Trade associations and industry bodies gave a guarded welcome to the Autumn Budget, delivered yesterday (Wednesday 27 October) by Chancellor of the Exchequer Rishi Sunak, praising its business-friendly aspects but warning about problems ahead.
A good budget for exports
As covered in yesterday’s Daily Update, IOE&IT director general Marco Forgione welcomed a rise in the DIT budget to support exporters, with funding for streamlined processes, digitisation of trade documentation and skills improvements.
“It is good news the Chancellor has announced a rise in the Department for International Trade’s budget – in particular the allocation of £45m in funding on support services for exports holds out the prospect of really making a difference to how the Government can help businesses to export,” he said.
Haulage skill shortage: more to do
New funding to improve lorry parking facilities and a promise to reduce the levies paid by haulage companies were on offer, but the logistics sector said they would not ease labour shortages.
The FT reports Logistics UK chief executive David Wells said longer term issues went unaddressed. “We have to do more to increase the number of available people in the labour market or the economy will be constrained.”
Baroness Charlotte Vere, under-secretary of state for transport, told a transport select committee yesterday that it would take until the end of next year to ease the country’s “acute” supply chain crisis due to problems training the 35,000 new drivers she said were required.
The Autumn Budget’s provisions for skills training and support for apprenticeships received a thumbs-up from the IOE&IT’s Marco Forgione.
“In the light of the skills shortages, from which we know internationally trading companies are suffering, the commitments of an additional £554m for adult skills and an uplift for apprenticeships are very welcome,” he said. “Training people to do roles such as customs compliance or logistics management is essential if we are to boost the UK’s international trade performance.”
The CBI’s director general, Tony Danker said the budget had taken positive steps forward. However, Danker argued its measures weren’t “bold enough to deliver the high investment, high productivity economy the government seeks”.
He called on the government to commit to innovation and take an agile approach to “revolutionising the skills landscape. Including apprenticeships”.
The Institute of Director’s chief economist, Kitty Ussher, labelled the skills revolution as “piecemeal” and said it would “not give business confidence that we have a coherent plan to prevent future labour shortages for our post-pandemic era outside the EU”.
Business rates and inflation
The budget’s business rates reform and R&D investment were welcomed by the IoD’s Kitty Ussher.
The Federation of Small Businesses approved of some budget measures to arrest the decline in business confidence, such as rates reform and the expansion of the British Business Bank.
However, the FSB sees “clouds gathering” over inflation and forthcoming tax hikes.
Mike Cherry, national chair of the FSB said: “If the OBR’s concerning inflation forecasts come to pass at the same moment when national insurance contributions and the living wage rise significantly, many small firms will be considering their futures – we’ve already lost close to half a million over the last year,” he added.