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Pre Budget Report a lead balloon in North East

Businesses in the North East have expressed concerns over Chancellor Alistair Darling’s first pre-budget report, the details of which were released earlier this week. The North East Chamber of Commerce were in particular worried that the Government has put the brakes on investment in transport. Mr Darling announced plans to slow growth in transport spending from 4.5% over the last three years to 2.25% until 2018.

James Ramsbotham, NECC chief executive, said: “The Government wants the economy to grow but it expects businesses to thrive on a sub-standard transport infrastructure. This comes at a time when our global competitors are pumping money into major transport projects. “It is more essential now than ever that public money is used to solve the key strategic transport issues, such as the A1, rather than focusing on a series of minor, localised improvements.”

The Federation of Small Businesses (FSB) criticised the pre-budget report for adding to the tax burden of small businesses. Plans to introduce supplementary business rates and changes to capital gains tax will hit many of the UK’s 4.5 million small businesses directly in the pocket. This comes as a big disappointment to small businesses still dealing with increases in corporation tax announced in the last Budget.

Bill Keenlyside, FSB North East Policy Chairman, said: “Alistair Darling’s first Pre-Budget Report was a disappointing one. The UK’s small business community, which contributes over half of the country’s GDP, will not be helped by increased business rates and a less generous capital gains scheme.

“There were some welcome announcements about simplifying the tax system, which is long overdue. The test now will be for it to actually happen in practice. Overall, though, this PBR looks set to increase the financial burdens on small businesses at a time when they are contributing more than ever to the UK economy. The Government has again failed to recognise that contribution.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .