IoD press release Budget meets the brief, but is no game changer for growth
Following the Institute of Directors’ initial response to the Chancellor’s Autumn Budget Statement, Anna Leach, Chief Economist at the Institute of Directors, said:
“In the short-term, this Budget fulfils its brief of delivering some relief for households and a chosen few in the business community, particularly high street businesses and pubs. Ongoing efforts to improve the ecosystem for entrepreneurs alongside capital reforms are welcome and should help more businesses form and scale in the UK. The devolution agenda has considerable scope to improve the efficiency of the state, albeit the payoff is a fair way off and provided the risks are well managed. There’s tougher talk on tackling public spending, increasing the hope that fiscal risk will no longer fall so squarely on the shoulders of businesses and investors.
“But this Budget is also a missed opportunity. Business taxes go up again overall, as does borrowing. The £2.6 billion being spent on untargeted and small-scale reductions in household energy bills would have been better used to reduce the cost of employing young people or reducing business energy bills. The surcharge on banks may be smaller and shorter lived than feared, but it still represents yet another attack on successful large businesses in the UK which will do little for the UK’s global investor appeal. Spending restraint is tomorrow’s problem and the need for wholesale reform of the tax system remains.
“All in all, there’s no game changer for growth here. Living standards remain under pressure, housebuilding targets will not be met, distortionary taxes remain unreformed and the UK’s capacity to meet further shocks continues to be eroded. All eyes will be on next year’s Spending Review as the big test of the government’s resolve in tackling some of the hard choices needed.”
The full detail on the Chancellor’s Budget is available in the Red Book here.
