Wednesday 6 March 2024

In reaction to the Chancellor’s Spring Budget, Karim Fatehi MBE, Chief Executive of the London Chamber of Commerce and Industry (LCCI), said:

“Today’s Spring Budget continues a pattern of piecemeal economic policymaking and fails to tackle the fundamental problems facing London, and the wider UK economy.

“The mini-budget of 2022 showed us that markets will punish spending that the state cannot afford. But this should not excuse a lack of bold investments and reforms that the economy needs to break out of its current malaise. No commitment to finding a long-term funding solution for TfL demonstrates absence of thought towards the type of investment needed to boost London’s businesses, who rely on the guarantee of a high-functioning transport network. The UK needs to see more, targeted capital expenditure deployed to lift productivity growth into the long-term.

“While the cut to National Insurance may provide workers, and the self-employed, with a much-needed boost in personal finances to spend in London’s shops, restaurants and pubs, it is not going to deliver the structural reform the economy needs.

“LCCI is incredibly disappointed to see that the ‘tourist tax’ has not been scrapped; VAT-free shopping would provide a desperately needed boost to the sectors that are still recovering from the impact of the pandemic. Attracting more international visitors back to the capital to spend in our shops, restaurants, cultural venues, and hotels would give a major lift to the economy, jobs, and – through positive knock-on effects – the Treasury’s coffers.

“We are pleased to see the introduction of pro-business measures including full expensing for leased assets, a reform of ISAs, and the Chancellor’s plans for a life sciences centre at Canary Wharf and agree with the Chancellor’s general sentiment that both productivity in our economy and provision of affordable housing must improve. We do also welcome raising the level that small businesses start paying VAT to £90,000. However, we are worried that without a fundamental skills policy overhaul and planning reform, this Budget is unlikely to provide the necessary impact on the economy

“As we look ahead to a General Election this year, it is essential that the policies put forward in party manifestos bring the bold, long-term plans the economy needs for a reset. These must be developed in close consultation with the business community, and, should they be fit for purpose, will hopefully put the UK back on a road to growth and productivity.”

ENDS

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