UK innovation and investment must be incentivised in Chancellor’s Spring Budget
- Gaps in support for businesses facing spiraling energy costs must be addressed
- Industry must be consulted on changes to tax policy to help incentivise investment
- Measures to help current and future labour and skills shortages should be a priority
Ahead of the forthcoming budget, ADS has written to the Chancellor to outline proposals that will support the UK Government in delivering growth and prosperity by strengthening the UK’s aerospace, defence, security, and space sectors.
During 2022, ADS members faced economic challenges of the rising cost of doing business, supply chain issues, and skills and labour shortages. These issues, amongst others have continued into the new year, and 2023 is set to be a challenging year for UK businesses with inflation continuing to remain high, pressures remaining around energy costs, and skills shortages continuing. Yet, despite the challenges, there are significant opportunities for UK businesses as post-pandemic trends of recovery continue and UK innovation must be icentivised, particularly in relation to the cost of doing business, and the US Inflation Reduction Act.
It is important UK competitiveness is maintained, and the UK remains an attractive placed to invest, ADS has made four recommendations where the Government could effectively do this while supporting companies with the rising cost of doing business. ADS’s recommendations include:
- Promoting energy efficiency measures and tackling any gaps in support for businesses facing spiraling energy costs.
- Reviewing the changes to the R&D tax credit scheme to ensure SMEs are incentivised to continue to invest in R&D in the UK.
- Reforming the Apprenticeship Levy to increase the flexibility with the scheme and the number of apprenticeships on offer.
- Incentivising investment in plants and machinery through reforms to business rates and capital allowances.
Commenting on ADS’s Budget calls, ADS Chief Executive Kevin Craven said:
“In the upcoming Spring Budget, I would like to see the Chancellor looking to secure UK advantage for our sectors where our innovation, high value design, advanced manufacturing techniques, and joint investment with Government have given us world leading market positions.
“Addressing some of the issues our four sectors face, from skills and labour shortages, the rising cost of doing business and ensuring access to financial incentives supporting R&D investment in the UK will enable the UK to remain competitive in those global markets, meet our critically important net zero goals, while supporting our national security.”