South East manufacturers are urging the chancellor to maintain his focus on driving up productivity and pressing ahead with infrastructure investment in the forthcoming Budget to ensure that businesses are teed up for post-Brexit success.
Making the call, EEF, the manufacturers’ organisation believes the direction set by the chancellor at the autumn statement should continue to provide the policy framework for what will be the first of two Budgets this year. It is, additionally, an opportunity to demonstrate that the policy priorities set out in the government’s industrial strategy green paper are being taken forward by all parts of government.
Government must enable more research and innovation, skills development and higher levels of investment through the potentially uncertain Brexit negotiations. This will be critical in laying the foundations for future growth and productivity across British manufacturing.
Actions that could underpin these outcomes include a positive outcome from the government’s review of the tax treatment of R&D which has the potential to make the R&D tax credit system even more attractive compared to international partners and bring forward additional innovation investment from businesses. And with the apprenticeship levy due to hit businesses this year, further efforts and investment is needed to ensure that there is sufficient, high quality technical training provision to meet the needs of employers and learners.
The chancellor must also act decisively to end the annual bout of controversy about the UK business rates system. It’s almost a unanimous view that this tax is far from perfect, but after successive rounds of consultation, we need an unequivocal decision on the long term future of non-domestic property taxation.
Frank Kaye, interim region director for EEF in the South East, said: “The economic indicators for the UK so far this year should offer the chancellor further confidence about the resilience of the UK economy, but we remain some way off from the end of possible Brexit uncertainty.
“This Budget must drive ahead with the productivity-focused commitments that we saw in both the Autumn statement and the government’s recent industrial strategy green paper. Action that enables more innovation, more investment and supports better skills and infrastructure in the economy are not optional if the UK is to be ready to make the most of post-Brexit opportunities.
“Just as important is ending the controversy over business rates. This is a significant tax on businesses, which has been subject to much consultation in recent years. This budget must ensure that the system meets fiscal and economic goals that are consistent with increasing productivity and doesn’t become an annual policy distraction.”
In its submission EEF has made the following recommendations under four pillars:
Delivering a skilled and productive workforce
More reliable and resilient infrastructure
The government should look to extend local full fibre networks through a public-sector demand aggregation approach and a targeted business voucher scheme to build backhaul provision.
A lower cost of doing business
Better support for growing businesses