Partner’s Reaction: Spring Budget 2023

Author - Jasmin Brown

Date published:

Following the Chancellor’s Spring Budget on 15 March, we heard from our Chamber Partners who share their thoughts:

“Today’s Budget brings some good news for the cultural sector. The Chancellor’s decision to extend orchestra and theatre tax reliefs at the temporary higher rate will mean more people in our region can experience the life-enhancing benefits of the performing arts.

“Investment in culture is also an investment in the wider economy, with Sage Gateshead and Royal Northern Sinfonia alone contributing c.£13.5 million each year to the North East economy.

“I would like to thank the UK Government for this vital support during what remains a challenging time for our cultural organisations, artists and audiences.”

Abigail Pogson, Managing Director, Sage Gateshead

“Many companies would have been hoping that the Chancellor would have taken the opportunity to reduce the planned increase in the rate of corporation tax to 25%, he did not do that but does seem to have offered some mitigation of more expansive tax allowances for investment in machinery and technology, which I suspect will be of interest to businesses in the region and perhaps seen as an encouragement for further investment by businesses to increase productivity rates.

“Locally the region will benefit from having two of the new investment zones that being are being created and there were suggestions of new tax credits for business involved in significant R&D which may be positive for businesses in the region.”

Mark Lazenby, Head of Corporate, Square One Law

“The announcement that the country is expected to avoid an economic recession will hopefully provide some confidence in future contracts allowing earlier crystalisation of works that may have been delayed or cancelled if a recession had been predicted.  The confirmation of the temporary full-expensing window on asset purchases should help reduce the impact of the rise in corporation tax and may encourage business capital expenditure.

“The continued support for energy bills and the announcement of changes to free childcare will hopefully increase the availability of workers and take some pressure off employees and smaller businesses struggling to meet the demands  associated with the higher cost of living.”

David Greenwood, Finance Director, Hodgson Sayer

“Whilst the last 18 months have seen extreme volatility in materials pricing and shortages which has caused pain for contractors and clients alike, the loss to the sector of qualified and unqualified labour has been a constant drain on the industry for a number of years.

“We welcome the Government’s willingness to accept the Migration Advisory Committee’s interim recommendations to add five key construction occupations to the Shortage Occupation List, which we hope will ease immediate pressures on an already strained sector.

“Obviously further work needs to be done in this area – but that is longer term requiring investment in apprentices, schools, and retraining bodies to make the construction industry a more attractive and diverse place to work.”

Simon Rowland, UK Partner in the Construction Team, Womble Bond Dickinson

“There was a focus in the Budget on doing more to improve the supply of labour in the UK. By far the biggest impact has come from the rise in ‘inactivity’ from ill health.

“Here, the Chancellor announced a Health and Disability White Paper that set out plans to reform the welfare system. There were also measures announced targeted at retaining and recruiting older workers.

“However, overall the net impact of these measures seems to result in only a marginal improvement in the supply side of the economy.”

Steve Harris, Regional Director for the North East, Lloyds Bank

“We welcome measures to support customers with the cost of living and to help remove barriers to work such as increasing childcare support; this will help us to support people into sustainable employment, however we hope that the new policies around looking for work will not lead to more sanctions and push more people into hardship, rather than helping people back into work.

“Good news, particularly around funding for regeneration, levelling up projects and investment zones, as this will bring a much needed boost to the local economy. We hope this will quicken the pace of new housing provision in these areas to help support the wider economic regeneration of Teesside.  We’re disappointed there’s nothing new to increase the timescales for the decarbonisation of housing as this is a big priority for the social rented sector. We do welcome the focus on addressing nutrient neutrality as this is a real barrier to achieving targets for new home building, especially in Teesside.”

Chris Smith, Deputy Chief Executive, Thirteen Group

“While there is a sense that the region is building positive momentum around employability and skills, there is still more to be done and more talent to be enabled. At a regional scale, the potential creation of two Investment Zones in the North East could help unlock capability; and support for working families through changes to free childcare entitlement will make a tangible difference for many people in our communities. But further investment is needed if we are to achieve our ambitions and support people to develop their potential, learn new skills and secure long-term meaningful jobs.”

Andrew Haigh, Chamber President and Chief Executive, Newcastle Building Society

“Changes to the annual tax-free pensions allowance, and the abolishment of the Lifetime Allowance will make a big difference to a fairly small number of higher earners. However, the Spring Budget highlights why proper planning for retirement is important for everyone and why regardless of income, people should be thinking about how they will manage their money as they get older.”

Michael Conville, acting Chief Customer Officer at Newcastle Building Society

“For the North East of England there were some additional moneys announced for regeneration projects and sustainable transport settlements. There was also the announcement of twelve new investment zones, which would be managed locally but may include tax reliefs and grants, with one in the North East and one in Teesside. Additional tax reliefs announced for audio-visual and video games sectors and incentives for the tech sector should also bring some welcome benefits for these growing industries in our region”

Jonny Murphy, Principal Lecturer (International), Teesside University
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