Chancellor Rishi Sunak’s Spring Statement today leaves the North East having to wait and see what the government is planning to do to aid the North East’s economic recovery.
That was the reaction to the Statement this afternoon from Richard Baker, strategy and policy director at the North East Local Enterprise Partnership.
Topics on which uncertainty remains include skills support, the apprenticeships levy, innovation performance and capital allowances. Firm news may have to await the Budget in the autumn.
The region is also left waiting to find out how much it will receive from the UK Shared Prosperity Fund, the replacement for the EU regional development funding it received before Brexit.
‘[S]ome of the big investments which could have accelerated growth in the North East will await the Budget’, said Mr Baker.
Stephen Harris, Associate Tax Director at Azets in the North East, a regional accountancy firm and business advisor to SMEs (small and medium-sized enterprises), called the Spring Statement ‘a missed opportunity to be bold’. He said:
‘Businesses had hoped for a complete U-turn on the 1.25% NICs (national insurance contributions)) increase, which might have been achieved with the government having received record tax receipts across the board in 2021.
‘We welcome the Chancellors pledge to cut tax rates on business investment in his Autumn Budget, as SMEs continue to have a significant role in driving the UK’s economic recovery from the pandemic, despite ongoing disruption to supply and rising costs.
‘However, existing schemes such as the super-deduction have so far been underutilised and we would encourage the government to extend incentives for investment in key areas such as R&D, innovation, and technology sooner rather than later.’