Osborne Budget ‘needs to help firms to grow’

The CBI, the UK’s leading business organisation, said George Osborne needed to deliver a budget that would improve the outlook for both growth and jobs.

John Cridland, director-general of the Confederation of British Industry, said: “The Chancellor must do all he can to create the right conditions for businesses to flourish and create much-needed employment.

“We want an all-action Budget that will improve export finance for fast-growing smaller firms, tackle delays in the planning system and make the UK a more attractive place to invest by enhancing the competitiveness of the tax system.

“The Government should also apply the mantra ‘think small first’ when shaping employment law, because if it gets it right for the smallest firms, it gets it right for all businesses.”

Margaret Wood, regional chairman of the Institute of Directors in Yorkshire & the Humber, said that businesses needed the Chancellor to keep to his word when he said there would be no further tax rises.

“The only way out of recession is for UK businesses to generate revenue but, in order for this to happen, the Government needs to work with the business community and not against it,” she said.

“The Chancellor has also indicated that he is considering freezing duty on fuel. This will no doubt come as a relief to many companies who are under increasing pressure from rising petrol prices.”

The IoD has also called for a scrapping of the 50 per cent top rate of income tax by 2015 and the re-introduction of the personal allowance for people earning over £100,000. It also wants corporation tax, which is to fall from 28 per cent to 24 per cent, to be cut to 15 per cent by 2020.

Andy Tüscher, northern director of manufacturers’ organisation EEF, said: “At the moment we accept that the coffers are dry. With simple measures regarding taxation the Government can allow businesses to grow.

“If you look at taxation – when you make investments and write off these investments – we’re not at all on a level playing field with the rest of Europe. It’s about making sure we create the right environment as far as research and development tax credits are concerned.”

Talking about Yorkshire, he said: “There’s going to be investment in the region. The Government has got to realise that it is also going to have to support investment for renewables as well.”

Gordon Millward, South and East Yorkshire chairman of the Federation of Small Businesses, said firms needed more support to encourage them to take on apprentices, such as payment to make up for time lost to training.

“Vocational education has suffered and we’ve not got the people to do the vocational-type work,” he said. “The only way to get small businesses to take on trainees is to give them something towards it.”

Mr Millward added it was vital Mr Osborne reversed a planned 5p increase fuel duty. “The effect on businesses from fuel is dramatic and will cause a lot of people to put prices up,” he said. The British Chambers of Commerce has said the UK faces a “jobless recovery” unless politicians introduce some more business-friendly proposals.

It wants the Government to postpone or scrap new employment regulations, reduce the youth minimum wage and offer employers tax benefits to take on young workers. It said businesses must be able to expand without “falling foul of lengthy bureaucratic planning decisions”.

The British Retail Consortium said the Budget must ensure that retailers are protected from any extra burdens.

It said the fuel duty increase due in April should be suspended and road tax for commercial vehicles waived for a year to compensate for the impact of rising transport costs.

The Forum of Private Business, which supports small businesses, wants access to more funding, saying that this is still a prob- lem.

Hints of some relief to come

chancellor George Osborne has dropped heavy hints that he will cancel an increase in fuel duty planned for April, bringing some limited relief to motorists and the haulage industry.

The Budget could also scrap a planned inflation-linked increase on air passenger duty this year.

The Liberal Democrats have signalled they expect to see further progress on exempting anyone earning less than £10,000 from paying tax.

When it comes to growth, the Government will be looking for eye-catching initiatives such as cutting red tape that do not break the bank.