the Wood Review of Offshore Oil and Gas, the Chancellor has made a significant step toward maximising oil and gas recovery in the UK as part of a diverse energy mix.
“Looking ahead, it is crucial to ensure that energy does not contribute ever further to the rising cost of doing business in the UK – so continued attention and investment are required.”
On infrastructure, he said:
“The Chamber has long called for more funding for road maintenance – a key bugbear for so many businesses – and welcomes the new pothole fund announced in the budget.
“Incremental support for other capital projects and flood defences are also positive. Yet, as ever, infrastructure projects both large and small are judged on how quickly they are delivered on the ground. Infrastructure delivery is the key business priority, so the government must move swiftly from announcement to action, on road repairs, house-building, flood defences and more.”
Referring to the change in pension rules, he addded:
“The unexpected and radical modernisation of pension rules and ISAs will be welcome news for many businesspeople and their employees. Greater flexibility and choice, combined with an end to some of the arbitrary and punitive tax rules that undercut prudent savers, favour aspiration, enterprise and long-term planning.”