What HR wants Rishi Sunak to know before the Spring Budget
As chancellor Rishi Sunak prepares to announce his Budget plans tomorrow, HR magazine found out what HR wants from the government's financial plans.
With increased pressures on jobs and no sign of employers winding down their reliance on furlough, HR is hoping for further extension of the scheme and low tax increases to help protect jobs.
Previously, the CIPD called on government to extend the scheme at least until the end of June. The Trades Union Congress (TUC) meanwhile has said it must be extended to the end of 2021 to have the desired impact.
Martin Tiplady, CEO of Chameleon People Solutions, said he is expecting a Budget that doesn’t ruin any potential recovery and is realistic in terms of getting business and people back to work.
Speaking to HR magazine, he said: “I would like to see a continuation of furlough in the short term and business grants perhaps tapered over a longer period, as well as some seed money to get businesses back to a degree of normality and to encourage people out to spend and get the economy moving once again.”
When the chancellor announced the furlough scheme would be extended until April 2020, the Trades Union Congress (TUC) said that millions of people’s jobs would still be left hanging in the balance after the scheme has ended.
TUC general secretary Frances O’Grady said: “It’s time to end the uncertainty and anxiety. The chancellor must urgently extend full furlough support to the end of the year to keep jobs safe.”
O’Grady asked the chancellor to cancel the pay freeze that is due to hit millions of key workers in April.
She added: “The last thing our businesses and high streets need is to have consumer spending held down when they are trying to recover."
The route out of furlough and towards business recovery:
A large increase in taxes for businesses would be unwelcome as this could also lead to an increase in redundancies.
Tiplady said that that a large tax increase now will discourage recovery, stifle initiative and demotivate us all back to normal.
He added: “Many businesses are on a knife edge and so even the smallest increase in employer’s national insurance or corporation tax could push them over.
“Those changes will come, inevitably and in time, but please not just yet. At the moment, we all need lifting out of this period, not a sense that we are sinking further. Remember austerity.”
Tiplady added that he would like to see some encouragement in the form of VAT benefits.
“Especially in the retail, tourism and hospitality sectors and some seed money to encourage businesses to start growing.
“The time for a punishing budget will come - and quite soon. But please not on Wednesday,” he said.
In a potentially positive move for the struggling hospitality sector, the chancellor may freeze beer duty following petitions from the British Beer & Pub Association.
Following the CIPD's damning report of the failure of the apprenticeship levy, there is promise of further reform including a so called "flexi-job" apprenticeship which would allow apprentices to work for multiple employers within the same sector.
A "Help to Grow" scheme giving SMEs access to MBA-style management training is also expected in the announcement.
The 2021 Spring Budget is scheduled to be announced on 3 March following PMQs at 12:30.