By Max Clarke & Marcus Leach
Following the announcement of today's Budget, Fresh Business Thinking offer the latest comments and analysis from business representatives.
On the Chancellor's announcement of a further 40,000 apprenticeships that will be funded for young unemployed people; HR expert and Co-Founder of Reabur.com online consultancy, Georgina Read commented:
“Unemployment amongst 18 — 24 years olds is currently at a record low so the investment into apprenticeships will be hugely beneficial to the country’s economy. The increase in university fees partnered with employment cuts is resulting in today’s youth struggling to gain an education and career. Apprenticeships provide great learning opportunities as well as schemes that mould youths into loyal and talented employees.
On the 1p reduction in fuel duty, and announcement of £2 billion fair fuel stabiliser funded by the profits from oil companies, Brian Madderson, Chairman of RMI Petrol commented:
“RMI Petrol positively welcomes the Government’s decision in today’s Budget to cancel the fuel duty escalator due on 1st April. With the 1.00ppl headline increase, the Retail Prices Indexation adding 3.00ppl plus VAT at 20%, we predicted that this would have imposed an additional 5.00ppl onto the pump prices of fuel.
“This legacy of the Labour Chancellor, Alistair Darling, who never consulted industry and ignored the plight of the UK motorist, would have had a severe impact on economic recovery at a time that is already one of the harshest that consumers and businesses have had to endure in many years.
On the Budget's impact on the Pound, Mark Bolsom, Head of UK Trading at Travelex Global Business Payments said:
“Most businesses thought the budget would have little impact on sterling, as much of it had been priced in. The pound fell around 0.8% to a session low against the dollar half way through the budget (1.6230) and eventually settled on 1.6220. It’s unsurprising that sterling dipped; the OBR have scaled back their growth forecasts, raised their borrowing forecasts and inflation is likely to overshoot for all of next year as well.”
On the announcement that there will be 21 Enterprise Zones Richard Grass, Head of Public Sector at Colliers International commented:
“Confirmation of the reintroduction of Enterprise Zones is a welcome sign that the coalition is focussing on growth as well as reducing public expenditure, although £100m will be spread fairly thin across 21 different zones over four years.
“The main criticisms of previous Enterprise Zones were that some of them were in areas of long term structural decline, and that jobs created were simply displacing employment from elsewhere and disappearing when the incentives ran out. To have any lasting impact these incentives need to be focussed on areas with high growth potential and which can deliver near term employment rather than just shiny new buildings on derelict land.”
Mark Ellis, partner at fixed-fee legal specialists, Ellis Whittam; and Ed Reeves, MoneyPenny CEO, offer concluding statements on the day's announcements.
Mark Ellis: “The government still needs to do more than the token changes announced today if it is serious about reversing the regulation that engulfs entrepreneurs. Although heading in the right direction with a simplification of the tax system many of the initiatives still look more like window dressing than radical change. The reduction in corporation tax is welcome and should help stimulate growth as will the cutting of business regulation by £350m. That said, they should never have been there in the first place. “
Ed Reeves: “The simplify the taxation system is welcomed as it reduces red tape, however to really kick start Britain the government should do more to offer employer’s tax breaks that encourage growth and stimulate reinvestment or employment. A government can't create wealth, but it can create the conditions for private enterprise to flourish and they would do well to remember that sometimes the tighter you squeeze the less you get.”