Autumn Statement: Business leaders welcome employer savings

A NUMBER of the measures announced by Chancellor George Osborne in yesterday’s Autumn Statement have been welcomed by business leaders.

Graeme Crawford, EY’s head of Midlands tax, welcomed the announcement that employers will have a 13.8% saving on younger employees who earn less that £42,275 per annum and save up to £1,000 on anyone under 21 years of age, earning up to £16,000 per annum.

“Today’s NIC tax breaks for under 21’s will be greeted with open arms by employers, particularly as is hasn’t been caveated to small businesses,” he said.

“The biggest beneficiaries are likely to be the hospitality and retail industry who typically are large employers of young people.

“It will be interesting to see if this measure will encourage employers to increasingly target A-level school leavers, rather than graduates.”

Looking at the statement in general, Crawford said: “Having focused so much on the continuing need to repay the debts of the past, many might have expected Osborne to be Mr Scrooge.

“Instead we have received gifts from Christmas Past, Christmas Present and Christmas Future. Businesses and consumers were today delivered cuts in fuel duty (the choice of many a past Chancellor), cuts in energy bills (the issue of the moment), and lower business rates for the future (starting next year).

“In an Autumn Statement that was ostensibly neutral over the next six years, through spending cuts offsetting tax changes, the Chancellor nonetheless created a Christmas Stocking of over £11bn through using the money saved on spending and raising over £9 billion from tackling tax avoidance and increasing the levy on banks.
 
“Altogether, this represented a true “mini-budget”, something we expected of his last two predecessors. Perhaps, the ghosts of the past still haunt the Palace of Westminster?”

TheBusinessDesk.com’s coverage of the Autumn Statement is brought to you in conjunction with EY. 

Louise Bennett, chief executive of the Coventry and Warwickshire Chamber of Commerce, said the Autumn Statement had brought welcome news for businesses.

She said: “The Chancellor has very little room for manoeuvre and we all know he is not going to be able to give hand-outs to businesses or individuals because there just isn’t the money to do it.

“Despite the improving economic picture, there is still a long way to go in terms of fixing our finances and the Chancellor was at pains to point out that we are only starting out on the road to a ‘responsible recovery’, as he put it.

“But, in terms of our members and the many thousands of businesses we work with across Coventry and Warwickshire, there were some interesting and welcome points.

“We would have liked a reduction in business rates and that was very much what the British Chambers of Commerce has been calling for ahead of the statement.

“That said, the capping of the rise in rates is welcome, especially with changes in the way they are collected coming into force by 2015, which will see greater local control of the rates.

“Ultimately, it was pro-business statement and also very much a pro-work statement, particularly focusing on young people.”

Gary Woodman, executive director  at Worcestershire LEP, said:  “We welcome the announcement made by the Chancellor today in relation to a cap of 2% on business rates.  

“The new ‘reoccupation relief’ will, we hope, also encourage greater occupancy rates in high streets across the county. We are hopeful that these  measures will reduce the cost burden on businesses, encouraging growth and securing jobs.

“We were also heartened by the Chancellor’s commitment to creating another 20,000 apprenticeships over the next two years. 

“This will enable more young people to make those first steps on their career paths, thus ensuring that businesses have the skills that they need for future growth.”  

Business leaders in Greater Birmingham welcomed new measures announced by the Chancellor to cap business rates increases and re-invigorate high street shops but warned there is much more to do.

Greater Birmingham Chambers of Commerce (GBCC) has campaigned for an immediate reform and a holiday of business rate payments. They welcome the announcement of a cap on the increase at 2%.

Chamber president Tim Pile said: “It is heartening that the Chancellor is listening to organisations like the Chambers of Commerce and is planning to limit the damage caused by relentless business rates increases.

“However, this does not mean businesses are off the hook because we will still be paying hundreds of millions more in rates to the Exchequer next year than the £27 billion they are expected to pay this year. 

“We need fundamental reform in business taxes but the promise to introduce changes in 2017 is too late. We need action now.”