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6th March 2024

Chambers react to Spring Statement Budget

The chancellor revealed the government’s Budget in the Spring Statement on 6 March.

Paul Butterworth, CEO at Chambers Wales South East, South West and Mid, said:

“The budget is not as comprehensive as the Autumn Statement in economic terms, but does contain a number of positive measures to tackle challenges surrounding investment and growth, including the increased VAT threshold and access to finance for SMEs. For investment to improve in the long-term and support a growing, innovative economy, interest rates and inflation will need to fall further still.

“Despite the Chancellor mentioning in the introduction to the budget that he wanted to build a ‘high wage, high skill’ economy, detailed measures to tackle the ongoing skills shortage in the private sector were notably absent within today’s statement. In Q4 of 2023, almost two thirds of businesses in Wales experienced difficulties in finding suitably skilled staff and only 16% increased their investment in training. This is a frustrating barrier to long-term economic and skills growth for Welsh businesses and an area where support would have been welcomed.

“It is promising, however, that both Welsh Labour leadership candidates are championing skills and business support within their manifestos and businesses in Wales will be hoping to see these measures actioned once the new leader is elected.”

Shevaun Haviland, Director General of the BCC, said:

“Following the Autumn Statement this Budget was always set to deliver less for business although changes to National Insurance will provide some momentum.

“However, beyond this there were no major announcements to help shift the dial on conditions for business.

“The clock is now ticking to the General Election – and this Budget could be the last fiscal event before voters go to the polls.

“Business confidence is improving but the coming months will remain challenging for many companies. It is vital that the economy remains front and centre of the campaign to come.”

On jobs, Shevaun said:

“The prospect of an additional 200,000 entering into the workforce, due to cuts in National Insurance, would make a significant dent in the job vacancies holding back our economy. It will also provide a welcome boost to economic growth.

“Combined with the increased child benefit threshold, this should help business find the staff they so desperately need.”

On the VAT threshold change, she added:

“Increasing the VAT threshold to £90,000 from April will help SMEs in our Chamber network to grow and invest but a more fundamental review is required. We will continue to engage with Government to push for this.”

Responding to news of new funding to train planners, Shevaun said:

“We are pleased the Chancellor has joined forces with the BCC and our founding partner Aviva, by committing £3m of matched funding to our business-led programme to unlock the planning system. This is a clear signal from Government about working in partnership with business to solve problems. We now have a real opportunity to make the system quicker and more efficient for everyone. It is all about investing in talent and building communities.”

On the new Growth Guarantee Scheme she said:

“It’s also good news that the Chancellor has listened to our calls for the Recovery Loan Scheme to be extended. Under its new name, the Growth Guarantee Scheme will continue to be a financial lifeline for thousands of businesses to get back on track after recent economic shocks and plan for future growth.”

On tax free shopping she added:

“There will be huge disappointment that a new internationally competitive tax-free shopping scheme was not mentioned by the Chancellor. We will review the OBR’s evidence and continue to make the case for this.”

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