Chancellors speech – industry reaction

Chancellor John Healey has set out his plan to drive growth in the UK. Speaking at the Manufacturing Technology Centre in Coventry, the Chancellor laid out how he will take an axe to delays holding back growth, from backing British business and giving local leaders more power, to clearing away the delays that hold back investment.

In response to the  speech on growth, Shanika Amarasekara MBE, Chief Executive of the FLA said “Growth needs investment. Investment needs finance. The Chancellor is right to focus on removing barriers to business investment and creating the conditions for businesses to grow.

“Our members are already playing a vital role in making that investment happen – providing businesses, particularly SMEs, with finance for the equipment, technology and vehicles they need to grow. The test now is whether the policy and regulatory environment gives private finance the confidence and capacity to keep supporting that investment.
If we want growth in every postcode, we need finance in every postcode too.”

Louise Hellem, CBI Chief Economist, said “Business will welcome the Chancellor’s clear commitment to use every lever of the state – in partnership with business – to deliver the step change in growth the UK urgently needs.

“The Chancellor is right that growth is not an abstract prize: it is the route to putting the public finances on a sustainable footing and improving living standards in every part of the country. Fiscal discipline and a competitive business environment must go hand in hand if the UK is to win investment that might otherwise go overseas.

“Early action to unlock regional growth across the country is encouraging. Backing high-growth firms in the North and using the National Wealth Fund to crowd in private investment can help turn ambition and innovation into jobs, productivity and stronger local economies.

“Securing investment is essential to the UK’s long-term prospects, so businesses will be reassured by plans to tackle regulatory bottlenecks, speed up decision-making and give investors greater confidence. Cutting unnecessary regulation must now translate into faster delivery on the ground.

“Accelerating the growth of UK unicorns should be a national priority. New sandboxing powers can help de-risk innovation and give firms the confidence to develop next-generation products, services and technologies here in the UK, rather than looking abroad for support.

“Firms will welcome the positive signals of intent from the Chancellor and will now be looking ahead to the Budget to see whether the government can match its ambition with decisive action to cut business costs and give firms the headroom they need to invest.”

Alan Vallance, ICAEW Chief Executive, said “The Chancellor is right that growth is the only sustainable route to stronger public finances, so his focus on investment, innovation and jobs, alongside measures to unlock infrastructure and spread economic opportunity, is a promising sign. It also won’t be lost on business that Healey was markedly more upbeat than some of his predecessors about the state of the UK economy and the future opportunities for growth, despite his candour about the magnitude of the challenges the country faces.

“The commitment to reduce the regulatory burden by 25% is particularly encouraging. Businesses tell us that operating in the UK has become too uncertain, too difficult and too expensive, so this target must translate into practical changes that cut the cost of doing business, reduce the pain points that businesses have to face and make it easier to invest, innovate and create jobs.

“Fiscal discipline matters, but the Budget must not seek to rebuild headroom through further increases in business taxes. Firms need certainty, simplicity and stability, supported by a credible, long-term roadmap towards a simpler, fairer and more modern tax system. The plans for greater fiscal devolution should also empower local leaders while avoiding additional complexity or fragmentation for businesses operating across the country.”