Chancellor sets out plan for working people

Chancellor of the Exchequer, George Osborne, today used his Summer Budget to set out the next stage in delivering the government’s plan for working people in the South West.

This Budget has delivered a tax cut for 2.6 million people in the South West, taken an additional 50,000 out of income tax all together, announced new opportunities for up to 320,000 apprentices and offers more childcare to working parents. Since 2010, there are 163,000 more people in work in the South West and 98,900 more businesses.

Putting progress towards devolution to Cornwall and significant investment in broadband, transport, skills and education at its heart, the Budget also set out how government will support local cider makers across the region.

But there is more to do and that’s why the Chancellor also announced wide ranging reforms to help working people at every stage of their lives, alongside local investments for the whole of the South West.

Chancellor of the Exchequer George Osborne said: “My budget today puts security first. It delivers economic security so Britain lives within its means, financial security for families, and national security for all.

“A new National Living Wage for 140,000 people, and an income tax cut for millions more provides new support for people right across the South West.

“At the heart of our plans is an ambition to build a world class transport system, to hand over new powers to local leaders in Cornwall, to support the South West’s small cider makers, and to invest in science, education and skills.

“This is a Budget that delivers on our plan for working people in the South West”

Measures announced in the Budget will support working people in the South West:

A tax cut for 2.6 million people in the South West with a rise in the Personal Allowance and an increase in the higher rate threshold. 50,000 more people will be taken out of income tax altogether.
A significant pay rise for 140,000 working people across the South West with the introduction of the National Living Wage.
Double the amount of free childcare for working parents of 3 and four year olds – meaning thousands families in the South West will now receive 30 hours of free childcare a week.
Thousands of family homes in the South West taken out of Inheritance Tax altogether as a result of the increase in the Inheritance Tax allowance.
New opportunities for up to 320,000 apprentices as part of ambitious plans to grow the number of apprentices across the country.

The Budget backs businesses in the South West:

An extra £1,000 for every business in the region with an increase in the Employment Allowance.
Further help for 11,000 businesses in the South West from a significant increase in the Annual Investment Allowance to £200,000
A tax cut for businesses across the South West with a cut in the main rate of corporation tax to 19 per cent in 2017 and 18 per cent in 2018.

The Summer Budget also includes announcements directly to support the South West:

The government is making good progress towards a devolution deal with Cornwall.
£20 million for a further round of the New Stations Fund which will consider proposals including any put forward by Somerset County Council for a new station between Castle Cary and Taunton.
The government will provide local councils with funding to support the development of business cases for the North Devon Link Road, and the A391.
£3.5 million for a further round of the “pinchpoint” fund which will address local congestion and bottlenecks including £2 million for the Treluswell Junction improvement in Cornwall.
£90 million to extend the Coastal Communities Fund, from which the South West has already benefitted significantly.
A new round of Enterprise Zones following the launch of the Plymouth enterprise zone, ensuring that all places in England can benefit, including rural areas.
A fund of up to £10 million to support connectivity in the South West through the broadband programme. The fund will be available for local projects to bid into, with priority given to those delivering ultrafast speeds. Broadband delivery UK will start working with local projects immediately.
£23 million of investment in six Next Digital Economy Centres across the country.
Continued support for the local cider industry in the face of demands from the European Commission to remove the tax exemption for small cider makers which would have cost up to 500 cider makers around £2,700 a year.
The establishment of a network of National Colleges right across the country to provide high quality professional and technical routes into employment.
The government also supports the work towards building a new stadium for Cornwall, and looks forward to seeing further progress.

Charles Kislingbury, head of office at JLL’s Exeter office, said: “The Chancellor’s continued focus on investment in improving transport links in the South West is welcome; it is vital that due emphasis is placed on important new infrastructure projects in the region.

“Similarly, our region may benefit from the launch of a new round of enterprise zones for smaller towns which has the potential to increase inward investment and indigenous growth in those places.

“The announcement regarding the delivery of three million new apprenticeships is one of the most important points put forward in this budget when addressing further stability and economic growth for the UK. The whole country is suffering from a chronic shortage of skilled construction workers. This is driving up construction costs and affecting the viability of much-needed housing and commercial developments.

“Providing a plentiful supply of skilled construction workers would help ease the pressure on costs while improving productivity in the industry and providing a further boost to employment.”

Commenting on the announcement that Sunday trading laws will be relaxed, Charles added: “This is a welcome announcement from the Chancellor. With people able to shop online 24/7, the physical retail world needs to be able to compete. Time is the most vital commodity that people have and more flexibility is required to enable people to fit shopping into their busy lives. At a time of rising consumer confidence more shopping time can only be good news for retailers and consumers alike. The Chancellor now needs to tackle the stranglehold that an outdated business rates system is having on retailers.”

David Beaumont, area director for SME Banking in the South West, Lloyds Bank Commercial Banking, said: “The announcements made today by the chancellor will be welcome news to many small businesses operating in the South West, especially to those in Cornwall which was named as one of the areas in line for devolved powers.

“Connectivity continues to be an issue for companies in the South West, many of which are in remote or isolated locations. The announcement that changes to vehicle excise duty will lead to increased investment in road infrastructure, and the continued commitment to freezing fuel duty will be a great support to many firms across the region.

“Announced enhancements to the annual investment allowance will also benefit many in the manufacturing and agricultural sector – both key contributors to the region’s economy

“Our recent research recent found that companies are struggling to recruit with the right skills, and the government’s announcement that three million more apprenticeships are to be created will help address this issue and benefit many firms, allowing them to reach their long-term growth potential.

“We are helping many companies to grow both at home and overseas through our SME Charter and commitment to lend an additional £1 billion net to small businesses every year until 2017.”

Jeremy Blackburn, RICS Head of Policy, said: "Chartered surveyors agree with the Chancellor that we are not training, building or investing enough and the apprenticeship levy will help address the skills gap in our industry.

"We predicted that measures for home-ownership and property taxation would be at the heart of this Budget and the announced changes to Buy-to-Let mortgages will take some of the heat out of the market and free up some much needed supply.

"Whilst making changes to rent levels and bringing in ‘pay to stay’, the biggest difference the Chancellor can make is to create the conditions to build more houses to live in – whether to buy or to rent.

"Measures to reassure downsizing baby boomers that they will not be penalised through their IHT allowance are welcome, but more could be done to unlock second hand stock now. One such reform might be to incentivise over 60’s to downsize now by doubling their IHT allowance on sale.

"We know that property is central to productivity, but so is mobility. Fixing our infrastructure with a new £3bn roads fund will drive locational investment and fuel government’s commitment to devolving powers and funding across Britain."

Exeter Citizen Advice Bureau's response to today's summer Budget can be found here.