Autumn Statement: Osborne's bid to revive economy gets lukewarm response
Businesses and economic experts hope yesterday's autumn statement by the Chancellor will do something to stimulate Britain's stalled economy.
GDP, the measure used to show how healthy the economy is, is expected to have shrunk 0.1 per cent this year – compared to an original forecast of 0.8 per cent growth.
George Osborne tried to offset the disappointment with announcements such as ditching the 3p fuel duty increase and chasing overseas tax exiles.
In Leicestershire, he announced cash to upgrade the A5 link with the M1, which should improve congestion in the south of the county and potentially attract investment. The Leicester and Leicestershire Enterprise Partnership should also benefit from more funding, while from April 2015 a new pot of cash will be made available for transport, housing and investment in skills.
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More money will be available for the Regional Growth Fund and industries in which the UK excels such as aerospace and advanced manufacturing.
Another positive was news that Government trade body UK Trade and Investment will get a 25 per cent increase in funding and £600 million will go to scientific research, £270 million to further education colleges and £77 million to fight tax avoidance.
Cutting the annual tax free pensions allowance from £50,000 to £40,000 will raise extra funds for the Treasury, while increasing tax relief on capital investments up to £250,000 will help small business.
While details of extra support for local enterprise partnerships (LEPs) remained sketchy yesterday, Mandip Rai, head of the Leicester and Leicestershire Enterprise Partnership (LLEP), said: "It's certainly something we welcome and there could be more funding to support economic growth locally.
"It is important that any extra funding is made available as soon as possible."
Richard Farnsworth, tax director at PriceWaterhouseCoopers in Castle Donington, said Mr Osborne had sent a message to the world that Britain was open for business and that low interest rates meant despite Government debt, repayments were not as terrifying as they might be.
Commenting on plans to reel in more money from tax avoiders, he said: "Everybody wants people to pay the right amount of tax and if there's more funding for HMRC that's good news for everybody."
Mark Hobson, managing director of Maber Architects in De Montfort Street, Leicester, said construction needed all the help it could get.
"What would really help the construction industry is more investment in housing projects to kick-start the economy," he said. "There should be more pressure on banks to make borrowing available."
Maxine Aldred, Leicestershire development manager for at the Federation of Small Businesses, said: "The Chancellor has listened to many of our members' concerns, and has put forward proposals to address these issues.
"However, it is clear from the Office of Budget Responsibility's figures that the recovery will take longer than anticipated. Efforts must therefore be focused on boosting short-term growth where finances allow."