December 5, 2016
Kevan Carrick (pictured)
Principal, JK Property Consultants LLP
The Chancellor’s Autumn Statement sounded a positive note for the regions, and it was good to see the North East singled out as having the fastest growing employment in the UK.
However, Philip Hammond’s approach was necessarily high level and clarity is needed on what certain UK-wide initiatives mean for the North East, and property and construction in particular.
The National Productivity Investment Fund and investment into infrastructure, affordable housing and the digital sector were all welcome news. Equally, a clear industrial strategy will improve the productivity of the region and make it more attractive for inward investors to relocate here.
The challenges that remain in the North East – the lack of a Mayoral Combined Authority and not having devolution or improved borrowing powers – puts us behind those areas that have.
Partner, EY North East
I welcome the Government’s continued commitment to the Northern Powerhouse with the publication of its Northern Powerhouse Strategy, announced in the Autumn Statement.
The published strategy places significant funds into the hands of the Local Economic Partnerships and other organisations across the North to foster economic growth. One of the other areas highlighted was on creating a centre for global excellence in digital innovation. This is a very welcome move. By investing in this fast-developing
disruptive technology, we can truly establish the North’s credentials as the leaders in technology innovations.
An area that was surprising, however, was the brevity of focus on trade and investment in the Northern Powerhouse Strategy document. Given how important exports and inward investment are to the future prosperity of the North of England, I would have hoped to see more detail on the Government’s approach.
Chief executive, NewcastleGateshead Initiative
We welcome the Government’s Northern Powerhouse Strategy and committed funding into the North of England. This demonstrates its continued support and focus on the North to help rebalance the economy and optimise the economic contribution the region will make.
NewcastleGateshead, and the wider North East, has already benefited from £35 million of funding across two national centres of excellence – the National Innovation Centre for Ageing and the National Institute for Smart Data Innovation – as well as a £5 million fund, and £15m legacy fund, towards hosting the Great Exhibition of the North, which will be held in NewcastleGateshead in 2018.
We also welcome the Government’s commitment to provide £100 million funding until 2020-21 to incentivise university collaboration in tech transfer and in working with business.
Corporate partner, Bond Dickinson
From a corporate perspective, there were no surprises in the Autumn Statement and, in fact, what we are hearing is a Chancellor talking about stability and committing to a medium and longer term plan. A targeted, continued reduction in corporate tax rates is good news. The business tax road map might sound uninteresting – but in
an environment where there is uncertainty around what happens after we finally exit the EU, an element of certainty around taxation affairs and reducing corporation tax rate is of some comfort to British corporates (and potentially overseas business sitting on investment decisions in the UK).
From the perspective of corporates trying to incentivise key people, the Employee Shareholder Status (ESS) never seemed to work properly or in accordance with the intention with which it was introduced – so saying goodbye to this is a welcome relief.
Chairman, North East Local Enterprise Partnership
The Chancellor of the Exchequer Philip Hammond’s focus on raising national productivity through substantial infrastructure and innovation investment mirrors the approach of the North East’s Strategic Economic Plan. We welcome the Chancellor’s focus on 5G broadband development through a £1 billion fund and trials programme – the region has written to the Chancellor with a proposal to create a trial site for 5G in the North East. The £220 million funding for pinch points on strategic roads gives the North East an opportunity to further develop schemes in relation to the strategic highway network in the region. And investment into the ultra-low emission vehicles sector represents a major opportunity for the North East with its strong automotive sector and highly developed low carbon vehicle programme.
Chairman, Transport for the North
We know the North currently lags behind the rest of England in terms of productivity but has huge potential. The new Northern Powerhouse Strategy highlights evidence from our Northern
Powerhouse Independent Economic Review, published earlier this year, which identified that with the right investment in infrastructure and skills development, by 2050 the North’s economy would be worth £97 billion more than if it carried on developing at the current rate. That’s a huge prize, not just for the North but for the whole of the United Kingdom, and we are pleased that the Government has recognised its importance in the latest Autumn Statement.
Independent financial advisor, Fairstone
This was clearly a statement of gives and takes.
Great news for business as the Chancellor announced corporation tax will continue as planned towards the 17 per cent rate. Although there was an announcement that employers will pay more National Insurance for employing staff. There has been much commentary about Salary Sacrifice in return for benefits and so it is no great surprise that Salary Sacrifice will be stopped for certain benefits but pensions look like they are exempt from these changes so that’s great news for all the workers who use this as a means of enhancing their funding for pensions.
The reduction in the money purchase annual allowance for pensioners using flexi access drawdown from £10,000 to £4000 will affect those who have accessed pensions but who may want to make a level of contribution in the future. There will be a need to review pension contribution strategy for those affected. And a glimmer of light for savers with the move to introduce a new NS&I bond for three years at an expected gross interest rate 2.2 per cent for a maximum of £3000 investment.
Regional director for North East, Lloyds Bank Commercial Banking
Speaking to local business leaders in the lead up to the Autumn Statement, reducing taxation and increasing investment in infrastructure were their top priorities for today’s announcement – so we’re encouraged to see these issues being tackled by the Chancellor. The Government’s commitment to reduce Corporation Tax to 17 per cent should encourage growth in our region, freeing up capital to invest in new talent, technology development and exporting. It’s also promising to hear that £1.3 billion of additional capital spending will be made available to upgrade Britain’s road network – especially because almost all of that money will be used for regional schemes across the UK, not just in the South East. This move will help North East firms create a range of new supply chain opportunities, and increase connectivity for those operating in rural locations.
Tax partner, UNW LLP
For the last 20 years one of the frustrations for tax practitioners has been having to wrestle with the complexities of, in effect, not one but two Budgets each year.
The return to having just the one Budget proper each year and in the Autumn, rather than the Spring, so that it is well in advance of the new financial year, should result in improved consultation, keener scrutiny in Parliament and ultimately, it is to be hoped, better and simpler tax legislation.