Budget 2021: A missed opportunity for skills
The recent Budget has generated a mix response from manufacturers. Although Make UK highlighted that there were some welcome announcements on business rates and the extension of the annual investment allowance, the announcements on skills amounted to little, if any, new money while the delay in the R&D spending target goes against the aim of making the UK a science superpower.
Furthermore, while growth is returning, future prospects will not be helped by the substantial tax rises companies are facing.
However, as Stephen Phipson, CEO of Make UK commented, the Government’s Net Zero Strategy is a positive step in the right direction to net Zero by 2050 with practical support to help businesses transition to green and clean production processes. The creation of 2 hydrogen clusters in Britain’s industrial heartlands puts our manufacturing powerhouse at the centre of innovation and will enable companies to make the switch away from fossil fuels at greater speed. It will be vital to produce enough hydrogen supply to feed not just the industrial clusters but all the manufacturers across the country.
To build on this, it is also important to make sure that the Government’s green investment plans go hand in hand with up-skilling of the country’s workforces to make sure that we have both the necessary digital and green skills to make these essential changes a reality. The Budget skills announcement did little to help this, and further investment is urgently needed if we are going to fill the skills gap that is now one of the greatest issues facing manufacturers.
I agree with the CBI in that this Budget alone won’t seize the moment and transform the UK economy for a post-Brexit post-Covid world. Businesses remain in a high tax, low productivity economy with concerns about inflation. As many commentators have indicated in recent days, this Budget was a missed opportunity to help manufacturers and invest in skills. Industry needs to continue pressing the Government to get this message across.