Chamber Partner’s reaction to the budget
Date published:
Womble Bond Dickinson
Kevin Bell, transport partner at Chamber Partners, Womble Bond Dickinson, said:
“As someone who cares passionately about the key role that public transport plays in connecting and transforming our towns and cities, boosting our economic recovery and delivering even more education and job opportunities, it is positive to hear the new Chancellor of the Exchequer, Jeremy Hunt, confirm in his Autumn Statement that infrastructure remains a “growth priority” for the Government and that he will not be “cutting a penny” from capital investment budgets over the next two years.
So the many large transport infrastructure projects that we initially feared could face the chop in order to fill the £60 billion black hole would appear, at first glance, to continue full steam ahead. HS2 to Manchester, the continued development of East West Rail and the promise to introduce the Northern Powerhouse Rail core network.
But scratch beneath the surface of the announcements from the despatch box at lunchtime and we find out that, for example, the plan for Northern Powerhouse Rail is to revert to the watered down version delivered in the Integrated Rail Plan that was published this time last year. A network that will, admittedly, consist of a new high-speed line between Warrington, Manchester and Yorkshire and additional upgrades to existing infrastructure but which falls well short of former Prime Minister Liz Truss’ promise from just over a month ago for a brand new electrified line from Liverpool to Hull, a new station in Bradford and even more besides. Rejoicing and relief one month. Wailing and gnashing of teeth the next. Critics of the Government’s proposals will argue that, even in these difficult times, they do not go far enough to transform the North’s rail infrastructure, which is needed for Levelling Up (remember that one?), and to deliver long-term, credible economic growth.
And at the time of writing, we are still waiting to hear if the Government has any plans to fully deliver on its National Bus Strategy and provide a long-term funding package for bus services (with some vital bus routes facing a cliff-edge when current funding runs out in April 2023) as well as continuing to support and promote the benefits of light rail and tram systems in the UK.
It certainly makes for interesting times in the UK transport and infrastructure sector as we look to deliver growth and stability on the one hand whilst balancing the books on the other …”
Nigel Emmerson, Partner and head of Womble Bond Dickinson’s Newcastle office said:
“Whilst the Chancellor’s announcement and associated measures will be perceived by many as painful, the tough decisions made leading up to today’s announcement certainly seem to have long-term financial stability for the UK economy at the heart. Right now, stability is what the region’s business community needs most as we all prepare for the challenges that come with a period of recession and economic strain.
“With detail around some key announcements yet to be made available, there was no silver bullet announced for businesses or individuals in relation to rising costs. The focus on renewable energy, education and the NHS were rays of light, but confirmation that the planned investment zones will be pulled may come as a blow for the levelling up agenda, although we wait with anticipation to learn what the government now considers to be the country’s knowledge-intensive clusters with the highest potential for growth and where the corresponding local research strengths sit.
“It was, however, encouraging to hear plans for a new devolution deal for “an area of the North East”, which should bring positive outcomes for our local business community.
“Whilst the Chancellor made no direct reference to freeports, investment in infrastructure forms one of three pillars, alongside energy security and investment in technology.”
Peter Snaith, partner and head of Womble Bond Dickinson’s Teesside practice and head of the national manufacturing sector team, added:
“At a time when there are such limited funds to support investment, it makes good sense to focus on initiatives which deliver benefits in as many ways as possible. In terms of capital projects, it is also important to concentrate on projects which are close to fruition, wherever possible.
“Undoubtedly, many of the proposed investment zone sites, which may have been shelved today, could deliver significant benefits for businesses and local communities over time. However, by preserving, we hope, the government’s focus on freeports, the Chancellor must choose to continue to back schemes which best support enterprise and encourage growth, whilst also delivering direct benefits in the form of jobs, access to training and regeneration projects for parts of the country which are amongst those that need it most. For example, the ‘shovel ready’ sites which sit at the heart of freeports like Teesside are of such an enormous scale that their positive effects will be enjoyed deep into the surrounding hinterland, which may now be denied access to the support that was proposed for wider enterprise zones.
“The Chancellor also preserved the UK’s commitments to decarbonisation and some of our freeports are already providing the hotbed that can support the homegrown technologies for secure sources of renewable energy, and carbon capture and storage. In doing so, the government is backing ‘clean power’ initiatives, which are crucial for a sustainable modern economy, which the Labour party proclaim to be lacking in contrast to its Green Prosperity Plan.”
Nigel Emmerson concludes: “Throughout 2022, businesses have seen an unprecedented frequency and unpredictability of political upheaval and announcements. This has undoubtedly added to the stresses and strains for businesses cross-sector. Growth and stability appear to remain at the heart of government policy, so let’s hope at the very least it will fuel further conversation and engagement around wider support for both the region and wider UK businesses in the weeks and months ahead.”
Sage
Steve Hare, CEO:
“There is some welcome relief for SMBs in the Autumn Statement but if the Government really wants a UK silicon valley, then tech needs to be a serious priority. We’re already seeing SMBs – which represent 99% of the UK business population – turn to technology to help manage rising costs. But they need more help to weather the storm and unlock the full benefits of data, AI and cloud computing, ultimately, to fuel growth, innovation and economic recovery.
“SMBs are incredibly resilient, but their confidence is waning. In conjunction with R&D spend the UK must leap ahead as an advanced digital economy. Regulation for growth should include a progressive set of policies and incentives to harness the power of data, seize potential of high growth sectors like climate tech and use digital tools to remove common barriers for SMBs like getting paid on time.”
Teesside University
Ben Fisher, Associate dean for enterprise and knowledge exchange and acting associate dean for research and innovation:
“We welcome the Government’s increased investment and commitment to R&D in the Autumn Statement. Innovation is key to stimulating economic growth and productivity and through the Government’s renewed focus on Investment Zones we look forward to continuing working with our Tees Valley and wider partners to translate our research, knowledge and resources into existing and emergent growth clusters in the Tees Valley region.”