Tag Archives: Economy

Awards, Events, News

2024 Institute of Economic Development Annual Conference open for booking, as Annual Awards also return

Early Bird registrations are now open for the 2024 Institute of Economic Development Annual Conference and Awards Dinner, the UK’s premier in-person event for economic development and regeneration professionals working for local and regional communities.

The IED Annual Conference, which this year will return to BMA House in London on Wednesday 6th November, is titled Economic Transition – How do we deliver long-lasting change in our towns, cities and regions?

Baroness Sharon Taylor of Stevenage OBE, Shadow Spokesperson for Levelling Up, Housing and Communities, is the confirmed opening keynote speaker. Other guest speakers include:

  • Adam Hawksbee, Deputy Director, Onward
  • Dame Irene Hays, Director, Hays Travel
  • Danyal Satter, CEO, Big Issue Invest
  • James Smith, Research Director, Resolution Foundation
  • Mel Barrett, Chief Executive, Nottingham City Council
  • Rachel Rowney, Chief Operating Officer, Local Trust

Tom Stannard, IED Chair, and Chief Executive, Salford City Council; and Bev Hurley CBE, IED Director and Chief Executive, YTKO Group, also feature in the conference programme with further speakers, breakout sessions and panels to be announced in the coming weeks.

Following the one-day conference, the IED Awards Dinner will take place in the Lutyens Suite at BMA House. The awards will once again recognise achievers in the public and private sector through a series of individual, team, and organisational categories. Eight categories are now open for entry and a ninth, Outstanding Contribution to Economic Development, will be selected by the IED Board and expert judging panel.

Leader of the Year

Economic development professionals who have demonstrated outstanding leadership and management in their role, and who motivate and inspire their team to achieve success through effective leadership.

Team of the Year

Exceptional economic development teams who have gone above and beyond in ensuring the smooth running and effective delivery of economic development functions in their organisations.

 

Rising Star of the Year

Younger economic development team members aged 30 or under (as of 1st June 2024) who have demonstrated excellence, commitment, and gone above and beyond in their early career.

Equality, Diversity and Inclusion Champion of the Year

Individuals who have strived to actively promote, celebrate and raise awareness of EDI, improving under-represented involvement in economic development in their organisation or externally.

Social Value Champion of the Year

Individuals who have championed and made a significant contribution to social value creation, developing best practice in their field and making positive impacts in their communities.

Most Innovative Project of the Year

Innovative economic development projects which have pushed the boundaries beyond traditional approaches and delivered additional beneficial outcomes as a result of the innovation.

Collaborative Initiative of the Year

Outstanding cross-sector economic development collaboration between two or more partners drawn from local authorities, private sector, third sector, business and academia.

 

Outstanding Impact

For projects delivered and concluded in the last five years, which demonstrate benchmarked evidence against other similar initiatives. Impacts could include environmental, social, business support (from start-up to growth and scale), rural development and regeneration.

 

*Outstanding Contribution to Economic Development

Individuals who have made a sustained outstanding contribution to any field of economic development over a minimum of 20 years.

 

*To be selected by Institute of Economic Development Board and expert judging panel.

 

To enter the awards, individuals/teams should develop a 500-word entry on ‘why they should win’ and a 50-word summary for promotion in the awards programme, together with an optional one page of additional evidence, and submit to admin@ied.co.uk by 5pm on 31st July.

Details of last year’s winners, and highly commended entries, can be viewed here.

“We are really looking forward to the Annual Conference and Awards Dinner in London, at a venue we know well, following a highly successful event as part of our 40th anniversary celebrations,” said IED Executive Director Nigel Wilcock. “Further details on our Economic Transition – How do we deliver long-lasting change in our towns, cities and regions? conference programme will be announced as and when speakers and sponsors are confirmed, but in the meantime we encourage members and non-members to take up the Early Bird ticket rates for the Annual Conference, which are available until 27th June, and to get their submissions in for the Annual Awards.”

Manufacturing, News

Report reveals ‘True Impact’ of manufacturing is nearly a quarter of UK GDP

Manufacturing is having a far greater impact on the UK economy than first thought according to a major new report released today.

‘The True Impact of UK Manufacturing’, which will be unveiled at MACH 2024 in Birmingham later, shows industry is worth £518billion and supports 7.3million UK jobs directly and across the supply chains/communities it operates in.

This represents nearly a quarter of total GDP (23%) and far bigger than the direct contribution of 8.2% that is usually quoted by economists.

Carried out by Oxford Economics and the Manufacturing Technologies Association (MTA), the in-depth report also shows that ‘making things’ accounts for 34.5% of all UK goods and services exports, whilst the median wage is £31,300 – 11% higher than the national median wage.

The findings are even more impressive when you consider the sector has had to navigate a myriad of challenges outside its control in recent years, including changing relations with the European Union, the Covid-19 pandemic, unprecedented increases in energy costs and global supply chain fragility and international conflicts.

MTA’s Chief Executive Officer, James Selka is now urging the sector to build on this report by exploring ways in which it can address the skills shortage and develop successful programmes, such as the High Value Manufacturing Catapult Centres, to increase wealth creation by commercialising more of the great ideas and innovations born in the UK.

“This is a fantastic insight into the true impact of manufacturing in the UK and reinforces what many of us already know – that industry is a far greater contributor to GDP and jobs than listed in national accounts,” commented James.

“Our report has been designed to take a ‘deeper dive’ and looks at the direct, indirect, and induced impacts of manufacturing, which is a far more comprehensive overview of what we make, the complex nature of our supply chains and the economic benefit gained from the spending of wages by those employed in our sector.”

He continued: “The results illustrate that manufacturing accounts for £518bn of GDP and supports 7.3m jobs, most of which enjoy higher than average wages.

“We are also a part of the economy that invests heavily in new technologies, with nearly half (47%) of total R&D investment made by manufacturers. You only have to visit MACH this week to see this first-hand, with more than 500 companies showcasing the latest in automation and robotics, additive manufacturing, latest software, advanced CNC machining and measurement and inspection solutions.”The MTA is now calling on a well-integrated commitment from the whole nation to help industry realise its potential, ranging from business leaders and academics to policymakers so crucial in developing a cross-party industrial strategy.

The recent Advanced Manufacturing Plan – accompanied by support worth £4.5bn – has been welcomed as a step in the right direction and an important vehicle in helping to cultivate the new technologies and industries being born, such as electrification, lightweighting, less carbon intensive materials and renewable energy.

Introducing new measures that increase exports should also be a priority and there is an unprecedented opportunity to deliver critical sovereign capabilities from public health to defending our realm.

MACH 2024

The True Impact of UK Manufacturing report will be officially launched at MACH 2024 by MTA President Tony Bowkett.

Set over five days at the NEC (15-19th April) in Birmingham, the event is the biggest in the UK’s industrial calendar and attracts over 30,000 people from the manufacturing community and more than 500 companies.

More than £200m of business is expected to be completed during the week as some of the country’s most innovative firms unveil new technologies and machines designed to boost productivity and global competitiveness.

MACH, which has a huge focus on sustainable manufacturing and carbon reduction through its six Knowledge Hubs, is also a big attraction for young people looking for a career in industry, with 3,500 students (aged between 12 and 18) set to attend the show.

Headline sponsors Lloyds Bank welcomed the findings of the latest report. David Atkinson, UK Head of Manufacturing SME and Mid Corporates, commented: “As this report highlights, manufacturing is an integral part of the UK economy, through GDP contribution, job creation, and as a source of high wages.

“When you consider the sector’s extended reach through its supply chains and beyond, you can really start to see the scale of its contribution.

“Manufacturers have demonstrated agility and resilience in the past few years of uncertainty, and we are responding by continuing to invest in partnerships in the sector that ensure it has the skills, tools and support needed to compete on a global scale.”

Stephen Phipson, CEO of Make UK, concluded: “Manufacturing has always been a strategically important sector for UK economy and, none more so than now, given the immense societal, political and economic challenges that we face.

“Just as the first industrial revolution provided a step change, the accelerating pace of technological change of the fourth industrial revolution gives us a generational opportunity to do the same now. This valuable report highlights to those in power now and in the future, how manufacturing is greater than the sum of its parts.”

To download the report, please visit The true impact of UK manufacturing (mta.org.uk). More information on MACH 2024 can be found here https://www.machexhibition.com.

Economy & Jobs News, Tax

The Spring Budget 2024 sees tax cuts and a continued push to unlock pension investment potential

In this year’s Spring Budget, the Chancellor Jeremy Hunt focused on tax cuts made possible through reported progress in the UK economy and to encourage growth in the next few years.

Where pensions are concerned, the Chancellor reiterated messaging over the last few months from the Mansion House reforms and Autumn Statement on targeting value for money for pension scheme members and encouraging pension funds to drive further growth in the UK economy.

Reduction in National Insurance contributions

The government announced plans today to reduce the basic employee rate of National Insurance contributions (affecting approximately 27 million people) from 10% to 8% with effect from 6 April 2024; a further decrease from the recent shift on 1 January 2024 from 12% to 10% and the lowest the rate has been set since the early 1980s.

From an employee benefits angle, this will make salary sacrifice arrangements (where employees can make National Insurance savings on certain benefits) a little less attractive for employees.

Simon Hubbard, a Principal Consultant at Quantum Advisory, said:

“Further reductions in National Insurance contribution rates will be welcomed by many. The change, at face value, indirectly makes saving into a pension less attractive for employees where contributions are paid before the deduction of tax and National Insurance through an arrangement known as salary sacrifice. This change reduces the National Insurance that employees save by using such an approach. 

“These tax cuts must be viewed alongside the freeze on income tax thresholds until 2027. Given this, we expect that salary sacrifice arrangements will remain the most efficient way for employees to pay their pension contributions and there is no impact on the National Insurance savings made by the employer.

“Cuts in National Insurance will only benefit income earned through work, so pensioners will not benefit in the same way that employees do.”

Disclosure and value for money for DC Schemes and LGPS arrangements

The government reiterated planned changes in disclosure requirements for defined contribution (DC) pension funds, such that funds will need to publicly state their level of UK investment and compare their performance level against other schemes (at least £10bn in size).

Where it is determined that schemes are providing relatively poor returns for members compared to that provided elsewhere, schemes may not be allowed to take on new members.

There will separately be revised reporting guidance for Local Government Pension Scheme (LGPS) Funds from April 2024, such that a summary of asset allocation, including UK equity investment, as well as providing greater clarity on pooling will need to be disclosed.

Simon Hubbard, a Principal Consultant at Quantum Advisory, said:

“The announcement from the government will help concentrate DC pension funds on delivering the best returns for members whilst encouraging further investment in the UK economy. We welcome the aim to target good investment returns for every member. Careful consideration will need to be given in the coming months on how to encourage this for DC schemes whilst allowing funds to invest in long-term growth assets that may be volatile in the short-term.”  

Abolition of the Lifetime Allowance

The Lifetime allowance (LTA) is being removed from 6 April 2024 following the Spring Budget announcement last year; a move that is hoped to alleviate pressure on the NHS as well as other industries to prevent early retirements from experienced individuals.

HMRC have since referenced that there will continue to be a fixed cap on tax-free cash sums of £268,275 (25% of the current LTA) and a fixed cap of £1,073,100 (the current LTA) on the total tax-free cash sums that can be paid to an individual.

Simon Hubbard, a Principal Consultant at Quantum Advisory, said:

“The abolition of the LTA will, as a whole, simplify the pensions industry and encourage more to save for retirement and work for longer. It remains to be seen whether this policy will change if there was a new government following the imminent General Election given the Labour party’s opposition to the abolition of the LTA.”

State Pension

The government has committed to applying the triple lock to the State Pension for 2024-2025, such that it will increase from £10,600.20 pa to £11,502.40 pa.

Simon Hubbard, a Principal Consultant at Quantum Advisory, said:

“The triple lock guarantee for 2024/25 (which the Labour Party has also committed to retaining) will ease pensioner fears, particularly given the recent years of high inflation. Whilst this news will be welcomed, wider issues remain with the functionality of the State Pension, which is becoming increasingly more expensive in real terms due to current birth / death rates. We expect there will be further discussions around the State Pension following the election.”

Pension ‘Pot for Life’

The government is continuing to consult on plans to allow individuals to choose one provider to hold their pension pot throughout their life; aiming to improve outcomes for savers as well as convenience of access.

Simon Hubbard, a Principal Consultant at Quantum Advisory, said:

“We look forward to the government providing further detail on the lifetime provider model they have set out, noting that challenges with economies of scale will need to be carefully managed.  This will help people who change jobs frequently or who have multiple jobs at any one time, because under the current system some workers can end up with a large number of small pensions which can be difficult to manage and to keep track of.”

ISAs

The government announced the launch of a new British ISA which will allow individuals to invest £5,000 tax-free cash per year in UK assets in addition to the current ISA allowance of £20,000. The government intends this to help the UK economy grow.

About Quantum Advisory

Established in 2000, we are an independent, owner-managed actuarial and employee benefits consultancy that provides straight-talking, no-nonsense advice to employers and pension scheme trustees.  We design, maintain and review pension schemes and related employee benefits so that they operate efficiently and effectively.  We also help communicate these benefits in a straightforward way so that employees understand their real value.

 

Simon Hubbard

Principal Consultant

Quantum Advisory

Economy & Jobs News, Finance News, Wales

Global economy set for slow growth, high uncertainty for 2024, says ACCA chief economist

  • ACCA’s review of the current global economy suggests 2024 will be beset with risks and challenges
  • Slow growth, geopolitical risks, lagged impact of monetary tightening in 2023 and businesses approaching with caution are likely to shape

 

 

An inaugural annual economic prospects report by ACCA examines the outlook and major risks for the global economy and key countries. The report, 2024 Global Economic Outlook: Slow Growth High Uncertainty, sets out the key events to watch in a year packed with elections; examines three trends to watch closely; and interviews chief financial officers (CFOs) from across the globe.

 

Jonathan Ashworth, chief economist at ACCA and author of the report, said: “The global economy looks set to grow slowly once again in 2024, and the risks are skewed to the downside. The lagged impact of past monetary tightening could lead to an even more pronounced slowing in growth, and geopolitical risks remain very heightened. The busy political calendar, with elections scheduled in around 60 countries, including the US, the UK, India, and the European Parliament, adds a sizable extra degree of uncertainty and potential volatility.”

 

Ashworth added: “It could be risky for central banks to declare imminent victory in their battles against inflation” but suggested that: “Upside risks to the global economy in 2024 could perhaps come from continued rapid improvements on the inflation front, which could pave the way for quite an early and significant easing of monetary policy by central banks.”

 

But he warned that “this could risk sowing the seeds of higher inflation in 2025 and beyond.”

 

In addition to monitoring the usual ebb and flow of economic data, Ashworth suggested watching three key trends this year:

 

  • Further backsliding by governments on policies to achieve the green transition
  • Signs of rising geo-economic fragmentation
  • Developments with artificial intelligence (AI).

 

Ashworth said: “The first two could be particularly impacted by political developments through the year, and we will be watching for early signs that wider AI adoption is beginning to provide a much-needed boost to productivity growth in economies.”

 

Meanwhile, caution was the watch word from CFOs given the challenging global economic backdrop and the geopolitical developments and elections in many countries. Some businesses were naturally less impacted by cyclical economic developments, but a number were impacted by, or at risk from, structural changes related to trade, and supply chain issues. Most were experimenting with AI and other technologies in their businesses, while some noted the difficulty in attracting talent given the changing ways of working.

 

Read the full report here.

 

Please visit ACCA’s website for more information.

News

Global economy set to enter recession in 2023

According to organisations such as the World Bank, Bank of America and Citi, as well as various economists, it is expected that the global economy will enter into a recession in 2023. A combination of factors has led to this global economic downturn, ranging from the ongoing Russia-Ukraine war and constriction of macroeconomic policies, to the current European energy crisis and the prolonged periods of supply disruption caused by the COVID-19 pandemic.

The US and European economies are expected to be the most heavily impacted by a recession this year. The USA’s real GDP growth is expected to be 0.0 per cent Year-over-Year (Y-o-Y) in 2023, while the real GDP of Europe – including the UK – is predicted to come in at 0.1 per cent this year. Nevertheless, it must be noted that the degree of recession is still being debated, and the actual economic impact remains under close observation as market conditions continue to change.

Rashi Singh, AVP, Procurement and Supply Chain at The Smart Cube comments on what impact a potential recession in 2023 could have across different sectors:

“A possible recession in 2023 is likely to significantly impact the CPG sector. In the upcoming months, high levels of volatility are expected when it comes to the prices of dairy and agricultural commodities as a result of recessionary pressures. It is also likely that food service firms will record a fall in sales figures. The expectation is for consumer preferences to transition from away-from-home to at-home food due to the expected decline in real personal income, resulting in decreased demand for food services in 2023.

“Meanwhile in the industrial sector, there is a high likelihood of semiconductor and electronic shortages easing as end-user businesses that stockpiled chips during the COVID-19 pandemic are cancelling or delaying orders to reduce inventory in case a recession takes place in the coming months. Additionally, while it’s expected that the demand for automobiles will fall during the recession – amid the potential decline in personal income – this won’t necessarily be the case. Industry growth is expected to be sustained this year due to the backlog of demand for automotives since the start of the pandemic.

“Finally, the logistics industry is not immune from being impacted by a recession. Expected fall in average annual price of oil and decline in manufacturing activities in 2023 because of the potential decline in consumer spending, is likely to lower down demand for logistics.”

News

Over 1 in 4 mid-sized Scottish businesses plan to restructure as cost pressures mount

According to new research from leading business and financial adviser Grant Thornton UK LLP, a combination of inflationary pressures, rising interest rates and high energy costs, and ongoing supply chain issues are all significantly impacting the financial viability of many mid-sized businesses. 

 

Grant Thornton’s Business Outlook Tracker*, which surveyed 50 Scottish businesses in October 2022, found that, in the face of these mounting pressures, almost a quarter (24%) of respondents have already restructured their operations, with a further 28% having plans to do so.  

 

The survey recorded lower levels of optimism from respondents on their business’ funding position  – dropping significantly (-42 percentage points) compared to August 2022, to just 34%.  

 

Many businesses are having to secure additional finance to work through the escalating costs facing the market, with 14% already having secured further funding and 56% planning to do so. 

 

The strain on funding has also led to a considerable drop in investment expectations across all areas monitored by the Tracker. The most significant drops compared to the last round in August 2022 were seen in skills development (-27pp), recruitment (-27pp) and research and development (-23pp). There was also a -21pp drop in the number of businesses planning to increase investment in growing in international markets.  

 

But investment looks to be being directed to areas that will have the most impact on reducing costs. Over half (60%) of respondents have already invested, or are planning to invest, in productivity, efficiency and automation. 

 

In the face of increasing costs and ongoing changes to government fiscal policy, the number of businesses optimistic about the outlook of the UK economy has also plummeted -24pp, compared to August 2022. 

 

Stuart Preston, Restructuring Partner, Grant Thornton UK LLP, said:  

 

“Scottish businesses are facing incredible cost pressures from all sides. The combination of input cost price increases, high energy costs and rising interest rates, are seeing businesses faced with increases from 5% to as much as 100% in some cases, when combined with the added strain of ongoing supply chain shortages in some areas. The severity of the environment is clear, with the majority of those surveyed either planning to restructure their operations, or already having done so.   

 

“There isn’t one solution to fix these issues but there are always sensible steps that businesses can take to start to rebuild confidence. For example, reducing the businesses debt level to counter interest rate rises, reducing energy usage and looking for efficiencies in the face of energy cost rises, and considering alterative, cheaper suppliers.  

 

“Many Scottish businesses are also reviewing their budgets for the next 6-12 months. It’s vital that these forward plans account for assumptions that may need to be made over this period, such as the impact of the end of energy bill relief, and rising interest costs. Businesses need to be proactive and take action where they can, rather than burying their heads in the sand – its these businesses who will work their way through this challenging environment, and emerge a more resilient, efficient organisation.” 

News

Over 1 in 3 mid-sized North West businesses plan to restructure as cost pressures mount

According to new research from leading business and financial adviser Grant Thornton UK LLP, a combination of inflationary pressures, rising interest rates and high energy costs, and ongoing supply chain issues are all significantly impacting the financial viability of many mid-sized businesses. 

 

Grant Thornton’s Business Outlook Tracker*, which surveyed 101 businesses in the North West in October 2022, found that, in the face of these mounting pressures, just under half (48%) of respondents have already restructured their operations, with a further 40% having plans to do so.  

 

Many businesses are having to secure additional finance to work through the escalating costs facing the market, with 48% already having secured further funding and 38% planning to do so. Similarly, 41% of businesses have already reviewed headcount with another 39% planning to. 

 

The strain on funding has also led to a drop in investment expectations across all areas monitored by the Tracker. The most significant drops compared to the last round in August 2022 were seen in technology (-11pp), employee wellbeing (-3pp) and recruitment (-2pp).  

 

But investment looks to be being directed to areas that will have the most impact on reducing costs. Well over three quarters (84%) of respondents have already invested, or are planning to invest, in productivity, efficiency and automation. 

 

Carl Williams, North West Managing Partner for Grant Thornton UK LLP, said:  

 

“Businesses are facing incredible cost pressures from all sides. The combination of input cost price increases, high energy costs and rising interest rates, are seeing businesses faced with increases from 5% to as much as 100% in some cases, when combined with the added strain of ongoing supply chain shortages in some areas. The severity of the environment is clear, with the majority of those surveyed either planning to restructure their operations, or already having done so.   

 

“There isn’t one solution to fix these issues but there are always sensible steps that businesses can take to start to rebuild confidence. For example, reducing the businesses debt level to counter interest rate rises, reducing energy usage and looking for efficiencies in the face of energy cost rises, and considering alterative, cheaper suppliers.  

 

“Many businesses are also reviewing their budgets for the next 6-12 months. It’s vital that these forward plans account for assumptions that may need to be made over this period, such as the impact of the end of energy bill relief, and rising interest costs. Businesses need to be proactive and take action where they can, rather than burying their heads in the sand – its these businesses who will work their way through this challenging environment, and emerge a more resilient, efficient organisation.” 

News

Over one third of mid-sized businesses in Yorkshire plan to restructure as cost pressures mount

According to new research from leading business and financial adviser Grant Thornton UK LLP, a combination of inflationary pressures, rising interest rates and high energy costs, and ongoing supply chain issues are all significantly impacting the financial viability of many mid-sized businesses. 

 

Grant Thornton’s Business Outlook Tracker*, which surveyed 50 businesses in October 2022, found that, in the face of these mounting pressures, 20% of respondents have already restructured their operations, with a further 40% having plans to do so.  

 

The survey recorded lower levels of optimism from respondents on their business’ funding position – dropping significantly (-42 percentage points) compared to August 2022, to just 42%.  

 

Many businesses are having to secure additional finance to work through the escalating costs facing the market, with 30% already having secured further funding and 38% planning to do so. 

 

The strain on funding has also led to a considerable drop in investment expectations across all areas monitored by the Tracker. The most significant drops compared to the last round in August 2022 were seen in technology (-39pp), plant, machinery and new buildings (-31pp) and employee rewards and benefits (-21pp). There was also a -17pp drop in the number of businesses planning to increase investment in both skills development and growth in international markets.  

 

But investment looks to be being directed to areas that will have the most impact on reducing costs. Over two thirds (68%) of respondents have already invested, or are planning to invest, in productivity, efficiency and automation. 

 

In the face of increasing costs and ongoing changes to government fiscal policy, the number of businesses optimistic about the outlook of the UK economy has also plummeted -32pp, compared to August 2022. 

 

Andy Wood, Yorkshire Managing Partner at Grant Thornton UK LLP, said:  

 

“Businesses across the country are facing incredible cost pressures from all sides. The combination of input cost price increases, high energy costs and rising interest rates, are seeing businesses faced with increases from 5% to as much as 100% in some cases, when combined with the added strain of ongoing supply chain shortages in some areas. The severity of the environment is clear, with the majority of those surveyed either planning to restructure their operations, or already having done so.   

 

“There isn’t one solution to fix these issues but there are always sensible steps that businesses can take to start to rebuild confidence. For example, reducing the businesses debt level to counter interest rate rises, reducing energy usage and looking for efficiencies in the face of energy cost rises, and considering alterative, cheaper suppliers.  

 

“Many businesses are also reviewing their budgets for the next 6-12 months. It’s vital that these forward plans account for assumptions that may need to be made over this period, such as the impact of the end of energy bill relief, and rising interest costs. Businesses need to be proactive and take action where they can, rather than burying their heads in the sand – its these businesses who will work their way through this challenging environment, and emerge a more resilient, efficient organisation.” 

Care, Midlands News, News

Concerns for social care funding following Government U-turn on taxes

The boss of Shropshire’s largest not-for-profit care provider has raised concerns about the future funding of social care following the government’s U-turn on National Insurance payments and scrapping of the social care levy.

The government announced today (Sep 23) as part of the Chancellor’s mini budget that it would be reversing the 1.25 percentage point increase in National Insurance (NI) from November to support people with the rising cost of household bills.

The increase, which came into effect in April this year, was meant to support the NHS and social care sector by raising billions of pounds and would have been replaced by the new Health and Social Care Levy from April 2023.

The treasury has now axed the planned levy saying the change would save nearly 28 million people hundreds of pounds a year.

Debbie Price, Chief Executive of Coverage Care Services, said the U-turn now cast doubt on the future funding of social care.

She said: “We are all struggling and whilst the Chancellor is right to look for ways to boost the economy and seek measures to ease the financial burden facing businesses, families and individuals the decision casts doubt on how the government expects to tackle the growing pressures being faced by the NHS and social care.

“It was predicted that the new 1.25p in the pound National Insurance increase would raise an additional £12billion a year. The government had promised that this money would go towards supporting the NHS and then a proportion to helping the social care sector which is currently facing huge demands.

“It has now said funding for health and social care will be maintained and come from general taxation but, as always, there is little detail, which causes concern. We need to know how the government plans to protect this funding and we urge them to address this issue immediately.

“The system is under a considerable amount of pressure to provide quality care to our ageing population. We are still facing many challenges as a result of the pandemic and coupled with recruitment issues, staff shortages nationally and already tightened government spending, this latest decision is another major blow to all care providers.”

Coverage Care Services is Shropshire’s largest independent care provider operating 12 homes across the county.

Earlier this week it announced a second pay increase for staff taking total investment into the company’s wage bill to £2.5million in 2022.

For more information about Coverage Care Services visit https://www.coveragecareservices.co.uk/.

Midlands News, News

Clarity welcome over economic policy says Q Financial Services

One of the region’s leading financial experts today said the mini-budget gave much-needed clarity over the Government’s future economic policy – but said the Chancellor must make driving down inflation and lowering interest rates a top priority. 

Mitch Gough, director at Q Financial Services, said moves to cut taxes and Stamp Duty, reverse the planned increase in National Insurance and scrap planned increases on Corporation Tax, would all help address the cost-of-living crisis and build on measures announced earlier this week to control both residential and commercial energy bills. 

But Mitch added that allowing inflation and interest rates to soar still further – and failing to support the supply of new housing developments to meet demand fuelled by the Stamp Duty cuts – would hinder future progress. 

“It is good to see the Government place such a clear priority on growing the economy and introducing a detailed set of proposals so soon after the new Prime Minister took office,” Mitch said. 

“After a period in which there seemed to be considerable drift, it is welcome that we now have a clear indication of the path the Government plans to take to help business and the commercial sector through this difficult period. 

“There is no doubt that the cut in Stamp Duty will fuel new demand in the property market, but this must be met with a sustained increase in supply if housing is to remain affordable. 

“Yesterday’s 0.5 per cent rise in interest rates to 2.25 per cent and the prospect of future increases and high inflation could mean that much of the extra cash the Government is handing back in this package is quickly eroded. 

“We want to see serious moves to tackle inflation and help reverse the trend for ever-rising interest rates, but fully support the drive for growth. 

“As ever, the devil will lie in the detail and we will be studying the Chancellor’s statement in great detail over the coming days to ensure we offer the most comprehensive advice possible to both our private and commercial clients.” 

Q Financial Services group, which has offices in Wellington and Shrewsbury, is one of the leading and fastest-growing companies in the sector across the Midlands. 

For more information about Q visit  https://www.qfinancialservices.co.uk/