Could measures in the Budget ease the pain for Bristol commuters?

Autumn Budget

Business Leader speaks to experts in the South West regarding today’s Autumn Budget announcement and how it will affect the region.

Karen Kirkwood, tax partner at EY in the South West and Wales comments on the measures announced in the Chancellor’s Autumn Budget and the impact for business and people across the South West.

She said: “In a budget where we anticipated a “steady as she goes” approach, there are a number of announcements that will be positive for business and people across the South West and Wales.

“The £1.7 billion Transforming Cities Fund will mean necessary spending on improving buses, trains and cycle lanes to drive growth and improve connectivity across the region. When you add in the £44 billion investment for new housing and abolishment of stamp duty for first time buyers; there is plenty to be positive about.”

“The Chancellor continues to wrangle with very low unemployment rates and the (not unconnected) low productivity rates. Further investment to help boost productivity is welcome – but all businesses also have the challenge of embracing the technological revolution in a way that drives productivity and exploring how existing staff can be reskilled and redeployed effectively.

West of England Mayor, Tim Bowles, comments further on the Autumn Budget.

He said: “Today’s budget clearly demonstrates the Government’s commitment to the West of England region. This new funding is a direct result of devolution, and recognises the significance of our region to the national economy.

“Our ability to talk to central government as a Combined Authority, with one voice, is one of the key benefits of devolution. As a region, working together, we have demonstrated that we have clear and ambitious plans and Government has recognised this by investing in our future.”

“Over the last decade, our economic contribution to the UK has outperformed the national average. Because of this success, and because we’re a great place to live and work, our population has been rising rapidly and we expect this to continue. This puts an increasing strain on our transport and infrastructure and we need this significant investment to support planned future growth.

“We will work with our constituent local authorities, Bath & North East Somerset, Bristol and South Gloucestershire, to decide how best to use this funding to help get our region moving.”

Tim Davies, Head of Bristol Office of commercial property specialist Colliers International comments: “As someone who knows only too well the struggle involved in making a simple journey into or across Bristol, I am delighted that the city is to benefit from the £1.7 billion ‘Transforming Cities Fund’ announced by the Chancellor in the 2017 Autumn Budget.

“The fund is designed to improve transport in English cities, and half of it will be allocated to the six Combined Authorities with Metro Mayors. The exact amount that the West of England Combined Authority will receive is unclear, but what is without doubt is that this funding is very much needed to address Bristol’s transport problems.

“Bristol is a popular place to live, visit and do business in, but in order to encourage growth and to stimulate the local economy it is essential to have an infrastructure that can cope, which clearly is not to case at present given the congested roads and crowded trains and buses that are a fact of daily working life in the city.”

Nick Sturge, South West Chair, Institute of Directors and Director of Engine Shed Bristol commented: “I am encouraged by the support committed to the technology sector.  We need to build on the strong network of clusters that are already working well in the regions, accelerating growing businesses by helping them to access a broader talent and mentor pool, markets and investment.

“Connectivity is also key. With a growing number of micro businesses operating from a home base, we wanted to see rural focused reincarnation of the Connection Vouchers scheme that made grants of up to £3k to help smaller business get super-fast broadband installed. This ended in 2015. Whether it will be reintroduced as part of the £500 million tech investment announced today also remains to be seen, but it’s well overdue to be brought out of the long grass.

“Increasing the amount of Public Data made open for companies is critical to enhance their products and develop new ones. Let’s hope the impressively named new Geospatial Data Commission does that. There are already some Developer Licenses available that allow use of charged for Public Data for free under certain criteria and we’d like to see this extended.  Data is of increasing importance to the economy and driving both innovation and productivity.

“Finally, I am pleased that the investment relief Enterprise Investment Schemes has been doubled, and will be focussed on knowledge intensive enterprises. This, along with Seed Enterprise Investment Schemes (SEIS) have allowed many small companies to progress significantly faster than they would have otherwise.”

Andrew Hodgson, senior partner for KPMG in Bristol, comments on the Autumn Budget: “The Budget delivered a nod to the urgent need for improvements in regional infrastructure today. Business leaders in Bristol and the South West will welcome Mr Hammond’s promise of a £1.7 billion Transforming Cities Fund to get the economy firing in the regions by boosting infrastructure.

“With clear evidence that our infrastructure if stifling productivity and growth in the South West, the power to transform the region now lies in the hands of the Metro Mayor.

“This welcome news is further boosted by the investment in Welsh rail to improve journey times between Swansea and Cardiff; South Wales, Bristol and London.”

Small businesses received some welcome backing in today’s Budget, according to a local tax specialist. John Mayer who runs TaxAssist Accountants in Weston-Super-Mare said: “Local business owners have grown used to bearing the brunt of Budget changes and new legislation and receiving little in return, but the Autumn Budget has at last given them some good news to encourage investment and growth.

“The £44 billion housing investment announcement will be a welcome contribution to local economies, with many local businesses, particularly in the construction industry, reaping benefits.

“Many local business owners will also be looking at available opportunities under the £2.5 billion scaled-up British Business Bank, the £500 million investment announced for new technologies including 5G mobile networks and fibre broadband and £2.3 billion investment in research and development.

“The Government has clearly listened to the Federation of Small Businesses and halted plans to lower the VAT threshold. Keeping that at £85,000 for the next two years will be welcome news for many small firms and self-employed business people. The personal allowance will increase to £11,850 from April and the higher rate threshold moves to £46,350.

“Cancelling the planned rise in fuel duty will help those businesses which deliver products and services to our homes, where cars and vans are essential not a luxury. Many business owners will also be relieved that vans are excluded from the planned increase in vehicle excise duty for diesel vehicles. In the future, local business owners will want to look closely at the potential benefits of electric cars as company vehicles.

“Business rates will now increase in line with the consumer prices index, instead of the higher retail prices index and many local businesses will be delighted to see the back of the so-called ‘staircase tax’ which would have hiked their rates bills if their workspace was split over more than one floor of a building. More frequent valuations are also welcome and many local pubs will benefit from a £1,000 discount for another year.

“We will be looking in more detail at the many announcements made by the Chancellor which will impact on small businesses, but overall there has at last been some recognition for the over five million small businesses across the U.K. who contribute a massive £1.8 trillion to our economy.”

Gordon Isgrove from GVA Bristol said: “Housing remains one of the big issues for this country and continues to be the focus for Government and Treasury, aiming to enable greater access to home ownership.

“The ambition to deliver 300,000 per annum is a big ask compared to previous completion rates, the problem being that housing delivery can be long and complicated; so you can’t just increase supply, like turning on a tap. The abolition of stamp duty for the majority of first-time-buyers will grab headlines, although this can only have a limited impact on what is a supply-side problem; it is just as likely to increase house prices in areas of low supply.

“We need to support and boost small developers to grow and increase supply of housing, new innovative construction techniques to speed up construction and resource local authorities to speed up the planning process, which are identified in the budget. The measures in the budget are positive but they are unlikely to be sufficient to deliver the step change required to address the supply side problem in areas of high demand.

“Infrastructure investment is a key plank in raising productivity, as well as helping to facilitate both housing and economic growth. It is therefore disappointing that the Chancellor was not able to announce further financial commitments from his long shopping list of important schemes. We need more investment infrastructure in the South West region to enable us to be competitive, to grow on our success in Bristol as a ‘smart city’, and a diverse innovative city.”