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Friday, 18 April 2014

Chamber of Commerce: What Autumn Statement means for Cumbria

In an initial response to the Chancellor's Autumn Statement today, Rob Johnston, Chief Executive, Cumbria Chamber of Commerce says

"Clearly the downgrading of the OBR growth forecasts are disappointing, but not unexpected. As Chambers we've already downgraded our forecasts for 2013 and 2014, while agreeing with the OBR forecast of -0.1% for the current year.

"Given these forecasts, a significant boost to the economy is more important than ever. While many of the measures announced in this year's Autumn Statement are welcome it doesn't go far enough and the Budget next March must implement truly radical and large actions that support long term growth and wealth creation. Only a wholesale re-prioritisation of resources, to unlock private sector finance, investment and jobs, will be enough to win the economic war we're facing."

Commenting on specific measures in the Autumn Statement, Rob says

On capital allowances for investment

"Over £700bn is currently parked on business balance sheets, so it's good to see that the Chancellor has listened to business and is improving incentives for investment by SMEs by increasing the annual investment allowance tenfold to £250,000 for the next two years. This should encourage businesses to start to implement investment plans and should cover the vast majority of SME investment.

And here in Cumbria we have specific support in place or about to come on stream to support that further through, for example, the Cumbria Infrastructure Fund and the Regional Growth Fund, which should also make a significant difference.

If businesses have the confidence to move ahead with investment their productivity will improve, their suppliers will benefit and export potential will rise."

Exporters and international trade

"It's great that the Chancellor is listening to Chambers' call for greater investment in trade and export support, which can help businesses get into new markets internationally. Exporters will welcome the commitment of £70m in new funding as long as it's used to help them strengthen their capacity and exploit opportunities.

"It's good to see too that the Government recognises the crucial role of Chambers, here and in the UK, as a unique resource to exporters."

On infrastructure

"The investments in infrastructure announced are good news nationally but unfortunately the major road spending isn't here in the north west. We look forward to plans for extension of HS2 to the north west, to be published in the new year, but will need to look at these to see whether the impact on Cumbria will be a positive or a negative one. It's unfortunate that Carlisle is not included in the ultrafast broadband announcement for smaller cities.

"The Government needs to do significantly more to support development of infrastructure, generating confidence in the short term, jobs in the medium term and competitiveness in the long term."

On housing

"While we note the Chancellor's reconfirmation of £10bn in guarantees for the housing sector, he should have gone further and committed to building 100,000 new homes directly, which would deliver construction jobs, business for supply chains and local confidence."

On business finance

"It's good to see reconfirmation of strong support for the creation of a British Business Bank but it's disappointing that the Chancellor was unable to give a clearer timetable for the bank's creation and we continue to have real concerns over the impact that the bank will have in practice. "

On the Heseltine Review and local growth

"The Chancellor has taken a decisive and radical step by endorsing Lord Heseltine's proposal for more local control over economic growth funding but it remains to be seen whether this proposed shift from central to local control will happen in practice.

It's also crucial that decisions are taken by true local partnerships, led by the private sector, in which businesses and other relevant stakeholders play an active role.

We look forward to the Government's more detailed response to the Review in the spring.

Chambers of Commerce are great advocates of local solution for local growth. They have and will continue to work closely with local authorities, LEPs and others to build stronger places, stronger business support and stronger exporters.

On fuel duty

"In a county like Cumbria it's especially welcome to see that the 3p rise in fuel duty planned for January has been cancelled. This will make a real differences to businesses, and to consumers."

On business taxation

"Measures announced on, for example, corporation tax are good news. Tax evasion is always wrong so it's good to see measures in place to address this, and aggressive avoidance can be an issue. It's right that businesses should pay their "fair" share of tax there's a fine line to tread here. It's vital that we don't drive away major companies that generate jobs and investment - and that the focus doesn't move to attacking other businesses which working hard and taking real risks to create wealth and jobs, moving spend away from business investment and jobs and into taxation."

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