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Chancellor Opens the Door: Onus on Business to Cross Threshold

 

NECC Partner Member KPMG has provided comment and reaction to the Chancellor's statement.

NECC Partner Member KPMG has provided comment and reaction to the Chancellor's statement.
 
In his Autumn Statement, the Chancellor has announced a raft of packages aimed at driving economic growth.

David Elliott, Tax Partner at KPMG in Newcastle says:

"There are some 'gifts for business' in the Chancellor's announcement as the government continues in its effort to assist SMEs and stimulate growth. News of infrastructure projects, the holding back of extra transport costs, easier access to funding and the relaxing of employment law and health and safety burdens are all to be welcomed.

"The introduction of the Seed Enterprise Investment Scheme, with its very generous tax incentives, accompanied by the relaxation of the very strict rules governing the main Enterprise Investment Scheme should help SMEs to attract new cash investment to help with their growth agendas as we move into another challenging year.

"The government has opened the door for business, and it is now up to business leaders to step over the threshold and take advantage of what is on offer.

"Infrastructure investment took centre stage as the government's antidote to lower growth forecasts and rising unemployment levels and to enhance the UK as an attractive place to do business and this region will benefit from the bringing forward of the investment in the Metro.

"A further £1bn for the regional growth fund will also feed through to smaller schemes in this region and the £400m construction fund will be a small but helpful boost to new housing starts.

"Whilst it is encouraging to see so much investment in Britain's 'hard' infrastructure', it's only the beginning as business needs more support when it comes to the 'soft' backbone of the economy. The Chancellor's proposed youth contract is certainly a step in the right direction, but it is not just about placing the unemployed in any job – business will only grow if the right people are given the right skills for the region in which they live.

"There is also no getting away from the fact that the support must come at a price. Someone has to pay for it and it is clear that the burden has fallen on the banks, public sector employees and business at large through the rates increase. After all, it may make good headlines to say that the increase in business rates is being partially deferred, but deferral only delays the pain. It's a move that emphasises the old adage, now true of the economy – namely that there will be no long term gain without medium term pain."