Highlighting the lack of support for the business community, Dickin says decisions taken by the Chancellor call into question the government’s stated focus on economic growth and are a missed opportunity.
Dickin expressed concern that the Budget fails to recognise business as a critical driver of growth and prosperity that would aid the UK's fiscal position.
"Only this morning I received a letter from Rachel Reeves in which she again stated the importance of achieving sustained economic growth. In that letter she also agreed with us that a strong construction sector, supported by high-quality and safe access and scaffolding equipment and a skilled workforce, is key to the government delivering its growth mission.
"Unfortunately, this Budget sends a worrying signal. It lacks a business-focused vision, disincentivises quality employment, and hampers innovation – all of which are foundational to future economic health."
The increase to the National Living Wage (NLW) of 6.7% is significantly above inflation. While many NASC members won’t be directly affected, this will form the basis for further salary increases across all employers. While an increase in line with inflation is needed, today’s announcement is excessive. It will jeopardise employers considering employing more junior staff and have an inflationary impact.
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On top of the NLW increase, the Chancellor today also announced an unhealthy increase in employers’ NI, both by value and by reducing the thresholds. This will inhibit employers from recruiting and even maintaining staffing levels, at a critical time for the UK economy. While there was some extra support for the smallest employers, this decision will put new recruitment at risk for most employers and reduce their ability to further reward existing staff. It is hard to see how this fits with the government's growth mission.
Also announced were changes to Business Rates that will mean many thousands of small businesses facing a significant increase. While the Chancellor has removed the cliff edge for small firms, changes to the Small Business Multiplier and Small Business Rates Relief mean a significant increase is on the way. In addition, changes to Capital Gains Tax thresholds could disincentivise investment. Investment is needed to ensure competitiveness and growth, especially for a sector facing a talent shortage.
NASC urges the government to reconsider these decisions and work closely with the business community to develop a more balanced approach that promotes economic growth.
Dickin stated: "The Chancellor claims she wants to use this Budget to ‘get Britain building’, with several housing and infrastructure schemes announced. And yet, at the same time it fails to recognise the fundamental role that businesses play in building a thriving economy.
"While there are small, subtle improvements for SMEs, such as the Employment Allowance, these are overshadowed by substantive increases elsewhere. Employment and innovation are the bedrock of economic resilience, therefore NASC calls on the government to revisit these policies and create a more conducive environment for UK businesses to succeed."
