Chamber Comments on Chancellor's Autumn Statement

Christian Spence, Research Manager at Greater Manchester Chamber of Commerce

Following the Chancellor’s Autumn Statement today, Christian Spence, Head of Business Intelligence at Greater Manchester Chamber of Commerce, said: “The single biggest and most welcome announcement from today’s Autumn Statement for many of our members will be that around business rates.

"Whilst a cap in the April 2014 rise of 2% is a better out-turn than the initially expected 3.2%, this smaller rise will still produce an additional burden for Greater Manchester businesses of £21.8m, equivalent to nearly 1,000 jobs at the GM average wage.

"Discounts for smaller retail premises are also welcome, as is the commitment to consider new ways of administering the business rates system from 2017.

"The system as it stands is unduly burdensome on many businesses and is desperate need of wholesale reform, but the government appears to be approaching the forthcoming discussions seeking a fiscally neutral outcome, meaning any changes will be entirely redistributive.

"We call upon the government to go further and aim to fundamentally change the system and we stand ready to work with government to support this aim.

“It is also good to see greater support for export measures, though there must be a continued focus on bringing the huge opportunities which exporting can bring to companies that do not currently consider themselves suitable for this important move.

"It is right that we seek to expand the work of current exporters, but there is much work to be done in increasing the volume of businesses actively engaging overseas.

"The Chamber is actively working directly with key overseas markets linking into established on-the-ground networks to help remove some of the barriers that businesses face in taking their first steps with international trade.

"With the support announced today we see this work increasing over the coming years.

“The skills of both the current and future workforce are vital if the UK economy will be able to fully respond to the demands that will be placed upon it over the coming years.

"Greater funding for advanced level apprenticeships and creating easier ways for employers to engage with and pay for the training they need are equally welcomed, as is the increased funding into Start Up Loans to help our next generation of entrepreneurs to access the funding they will surely need to become successful.

“The additional funding into the British Business Bank is not unwelcome, but Greater Manchester Chamber fundamentally questions the need to create the additional administrative burden that this will generate.

"The time and money being invested into this new venture would be better spent supporting and reinvigorating the current banking system and allowing those businesses that are well experienced in the business lending market to more fully deliver the funding required to the UK’s SMEs.

"The capital provided to the Business Bank is not of a size large enough to deliver any significant impact when considered side-by-side with the current banking sector and should instead be used to improve the functioning of the current system.

“The government’s commitment to a low and competitive taxation system is important. The removal of employers’ National Insurance Contributions for under-21s will reduce the burden of what is simply a tax on employment.

"We question, however, whether this will have any significant impact on the employment of young people as the savings for a minimum-waged 18-20-year-old will be less than £300 per year for any employer. We would prefer the government to look more closely at the impact that employers’ National Insurance has on the wider labour market and its disincentives to hire and its effects on the take-home pay of employees.

“The Chancellor’s specific continued support for High Speed 2, Northern Hub and energy supply (including both shale gas and nuclear) are vital as are his proposals to improve the planning regime necessary to deliver these and other major projects in a timely fashion.

"The announcement of a specialist planning court for national infrastructure projects and the development of a National Networks National Policy Statement to provide confidence for transport sector will receive a warm reception in many quarters, as will the proposed £1bn programme to fund specific infrastructure projects to unlock stalled housing sites, so vital if we are to build enough homes to support our growing population and allow them to live close to where they work.

“The macro-economic picture has improved significantly in the last six months as reflected in the Chamber’s own Quarterly Economic Survey, the results of which for the fourth quarter of 2013 will be published in January.

"The government’s desire to improve the public sector finances is vital to provide a sure economic footing for the country into the medium- and long-term and we support the government’s aims of reducing the deficit and its wider programme of public sector reform.

"Broadly, the Chamber welcomes this Autumn Statement for the reasons addressed above but it must use the remaining 18 months of this parliament to continue to make the supply-side reforms necessary to allow our businesses to take advantage of the economic recovery.

"The future is looking much brighter than any of us expected earlier this year but this is not the time for government to relax: it must be relentless in seeking – and delivering – the policies necessary to allow Greater Manchester to deliver a future worthy of its history.”