How does the Autumn Budget affect businesses?
In the pursuit of economic stability, Chancellor George Osborne has detailed the spending and saving plans that together make up the Autumn Budget 2014. Economic uncertainty has been commonplace in past budgets but there is certainly a sense of optimism with the plans announced today. The rise of forecasted growth in GDP is a testament to this.
With the objective of reducing the current deficit and sustaining economic recovery within the UK, the autumn budget can be characterised by several expansionary policies with a particular focus on the growth of small to medium-sized enterprises (SMEs).
The Treasury has pledged a further £400m to increase government-backed ventures via Enterprise Capital Funds. Investment is essential for the growth of a company. This is good news for new start-ups and established enterprises alike.
The increased availability of investment promotes entrepreneurialism and is a big boost for new start-ups looking to build a sustainable foundation for the future. As an established company, a rise in government-backed ventures could increase the market for your services and you may see demand for your services rising.
The autumn statement outlines major increases in business lending. The Treasury has vowed to guarantee up to £500m of new bank lending to SMEs. The increase of credit availability aims to encourage business spending. The increase of funding available is certainly a positive for small companies aiming to raise capital.
In the interest of reducing unemployment and improving the labour market, George Osborne has announced reforms to apprenticeships. National Insurance for young apprentices is to be abolished. This could impact you in the short term, particularly if your company operates in the industrial sector. In the long term, incentivising apprenticeship schemes should theoretically improve the quality of labour available to you as a company.
The current business rates system is also to be reviewed. Under the current system, the rates paid can often be disproportionate to revenues and are a burden to small companies. Therefore a review of this system is a welcome move and should ensure the growth of your company is not impaired by an outdated system.
The proposed fiscal measures aim to use the growth of small businesses as a vehicle for economic success and, overall, the autumn budget should be a cause of optimism for your company.