Member Article

Hopes for vaccine puts growth back on Budget wish list

South East businesses want the Chancellor to focus on economic growth over new or extended COVID-19 support measures in the upcoming Budget, according to a new survey from Grant Thornton UK LLP.

The research finds that 45% of mid-sized companies want Rishi Sunak to prioritise growth, while 27% call for more help coping with the impact of the pandemic.

An uptick in optimism since the end of 2020 is a likely driver of the renewed interest in growth, with 80% of businesses surveyed feeling optimistic about the outlook of the UK economy over the next six months, an 18 percentage point increase compared to December last year. Outlook for revenue growth was also more positive, with 82% saying they were feeling optimistic, a 12 percentage point increase since December 2020.

Business leaders would most like to see the government target improving infrastructure (36%) and incentives for employers to invest in skills attraction and development (35%) to support their growth ambitions.

Of the existing government support that companies would most like to see extended, the COVID-19 Corporate Financing Facility (33%) and Coronavirus Business Interruption Loans (33%) share top billing, followed by Business Rates Holiday (32%) and the Coronavirus Job Retention Scheme (29%).

John O’Mahony, practice leader at Grant Thornton’s Gatwick office, said: “Business leaders across Sussex, Surrey and Kent are starting to see light at the end of the tunnel, which is reflected in the increased levels of optimism compared to the end of last year. The pandemic has hit parts of the regional economy hard and many sectors are now operating in a very different market context. Though we’re currently still in a lockdown and prioritising health and safety, business leaders are planning for the mid to long term future. A likely driver for this increase in optimism is the ongoing success of the UK vaccine programme and is further bolstered by the Bank of England’s predictions of a strong economic recovery.

“It is important that the government capitalises on this optimism as a driver for growth and backs business in the right way. Though government support has been vital during the pandemic, as we start to plan our roadmap to recovery, we can see clearly from the findings of this research that businesses are starting to look longer term, prioritising incentives and investment that support growth, with less reliance on government handouts.”

This was posted in Bdaily's Members' News section by Helena Young .