Paul Scarrott, EMEA Director, Nimble Storage:
“In today’s Autumn Statement, the Chancellor pointed to the UK’s continued low UK labour productivity. Indeed, the productivity gap between Britain and the other members of the G7 group of industrial nations is now at its greatest since the early 1990s when modern records began.
“With the new National Productivity Investment Fund announced today supporting greater innovation and infrastructure on a national scale, it is important that businesses start taking a smarter approach to increasing productivity in their own firm. For those companies that increasingly rely on digital technologies, it is important that they look into their own infrastructure to reduce the time currently wasted by employees on software delays. With the typical employee experiencing an average of four software-caused delays per work day, and each of these lasting about seven seconds, the cost of this time to the British economy amounts to £744,235,520 every year. By taking simple steps to reduce the app-delivery gap in their own infrastructure, businesses can make a concerted effort to improve productivity in their company and the wider economy.”
William Newton, EMEA Director, WiredScore:
“With its new targets for full-fibre broadband, the government is setting goals that will truly future-proof the UK’s connectivity infrastructure – rather settling for part-fibre investments that will not meet the digital needs of businesses and consumers in five years and beyond.
“There is certainly a long way to go before the UK becomes fully fibre – with many areas still not yet benefitting from the government’s previous ultrafast or even superfast targets. But this new investment is another clear example of the government’s essential investment in ensuring that the UK stays at the forefront of future-proofed digital industries.”
Genevieve Moore, Partner at leading accounting practice Blick Rothenberg:
“The Chancellor announced an alignment of Employees and employers NI thresholds and this to be a cost to employers. It is unlikely that this will be a barrier to employment, but the largest employers will pay the most – and they’re not necessarily the most profitable businesses.”
“Fantastic news that the UK will move the annual Budget to Autumn rather than Spring, ensuring that there is plenty of time between announcements and the start of the tax year. Although there will now be a “Spring Statement” but no significant changes announced. This provides greater certainty to businesses and people in the UK,”
Paul Smith, Partner at leading accounting practice Blick Rothenberg:
“Reforming the Budget to an Autumn Statement will allow Parliament greater time to review draft legislation. Perhaps the Chancellor should have gone further to reform the tax year to one that ends on 31 December rather than 5 April and would bring the UK into line with the modern world,”
Lucy-Rose Walker, CEO Entrepreneurial Spark:
“The Chancellor’s pledge to provide an economic environment that drives productivity and supports growth sounds great for entrepreneurs, but we’re keen to see more support for early stage and scale-up businesses in the form of tax relief, access to finance and support for employing and developing people.”
Mark Tighe, Managing Director, RD Tax Solutions:
“The Government is acutely aware that if this country wants to stay competitive globally, R&D is vital, and in this Autumn Statement it has put its money where its mouth is.
“Rapid technology advances have made R&D something that more and more businesses can enter into and commit budget to.
“While the number of firms spending money on R&D is rising, there’s still a long way to go in raising awareness about the lucrative tax reliefs available. Only a tiny percentage of firms investing in R&D are claiming back the available tax reliefs.”
David Johnson, Director at Halo Financial:
“The Chancellor said that the weakness of Sterling in the face of the UK EU Referendum and political and economic activities throughout Europe and the US was cited as the main reason for having to revise the UK growth forecast down to 1.4%, from 2.1%. However, several positive announcements helped the Pound to strengthen slightly against the Euro and US Dollar.
“We saw similar small changes in the exchange rates for other currencies, which is likely from the announcement that, despite the downgraded UK growth forecast, it is still a figure similar to that of Germany’s and higher than predicted figures for France and Italy, all countries with their own important upcoming political and economic events to deal with.”
“Philip Hammond will have been pleased to announce that the Government will not be seeking a surplus in 2019-2020 – this bodes well for both the UK economy and the country’s currency. Positive labour data, shining the spotlight on improved employment figures – not just in the South East, as we may have come to expect, but particularly in the North East, Northern Ireland and the Midlands – emphasised the business opportunities in other key regions of the UK outside London and also helped lift Sterling.”
Emma Jones, founder of small business support group Enterprise Nation:
“It’s absolutely the Government’s responsibility to invest in the infrastructure and technology we need to boost our economy, we all benefit from that. It’s also good news that the rural economy will benefit from business rates relief.“But for the only reference to hard-working small businesses and the self-employed to be in connection with tax avoidance is worrying. Is this a dawning of a dangerous new era for entrepreneurs in post-Brexit Britain?”
Anthony Carty, Group Financial Planning & Business Development Director, Clifton Asset Management:
“It absolutely makes sense that the Chancellor is protecting vulnerable people from the 250 million scam calls they receive each year.
“But, whilst it is prudent to hand extra powers to pension providers to block transfers of savings to suspicious operations, we do need to avoid genuine entrepreneurial investors being discouraged from using flexible pensions such as Small Self-Administered Schemes (SSAS) – as they can be a highly effective pension, tax and estate planning tool for the business owner.
“It has been common for business owners to set up a SSAS and hold their premises – whether offices or factories – in the pension in order to benefit from the tax-free income and growth on the property, but an increasing number of businesses are now using the flexibility of a SSAS to invest in their own business – funding it to boost growth.”
Colin Valentine, CAMRA’s National Chairman:
“CAMRA welcomes the Chancellor’s decision not to raise beer duty in the Autumn Statement. Pubs are under a huge amount of financial pressure and with UK beer drinkers paying 52.2p of duty on their pint we are seeing more and more people choosing to drink at home rather than at their local. This trend not only hurts UK businesses, but is also contributing to the demise of our communities and affects people’s personal wellbeing.”
“While a freeze in beer duty is welcome, CAMRA would like to see the Government do more to reverse the damage done by the beer duty escalator by cutting duty in the 2017 Budget.”
Mark Wilkinson, SAS Regional Vice President – Northern Europe:
“We have entered an era where the pace of change is so intense that organisations are finding it hard to retain relevance over time. The focus on innovation in today’s budget is a step in the right direction. Against a backdrop of low productivity, the survival factor for companies lies not in using traditional techniques but embracing new innovations to make optimum decisions and iron out inefficiencies.
“The emergence of artificial intelligence and robotics in sectors that are foundations of a sustainable economy, such as manufacturing, banking and retail, empowers organisations to gather and analyse ever increasing amounts of data to deliver results in real-time. In the future, this agility will be the deciding factor in whether a new product line makes millions or crashes at the first hurdle.”
“The value of each person’s competitiveness as an employee no longer lies in gaining necessary knowledge. Instead it lies in developing a dexterity for learning. This presents a powerful opportunity to continue upskilling our workforce in areas like analytics, business intelligence and data management so we can uncover new opportunities for the UK in the long-term.”
Simon Bashorun, Financial Planning Team Leader at Investec Wealth & Investment:
“It is great news to see pension saving excluded from the Salary Sacrifice changes announced in today’s Autumn Statement. Where this option is offered, it remains an incredibly efficient way for individuals to contribute to their pension scheme, particularly where their Employer pays part of the Employer’s National Insurance saving into the pension plan.
“Since April 2015, individuals taking income benefits flexibly from their pension plans have had to be aware that doing so may reduce the amount they can contribute tax efficiently to pensions in the future through the £10,000 Money Purchase Annual Allowance. The reduction in this allowance to £4,000 reinforces the need to take appropriate advice when drawing benefits from a plan in this way, particularly if there is the intention to continue working and contributing to a pension scheme at that point or at some point in the future.”
Chris Bryce, IPSE Chief Executive:
“The Government must now justify this decision. It has chosen to ignore the advice of the business and freelance community. We want to know why. It would be totally justified for contactors to walk away from the public sector.
“There was no recognition for the immense contribution the self-employed make to the economy. Having trumpeted the lowest unemployment rate for 11 years, ironically the Chancellor has launched an attack on the group largely responsible for this record.
“IPSE will continue to fight for the contracting community which has been badly let down by a self-described pro-business Government.”
Steve Cox, senior product director at IRIS Software:
“HMRC’s Making Tax Digital mandate has proven a divisive topic amongst UK accountants and many were hoping the Chancellor would offer more insight during the Autumn Statement.
“Research has shown that although two thirds of accountants agree with the Government’s digital strategy, just as many haven’t read the mandate documentation, while 68 per cent disagree with the recommended timescales. With HMRC’s response to the recent Making Tax Digital consultation period not expected until January, accountants and their clients remain uncertain about what lies ahead. Will the April 2018 deadline remain? Have there been any major amendments as a result of accountant feedback?
“By failing to answer these questions, the Chancellor has increased the fear of what lies ahead and negativity towards the mandate. The longer the industry is given to prepare for Making Tax Digital, the smoother the transition will be, so many will hope the next announcement comes sooner rather than later”.
Dafydd Llewellyn, managing director at UK SMB at Concur:
“The Chancellor finds himself delivering an Autumn Statement at a tricky time. After a year of uncertainty and decision stagnation, SMEs will rejoice in news that corporation tax will fall to 17%. The fact this will rise even further for SMEs based in rural areas is great news. SMEs are the backbone of the economy, which means they are not just focused in big hubs like London, Birmingham or Manchester. Any help businesses in such areas can receive will ensure they will be given to opportunity to expand and enable the economy to grow in all corners of the country.
“To ensure that SMEs remain the powerhouse of the economy, someone must be finally appointed into the role of Small Business Commissioner. That such a role exists but has yet to be filled is continuingly worrying. At a time when SMEs are highly vulnerable to late payments by larger organisations and as a hard Brexit approaches, support and guidance are top of SMEs wishlist. This, however, isn’t just about ensuring SMB’s get paid on time. As the PM said in her speech to the CBI earlier this week, these are the medium to large companies of the future, ensuring they are paid on time and thus have the funds and opportunity to grow. As such, the role of the Small Business Commissioner must be filled and fast.”
Alex Fenton, founder and CEO of GapCap:
“The extra funds promised by the Chancellor are exactly what we needed to ensure any fears held by UK SMEs are allayed. We’ve seen first-hand that, post the Brexit vote, many young UK businesses face uncertainty and are in need of support more than ever, so this encouragement from the Government is perfectly timed.
“Keeping UK start-ups in the UK is crucial to the economy and in ensuring UK’s status as the European centre for all young, growing industries. Post-Brexit, there was only really one way to secure their loyalty. This was through an injection of funds and I am delighted to see that is what we’ve received.”
Patrick Imbach, co-head of KPMG’s Tech Growth practice:
“This announcement was a timely acknowledgment that our long-term investment culture in the UK, as far as tech start-ups are concerned at least, is lagging behind the likes of the US and China.
“Do we think it’s a game-changer? No, we don’t. The reality is £400m is a drop in the ocean when you look at historic levels of investment into the UK start-up community. Indeed, our own recent Venture Capital Insights survey highlighted a total of $4,336m of investment by VCs in UK businesses over the last four quarters.
“Will it make UK entrepreneurs sell-out later? Again, I’m afraid the answer is no. £400m on its own will not be sufficient to bridge any later-stage funding gap and does not address other reasons for companies not going all the way in the UK, such as the lack of experienced entrepreneurs with a proven track record of scaling businesses beyond the early growth stages.”
Ishann Malhi, CEO and Founder of online mortgage broker Trussle:
“We needed a radical injection of new houses in the UK from today’s Autumn Statement, and the Chancellor certainly hasn’t ducked the issue. £7.2 billion to support the construction of new homes and a housing white paper which will soon tell us exactly how he plans to address the long term underlying issues.”
“The unaffordability of housing is arguably the biggest problem facing young people in the UK today, so it will come as a huge relief to many that the Chancellor has placed homeownership at the top of his agenda. These investments won’t change things overnight, but for aspiring homeowners and those trapped in the rental cycle, the prospect of purchasing a property may have become a little more realistic. Hopefully Mr Hammond’s policies will mark a renewed effort to turn Generation Rent into Generation Buy.”
Niels Turfboer, Managing Director UK, Spotcap:
“SMEs account for 99.9% of the UK’s private sector companies and will contribute £217 billion to the economy by 2020. These companies need adequate incentives from the government to execute their growth strategies with confidence. The Autumn Statement fell short in providing specific initiatives for this.
“It is important to remember that following the Brexit announcement, a fall in interest rates and a predicted spike in inflation, SMEs are coping with huge challenges and an uncertain economic outlook. They need reason to feel confident.
“Some of the points mentioned will indirectly help drive SME growth. However, the overall verdict is that the Chancellor could have provided more specific initiatives on how to boost overall SME growth – a corner-stone of the British economy. For example he could have addressed access to finance for SMEs, which will be an important aspect of helping increase productivity and competitiveness that is a current focus for the government.”
Stuart Veale, Managing Partner at Beringea:
“I was pleased to hear the Chancellor’s remarks today about ‘investing today for the economy of the future’. As he said, more needs to be done to support the UK’s research, development and innovation sectors, to build on the UK’s strengths in these areas. It’s definitely a positive move that the Government wants to help British tech businesses. It will be interesting to see the details around the new £23bn National Productivity Fund and the additional £400m going into the British Business Bank to invest in venture capital funds. Overall, in these uncertain times, it’s a good moment for the Government to be investing in the economy of the future.”
Katharine Moxham, spokesperson for GRiD:
“We are obviously disappointed that Government has not seen fit to give an exemption for group life or income protection where employees are able to increase their coverage through salary sacrifice. The amounts involved are small and the resulting change will simply add complexity for providers and scheme members. It will add a further burden on businesses which might otherwise have included a facility to allow their employees to build on a basic level of employer-provided cover.
“The outcome is particularly pertinent for group income protection given that the DWP/DH green paper on work, health and disability has recognised the role that group income protection can play in supporting employers’ health, wellness and attendance programmes. Clearly some joined up thinking needs to take place here.”
Richard Stone, Chief Executive of The Share Centre:
“Philip Hammond’s first, and last, Autumn Statement as Chancellor was something of a non-event for personal investors. There was no mention of capital gains tax, savings allowances or the forthcoming Lifetime ISA Product. In effect the Government has reaffirmed its commitment to personal investors and has not reversed, delayed or stepped away from any of the measures previously announced by George Osborne. In particular the increase in the ISA limit to £20,000 in April 2017, the launch of the Lifetime ISA in 2017 for those aged 18-40, and the reductions in capital gains tax which came into effect in April 2016.
“The Government recognises the need to encourage individuals to save and invest and the effective affirmation of these measures will be welcomed by personal investors.
“Since the budget in March, the UK has voted to leave the EU, the Prime Minister resigned and the Chancellor was effectively fired by the new Prime Minister. Teresa May and Philip Hammond have taken office and in effect we have a new Government albeit we haven’t had a General Election. As Philip Hammond recognised when presenting reduced growth forecasts through to 2021 the level of uncertainty is high.”
Professor Stephen Roper, of Warwick Business School:
“The productivity challenge is significant and borrowing to fund a £23bn Productivity Investment Fund to address it is a gamble. As the Chancellor indicated it currently takes an average UK worker 5 days to generate the same productivity as German employees generate in 4 days.
“How effective will the Chancellor’s package of measures be in addressing the productivity challenge? Only time will tell, but public investment alone is unlikely to close the gap. UK firms too will need to significantly increase their investment, which is perhaps unlikely given the uncertainties of Brexit.
“Other aspects of the Statement will be welcomed by business. Confirmation of planned corporation tax reductions to 17 per cent, business rate reductions and rural rate relief are all positive steps. Less welcome in some quarters will be the increase in insurance taxes.”
Charlie Mullins, CEO of Pimlico Plumbers:
“The Government is committed to creating three million apprenticeships by 2020, but that may not be enough if the Chancellor is going to deliver on his promises.
“We can’t be more productive, work cleverer and compete in international markets if we don’t arm people with the right skills at an early age. Investments into the fabric of the country have to be matched by investments in skills.
“We already face skills challenges in key trades and technical industries, which depending what happens with our exit of the European Union, could be intensified by immigration curbs.”
“The Chancellor is playing economic Snakes and Ladders and we’ve just landed on the head of one of the biggest snakes. It feels like we’re back in 2010 with a need to re-set the economy rather than benefiting from what’s been achieved in the past six years. We’re nearly back to square one and Mr. Hammond needs to look for ladders to take us back to where we have to be.”
John Smith, Principal Solution Architect, Veracode:
“We are delighted that the UK government has affirmed that it will continue to invest in autonomous vehicles. However, cybersecurity factors must be brought to the forefront of policy agendas from the outset. Government bodies and manufacturers need to prioritise security across systems that impact safety – such as software and applications downloaded to the vehicles.
“Today, vulnerable software is one of the most significant challenges faced by the automotive industry. Findings from a recent IDC report indicated that there could be a lag of up to three years before car security systems are protected from hackers. With over 200 million lines of code in today’s connected car, not to mention smartphone apps linked to the car, we must ensure they are developed with security at the heart of the strategy, rather than as an afterthought.”
“The key focuses of today’s Autumn Statement was to ensure the UK economy remains stable after the uncertainty of Brexit, whilst continuing to invest in the UK economy’s manifest strengths and perpetuate its growth and success.“It is, therefore, fitting that such an emphasis was put on business, technology and digital infrastructure as the Government looks to support those areas that drive the economy and employment growth.“We welcome the news that £400m is to be injected into the British Business Bank with a mandate to invest across UK VC funds, and that the Treasury will be reviewing access to finance for those businesses trying to scale.“Investment and support for the UK’s start-ups to become scale-up businesses is vital if the UK is to create the new breed of world-leading tech companies. Investment into UK productivity and infrastructure, especially those of a digital nature, and those between great innovation hubs such as Cambridge and Oxford, are also very positive moves.”
Dominic Baliszewski, Director of Consumer Strategy for Momentum UK:
“Today’s Autumn Statement will be largely welcomed by those British families just about managing, or ‘JAMs’, with a hike in the minimum wage perhaps the most impactful of the new policies. Our research shows that 50% of people in the UK don’t have any savings to protect them should the worst happen, so any increase, whilst small, could go a long way to improving their future.
“There was also good news for the UK’s 4.3 million renters, with a ban on letting fees in England potentially saving them up to £500 every time they move. Our 2016 Financial Wellness report highlighted that people who own their own homes are almost always financially better off than those that don’t, so banning letting fees will provide a much-needed boost to those caught in the rental trap.
“It was also great to see that a further £1bn is being invested to improve our digital infrastructure. It’s shocking that in 2016, thousands of UK households still don’t have reliable access to the internet. Considering the growing dependence and appetite among consumers for technology, successful improvements in this area are paramount.”
Ed Cottrell, Head of Corporate Lending at Investec Specialist Bank:
“Government has a critical role to play in shaping an environment in which businesses can thrive. We welcome all initiatives giving them more freedom, both to pursue their existing strategies and to invest in new products and markets. Reliable infrastructure is critical to this, so we applaud the emphasis in the Chancellor’s statement on quality rather than quantity: companies need confidence in essential physical and digital communications, not headline-grabbing promises on spending.
“We also welcome the emphasis on research and development and the support to start-ups. As we know from working with entrepreneurs every day, they have no shortage of great ideas but the costs of realising them can be prohibitive. The commitment to R&D could be just the kind of targeted intervention that encourages companies to make investments that are costly in the short term but offer enduring benefits to productivity.”
Philip Salter, Director of The Entrepreneurs Network:
“Chancellor Philip Hammond’s Autumn Statement may have lacked his predecessor’s attempts to set a grand narrative, but he did at least avoid Osborne’s excessive tinkering. A number of measures were pre-announced, but his commitment to honour the planned drop to 17 per cent corporation tax should be welcomed, as should the Prime Minister’s ambition, announced earlier this week, to keep it the lowest in G20.
“Our members will be happy with many of the announcements: £1bn for digital infrastructure, 100% business rates relief on new fibre infrastructure, £23bn on innovation and infrastructure over five years, £2bn per year by 2020 for research and development funding and £400m into venture capital funds through the British Business Bank. This last commitment makes sense in the context of Brexit, given the expected need to transition from the European Investment Fund (EIF) after we leave the European Union.”
“In this Autumn Statement, the government has again highlighted the importance of fast growth tech companies to the UK with the injection of £400m into Venture Capital funds via the British Business Bank to unlock investment for scaling.
“Funding is a crucial element to the success of scaling business, but it’s not the only one. While additional funding is always welcome and may help to relieve any uncertainty in the market, it should be combined with support to address skills issues, digital infrastructure limitations and the impact Brexit could have on export markets and talent availability.”
Bob Scott, Chairman of the Association of Consulting Actuaries (ACA):
“It’s a welcome change not to have a further pension tax hike, but – there again – the Chancellor has two Budgets in 2017 to consider further pension tax changes, which must be all the more likely if the impact of Brexit begins to bite. If change happens, we hope this is a thoughtful reform that simplifies the present ‘nightmare regime’, not just another tax swoop.
“We’re disappointed the Chancellor didn’t pause the introduction of the Lifetime ISA as we feel its launch could clash with the simultaneous staging of auto-enrolment into tens of thousands of smaller employers next year. We also await the announcement of next year’s earnings trigger for auto-enrolment where we feel a reduction from the £10,000pa current level is needed to enable more lower earners and women to be enrolled into workplace schemes.”
David Bywater, Tax Partner at KPMG:
“Despite the Chancellor making a great deal of noise today on behalf of the SME community, the announcement of a consultation of a review of the way people work will cause concern for large swathes of micro-businesses. As an estimated 4.2 million businesses that make up the UK’s 5.5 million SME community have just one employee, the outcome of the consultation could have massive tax implications for small business owners in the future.
“In general there were a number of micro-measures introduced for SMEs providing some good mood music around supporting the SME community. Softening the impact of the rates regime, providing rate relief for rural small businesses and freezing increases in fuel duty will be welcome. Saving businesses £6.7 billion over the next 5 years in the overall package of business rate reform is not a small number. Announcements of billions of pounds being spent in infrastructure and housing programmes will not just be positive in terms of helping to improve productivity, but will be extra welcome for those SMEs who are represented in the construction supply chain, providing of course that they have access to work on these infrastructure projects by supporting the large corporates.”
Phil Smith, Chairman, Cisco UK & Ireland:
“We’re not a nation to stand still when faced with a challenge. Two-thirds of British workers are in businesses with productivity below average for their size and sector, and that is a significant challenge that we need to tackle together as a nation.
“Our greatness comes from our ability to innovate, whether Turing’s code breaking, or the numerous British inventions that came together to provide the digital back bone of industry. We strongly believe that our edge will once again come from our unique culture of innovation in technology, with the potential to vastly improve the productivity of UK industry through digitisation.
“We welcome the governments investment in providing a foundation for a more digital and connected UK through the £23bn National Productivity Investment Fund. We look forward to continued collaboration between government and industry on this and many other initiatives.”
Lee Murphy, owner of Pandle:
“Following Philip Hammond’s ‘final’ Autumn Statement, the UK government has set the best stage possible for UK SMEs to prosper once Article 50 is initiated next year. By unlocking one billion pounds of new finance to growing firms, more startups will be able to scale up, and in turn, provide more competition in the markets. This will allow for overall greater growth and innovation, and assist in augmenting the speed of innovation in respective sectors, something essential in enabling businesses to thrive in our economy. Furthermore, consumers will experience better prices, services and options as a result.”“One of the major concerns to come out of Brexit has been on exports, with companies now having to consider separate licences for all the countries with which they wish to export their goods or services to. By doubling the UK Export Finance capacity, British SMEs will have a much easier time exporting to foreign markets, and also a great incentive to help tackle the trade deficit.”
Chris Manson, CEO of Newable:
“The introduction of the National Productivity Investment Fund is a real boost for the UK’s innovative SME community. The Chancellor’s intentions to target digital communications as well as research & development sends a clear message that the Government wishes to establish the UK as a world leader in science and innovation.
“Investors should be encouraged by this move and look to invest in fast-growing, innovative businesses doing different things in the STEM sector. Fostering early stage technology will enable new concepts to come to life and ultimately to become commercially viable.”
Kerry Agiasotis, President at Western Union Business Solutions:
“We welcome the Chancellor’s support for small and medium sized businesses in the UK by doubling its export finance capacity in the Autumn Statement today. This, coupled with a relatively weak sterling represents a real opportunity for ambitious firms wanting to connect and trade with new overseas markets.
“We want to connect buyers and sellers all over the world, thousands of our clients are already benefitting from using our new digital trading tool. Today’s announcement supports innovation and ambition and we want to see many more SMEs understanding that new borders are within their reach. The traditional barriers for doing business internationally are quickly abating.”
Liz Ward, Principal of Leeds-based UK200Group member and specialist IP law firm Virtuoso Legal:
“The statement is of great interest to our technology clients as the government seems to understand that they have to actively assist in the generation of IP in order to grow the economy. So far, spending has been promised for universities and also to help technology companies to scale and grow.
“One of the biggest problems is that, whilst the UK generates lots of great start up and SME technology businesses, once they grow they tend to be snapped up by overseas investors. We need to support these companies and help the UK retain talent and ownership of businesses.”
Nancy Curtin, Chief Investment Officer of Close Brothers Asset Management:
“Many investors were hoping for a complete overhaul of fiscal policy. What they saw from the Chancellor was tinkering around the edges. Without ripping up George Osborne’s conservative approach entirely, Phillip Hammond had little room to manoeuvre, or deliver “shock and awe” fiscal initiatives to boost economic growth. The medium-term economic outlook has clouded somewhat, and with slower forecasted growth comes weaker tax receipts, reducing the government’s ability to invest.
“That said, the infrastructure spending confirmed should be seen as a positive. The £23bn fund for innovation and infrastructure is a step forwards, as is the commitment to invest in improving the road and rail network, alongside welcome support for housebuilding. Additional fiscal support for R&D should be well received by science and tech firms, helping offset some of the damage of many companies curtailing their own investment plans until there is more certainty over the terms of Brexit.”
Richard Larner, Head of Research, Brooks Macdonald:
“The Chancellor’s first and final Autumn Statement set a cautiously-optimistic tone, emphasising that “Britain remains open for business”. In a speech that sought to boost confidence in the UK’s economic prospects, he announced a sizeable increase in the Government’s short-term spending plans and created room to provide further fiscal stimulus if required, but was also keen to state that he continues to consider longer-term fiscal discipline of paramount importance. In our view, the announcements are characteristic of the shift toward populist politics that has been proliferating across the developed world in recent years.
“Given that the UK economy has largely shown resilience since the ‘Brexit’ referendum on 23 June, the Chancellor had tempered expectations of any expansion in fiscal spending before today’s budget announcement. Nevertheless, he increased public sector net borrowing plans and left the door open for further fiscal expansion, despite existing spending constraints. This may weigh on perceptions of the Government’s financial position, despite his claim that the public debt to Gross Domestic Product ratio will peak in 2017/18.”
Rachel Mainwaring, Operations Director at Creditsafe:
“Although widely expected, the Chancellor’s pledge today to boost infrastructure investment across the UK is still very encouraging. However, it’s vital that the opportunities he has laid out filter down the supply chain to reach the SME businesses and subcontractors that make up the backbone of our economy.
“The government’s pledge to improve the procurement process to open the doors for both national and regional subcontractors as part of its National Infrastructure Delivery Plan will be vital in helping to achieve this.”
Brett Hill, Managing Director of The Health Insurance Group:
“Today’s increase in Insurance Premium Tax (IPT) from 10 per cent to 12 per cent on 1st June 2017 will mean that IPT will have doubled in less than two years.
“The Government may believe that increasing IPT is a ‘soft’ option, as customers with general insurance products such as car insurance and home insurance can go to an online price comparison site and shop around for a cheaper renewal quote that might offset the effect of the tax rise.
“However medical insurance is a unique product in the general insurance market. It is the only general insurance product where customers have access to a free alternative in the form of the NHS, paid for by the tax payer. It is also not so easy for medical insurance policyholders to change insurer in return for a reduced premium. Many will have medical conditions for which they have recently or are currently claiming, and so will be unable to change insurer without losing cover for the medical conditions that matter to them the most. These customers will be faced with a stark choice, renew with their current insurer and pay higher premiums that they may not be able to afford, or cancel their policy and fall back on the NHS to pick up the bill for treating those conditions.”
Craig Harman, Tax Specialist at Perrys Chartered Accountants:
“As expected there were no major surprises from a taxation point of view, instead the Chancellor’s main focus was the impact on the economy following the Brexit vote.”
“The Government has confirmed it is still committed to raising the tax free personal allowance and higher rate of income tax as well as reducing the rate of corporation tax which will be welcome news for individuals and businesses already paying their fair share of taxes. However the recent trend of cracking down on tax avoidance is set to continue with tougher penalties to be introduced for those deliberately investing in such arrangements”
“The exclusion of an Autumn Statement will make it easier for businesses to plan with a bit more certainty over the year. However, it will be interesting to see if the new Spring Statement remains as the Chancellor intends or if it simply becomes the current Autumn Statement equivalent in the future.”
