Ahead of the General Election, ACCA (the Association of Chartered Certified Accountants) has released a five-point manifesto for the next government.
‘Britain is facing unprecedented challenges and opportunities over the coming months and years. This is a time for the government to take stock, review existing structures and strategies, and prepare a long-term plan to benefit the UK economy and business,’ said Helen Brand OBE, chief executive of ACCA.
1. A sustainable industrial strategy for everyone
Any new administration must look to boost businesses confidence and establish a stable economic environment. This includes the continued commitment to a UK-wide industrial strategy that helps businesses of all sizes to start, grow and boost the UK’s economy and productivity.
The strategy must hone in on the barriers to growth for SMEs and scale-ups, with a recognition that the challenges faced in England, Scotland, Wales and Northern Ireland will differ according to financial landscapes, connectivity and talent pools.
Regional administrations will need to work closely with local businesses to identify effective solutions to the challenges that are holding UK businesses back.
An ambitious, UK-wide strategy sends a clear signal to international partners that the UK remains a reliable long-term business partner that is actively looking for cross-border business opportunities.
2. A practical approach to skills gaps
Government must recognise employers are best placed to identify skills gaps and anticipate what capabilities workforces of the future will need.
To create a future-proofed workforce, the right educational programmes and skills training must be put in place. Governments, schools and businesses alike need to look beyond traditional education routes when developing a highly skilled and agile workforce. This must focus on creating a lifelong learning culture within the workplace and boosting career aspirations for younger generations.
The first step must be a wholesale review of national careers advice and building strong links between local businesses, schools and learning providers to ensure a better alignment between learning and the workplace.
Vocational education will play a key part in the creation of a multi-skilled and flexible workforce, it is therefore vital vocational career pathways, such as apprenticeships, include core transferrable skills that benefit both individuals and employers
3. A return to the basics of the tax system
The government should revisit key tenets of the tax system such as business rates, and ensure they are conducting a root and branch review of current systems, with consideration of the changing post-Brexit business landscape. It may be time, for example, to detach business rates from property values.
We welcome the deferment of Making Tax Digital following its removal from the Finance Bill, allowing government and stakeholders to reassess the current plan post-election. The next seven weeks of purdah gives us time to take a constructive and close look at the Finance Bill, and then the delayed MTD can be later scrutinised alongside potential accelerated tax payments.
We hope that the next government avoids the temptation to tamper with tax plans, and instead conducts a thorough review of existing systems to lay the foundation for long-term planning.
4. A holistic and prioritised approach to public sector funding
Government should adopt a holistic outlook when considering funding for public services.
A cross-governmental system would promote greater collaboration, reduce doubling of efforts, and ensure the best funding is in the right area to make sure people receive the public services needed. Equally, stability is important and a long-term funding framework in place would most likely deliver greater value for taxpayers.
The public sector landscape is ever-changing and while the government’s position on regional control over public services finances is commendable, more needs to be done to make this a reality. This would give local public sector bodies more control over budget allocation. Vast improvement is also needed to bring the public sector into the digital age and to run public services more effectively, including up-skilling staff to adopt change.
5. Avoid overly prescriptive solutions to corporate governance concerns
Government needs to support voluntary measures to improve the culture of corporate governance in the work place. ACCA advises against unnecessary additional regulation, for both listed and privately-held companies, warning that a one-size-fits-all approach will not work and that positive reinforcement of culture-led solutions will be more effective.
To improve current guidance on corporate governance, we need to look at how corporate leadership can involve and engage its stakeholders effectively, from employees to shareholders. Bottom-up solutions that obtain the buy-in of employees, for example, are becoming as important as top-down solutions and shareholder engagement.
The government must also be mindful of pay trends for UK companies, which could intensify due to global economic uncertainty on issues such as Brexit, which increases competition for talent.
ACCA support measures to increase the transparency of company pay policies through a voluntary approach. This enables companies to demonstrate their commitment to accountability and facilitates their engagement with relevant stakeholders.