Amidst the ongoing chaos of Brexit, Chancellor of the Exchequer Phillip Hammond delivered his Spring Statement in the House of Commons yesterday – Wednesday 13th March.
We were watching closely, and below are the points that we think are most relevant to SMEs, especially those in the East of England.
- The economy has seen unbroken growth for nine consecutive years and is predicted to grow faster than Germany this year.
- Growth is set to continue over the next five years, although this year’s forecast has been reduced to 1.2% from 1.6%. 2020 is expected to see the forecast remain at 1.4% but then rise to 1.6% for the following three years.
- Borrowing will be £3bn lower in 2019 than previously predicted. It’s likely to fall to its lowest level in 22 years, from the current £29.3bn to £13.5bn in 2023-24.
- If we leave the EU with no deal, UK productivity will fall considerably, and costs will rise.
- A Brexit ‘deal dividend’ will be delivered if we the EU at the end of March with a deal.
Jobs & wages
- Youth unemployment has been halved by the Conservative government.
- In 2018, 96% of new jobs were full time.
- By 2023 the Office for Budget Responsibility (OBR) expects to see 600,000 more new jobs.
- Wage growth is forecast to rise by 3% or more every year – the fastest pace in a decade and quicker than inflation, giving people more money in their pockets.
- Income tax personal allowance is rising to £12,500 from April.
- With national wage increases happening year by year, the government is due to start planning for the National Living Wage policy beyond 2020.
- The government is clamping down on late payments by big business, which often leave SMEs out of pocket.
- The Chancellor will hold a Spending Review before the summer recess.
- From April the government’s Making Tax Digital scheme rolls out.
- A review will look at how the government can support SMEs reduce energy bills and carbon emissions.
Skills & education
- In 2020, the first three routes of T-levels will be delivered.
- £700m in apprenticeship levy reforms are to be brought forward to 2019/ 20, including halving the co-investment rate to 5%.
- Free sanitary products will be made available to secondary schools and colleges to prevent some female students missing school as a result of ‘period poverty’.
- PhD-level roles will be eliminated from visa caps this autumn.
Technology & innovation
- £79m will fund development of a new supercomputer in Edinburgh University.
- £120m is being invested in scientific research in Cambridge and Oxfordshire.
- A new independent review on tech giants and lack of competition is calling for changes in regulation to open up new opportunities for digital companies in the UK.
Housing & infrastructure
- The government’s target of building 300,000 new homes a year is on track.
- £1bn is being made available to help small and medium-sized builders to help achieve the government’s target.
- £717m will ensure 37,000 new homes are built on sites in London, Cheshire, and the Oxford-Cambridge Arc. £445m will be dedicated to 22,000 homes on ‘Arc’ land connecting Oxford, Milton Keynes and Cambridge.
- A £3bn package for housing associations will help them deliver 30,000 affordable homes.
- From 2025 new homes can no longer be built with fossil fuel heating systems.
- A global review will look at the link between economic prosperity and biodiversity.
If you’re an SME or job seeker, our team of experienced consultants can discuss your requirements regarding employment in the East of England.