Why Apprenticeship Levy should be turned into Skills Challenge Fund: Olga Watterich

But before we look ahead, let’s look back to March. At the Spring Budget, we got strong foundations for stability and growth.

After months of uncertainty, Chancellor Jeremy Hunt managed to set the right tone in his second fiscal event, announcing enhanced childcare provision, increased support for occupational health, and full capital expensing for three years.

All measures the CBI has been calling for – and all decisions that will boost the UK’s competitiveness.

And whilst inflationary pressures are slowly easing, the latest GDP and labour market statistics show that we can’t afford to rest.

Firms are still operating in an extraordinary, high-cost environment, and the Bank of England has warned against complacency.

And on top of that, the CBI’s latest Growth Indicator suggests that firms are looking to cut back on capital expenditure over the next 12 months.

It’s clear that businesses need more action from the Government to help the UK get back on track to secure long-term sustainable growth. In our Autumn Statement submission, we present our three- point plan for doing just that. First, we’re encouraging the Government to deliver an internationally competitive business environment by creating a tax regime that’s appealing to investors, pro-innovation regulation and effective planning. And we’re calling for permanent full expensing – beyond the current three-year window.

Our analysis show that this could lead to a permanent boost of 21 per cent to business investment and a 2 per cent increase to GDP by 2030/31.

But we also need to mobilise the potential and productivity of the UK’s workforce, once and for all.

Businesses need support from Government to remove barriers to work and upskill our existing workforce to prepare them for the jobs of today and tomorrow.

The CBI is calling on the Government to establish a two-year pilot to turn the Apprenticeship Levy into a “Skills Challenge Fund”, affording firms more flexibility when it comes to training and upskilling. Under our proposed policy, levy-payers would invest an additional 30 per cent of their levy over the next 12 months, according to CBI survey evidence.

And finally, we need to grasp the UK’s net zero growth opportunity. There’s no question that net zero presents an unrivalled economic opportunity for firms up and down the UK, including here in Yorkshire and the Humber. But our international competitors are racing ahead to secure green investment.

So we need to urgently move to outsmart the US and Europe on green growth initiatives, by implementing a Net Zero Investment Plan, and creating a targeted ‘green’ super deduction to support firms.

These are just some of the measures our members have told us would make a real difference in realising their ambitions to boost growth and prosperity across the UK.

At the Autumn Statement, the Chancellor has the opportunity to change the UK’s economic prospects – it’s a chance we can’t afford to miss.

Olga Watterich is CBI deputy regional director for Yorkshire and Humber