The new dawn after the night before and there is a flutter of excitement in the air. The great beast of British industry starts to break out of its 20th century chrysalis, shaking off the old economic straitjacket of the past and emerging into a new world order where all citizens will wear lab coats and have pointy heads. Welcome to the United Kingdom 2011, newly termed ‘Growth Nation’.
Short-term stimulus
To paraphrase the Chancellor, “From Shanghai to Seattle, and from Stuttgart to Sao Paolo: Britain is open for Business”, but does it feel better waking up this morning? Well, for many the answer will be a resounding no, and especially not if you are a North Sea oil and gas producer or a family facing public sector and child benefit cuts, but for a portion of the economy who are involved in the risky business of innovating and growing the economy through new inventions and discoveries, there is a genuine whiff of excitement.
Higher than expected cuts in corporation tax; generous R&D tax breaks (a recommendation taken up by James Dyson’s review for the Treasury); £100 million worth of funding for new research facilities at universities and 21 new enterprise zones offering discounts on business rates and reduced planning constraints and more generous qualifying rules and tax reliefs for EISs and VCTS are all great news for those companies and investors, working hard at the 21st century coalface.
Long-term growth
As well as an aspiration to create conditions for businesses to flourish, the Chancellor stressed the need for skills – another component in this mix to get the economic turbines purring again. As the Chancellor so eloquently put it: “Britain’s working age population has lower skills than the populations of America, Germany and France. That’s probably the biggest problem facing our economy in the future.” Bullseye, George. You’ve nailed it there.
As a remedy he announced a number of measures including an additional £180 million for apprentices and up to 50,000 additional places over the next four years. And to address the specific barriers faced by SMEs in accessing apprenticeships, the Government will support business consortia to set up and maintain advanced and higher apprenticeships schemes, supported by grants, creating a further 10,000 apprenticeships.
Well, if the net effect of these measures means that the Chancellor says in Budget 2012: “From Bridgend to Bury and Bognor to Batley: Britain is open to business”, rather than the more exotic analogy he used this year, we’ll be thankful for any steps forward.
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