Reflections on the Spring 2023 Budget
15 March 2023
By Stephen Haddrill, Director General
The Chancellor’s prediction that the UK will hover around a zero growth rate this year is far from exciting news but it marks a definite shift from the bleak prophesies made by many last year. The Chancellor has also secured OBR endorsement of his figures despite a significant number of spending and tax reduction measures, another step forward from the anxieties that swirled around his predecessor’s budget. The ship of state seems a lot steadier and there is reason to believe the climate for business finance will strengthen.
Many of the new measures are aimed at fostering enterprise and investment by reducing the tax burden on business. We particularly welcome the introduction of full expensing of investment for tax purposes which we pressed the Treasury to do. This will apply to HP funded investments but it is not clear that leasing will benefit. We continue to push for that.
The focus on increasing the size of the labour market is also to be welcomed. FLA Members in common with most of the economy have struggled to recruit since the pandemic. The abolition of the Lifetime Pension Limit to encourage older people to stay in work is a radical step as is the decision to allow disabled to retain benefits when they find work. The measures to help parents with young children will be welcomed by many too. The Government appears to be focussed on finding a sweet spot between helping the economy and helping the disadvantaged. It is not a dramatic Budget. It contains little tax and spend rhetoric. But in combining the economy and social policy it is a pointer to where its manifesto for the next election will be pitched.
27 Sep 2022
Ever since the coalition days of 2010, subsequent UK Governments have been steadfastly centrist on almost everything
01 Sep 2022
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04 Aug 2022
The Bank of England’s new inflation forecast will be a shock to many
08 Sep 2021
It may still feel like summer this week, but Autumn is already here bringing the usual surge in meetings, priorities and deadlines. Westminster is no exception.
12 May 2021
The last week has seen the Government consolidate its position as a result of the biggest ever set of polls, whilst the Opposition has fallen into internal strife.
03 Mar 2021
The FLA has called for support for business to be maintained through the crisis and for the restoration of public finances to be phased in gradually.
24 Feb 2021
This is one of the hardest budgets to predict of recent times because the range of possible economic scenarios for the rest of the year is itself so wide. And, unlike some of his predecessors, the Chancellor has floated nothing of significance. But the ink must be nearly dry. Today, the OBR will start its work on assessing the soundness of the proposals. The rest of us have another week to wait.
05 Jan 2021
As we embark on a new year, much of the news about Covid 19 and the economy is bleak - infections are rising and economic growth has stalled. However, our situation could have been so much worse without two things: the gift of the vaccine; and the agreement of the trade deal. They give us all the chance for cautious optimism that the recovery will start properly in the year ahead. But whether that turns into real future prosperity depends on the decisions taken by Government and businesses in the next few months. So what should we now expect from the Government in 2021?
08 Oct 2020
Earlier this week the Treasury announced revisions to the legislation which prescribes how default notices issued by lenders should be written. This is a step forward. For too long, the law has required lenders to use language that is threatening in tone and does not reflect the mutually respectful relationship that lenders seek with borrowers.
It might seem churlish therefore to complain, but the truth is that the announcement has only scratched the surface of what needs to be done to reform consumer credit legislation.
17 Sep 2020
The Chancellor is working on the shape of his Comprehensive Spending Review and Budget to determine what the Government can afford to spend and how spending should be allocated at a time of the greatest uncertainty. The pandemic is placing huge pressures on him to keep the taps open to maintain economic recovery. At the same time, his ability to raise taxes to pay for this largesse is severely constrained for the same reasons. There will be a gap in the country’s finances, and it may have to be met by borrowing. Fortunately, interest rates are low, and the Government remains credit worthy. It can afford to ease the pain of business and individuals through the winter.
21 Aug 2020
Now more than ever Government needs to avoid becoming trapped in the here and now. It must show anticipation and vision. That is not at all easy given the need to tackle so many short term problems against a backdrop of uncertainty about what the next months will bring. So it’s good that major long term priorities such as net zero, raising productivity and levelling up across the country are still being addressed. These are goals that the FLA wholly supports and we look forward to the coming spending review showing vision in taking them forward...
20 Jul 2020
We stand at a fork in the Covid road. In one direction the virus fades away, business opens further and economic recovery gathers real momentum. In the other, we bounce from lockdown to lockdown, with millions losing their livelihoods and the economy remaining in the doldrums for years.
01 Jul 2020
Hardly a year goes by without the role of regulation in the economy being reconsidered.
04 Jun 2020
We are great spenders. Consumption is the lifeblood of the British economy.
20 May 2020
The Coronavirus crisis is often described as unprecedented, but the effects on people of an abrupt change in circumstances, such as loss of income, are all too familiar – uncertainty, anxiety, and the fear of being overwhelmed.
27 Mar 2020
In numerous conversations with Government, we have been very clear that the tools used to support the banking sector in 2008 are too narrowly focused to support firms of all sizes, in every sector of business, across the whole of the UK economy in 2020.
11 Mar 2020
The Chancellor has delivered a budget for business, whilst extending a helping hand to people threatened by Coronavirus.
06 Mar 2020
International Women’s Day, which falls this weekend, is a great moment to stand back and reflect on whether we are doing enough on diversity and inclusion.
17 Feb 2020
The pace of technological innovation can at times seems daunting, but technology is simply a means to an end, not an end in itself.
06 Feb 2020
The Government’s decision to bring forward the ban on selling new petrol, diesel and hybrid cars from 2040 to 2035 will require the concerted efforts of politicians, regulators, manufacturers, lenders, utilities and planners to make it achievable.
22 Jan 2020
Lending to small and medium businesses has been falling for some time, especially outside the South East. It has been suggested that this shows SMEs are cash rich but unwilling to invest. There is some truth in both statements. But there is also a ray of hope if we look beyond the use of conventional borrowing and overdraft facilities.
16 Jan 2020
During his time as Governor of the Bank of England, Mark Carney has been a leading voice in encouraging policymakers, business and investors to recognise the key role of markets, financial and otherwise, in tackling climate change.
13 Dec 2019
After the turbulence of recent months, we now have a Government with a mandate to govern for a full term – and the numbers to get business through the House of Commons.
That list of business is very long, and of course begins with negotiating a rather tricky post-Brexit trade deal, not to mention a brewing storm about the unity of the UK. As strong as the SNP are in Scotland, their influence in Westminster has been blown away by the size of the Conservative majority. And what about unity more generally? Some basis for co-existence between leavers and remainers needs to be found.
So, what are the implications of the General Election results for the financial services sector and FLA members in particular?