Focus is on fundamentals but with long term challenge for South West to raise its game says Business West.
Commenting on Budget 2015, delivered today by Chancellor of the Exchequer George Osborne, Phil Smith, Managing Director of Business West said:
“This was a budget focused on the big fiscal fundamentals, with George Osborne stressing his credentials on debt and deficit reduction in the lead in to the general election. We didn’t see big spending giveaways, which is a relief for those who know that tax pledges before elections are usually reversed immediately afterwards.
“Businesses will welcome many of the measures on business tax. Confirmation of the cut in the rate of corporation tax to 20% was aimed at sending a message globally that Britain remains open for business. It is the measures on National Insurance contributions and business rate reform that will be more of interest to small and medium firms though.
“Business rates reform was trailed in the Autumn Statement, and plugged again today. We await the detail with keen interest, but as reform has to be fiscally neutral, it is hard to see how we are going to see really fundamental reform of this outdated and unfair tax, without ‘robbing Peter to pay Paul’.
“There is better news for the self employed, with the abolishment of class II National Insurance contributions. The abolishment of the annual tax return will be good news for all those small traders and the self employed who have ever struggled with time consuming returns on the 31st of January – but it is unclear just how simple the alternative will be. The cancellation of fuel duty rise pencilled in for September will also reduce pressures on many firms’ bottom lines.
“The South West got some honourable mentions, with a £7 billion transport announcement and a 2% cut in cider duty. It’s also great news that the government has announced full approval to the North fringe to Hengrove metro bus scheme in greater Bristol, allowing construction to start next month.
“But what was most striking is how little attention is being paid to the West of England compared to the North of England. The Northern Powerhouse, a “comprehensive transport strategy for the North”, Manchester and new deals for West Yorkshire were all heavily underlined – as was the hopes for a stronger Northern economic performance in the future. Manchester being able to retain 100% of business rate growth was a real eye catching pledge.
“There is a real danger that our region is going to miss the boat if it fails to get its act together and put forward a clear offer to government on how we can grow our economy in return for delivering strong leadership for jobs, skills, transport and housing growth. Our local leaders must take note that others are stealing a march on us.”