Somerset Chamber CEO Stephen Henagulph has welcomed today’s Budget, with extensions to furlough, Business Rates Relief and VAT reductions to help struggling firms both restart and rebuild.
The Chancellor also announced a ‘super deduction’ investment incentive over the next two years to encourage businesses to invest and grow.
Mr Henagulph said: “This is very much a business-focused Budget. We have seen the extension of the furlough scheme through to September to enable employers to get businesses back on their feet and the continued reduction in VAT to 5% for businesses in the hospitality industry that have been hardest hit in our region.
“There are big new incentives for investment, lower tax rates for the smallest firms and I’m delighted to see the extension of Coronavirus support measures and grants for businesses in the short term.
“Slightly less good news was that Avonmouth did not receive one of the eight Freeport designations in the UK, although I’m delighted for the South West as it was confirmed that Plymouth has been allocated a Freeport allocation.
“It was also a little bit disappointing that the geography still seems to be slightly biased to the north as there was no mention of the South West, other than the Freeport. New initiatives are being centred in Leeds and Darlington and when the Chancellor talked about wind and tide power, he gave the example in Scotland, yet we know in Cornwall there are some fantastic projects leading the way in autonomous marine.
“Overall, though, there are some really positive noises coming back from businesses already that this is a Budget that will encourage and support them to grow – and to grow sustainably – in the coming years. Even the dreaded tax side of things in terms of Capital Gains Tax won’t come into effect until 2023.
“Somerset Chamber of Commerce welcomes the Chancellor’s Budget today and the effective number of measures to kickstart our businesses back post-lockdown. It was a Budget that provides them with reassurance and if there are unexpected bumps in the road, the Chamber network will be here to lobby for more support and more action until the economy is back firing on all cylinders again.”
The British Chambers of Commerce provided a full response to the Budget 2021:
Commenting on the latest forecasts by the Office for Budget Responsibility, Suren Thiru, Head of Economics at the BCC, said: “The OBR’s central forecast provides a more upbeat outlook for the UK economy with the vaccine rollout expected to drive a faster recovery. Even with the mass vaccine rollout, the economic scarring already caused by the pandemic, including structural unemployment, rising private debt levels and weak investment, may mean that any recovery is slower than the OBR predicts.
“While the OBR highlights significant fiscal challenges, the chancellor should tread carefully in managing the future path of fiscal consolidation to avoid suffocating the recovery.”
Commenting on the Recovery Loan scheme, Mr Thiru, said: “Accessing finance remains crucial to the lifeblood of a business and so the announcement of a new loan scheme to succeed CBILS and BBLS is welcome. The acid test for the new scheme will be whether it is able to support the recovery by getting credit flowing to the firms who most need it.
“The scheme must be right from day one to ensure that businesses and banks can use it to help SMEs return to growth. Businesses will need an approach to operation of the new scheme that is clear, consistent and considerate to the impact of the pandemic on their financial position.
On the super deduction investment incentives, he said: “We pleased that the Chancellor has listened to our call for bold incentives to encourage companies to invest. Super deduction will provide a major enticement for firms to invest and grow, helping to boost productivity and the wider economic recovery.”
Commenting on those who have fallen through gaps in Government support, Claire Walker, Co-Executive Director at the BCC, said: “Despite the widening of the self-employment support scheme, there are still many businesses and individuals who have, through no fault of their own, been unable to access any government support since the start of the pandemic. Many require help if they are to navigate a difficult few months ahead before the economy is able to reopen more fully.”
With regards to the Help to Grow scheme, Jane Gratton, Head of People Policy at the BCC, said: “To boost productivity, businesses of all sizes need to invest more in skills and innovation. Funded access to high quality, flexible management training will help SMEs maximise the growth potential of innovation, but it must also give managers the skills to understand the training and development needs of its adult workforce and increase the digital and technical skills needed for the rapidly changing workplace.”
On incentives for apprenticeships and other training schemes, Ms Gratton said: “Apprenticeships and jobs with training opportunities and have been severely impacted by the pandemic, particularly for young people.
“We welcome this additional investment in traineeships, employer incentives and more flexible apprenticeships that will help businesses create more high-quality earning and learning opportunities for people and boost skills in the workplace.”