Chancellor Rishi Sunak has announced a raft of new measures in his spring Budget speech for 2021.
On Wednesday, March 3, Mr Sunak laid out his plans for spending and taxation in the House of Commons, including billions of pounds of support for business.
He described his statement as "honest", acknowledging the need to introduce measures to boost public finances in the longer term, including a corporation tax rise of 25%.
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In the South West, the chancellor announced Plymouth would be included among eight new freeports for England, while a bid for a freeport in the Bristol region, that was slated to create thousands of jobs, and another in Bournemouth, Poole and Christchurch, was overlooked.
However, several areas in the region have been identified as priority places to receive support via the £4.8bn 'Levelling Up Fund' and the £220m 'Community Renewal Fund'. They include the Isles of Scilly, Torbay, Torridge, West Devon, Cornwall, Mendip, Sedgemoor, South Somerset, the Forest of Dean and Gloucester.
There were also multi-million-pound town deals confirmed for Bournemouth and Swindon.
Commenting on the impact of the Budget on the South West, Mr Sunak said: “Today’s Budget provides certainty in the months ahead for the people of the South West – with the cut in VAT to 5% for the hospitality, accommodation and tourism sectors, Self-Employment Income Support Scheme and furlough scheme all being extended through to September.
“I was also delighted to confirm that Plymouth Freeport was successful in the Freeports bidding process – bringing jobs, opportunity and investment to the region."
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But what do business leaders in the South West think of Mr Sunak's proposals? Here, they share their views.
'One of most inspiring Budgets for long time'
Tim Jones, chairman of South West Business Council, said he was “blown away” by Plymouth being named as a freeport, having been involved in what he calls a “last minute bid”.
“Plymouth has snuck in. We didn’t expect that at all,” he said. “But it has grasped the opportunity and been rewarded.
“The initial financial impact will be worth millions of pounds," he said. “And this is not just for the marine sector but will benefit the whole of Plymouth, including the businesses in the marine supply chain. It will attract a lot of national and international investment and open doors.”
Outside of the freeport announcement, Mr Jones called the chancellor’s speech “one of the most inspiring Budgets for a long time” with some “highly creative” measures which will be welcomed in the South West.
He said the extension of the furlough scheme and VAT and business rates holidays would help the hospitality sector and was especially supportive of the announcements on corporation tax and the 'super deduction' investment programme.
“This will unlock significant investment,” he said. “And there is welcome support for skills development, particularly for digital as an investment for the future.”
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Mr Jones did said there had been no detailed support for under-pressure high streets, but the 45 new town deals may assist the region, when details are known.
“So the business of staunching online retail is for another day,” he said.
'Company directors left out in cold'
Muir McDonald, chair of the Institute of Directors South West, said business leaders would be "relieved" the furlough scheme had been extended.
“Many firms have used the Job Retention Scheme to support their cashflow while restrictions have eaten into their revenues, and without it jobs losses would be even higher.
"By extending support until the end of September, the chancellor has given many businesses an extra cushion as they attempt to re-scale and re-hire when the economy reopens. Hospitality and the leisure industry has been particularly hard hit in the South West and needs all the help it can get to rebuild."
He said widening the eligibility for self-employed income support was also a welcome step, as many have gone without significant earnings for almost a year. But added that the chancellor had "missed a trick" by not providing grants for company directors who continued to be "left out in the cold".
However, he said Mr Sunak's approach to corporation tax was "pragmatic" and vouchers for SMEs to invest in technology, and provisions for management training, would help address the 海角视频’s longstanding productivity problems.
"The prospect of higher taxes will no doubt bite for many firms that are still tending to wounded balance sheets. Delaying and tiering the corporation tax rise is a pragmatic approach, though adjustments to the plan should remain on the table as a clearer picture of the recovery emerges. Overall there is much for businesses to get behind in this Budget."
'A Budget that should help firms survive'
Stuart Elford, chief executive of Devon & Plymouth Chamber and chair of British Chambers of Commerce South West said it was "pleasing" to see that the chancellor has listened to the concerns of the business community - and the news of the freeport in Plymouth was "fantastic".
"[He has] delivered a Budget that should help firms to survive and recover from this pandemic.
“The extension of the furlough scheme, which we directly called for, will save thousands of jobs as firms gradually return to full operations. The extension of cash grants for business and the self-employed, together with the business rates holiday is also in direct response to our campaigning.
“Accepting that the debt caused by the pandemic has to be repaid, businesses will not relish an increase in corporation tax. Profit is not a dirty word; businesses use that money to reinvest and grow, creating jobs and contributing to economic growth.
“But Mr Sunak has tapered that increase and introduced incentives for investment in increased productivity, both in terms of tax relief on machinery and much-needed investment in digital, management and leadership skills.
“The continuation of the reduced rate of VAT is especially welcome in our region that relies so heavily on leisure, hospitality and tourism, and its associated supply chains.”
'Another extraordinary Budget [but] West Country losing out'
Phil Smith, managing director of Business West, said the chancellor's approach made "good sense" and would put business people "at ease".
“It was another extraordinary Budget from the chancellor, reflecting what is an extraordinary time for the 海角视频 economy," he said.
“Businesses will welcome an extension of the full range of Covid-19 support measures, with the timescales longer than many were expecting. The extension of the furlough scheme, an extended and more targeted self-employed scheme, a new tranche of business grants and a new recovery loan scheme will all continue to provide a safety net for businesses through to the autumn."
However, he agreed there would be disappointment that limited company owners had been "forgotten" and said the Bristol and Bath region was "losing out".
"Bristol failed to secure a Freeport for the region, as much of the focus of the chancellor was fixed on the North of England, Scotland and Wales. This is disappointing and we encourage our MPs and political leaders to continue to fight for our fair share of levelling up money to address the needs of this region.”
'Chancellor has listened to business'
Dorset Chamber chief executive Ian Girling said there was "much to welcome" in the Budget and the chancellor had "listened to business".
“Its business-friendly measures will stoke confidence, create greater clarity about the way forward and give hope for economic recovery as lockdown eases," he said.
“The extension of the furlough scheme and support for the self-employed, apprenticeship incentives and restart grants will be welcomed by many business in Dorset.
But he said it was "incredibly disappointing" to see Bournemouth, Poole and Christchurch miss out on a freeport.
He added: "We stand ready to seize any similar opportunities in future. I hope the fiscal firepower deployed by the chancellor will now give businesses in Dorset the confidence to plan ahead with greater certainty as they begin to rebuild over the coming months.”
'Bitter disappointment over Great Western freeport'
Tim Bowles, the mayor of the West of England, said there were a lot of "excellent schemes" in the Budget that would help support jobs and the region's economy.
He said: "Schemes like Help to Grow will also link with my own recovery plans and make sure that the West of England is able to build back strongly. I am pleased to see that our vital hospitality and construction sectors will be receiving specific support as this is something that I have been calling for and the need for it has been reinforced by my regional recovery taskforce.
But the leader of the West of England Combined Authority, who was heading up the bid for a freeport in the Bristol and Bath region said he was "bitterly disappointed" the Great Western Freeport was not selected.
He added: "I still believe the strength of our region and economy could have made us an exemplar of how modern freeports could be a success.
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"We had widespread support across the region for the bid which the Government have told us met their criteria, so I look forward to a prompt and detailed explanation from ministers about why they did not take our bid forward.
"Nevertheless, thanks to our regional recovery plan, we are bringing forward our own schemes and plans to secure our recovery, help businesses create decent, well- paid jobs and renew our economy by supporting our region’s strengths.”
'Business rates holiday will provide some certainty'
Rebecca Cook, head of business rates consultancy at South West property firm Vickery Holman, said: “We are pleased to see the chancellor has provided some certainty for businesses in the retail, leisure and hospitality sectors, by extending the business rates holiday for another three months at 100% and an extended discount beyond that for a further nine months.
“This extended period will provide businesses with the all-important time they need to recover from the impact of the pandemic and focus on re-opening, without the added pressure and cost burden of business rates.
“It was announced last week the Government has postponed the business rates review until Autumn and with an extraordinary high multiplier, combined with an unfair transitional relief scheme and historical rateable values, the extended holiday is a lifeline for many businesses in these sectors, particularly those on our struggling high streets.”
'Grants for firms very helpful'
Malcolm Bell, chief executive of Visit Cornwall and a co-chair of Great South West Tourism Partnership, said the extension of furlough is welcome, but is less needed in the South West, but the grants for firms to open up will be very helpful. He said extensions to VAT and business rates holidays are also good news.
“That will help businesses’ cash flows,” he said. “And they won’t restart trading being hit by bills.”
but generally wanted more support for the hard-hit hospitality and tourism sector.
“We welcome and appreciate the initiatives but would have welcomed a bit more,” he said. “We will have to look at the details. We would have loved VAT to be extended until next year.”
He said it will be important for the chancellor’s measures to boost the wider 海角视频 economy, and added: “Tourism requires the wider economy to do well for people to come here.”
'Geography biased to the north'
Stephen Henagulph, chief executive of Somerset chamber, welcomed the "business-focussed" Budget.
“There are big new incentives for investment, lower tax rates for the smallest firms and I’m delighted to see the extension of Coronavirus support measures and grants for businesses in the short term," he said.
“Slightly less good news was that Avonmouth did not receive one of the eight freeport designations in the 海角视频, although I’m delighted for the South West as it was confirmed that Plymouth has been allocated a freeport allocation.
“It was also a little bit disappointing that the geography still seems to be slightly biased to the north as there was no mention of the South West, other than the freeport. New initiatives are being centred in Leeds and Darlington and when the chancellor talked about wind and tide power, he gave the example in Scotland, yet we know in Cornwall there are some fantastic projects leading the way in autonomous marine.
“Overall, though, there are some really positive noises coming back from businesses already that this is a Budget that will encourage and support them to grow."
'Budget gives breathing space'
Kim Conchie, chief executive of Cornwall Chamber of Commerce, said he was giving the Budget statement a “cautious” welcome.
He said that extending the furlough scheme, and VAT and business rates holidays, would help businesses, but he would have preferred them to be stretched to 2022 so they can “plan and forecast”.
“But it gives breathing space,” he said. “Hopefully we will be out of the (Covid) mess by September.”
He said announcements on Corporation Tax and apprenticeship funding will help Cornish businesses, but said the increase in minimum wages may be arriving too soon.
However, he said businesses would benefit from the new, free management training, promised by the chancellor, and tax credits for R&D, and the freeze on fuel duty would be very important for the rural economy.
But he said that with the Covid situation still ongoing “we will keep this under review”, and he said: “Business leaders will need to keep pressure on politicians to ensure we are moving safely out of lockdown.”
'Business rates extension not long enough'
Amanda Lumley, executive director of Destination Plymouth and co-chair of the Great South West Tourism Alliance, said: “We welcome the support for the tourism and visitor sector from the chancellor in his statement. The sector has been lobbying hard for several months to get furlough and business rates relief extended plus an extension to the 5% VAT rate.
“However we are concerned that the extension to June for zero business rates will not be long enough given many tourism businesses will not actually reopen until mid May.
“Many of these businesses have not had any cash coming in for a year and will only have less than a month after opening until they get their business rates bill.
“The impact on their cash flow will be hard hitting and in one sense could not come at a worse time as businesses prepare for summer. We will continue to listen to our businesses and if necessary will lobby for further support going forwards.”
'A solid plan'
Steve Witt co-founder of Not Just Travel, based at Aviation Retail Park near Bournemouth Airport , said the Budget included a "strong all-round mix of measures" to help get the economy back on track.
He said: "Given the hugely difficult position all governments are in right now, this is a solid plan which will help a lot. For the small business, the extension of furlough, grant access, rate relief and access to recovery loans, there are lots of options.
"So far, the chancellor has stopped short of specifically helping the travel sector, however the measures announced today will go a long way to giving consumers confidence without hitting their pockets. As a result, they will be encouraged to spend their money on travel either in the 海角视频 or overseas. The quicker we can get customers travelling again, the quicker the industry can support itself."
'Why was furlough extension not announced earlier?'
James Twine, partner solicitor at Wolferstans in Plymouth, said the furlough extension would be “welcome news for employers who are still suffering a drop in demand from their customers and those in sectors such as leisure and tourism which will still not be fully operational by the end of April.
He added: “As expected, the announcement has still been met with criticism from some quarters, with the main objection being the timing. Many employers have questioned why the extension was not announced earlier which would have assisted their planning.”
He added: “While no politician is ever going to please everyone, I was quite impressed with the Budget and the chancellor's initiatives during the pandemic.
"There has been much criticism over the lack of support available for certain self-employed individuals and this has now largely been addressed by today’s announcement and the additional access to self-employed SEISS grants."
'It was not a Budget without hope'
Mark Tibbert, partner and head of tax, Thomas Westcott Chartered Accountants, said: “Overall, although from a tax perspective it was a passive Budget statement it was not a Budget without hope.
“Without committing to deadline to achieve milestones there was a clear indication of the chancellor looking to honour previous levelling up commitments and encourage investment in green technology.
“It was also notable that there was only one reference to having left the EU, which has made it possible to introduce freeports to the 海角视频. On this, it was positive news for the South West that Plymouth will harbour one of only eight in the country, which will surely help encourage investment and employment in the region.