This Week’s Hot Topic: What to expect from the Chancellor’s low-key Spring Budget
One gets the impression that this year’s Spring Budget is very much a fiscal event the Chancellor Philip Hammond, and the Government as a whole, could well do without.
With Brexit negotiations due to begin in a matter of weeks and the Prime Minister, Theresa May, battling to ensure the her Article 50 bill passes through the House of Lords, the build-up to this year’s budget has been decidedly low key as White Hall grapples with the monumental task of shepherding the country out of the EU.
That being said, Hammond will still be expected to show he has a firm hand on the tiller, with many looking to the Chancellor for more details on the Government’s Industrial and Digital Strategies announced this year.
Similarly, a renewed commitment to the Northern Powerhouse and more support for the UK’s scaleups could go a long way to quelling the concerns of business and industry ahead of a prolonged period of sustained uncertainty.
With Budget announcement set to take place this Wednesday (8 March), Bdaily’s regional editors gave their thoughts on what businesses can expect to see from the Chancellor.
Bdaily North West Editor, Richard Bell - Scaleups
Last November, I had the honour of launching Bdaily’s first-ever foray into webinars by hosting a discussion on scaleups and the valuable contribution they make to the economy.
When Chancellor Philip Hammond announces his Spring Budget on Wednesday, I’m hoping to see signs of the Government shifting its focus onto businesses with high-growth potential.
What exactly might this mean, in tangible terms? It’s hard to say, but any steps that address the unique challenges faced by fast-growing SMEs will be a plus.
This could cover securing the right kinds of finance; accessing infrastructure, like well-equipped R&D facilities and premises; or attracting and developing the talent and leadership that will ultimately stimulate growth.
We also need to see practical support for startups – the kind that will help them transition into scaleups.
A report by ScaleUp Institute co-founder Sherry Coutu CBE highlighted that if we turn just 1% of UK businesses with 10-plus employees into high-growth firms, after three years we’d have seen 238k jobs created and generated nearly £39bn in additional turnover.
The potential is huge, so let’s hope the Chancellor is preparing to do something about it.
Bdaily Yorkshire Editor, Nick Hill - Northern Powerhouse
Over the past 12 months, Bdaily has comprehensively covered the government’s ambitions towards creating a Northern Powerhouse. During this time, we have heard multiple business leaders from across different regions to express their views on what they think need to happen for the North of England to reach its full economic potential.
But ever since George Osborne first declared the need for such a scheme, how much progress has been made towards the government’s ‘Northern Powerhouse’ ambition?
From my experience working at Bdaily, the Northern Powerhouse has always remained a hot topic amongst business communities in the North. But I believe the pace the government and its various schemes are moving is just too slow to make any real impact to the Northern economy.
However, a change of pace now appears to be in motion following on from the launch of Prime Minister Theresa May’s Industrial Strategy. The government announced that it will provide a £556m boost for the Northern Powerhouse initiative. This funding will be used to help create new jobs, support businesses and generate growth across the Northern regions.
When Chancellor Philip Hammond announces his Spring Budget on Wednesday, I am hoping to see the government reiterate its support towards business communities in the North, and give more clarity this funding awarded to the Northern Powerhouse.
We still don’t know long the £556m investment will be spend over, which sectors will be allocated the most funding, or if businesses and employees are able to have their say in securing/distributing the funds?
But I am confident that the Chancellor will deliver further support towards the Northern Powerhouse in the Spring Statement after recent comments made by the Northern Powerhouse Minister Andrew Percy. During the Northern Powerhouse International Conference and Exhibition in Manchester, Mr Percy reiterated that the government remained fully committed to the powerhouse project.
However, he also said that “there is a lot more to do.” And I believe this is echoed by many businesses communities in the North, therefore it is vital that Hammond uses the Spring Budget to highlight what exactly the future holds for the Northern Powerhouse.
Bdaily London Editor, Billy Wood - The digital agenda
Much has been made of the Government’s long-delayed Digital Strategy which was finally published this week and, while hobbled somewhat by Brexit, the report gave some hints as to where its digital priorities lie.
Digital infrastructure is one, with high-tech businesses and industries crying out for firm commitments from White Hall for more rapid deployment of superfast broadband networks and investment in 5G-ready technologies.
After all, a high-tech economy is only as effective as its fastest broadband speeds, so Digital and Culture Minister Matt Hancock’s commitment that the Government is poised to reveal more details of its fibre and 5G trials suggests the Budget could see the UK making even greater strides to building its smart, connected infrastructure.
Another key area is skills and many tech firms will be looking for more commitments to the digital skills agenda than some of the digital literacy initiatives revealed in the Digital Strategy.
While the Government’s attempt to get more of the UK population’s tech proficiencies up to speed is commendable, the move is at least partly driven by the desire to make greater efficiency savings through the uptake of digital services and does little to tackle the chronic skills shortages that tech firms UK-wide are currently facing.
The problem is made all the more urgent with the current uncertainty surrounding post-Brexit migration rules and fears that the tech sector could be seriously impacted by any controls placed on skilled workers from the EU.
While there’s little the Chancellor can do on the migration front, any cash boost or commitment to the skills needs of the UK’s tech industry could go a long way to allaying fears that the Government is blithely vandalising the potential of one of its most productive and valuable industries in the name of political point scoring.