The Autumn budget reaction
After just four months since the General Election, the first Labour budget in 14 years was set to be announced by Rachel Reeves, with a promise to grow the economy and create wealth and opportunity for all aiming to restore economic credibility and stability of public finances. Many anticipated the Government’s next steps considering how the changes were set to impact both individuals and businesses.
The new proposal would present some of the most significant changes, proposing significant cuts, and weighing up tough fiscal choices that would deliver benefits across different areas of the economy.
Sean Keyes, CEO of Sutcliffe said pre budget:
“This is going to be the first Labour budget in 14 years and no doubt one of the most significant budgets in some time, so we are expecting it to be delivered with confidence, reassurance and conviction. The economy has been stifled by the lack of development, inadequate housing stock and investment in infrastructure, therefore the Chancellor must concentrate on delivering the appropriate infrastructure projects to boost economic development.”
“The housebuilding sector has been highlighted as needing ‘significant intervention’, not only in terms of quality of new housing, but also complex planning systems which fed Britain’s chronic housing shortage, driving up prices and making the market increasingly inaccessible. With that being said, the Prime Minister’s proposals are somewhat positive, and the Government has demonstrated a commendable willingness in the months following the election to remove significant barriers to the construction of new homes and its housing target of 1.5m homes over the next five years. Proposals to improve the quality of homes being built have been acknowledged, and increased construction and investment in unlocking brownfield areas are also a step in the right direction to accelerate economic growth.”
“I anticipate an array of tax-raising changes in Rachel Reeves’ debut budget – which is somewhat worrying considering our tax burden already sits amongst one of the highest. For the business sector to participate and fund this government’s initiatives, it must be certain that the new, higher taxes will be used wisely and not squandered.”
After the highly anticipated budget was finally announced on Wednesday 30th October, the Labour party have made some key changes which are set to bring the economy stability and economic growth, helping to improve standards for the UK. As the first female Chancellor of the Exchequer, Rachel Reeves announced she will be raising taxes by £40bn in order to fund additional spending, investments and borrowing. £8bn of the increasing taxes will help to fund spending commitments for more NHS appointments and teachers. The rate of employees National Insurance tax is set to increase by 15% from the current 13.8%, along with an increase in employment allowance from £5,000 to £10,500 from April 2025. The budget is also part of a significant step in a plan to “get Britain building again”, supporting the shortage within the housing market across the UK.
Following on from the budget announcement, Sean Keyes later spoke to PBC Today:
“The array of tax-raising changes in today’s budget is somewhat worrying considering our tax burden already sits amongst one of the highest. For the business sector to participate and fund this government’s initiatives, it must be certain that the new, higher taxes will be used appropriately.”
“Developers will also be impacted by the collective 24% increase in capital gains tax included in today’s announcement. Developers are less inclined to take on new projects or extend current ones when profit margins are constrained; though there’s no doubt that the government has shown a welcome desire in the months since the election to lift the major constraints on not only house building and achieving its 1.5m target by investing £5bn to deliver this programme, but other major infrastructure projects that could accelerate economic growth in alignment with today’s budget.”
