BUSINESS LEADERS in Milton Keynes say there were few ‘crumbs of comfort’ for firms across the region in the Budget statement by Chancellor of the Exchequer Jeremy Hunt.
Mr Hunt enhanced support for childcare to encourage more people back to work, froze duty on alcohol and fuel and also reduced employee National Insurance by 2% which had been widely forecast.
Sean Rose (pictured above), head of policy at Milton Keynes Chamber of Commerce, said: “There was not a lot in the budget for business. Firms across the region will be thinking that there could have been more.
“The cut in National Insurance will provide a boost to staff who are still feeling the effects of the cost of living crisis but that was not matched by the same kind of help for companies.”
There was little in particular for manufacturers and construction businesses still feeling the effects of rising costs over recent years, he added. It was a similar story for hospitality.
“One of the most positive announcements for companies across the region was not a policy change but the fact that inflation is expected to fall to less than 2% in the next few months as this will, hopefully, have a stabilising effect on businesses and give them a platform from which to grow,” Mr Rose said.
“As with every budget and fiscal event, it is often the case that we learn more when the detail emerges but I think it is fair to say that the initial reaction from businesses was fairly muted.
“The economy slipped into technical recession at the end of 2023 and, while that is not anticipated to last very long, more is going to be needed to build sustainable economic growth.
On a national level, changes to NI will give the economy some momentum, said British Chambers of Commerce director general Shevaun Haviland. That aside, there were no major announcements to improve prospects for UK companies.
“The clock is now ticking to the General Election and this Budget could be the last fiscal event before voters go to the polls,” Ms Haviland said. “Business confidence is improving but the coming months will remain challenging for many companies. It is vital that the economy remains front and centre of the campaign to come.”
The cuts in National Insurance could mean 200,000 more jobseekers, which would help to reduce the number of unfilled vacancies. “Combined with the increased child benefit threshold, this should help business find the staff they so desperately need,” Ms Haviland said.
While the VAT threshold increase to £90,000 will encourage growth and investment by SMEs, the threshold requires a more fundamental review, the BCC said. It also has welcomed moves to speed up the planning system.
Ms Haviland said: “This is a clear signal from government about working in partnership with business to solve problems. We now have a real opportunity to make the system quicker and more efficient for everyone. It is all about investing in talent and building communities.”
The Chancellor has listened to BCC calls to extend the Recovery Loan Scheme. “Under its new name, the Growth Guarantee Scheme will continue to be a financial lifeline for thousands of businesses to get back on track after recent economic shocks and plan for future growth,” Ms Haviland said.
The BCC will continue to campaign for new internationally competitive tax-free shopping scheme, not mentioned by the Chancellor in his statement to Parliament last week.
“We will review the OBR’s evidence and continue to make the case for this,” Ms Haviland said.
