Business leaders give cautious welcome to UK budget plans

The latest UK budget has been described as “more defined by what it omitted than what it included”, and it has divided opinion in the business community. David Sapsted uncovers more.

Relocate Global and David Sapsted report on the Nov 2017 budget with illustration of piggy bank superimposed on Union Jack flag
Business leaders in Britain have given a guarded welcome to the proposals to boost output in Chancellor of the Exchequer Philip Hammond's Budget on Wednesday.While some felt the government could have gone further to encourage investment, the country's largest business group, the Confederation of British Industry (CBI) described the Budget as a good one "for a country in tough times".

CBI director-general, Carolyn Fairbairn and the UK budget: "Delivery is everything"

Carolyn Fairbairn, CBI director-general, said: “Against a sombre economic backdrop, the chancellor gripped the steering wheel on the UK economy. This is a budget that balances support for people on squeezed incomes with vital action to help grow the UK out of austerity. But delivery is everything.“Action on business rates, R&D tax credits, the National Productivity Investment Fund and Brexit planning will help firms to invest and grow today against an uncertain Brexit backdrop.“It was good to see focused investment in the long-term drivers of growth that underpin sustainable prosperity.

Investment in infrastructure will tackle regional inequalities

“Building a skills system that supports the 4th industrial revolution is the right ambition, but the approach needs to be joined-up with the National Retraining Partnership delivering a stable approach and apprenticeship levy flexibility.“Additional investment in infrastructure will help tackle regional inequalities. The support for housing supply is critical for people and firms. Metro mayors will also welcome greater options for transport funding, but regions without devolution deals must not be left behind."

Stephen Martin, DG of the Institute of Directors, was cautious about the UK budget

Stephen Martin, director-general of the Institute of Directors, offered a more cautious welcome to the proposals, saying that Mr Hammond had "dipped his toe in the water with this Budget, but failed to make a splash with business".He said that, with Brexit looming in March 2019, this year’s Budget represented the last chance to give business the the confidence and incentives "it desperately needs" to invest in equipment and employees.Mr Martin added: “Philip Hammond faced a difficult task, with ugly growth forecasts and plenty of demands on the Treasury, but companies will still be disappointed with what they got. Individually, there were some positive measures, but overall, the Budget was more defined by what it omitted than what it included.“Investment in maths and computer science in schools, re-training, and transport for the Northern Powerhouse are all positive. But the Budget was simply too tepid in other areas. Adjusting the up-rating of business rates was welcome, but too little relief was provided for small businesses now."
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Adam Marshall, DG of the British Chambers of Commerce was pleased that Chancellor focused on the basics: rates, roads and ringtones

Adam Marshall, director-general of the British Chambers of Commerce, said business communities had wanted the chancellor to focus on the basics - "rates, roads and ringtones" - and would be pleased there had been some action on all three fronts. “While more remains to be done to reduce the impact of business rates on investment and growth, the chancellor’s decisions will lessen the impact of rate rises on hard-pressed firms in many parts of the country from next April," Mr Marshall said."Commitments to delivering road and rail infrastructure, and working to improve mobile phone signals on key transport corridors, will help support local business productivity. “Despite the inclusion of a number of announcements that will support business communities in the short term, more will still need to be done over the coming months to lay the groundwork for a successful Brexit transition."Businesses will expect greater boldness from the chancellor - and more radical support for infrastructure and investment - once a Brexit transition period is secured and the shape of a UK-EU deal becomes clearer.”

Terry Scuoler, CEO of EEF, welcomed the UK government's commitment to a comprehensive industrial strategy

Terry Scuoler, chief executive of the manufacturers' organisation EEF, said the government's commitment to a comprehensive industrial strategy and support for manufacturing, innovation and new technology came as "a welcome stiffener for business as Brexit anxiety looms".He said: "The chancellor's explicit pledge to deliver an implementation plan ahead of Brexit will reassure companies of the government's intent, giving business certainty amid gathering Brexit jitters.“We are delighted to see the government's National Productivity Fund has been extended for a further year to £31 billion to upgrade Britain's economic infrastructure and the extension of the R&D tax credit increasing to 12 per cent will boost business investment in future productivity and technological advances."

Mercer's Global Head of Infrastructure, Toby Buscombe, also welcomed the proposed UK infrastructure initiatives

Toby Buscombe, global head of infrastructure at Mercer, commented: “ We welcome the government’s announcements on a range of new infrastructure initiatives. Depending on the detail of individual projects and how they are to be financed this could be good news for a range of institutional investors."Infrastructure investment can provide a portfolio enhancement for many investors by diversifying away from traditional financial market risk whilst adding a source of return stability and value preservation." For related news and features, visit our Finance section. Look out for the launch of 2018's Relocate Awards, entries open in January.Relocate’s new Global Mobility Toolkit provides free information, practical advice and support for HR, global mobility managers and global teams operating overseas.Access hundreds of global services and suppliers in our Online DirectoryClick to get to the Relocate Global Online Directory

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