Philip Hammond failed to provide much help for “just about managing” businesses as they prepare for a slowdown in economic growth, leading business groups complained yesterday.
But they described the autumn statement as “responsible, solid and focused” in the wake of Britain’s vote to leave the European Union and welcomed his decision to make it his last.
The Institute of Directors said the chancellor’s statement was “sensible and sober”. As Theresa May focuses on helping “Jam” families, the group suggested more could be done for businesses in a similar position.
Simon Walker, its outgoing director-general, has this month joined the government’s ranks as lead non-executive board member at the new Department for International Trade. He said: “The chancellor’s attempts to increase productivity by investing in transport infrastructure, broadband and housing are welcome, but businesses would also have liked to have seen measures to encourage them to invest now.
“The OBR predicts that next year will be the low point for growth, so we are surprised that amid all of the political and economic uncertainty there weren’t many measures to help ‘just managing’ businesses now.”
The Federation of Small Businesses echoed the sentiment, insisting that “there will need to be stronger fiscal intervention to boost the economy next year, with the prospect of weaker longer-term growth looming.”
Mr Walker said he had not expected “anything flashy . . . and we didn’t get it, but that’s not necessarily a bad thing from the man in charge of the economy”. The British Chambers of Commerce said business recognised Mr Hammond’s hands “are somewhat tied by lower tax receipts and sharply higher borrowing forecasts”. Adam Marshall, its director-general, suggested investing to boost productivity and growth “demonstrates welcome flexibility during a period of uncertainty and change”.
“There was very little support in our business communities for further cuts to corporation tax, so Philip Hammond was right to stick with existing plans,” he said. “We would have liked to see more action on the high up-front taxes and costs of doing business in the UK, particularly business rates.”
The decision to do away with the autumn statement, moving the budget to later in the year and focusing on economic forecasts in the spring, was universally welcomed.
Mike Cherry, national chairman of the Federation of Small Businesses, also welcomed more infrastructure investment but added: “Today’s moves to tighten conditions for the self-employed must also be followed up with help to give them parity in benefits so that the UK’s army of genuine self-employed people will continue to grow.”
Carolyn Fairbairn, director-general of the CBI, said the investment measures “must now be translated into action”.
She supported the chancellor’s new fiscal rules — to balance the books “as early as possible” after 2020, cap welfare spending and ensure that public sector net debt as a share of GDP falls by the end of the decade — saying they would provide “welcome flexibility, while remaining prudent”. She warned that taxation on worker benefits “sends the wrong signal to companies wanting to invest more in employee health and wellbeing”.