Here’s how the industry has reacted to today’s Autumn Statement announced by Chancellor George Osborne…
Helen Dickinson, director general, British Retail Consortium:
On business rates: “We very much welcome the commitment to undertake a comprehensive review of the business rates system. We want a system that brings investment and jobs to the high street without punishing retailers who trade online. The retail industry is the largest rates payer, contributing over a quarter of the total rates tax take.
“Today’s short term support package will be of enormous help to those struggling to keep their businesses open on the high street. We look forward to playing a full part in the discussions that will take place with Government on the reform of the system.”
On voluntary schemes and employers NICs: “We are delighted that the Chancellor recognises that voluntary schemes have room for improvement and agrees with our proposals to take a more careful approach so that customers and companies all benefit from well thought-out and properly-costed schemes.
“The retail industry employs an estimated 100,000 apprentices and any support for increasing the number of young people able to get a head start working in our world-beating industry is to be warmly welcomed. The BRC congratulates the Chancellor on his recognition that apprenticeships are a great way to get young people into work. By eliminating Employers NI contributions for young apprentices the Chancellor has made it much easier for businesses to take on an apprentice and give them the skills they’ll need to succeed.”
John Rogers, chief financial officer, Sainsbury’s, and chair, BRC industry-wide group looking at the issue of business rates:
“We welcome the full review of the structure of business rates. A clear consensus has emerged across businesses of all sizes and from all sectors - our current outdated system of business rates isn’t just a retail problem, but a business problem. We will be fully engaging with the review to ensure we get a new system which is fit for purpose in the 21st century.”
Phil Orford, chief executive, Forum of Private Business:
“The Chancellor was keen to provide a much needed boost for Britain’s small businesses and there were some positive measures in today’s speech which will go a long way to helping reduce costs and improving business confidence. Whether this will be enough as we enter a period of uncertainty at the start of next year remains to be seen.
“Business rates have been an ongoing concern for a large number of our members, with 55% in a recent poll seeing this significant barrier to business growth. It is good to see that the Chancellor has agreed with our suggestions of short term measures to reduce the pain of excessive property taxation with continued a continued cap of 2%, a £1,500 discount for retail properties and an extension on Small Business Rates Relief. While we also welcome the Chancellor’s decision to answer our repeated calls for a proper review of the system and the way in which it is calculated, the devil will definitely be in the detail. With the review scheduled for after the General Election, we are keen to see all parties commit to making concrete moves to tackle an issue that many businesses feel has needed addressing for some time.
“Announcements of additional British Business Bank and the extension of the Funding for Lending scheme are also welcome measures to address ongoing small business confidence issues around the ability to obtain the finance they need to grow.
“On the announcements of further scoping and development of a Northern Powerhouse incorporating several major cities, and increased tax raising powers to Wales, Northern Ireland and Scotland, our members see this as a very positive further step in re-balancing our economy, not only in terms of financial services and manufacturing, but also in a commitment to support major regional and local development plans outside of London and the south-east.
“While we applaud the increase in R&D tax credits - a successful driver for innovation, we would have preferred the relief to have been focussed on the formulation of a new Export Tax Credit to incentivise and support new exporters in riskier overseas markets.”
James Lowman, chief executive, Association of Convenience Stores:
“We are delighted that the Chancellor has listened to our concerns on business rates by committing to a full review. Local shops will welcome the 2% cap on rates increases and the extension of the higher threshold for small business rate relief, alongside the increased £1,500 rates discount for shops on the high street. We are committed to rates reform that works for local shops and will play a full part in the review in the coming months.”
Paul Baxter, chief executive, National Federation of Retail Newsagents:
“The NFRN has long argued that reform of the business rates system is desperately needed, therefore we are happy that a review will take place. The system is no longer fit for purpose and many agree that changes need to be made. We hope that the review will provide a more viable solution that accounts for the many different types of business that now exist and we will be writing to the government to offer our assistance and ensure the interests of independents are taken into account.”
Jeremy Cooper, managing partner and head of retail, Crowe Clark Whitehill:
“It is clearly good news for smaller retailers that they will continue to receive the 100% relief from business rates until April 2016, with around a further 190,000 benefiting from tapering relief.
“It is also pleasing that the Chancellor has agreed for the government to conduct a review of the future structure of business rates, however it is not due to report until the spring of 2016. One must question whether or not there will be the political will post the general election to implement the review’s findings.
“In the meantime, the government will continue the 2% cap on the RPI increase in the business rates multiplier for an additional year from 1 April 2015. On the face of it, this may be seen as good news, however this is at a time when many retailers, particularly in the fashion and grocery sectors, are seeing real declines in like-for-like sales and it would not surprise me to see the usual round of administrations of retailers in January 2015.”
Phil Mullis, partner, Wilkins Kennedy LLP:
“Tailored customer service, local knowledge and specialist goods are all USPs for the independent retailer, giving them the growth they deserve during the recession. The Chancellor’s further rate relief announced today will only go further to help keep the wolf from the door.
“However, we mustn’t lose sight of the bigger retail stores who are large employers. The recession taught us that no one was safe, independent or national chain and the government must do their bit at the other end of the scale to help the bigger players out too.
“Also, we can’t ignore the fact that trade is increasingly moving online. So, whilst these rate reliefs are handy in the short term the growth won’t be sustainable if the footfall chooses the online shop over the bricks-and-mortar store.
“In order to secure the future of the high street, the government needs to be much more proactive and sensitive to the way the world is changing. Today’s shoppers are much more fluid, and can combine popular shopping channels; so, independent retailers need to build a better support network to reflect this modern shopping experience. This should not only lead to a high street recovery, but it will also help to stabilise retail sales overall.”
Melanie Leech, director general, Food and Drink Federation:
“It is great that the Chancellor has announced measures to stimulate growth which should help the country’s largest manufacturing sector towards achieving its ambitious agenda to grow by 20% by 2020.
“Food and drink manufacturers are already strong exporters and the announcement of a £45m package to help exporters reach emerging markets will enable us to build on our success and to take our world-class products to new markets.
“As an industry that invests heavily in the future skills of its employees, the abolishment of National Insurance Contributions for apprentices under the age of 25 should encourage even more firms to take on young people.
“However, we would welcome further incentives to support upskilling through the apprenticeship route for over 25 year olds and to route apprenticeship funding directly to employers.
“FDF also welcomes the increase in R&D tax credits for small and medium sized companies to 230% and for large firms to 11%. Innovation is the lifeblood of the food and drink sector and these measures should provide a significant boost to a sector which is characterised by its vibrant SMEs.”