The Cumbrian Chamber of Commerce has responded to Jeremy Hunt’s spring budget.
Managing director of the chamber, Suzanne Caldwell, said the chamber welcomed some key areas of the budget – but is disappointed in others.
Hunt announced several measures to grow the UK’s workforce including incentives for people to return to work or take on more shifts, starting with pension reforms.
The system used to assess eligibility for sickness benefits is also set to be scrapped, while parents on universal credit will be paid childcare support directly and the amount they can claim will increase by several hundred pounds.
Suzanne said: “We hear from businesses every day of their significant staffing challenges. So there were welcome measures in today’s Budget.
“It’s great to see the measures to help more people with disabilities and long term health conditions stay in or get into the workplace, for example separating capability assessments from benefits entitlement, introducing additional funding to 50,000 people into employment and providing additional support with occupational health services and mental health and musculoskeletal support.
“It was also encouraging to see more support to help care leavers into employment.
“Increasing the hours people on UC work before benefits are affected, and applying JCP sanctions more rigorously are also positive moves.
“It will be interesting to see the detail being the new Returnship “apprenticeships” for over 50s looking to return to the workforce, working alongside Bootcamps and Sector Based Work Academies. It’s particularly welcome that these will be flexible to take into account prior experience and qualifications. We’re also looking forward to hearing more about the expansion of the Mid Life MOT scheme, as well as other measures above, when we meet with DWP on Friday.
“Abolition of the life time allowance on pension contributions won’t impact most people – but it will have a very significant and much needed impact on keeping doctors at work and in our NHS.
“The measures announced around childcare should, over time, have a significant positive impact on drawing more parents into the workforce or enabling them to increase their hours.
“These measures include financial incentives to encourage more people to become childminders, increasing funding to nurseries offering free childcare by an average of 30 per cent, enabling flexibility in child to carer ratios, 30 hours free childcare for every child from 9 months old until they start school and, for those on Universal Credit, enabling payments up front and increasing the level of those payments.
“There’s also provision of funding which aims to ensure that by 2026 all schools will be able to offer 8m-6pm wrap around care, either alone or with others.
“While there clearly is a need to give time for the childcare sector to grow to support this (with it’s own challenges in finding staff!), given the acute staff shortages businesses are facing, it’s disappointing that some of these measures will take so long to come to fruition – with the 30 hours free childcare for younger children being introduced on a phased basis and not fully operational until September 2025 and full implementation of wrap around care not expected until September 2026.
“However it was disappointing that measures did not go further and enable businesses, especially in the visitor economy and the land-based sector, to access staff from abroad more easily.”
Hunt also addressed plans for investment and innovation in his budget including the rise of corporation tax and a full expensing scheme in place of the Covid-era deduction policy.
Suzanne said: “It was disappointing that the planned increases in corporation tax will still be going ahead but the announcements around investment are welcome, with the small business investment allowance increased to £1m and full expensing allowing businesses to claim in full against purchases of IT, equipment, plant and machinery for at least the next three years.
It was also disappointing not to hear Cumbria’s name in the list of those areas able to apply for a new Investment Zone or mentioned in other regeneration projects. Support announced for innovation, for example, around ground breaking AI, was also welcome although in practice it’s effect on Cumbria will be as innovations come through in the longer term.”
The chancellor also spoke on plans for nuclear energy and fuel duty.
The government will be looking into reclassifying nuclear energy as ‘environmentally sustainable’ with an overall aim of increasing private investment in the sector.
Hunt said nuclear was a ‘critical source of cheap and reliable energy’ to help the UK meet its net zero obligations.
Suzanne said: “The announcements on nuclear are clearly important to us here in Cumbria, with investment in nuclear on top of that already announced for Sizewell C and the intention of 25 per cent of electricity from nuclear by 2050 positive for the nuclear supply chain. As is announcement of the first competition for SMRs.”
Fuel duty has also been frozen and a 5p cut and will continue for a further 12 months, with the Chancellor predicting a saving of £100 next year for motorists.
Suzanne added: “Maintenance of the 5p cut and freezing of fuel duty to next April is particularly welcome in a county such as Cumbria, but it’s always disappointing not to see more.”
Further major announcements outlined in the budget include free childcare support being widened, extended household energy assistance, an increase in the draught relief – a move that will make alcohol duty 11p lower on pulled pints compared to supermarket sales and help for leisure centres with swimming pools to meet energy costs.
Tax on other alcohol will soar by 10.1 per cent in August in line with inflation and the price of cigarettes will also be more expensive after tobacco duty was uprated.
