Today Chancellor Rishi Sunak announced his 2021 spring budget, highlighting the acute economic damage that the COVID-19 pandemic, with more than 700,000 people losing their jobs and the economy shrinking by 10% – the largest fall in 300 years.
Warning that borrowing had reached wartime levels the Chancellor also stated that it would not be “right or responsible” to “ignore this problem”.
The Budget did provide some positive news for businesses in the design, construction, manufacturing and property sectors. Giving his initial response to the announcement, ArchiPhonic co-director, Adam Mokhtar, said: “The devil is always in the detail with these announcements, but at first glance there is plenty of positive news for our sector and those we work closely with.
“On a national level the extension of the furlough scheme will help protect businesses and jobs and there has also been significant investment in infrastructure, with the launch of the first ever UK Infrastructure Bank, and in apprenticeships, with £126 million being funnelled into creating 40,000 new and flexible traineeships. This will particularly benefit the construction sector as, with accelerated growth expected as the UK begins to unlock.
“From a local perspective, the news that the Liverpool City Region has been granted Freeport status will make the region even more attractive to commercial projects and investors. Freeport rules will make it easier and cheaper to do business and could also benefit the construction and sector in terms of importing materials.
“The North West has also secured a larger cash boost from the Towns Fund than anywhere else in the country, with Bolton, Cheadle, Carlisle, Leyland, Southport, Staveley, Rochdale, Preston and Workington all taking a share of £211m investment in the region. These funds will allow areas that have previously been left behind to level up through regeneration projects, which will have a positive effect in terms of new projects.
“The new tax ‘super deduction’ policy will certainly stimulate investment as we emerge from the pandemic and it will be popular with manufacturing and construction firms, but the increase in corporation tax from 19% to 25% in 2023 will loom on the horizon and be a concern for many businesses.
“Looking at the residential sector, the three-month extension on the stamp duty holiday and new mortgage guarantee for buyers with a 5% deposit will be welcomed by homebuyers, yet it appears that tenants and landlords have been largely forgotten, which is likely to have a knock-on effect for residential developers.”
Image credit: Chris McAndrew, CC BY 3.0, via Wikimedia Commons