Time for Change, Mr Chancellor

Greater Manchester Chamber of Commerce logo

The Chamber has written to the Chancellor, ahead of his Budget report on 20th March, outlining what we would like him to do for business.

After consultation with our members, we have produced the following recommendations which we believe will improve conditions for the business community:
Infrastructure

Chamber members have expressed a desire to see a continued shift of focus of infrastructure investment from London and the South East to the UK regions.

Smaller, quicker projects that can start as soon as possible
Greater focus on local procurement to support local businesses
Accelerated delivery of the Northern Hub project, faster delivery of High Speed Rail proposals, including the development of stations which will enable faster delivery of associated benefits for business and jobs;
Improvements in access to high speed broadband;
Incentives to invest in the energy distribution network;
Local road improvement projects, including maintenance and delivering the A57 Mottram by-pass.
Business Rates

Some businesses in Greater Manchester will be amongst the hardest hit by the delayed revaluation of business rates.

We strongly recommend a regionally based subsidy for firms in the North West for the coming two years who will be adversely affected by the delayed revaluation, akin to the subsidy announced for households in the South West in clause 1.134 of Autumn Statement 2011.

Initiate a review of business rates to consider an alternative and more responsive form of business rate calculation adopted in the future.
Regulatory Burden

Although there have been a number of initiatives aimed at reducing the regulatory burden on businesses, the Chamber still receives a high level of complaints from its members concerning regulation. The majority of current concerns can be summarised as:

The planning system remains too slow;
The amount of regulation should be proportionate to the perceived risk, a one size fits all approach does not reflect the flexibility of a modern business market;
Environmental regulation is increasing energy costs for business, e.g. the climate change levy;
Government processes and functions could be better integrated to reduce the regulatory burden, such as a single point within government to collect consolidated information for all departments from each business.
The likely increase in employment costs resulting from the introduction of pensions auto enrolment;

Businesses would still like to see Employer’s National Insurance Contributions reduced or abolished, and the Chamber once again urges you to accelerate progress towards integrating income tax and National Insurance as a simplification and to make the tax system more transparent.

Whilst recognising the decision to scrap the 3p fuel duty increase in the Autumn Statement, fuel prices are continuing to rise with the associated impact on business costs.

The Chamber has also been a long standing supporter of reforms to Air Passenger Duty and calls again for a commitment from government to investigate and review the current model. This is a tax that impacts directly on the UK’s ability to trade overseas and is therefore a hindrance to establishing growth back into the economy.
The Green Economy

Rather than simply increase the cost burden of energy, there is much that the Government might also be able to consider to incentivise the green economy and promote growth.

Create greater incentives for the uptake of Green Deal/building and retrofit;
Allow the Green Investment Bank to borrow from the market now rather than wait until 2015;
Historically low interest rates in the UK offer an opportunity to accelerate the roll out of more efficient technology across the public estate, e.g. LED lighting on motorways, benefiting both business and the environment.
Government should robustly defend the UK VAT position on energy efficiency equipment, currently at 5%.
Funding Growth & British Business Bank

The British Business Bank may be a useful additional tool but this must not divert attention away from the root cause of the problem for SMEs in accessing adequate capital to assist growth. The level of lending from existing institutions must be improved and accelerated.

Funding for Lending is proving to be successful in stimulating the mortgage market but it is not yet benefitting business and this needs to be addressed.
Skills & Employment

We remain concerned about the variability and lack of information, advice and guidance (careers advice) to young people, teachers and parents. If young people are to make informed careers choices it is vital that independent, impartial, face to face guidance is available.

Introduce free or highly subsidised public transport for under 18s and encourage increased labour mobility in the 19 – 24 year old age group.