Leading figures from Britain’s manufacturing sector have delivered a damning verdict on the Chancellor’s Budget, warning it fails to address the fundamental challenges facing the industry.
Despite limited measures on energy costs and skills development, manufacturing bosses say increased taxation, continued bureaucracy and insufficient support for innovation are all major concerns which will undermine business confidence and restrict investment.
World-leading aviation manufacturer Aviramp said today’s Budget would do little to kickstart the nation’s faltering economy.
Graham Corfield, chief executive of the Telford-based company whose award-winning step-free boarding ramps are in use at more than 900 airports around the world, said the Chancellor had not taken the action needed to drive business growth.
“By raising taxes the Chancellor is taking more money out of the economy. You cannot tax your way to growth however much you try to disguise new measures to raise revenue,” Graham said.
“The only way to get our economy firing on all cylinders again is to give the business community the freedom to start creating wealth and the confidence to invest in the future.
“That means stripping away the red tape and bureaucracy which stifles innovation, creating the conditions where business can invest with confidence knowing we won’t be taxed just for being successful and investing in skills and training so we can really seize the digital future.
Pioneering engineering firm Transicon also expressed disappointment claiming the Budget lacked tangible support for manufacturers in the wake of the Industrial Strategy.
Jennifer Hughes, general manager of the Telford-based firm which works with major manufacturers such as BMW, Tata Steel and Muller Dairy, welcomed support with energy costs, access to finance and funding of apprenticeships. But she warned the measures were not enough to restore confidence and growth across the sector.
She said: “The cumulative impact of increased National Insurance contributions, uplift in National Minimum Wage and Corporation Tax is already squeezing margins for many businesses and the additional tax rises announced today will lump further pressure on businesses.
“We’re disappointed that there was no real recognition of the burden that industry is facing and the impact this is having on the sector’s ability to invest in skills, innovation, AI, cybersecurity and technology.
“With the launch of the Industrial Strategy earlier this year, we’d been hopeful that this budget might deliver more in terms of funding for manufacturers particularly SMEs like ourselves.
“We’d also been keen to see a reversal to the SME R&D tax relief which is crucial if we want to encourage small firms across the industry to push boundaries and invest in new solutions.
“We were pleased to see mention of funding for skills and welcome new measures on apprenticeships that will support us and other SMEs to train the next generation. The skills gap across the sector remains a persistent challenge.”
Transicon, which employs 45 people, has built a formidable reputation for its work manufacturing bespoke automation and control systems incorporating AC Drives, DC Drives, Servo Drives, PLC and SCADA Systems.
Leading UK additive manufacturer AMufacture also stressed the Budget could have gone much further in supporting innovation in UK industry.
The Portsmouth-based firm says it welcomed the move to cut energy bills for 7,000 businesses in high-growth industries and a new five-year plan by the British Business Bank to invest larger amounts in successful domestic scale-ups.
But company founders Craig Pyser and Will Howden said the moves were set against a wider picture of depressed business confidence and rising taxes which were putting the brakes on growth.
“We are pleased to see some help for business around the huge cost of energy, which continues to make it more difficult for UK companies like ours to compete on a global stage.
“It’s also good to see the Government making access to finance easier for our brilliant entrepreneurs.
“But the general economic outlook remains flat and confidence among the business community extremely fragile. Today’s Budget will not change that in the long-term because extra taxes simply take more money out of circulation meaning it is not available for investment.
“We would have liked to see more action to cut some of the red tape around business, particularly when it comes to exports, and moves to reduce the cost of actually employing people.
Craig, who is also chairman of AMUK, the additive manufacturing industry’s trade association, said there needed to be more joined-up thinking in Government.
“I highlighted earlier this year how the Ministry of Defence itself recognises additive manufacturing as a transformative technology which could revolutionise supply chain resilience and cut costs by £110 million.
“But there is a huge gap between our industry and the Government’s procurement teams which means that all too often companies such as ours are frozen out of opportunities where we could deliver real innovation and significant savings.
“The technology and skills already exist to deliver a massive leap forward in the use of 3D printing across a huge number of national contracts, but these opportunities are too often not taken.”
Amy Bould, of marketing and PR specialist Be Bold Media which delivers visibility and profile for manufacturing firms across the UK, said SME makers would be counting the increased cost of doing business following the Budget.
“The UK’s manufacturing sector is the engine which drives growth across the country and the Chancellor appears to be using these companies as the Government’s personal cash machine. On top of the NIC rises last year, an inflation busting minimum wage increase and changes to the salary sacrifice scheme for pensions, the cost burden on businesses is huge.”
