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Budget 2011: Red-tape cutting and skills support welcomed

Simon Quicke
The Budget has been given a cautious thumbs up by business groups keen to see the skills gap addressed and restrictions on small companies eased.

With most of the media focus falling on the moves made by the Chancellor George Osborne to reduce fuel costs it was the details on technical colleges and cutting red tape for SMEs that gained most attention from business groups.

John Cridland, CBI director general, said that the Budget would help businesses grow and create jobs with the extra 1p cut in corporation tax encouraging investment.

"Reductions in regulations on businesses and the promise of a faster planning system will provide relief to companies trying to take on staff and invest," he said.

He also welcomed moves made to simplify the tax structure and introduce a moratorium on small business regulations.

"The Government's commitment to reducing red tape will increase the amount of time that managers spend growing the business and creating jobs," he added "The moratorium on new legislation will be welcomed by smaller firms. The Government should think small first when it comes to making employment law - if it works for the smallest firms, then it works for businesses of all sizes."  

Where there was wide agreement the Chancellor had made the right moves was with the decision to increase the number of technical colleges and to recognise that a skills gap would threaten future prosperity.

"It is encouraging to see that the number of planned university technical colleges is to double from 12 to 24. IT forms the backbone of business, and it is vital for companies to train and nurture talent within the sector as early as possible, in order to sustain growth," said Alex Farrell, managing director at The IT Job Board.

"The Government must do all it can to offer career choice to young people. But the onus is on those companies operating in the IT sector to attract the talent of the future, and working closely with educational institutions will certainly help to achieve this," he added.

But there were some hoping that the support for SMEs would have gone further than the measures outlined yesterday, particularly given the expectation that the sector will drive growth as public sector cuts come into effect.

"It was important a Budget heralded as being pro-enterprise focused on easing the dual burdens of tax and red tape - two of the biggest barriers to business growth and job creation facing small businesses. In that sense, we weren't disappointed and this was certainly more than just a nod in the direction of UK SMEs," said the Forum of Private Busines chief executive Phil Orford.

"However, while there have been some definite steps in the right direction the Government could have gone further in reducing taxes and making the tax and regulatory systems more proportional to all small businesses so that they incentivise to entrepreneurship rather than act as a barrier to it," he added.

There was also a wish that the Chancellor would do more to recognise the role the IT industry plays in the UK economy.

Tom Wills-Sandford, Intellect's deputy director general said it welcomed a lot of the measures in the Budget, including the red-tape cutting and moves to tackle skills gaps.

"However, we were surprised that ICT and digital technology was not acknowledged as one of the key drivers of growth and urge the Government to recognise that technology underpins all the growth sectors that were named in the budget," he added.



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