The East Midlands will have to wait a little longer for confirmation that it can have a freeport created here.
The Autumn Budget and Spending Review revealed that Humber, Teesside and Thames will be able to start operating as low tax freeport sites from as early as next month.
Other sites, including one planned for a wide area around East Midlands Airport on the Leicestershire/Derbyshire border will still have to wait to hear when they can get going.
The business case for an East Midlands Freeport, potentially supporting more than 25,000 jobs, was submitted to government earlier this autumn after getting provisional backing in the spring.
An outline case suggests it could boost the East Midlands economy by £8.4 billion across 25 years.
And it says a further 30,000 indirect jobs could come off the back of the project, helping to improve local supply chains and energise the region’s economy.
However there was some good news for management, airlines and holiday companies operating at the Castle Donington airport after it was announced flights between airports in England, Scotland, Wales and Northern Ireland will be subject to a new lower rate of Air Passenger Duty from April 2023.
In local travel news, Leicester was confirmed as one of a number of 海角视频 cities to get a share of £70 million to create Zero Emission Bus Regional Areas. Warrington, Milton Keynes, Kent, Cambridgeshire and Peterborough will also benefit from the investment in new buses and related infrastructure.
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Campaigners for the eastern leg of HS2 from Birmingham, via Nottinghamshire, to Leeds, said they were worried that the Government was still stalling on the multi-billion pound plans.
Nottinghamshire County Council leader Ben Bradley MP and James Lewis, Leader of Leeds City Council are co-chairs of the HS2 East campaign.
In a joint statement they welcomed the local transport funding in the budget.
They said: “The existing gap between transport spending in London and the South compared to the North and Midlands is stark, and this is a positive step.
“But that is only one part of the jigsaw, and we need new infrastructure North to South and East to West to connect our towns and cities to make the transformative changes we need.
“The Integrated Rail Plan for the North and Midlands is now 10 months overdue.
“This continued uncertainty is undermining business confidence and we need clarity now that we will get what we were promised.
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“We are ambitious and want to work with Government to transform our communities in West Yorkshire, Nottinghamshire and throughout the east of the country.
“If the Eastern Leg of HS2 is scaled back or cancelled, the North East, Leeds, Sheffield and the East Midlands will pay a heavy price.
“We’ll miss out on jobs, investment and opportunity while the west of the country becomes better-connected through the high-speed rail network acting as a spur for growth and regeneration.
“There is no levelling up without full delivery of HS2 both sides of the Pennines.”
The Chancellor also said:
- £7 million will be made available for the National Forest to support woodland creation in the East Midlands, covering parts of Derbyshire, Leicestershire and Staffordshire
- £250,000 will go towards a Hub Community Centre and Café in Thurnby from the first round of the Community Ownership Fund to protect valued community assets
- 10 areas, including Lincolnshire and Derbyshire, will benefit from almost £203 million in local infrastructure improvements through the Levelling Up Fund.
- Through the BBLS and CBILs, approximately £2.9 billion and £1.8 billion has been lent to business respectively
There was also some respite for smaller East Midlands businesses and shops, many of whom only survived the pandemic thanks to Government support.
A new 50 per cent business rates discount will apply in retail, hospitality, and leisure, with eligible businesses able to claim a discount on their bills of up to £110,000.
Pubs, meanwhile, will benefit from what has been dubbed a draught relief – a lower rate of duty on draught beer and cider, cutting the tax by 5 per cent on drinks served from draught containers over 40 litres and bringing the price of a pint down by 3p.
Mark Henderson co-owns the independent Bistro Live group which offers live music and dining at venues in Leicester, Nottingham and Milton Keynes.
The three venues were shut for 500 days during Covid, and Mr Henderson said they even considered pulling the plug at one point.
Following the Chancellor’s speech he said: “On first glance from a hospitality business perspective the positives are the cut in business rates and change in the multiplier and the cut in alcohol duty and duty reforms.
“Budget negatives are the big increase in national minimum wage – payroll is a big proportion of costs for hospitality businesses and this will have a massive impact on cashflow and ultimately profitability.
“There was also no announcement on the extension of VAT rate reduction [introduced for hospitality businesses during the pandemic], which would have been a big boost.”
Jennifer Thomas, development manager for the Federation of Small Businesses in Leicestershire, Northamptonshire and Rutland feared the Budget would not reassure the region’s businesses.
She said: “This Budget has delivered some of the measures asked for by small businesses to boost confidence and support areas such as retail, hospitality and leisure.
“However, against a backdrop of spiralling costs, supply chain disruption and labour shortages, is there enough here to deliver the Government’s vision for a low-tax, high-productivity economy?
“Unfortunately not. Where inflation and forthcoming tax hikes are concerned, the clouds are gathering.
“It’s good to see the Chancellor embrace our recommendation for business rates reform: changing the system so it stops hitting small firms that invest to make their premises more sustainable with higher bills.
“However we would like to see the business rates support for SMEs go further, raising the threshold for Small Business Rate Relief and therefore taking a swathe of Leicestershire’s smallest businesses who have property to try to maintain, out of the rates system.”
Dr Nik Kotecha OBE is founder and chairman of £63 million turnover Morningside Pharmaceuticals, in Loughborough.
He called it a landmark budget from which extra investment and rate reliefs would stimulate growth now and well into the future.
But he said economic success would still depend on the continuation of growth, management of inflation and the rate at which interest rates would rise.
He said: “The Chancellor’s £7 billion tax cuts in Business Rate Relief for the retail, hospitality and leisure sectors – the largest in 30 years – will go a long way to supporting areas of the economy which have been most significantly damaged by the Covid-19 pandemic and lockdowns.
“There was an important focus on nurturing innovation. As Chairman of a business which invests significantly in R&D; I was particularly pleased to see that the 海角视频’s R&D investment will be raised from 0.7 per cent to 1.1 per cent of GDP by 2024/25.
“This will help towards the Government’s ambition to make the 海角视频 a ‘science and technology superpower’.
“It is also great to see that the Government intends to reintroduce Foreign Aid spending to the 0.7 per cent of GDP level by 2024/25, which provides critical funding to global communities suffering extreme hardship.
“There was very welcome news about investment in boosting skills, supporting families, cutting the Universal Credit taper, raising the minimum wage and for infrastructure projects across the 海角视频. There is no doubt that this was a significant budget, focused on delivering a high wage, high skill, high productivity, economy.”
Laura Kearsley is a partner and head of the employment team at East Midlands law firm Nelsons which has three offices in Leicester, Derby and Nottingham.
She said the Chancellor had done the right thing to adapt to pressure to increase the minimum wage for workers struggling to make ends meet post-pandemic.
But she said the rise would inevitably impact employers.
She said: “Although there are several areas of the economy that have bounced back from Covid-19, there are other sectors where the effects are still very much being felt – travel and hospitality are prime examples of this.
“In these industries, adding this pay increase to employer’s overheads will be a significant burden that will need managing carefully to ensure the longevity of the business.
“For example, employers with workers on zero-hour contracts may be forced to offer fewer working hours on the increased wage, which means that, while the hourly rate is more, it won’t necessarily translate to people earning more money than they did previously.”
“However, it’s also imperative that international investors see the 海角视频 as a place to do business, with a supportive enterprise culture and the draw of skilled people.”
In what he called a bid to give everyone a fairer chance in life, regardless of what part of the country they were born in the Chancellor said he was allocating the first round of bids from the Levelling Up Fund – with £1.7 billion to “invest in the infrastructure of everyday life in over 100 local areas”.
Mr Sunak said the Government is backing projects in Aberdeen, Bury, Burnley, Lewes, Clwyd South and Stoke-on-Trent – along with Labour areas of Ashton under Lyne, Doncaster, South Leicester, Sunderland and West Leeds.
Michelle Craven-Faulkner, a partner at Shoosmiths law firm who sits on the East Midlands HS2 Strategic Board and the HS2 Business Advisory Board said she felt the East Midlands lagged behind other areas because it didn’t have the clout of a regional mayor.
She said: “For example, the Midlands continues to be defined to largely exclude the East Midlands when it comes to transport investment.
“Despite the funding guarantees, transport investment is a fine line for the government considering the financial support already provided following Covid-19.
“Uncertainty remains, with no mention of HS2, an Integrated Rail Plan promised soon and partial renationalisation is still the name of the game.”