Reactions to today's Spending Review by Chancellor Rishi Sunak are diverse.
Stakeholders react to the Chancellor's Spending Review
Commenting on the statement by the Chancellor of the Exchequer:
Stephen Phipson, Chief Executive of Make UK, said:
“This was a realistic statement which lays bare the immense challenges the Chancellor and the economy faces in the near term. In the face of these it is absolutely right that the priority must be to protect jobs, whilst trying to create opportunities for young people whose futures have been left badly scarred. Equally, it is vital to put in place the foundations now for how we rebuild our economy.
“Industry will commend the Chancellor for addressing this difficult balancing act with a package of measures designed to get boots and shovels on the ground, especially the National Infrastructure Bank and Levelling up Fund to boost growth in those Regions which have been hardest hit.
Robert Colvile, Director of the Centre for Policy Studies, said
“Today’s spending review recognises the extraordinary scale of the Government’s fiscal response to the pandemic, but also the extraordinary and long-lasting economic damage that it has inflicted.
“It is right to prioritise jobs, health and public services now, rather than immediately closing the deficit, but also right to acknowledge the enormity of the challenges ahead. The temporary cut to international aid and the imposition of public sector pay restraint, both called for by the Centre for Policy Studies, recognised this changed environment - but we are still committed to increasing spending on a shrunken tax base.
“The Chancellor’s announcements on infrastructure investment and levelling up were extremely welcome, echoing for example the CPS’s proposal for a National Infrastructure Bank.”
Rain Newton-Smith, CBI Chief Economist, said:
"Stark forecasts point to tough times ahead. But through his statement, the Chancellor has made some bold autumn decisions to power a Spring recovery.
“The Spending Review lays the foundations for a brighter economic future. A new National Infrastructure Bank, long-term funding for innovation, and a comprehensive plan for creating jobs and renewing skills are just some of the building blocks needed to deliver on this vision. It’s right to take this opportunity to plan for tomorrow.
“But ambition must be matched by action on the ground. The Government’s commitment to build, build, build must be delivered now. This means a clear strategy to upgrade the UK’s infrastructure and publishing the Energy White Paper.
“And there can be no let-up in the support for firms facing new COVID restrictions. Firms need help to survive, then thrive. Business investment and confidence can be the engine of UK growth, creating jobs around the UK.”
Adam Marshall, Director General, BCC, said:
"This spending review comes at a critical time as business communities are fighting for survival in the midst of the coronavirus pandemic.
“The launch of the National Infrastructure Strategy is an important step in overcoming the longstanding infrastructure deficit. We’ve spent long enough discussing infrastructure projects - it’s now time to focus on delivery.
“Measures to help people return to work at this challenging time will help limit long-term unemployment but Government must waste no time in putting these plans into action. Government and business will need to work together to re-train and re-skill the UK workforce. Investment in the Kickstart Scheme, in which Chambers are playing a leading role, and the launch of the Restart scheme, will be critical in helping to achieve that.
“With an uncertain winter ahead, the government will need to maintain an open mind on providing further support to businesses struggling to survive. As we look to rebuild and renew local and national economies, businesses will also need further significant incentives for investment in people, productivity and the planet.”
Dr Gerard Lyons, Senior Fellow at Policy Exchange, said:
“In the face of a global health and economic crisis the UK’s generous fiscal response is both necessary and justified. I felt the Chancellor got the balance right between difficult policy choices ahead and avoiding panic about the size of the debt. It is right to use fiscal policy as a shock absorber, to avoid premature tightening and to direct spending towards capital investment and public services. The main focus has to be on a pro-growth agenda, that reduces unemployment and allows the economy to recover.
“Although the ratio of debt to GDP is set to rise in coming years this should not prove onerous to service by historical standards and can then be reduced gradually over time. The U.K. may wish to take advantage of its ability to borrow at very low yields by issuing longer dated debt.”
Michelle Ovens MBE, Founder, Small Business Britain, said:
“It is good to see the Government investing to stimulate the UK economy, particularly across digital and infrastructure. This will help to support and revive small businesses and communities across the country, particularly as we move into 2021 and look to the small business economy to be the engine of growth.”
Covid Support & Jobs
Rob Hattrell, Senior Vice President, eBay Europe, said:
“The extra investment announced today for Kickstart is fantastic news and offers real hope for young people who want to gain valuable work experience and learn new skills. There is huge potential for SMEs to get involved, particularly those involved in online retail which is a growth area. We look forward to partnering with the Chancellor in the weeks and months ahead to deliver opportunity to those who need it most.”
Charles Woodburn, Chief Executive, BAE Systems, said:
“We welcome the Government’s continued commitment to apprentices and the Kickstart programme. We’ve recruited almost 800 apprentices this year who are helping to develop cutting edge technology whilst also playing a role in supporting the UK’s economic recovery.”
Bryan Sanderson, Chair, Low Pay Commission, said:
“We are pleased that the Government has accepted our recommendations today. After much debate, these have the support of business, trade union and academic representatives who make up the Commission.
Recommending minimum wage rates in the midst of an economic crisis coupled with a pandemic is a formidable task. The difficulty in looking forward even to next April is daunting. There are strong arguments concerning both low-paid workers – many performing critically important tasks – and the very real solvency risks to which small businesses are currently exposed. In these unprecedented conditions, stability and competence are prime requirements.
Our value as a social partnership is to use the imperfect economic evidence to produce a recommendation which is professionally researched and dispassionate. We have opted for a prudent increase which consolidates the considerable progress of recent years and provides a base from which we can move towards the Government’s target over the next few years.”
Rain Newton-Smith, CBI Chief Economist, said:
“Many lower paid workers have been the heroes of the COVID crisis, and business supports government's ambition of ending low pay. But unemployment is rising in lower paying sectors and these increases will be tough for some firms afford, so caution is justified to protect jobs.”
Edward Davies, Director of Policy, Centre for Social Justice, said:
"Amidst the eye-watering barrage of numbers, the focus first and foremost on jobs, was the right one. It is not just important for the recovery of the economy but as the Chancellor said, a job is the best route to personal prosperity – an identity, purpose, and reason to get up each morning. Various investments in housing, city growth deals, and a very welcome community levelling-up fund will all help to enable this.
"And for those out of work the announcement of the £3bn Restart Programme is welcome too. This can build on and expand the Work Programme and Work and Health Programme. But it must be personalised and human, as per the original design of Universal Support, to go alongside Universal Credit. As the Shadow Chancellor said it must address the needs of those furthest from the job market and work with the small local actors, who know their communities best.
"Lastly, support for the most vulnerable such as rough sleepers, and our prisons was welcome, but warm words on families and communities, where many find their greatest support, must be followed by action.”
Elizabeth Taylor CEO, ERSA (Employment Related Services Association), said:
"The Employment Support sector welcomes the announcement of Restart commissioning alongside investment in infrastructure, capital investment, job creation, green jobs, sector-based training, traineeships, and the expansion of the National Careers Service. We hope the expansion of front-line advisors at Jobcentre Plus will ensure the right people are referred to the right provisions at the right time. The Employment Support sector itself will expand to meet the challenges of future delivery and this work has begun with partnerships and collaborations being developed to increase capacity and to build diverse supply chains that will reach into local communities through knowledge of employers, with local partnerships bringing in the expertise of third sector partners, specialists, local authorities and recognising that health and housing issues will factor into the success of economic recovery. For the Employment Support sector Restart is a start, we look forward to the details of allocation of ESF reserves and the future Shared Prosperity Fund to provide effective employment support for all."
Lord Jim O'Neill, vice-chair of the Northern Powerhouse Partnership, said:
“Out of everything released today alongside the spending plan themselves, it’s hard to overstate just how important Green Book reform could be for the North.
“We’ve been calling for this for a number of years and it should prove to be a key turning point in unlocking further infrastructure investment in the North for decades to come.”
“The establishment of a new National Infrastructure Bank based in the North and the acceleration of the Borderlands Growth Deal are both encouraging signs the Chancellor has begun delivering on his commitment to levelling up, focusing on issues which impact productivity.”
Leo Quinn, Balfour Beatty Group Chief Executive, said:
"We welcome the scope and vision of the National Infrastructure Strategy. It not only provides the long-term clarity vital to protect our national capability in infrastructure and construction, but the enlarged funding is exactly what’s needed to prime the UK’s economic recovery. Ours is an industry which creates jobs, skills training and transport links which strengthens local communities for generations to come. The focus on sustainable infrastructure is particularly key to ensuring we really do build back better and greener futures. "
Jonathan Geldart, Director General, IoD, said:
“Today’s statement provided a sobering view of the challenge ahead, and funding for infrastructure and skills will be crucial to meeting that challenge.
“IoD members see infrastructure investment as the top priority for our economic recovery. A long-term plan for upgrading broadband and transport, backed by a new national Infrastructure Bank, will provide a significant boost for business confidence.
“With widespread uncertainty at the moment, clear Government strategy and commitments are crucial encouragement for directors' plans for their own organisations. As ever, the acid test will be how quickly and effectively this funding reaches the ground. Transparency, good governance and a focus on the Net Zero target will be key for both the new Bank and the Levelling Up Fund.”
Nick Baveystock, ICE Director General, said:
“Today’s announcements could genuinely be a game-changer in delivering an infrastructure system that works better for the public. An infrastructure strategy gives clarity on the direction of travel for investment, and an infrastructure bank will help lower the cost of greener technologies and projects needed to ramp up decarbonisation. The Green Book now lives up to its name, with a bright green thread running through it to better weigh environmental costs and benefits alongside social and economic needs.
“Expected consultations on financing a net-zero transition and exploring the options for greening our electricity will be an essential start. However, this is an integrated challenge. We need joined-up plans to achieve real change, for example to ensure polluting forms of transport get phased out as greener sources of electricity come online, alongside the introduction of measures to replace the evaporation of fuel duty receipts. Connecting these dots is an area policymakers should now focus their effort and attention.”
Rain Newton-Smith, CBI Chief Economist, said:
“We know just how vital refreshing our ageing infrastructure is to repower the economy, connect more people and create job opportunities across the UK. Putting money into roads, broadband and clean energy will help do just that.
“Most importantly of all, the Government has set out its stall for the long-term by creating a National Infrastructure Bank. With the right remit, the bank has the potential, to crowd in the private finance that will be crucial to delivering these new projects.
“Local authorities and businesses have been waiting a long time to hear how EU structural funding will be replaced from 1 January. They will be encouraged to see pilot programmes launched for the UK Shared Prosperity Fund alongside the Levelling Up Fund. Both will help deliver improvements in communities across the country.”
Suzannah Nichol MBE, Build UK Chief Executive, said:
“We welcome the Chancellor’s announcement and the Government’s firm commitment to investing in infrastructure and new housing across the country. Supported by the publication of the National Infrastructure Strategy, the promise to ‘Build Build Build’ puts construction at the heart of the UK’s economic recovery. Delivery of these projects, in accordance with the published timescales, is the next step and the construction supply chain is ready and waiting to play its part.”
Fhaheen Khan, Senior Economist at Make UK, said:
“Infrastructure has long been the Achilles Heel of the UK economy causing a wide range of economic impacts from poor connections to ports and lack of broadband. The need to invest in both physical and digital infrastructure is not just about a short term boost to increase shovel ready projects to provide employment and growth, it will be one of the pieces in the jigsaw of the UK’s productivity puzzle. Using the National Infrastructure Bank and Strategy, as well as changes to the Green Book, can also unlock the power of UK manufacturing and productivity, as well as crucially support the rebalancing of our regions.”
Will Gardiner, CEO, Drax Group, said:
“Today’s Spending Review setting out the next stages of the government’s record investment plans in infrastructure to drive a green recovery underscores the significant role for businesses in the North, like Drax, who will be at the heart of a green industrial revolution – attracting investment and creating jobs and helping the UK show climate leadership ahead of COP26 next year.
“Investing in new green technologies like bioenergy with carbon capture and storage at Drax to deliver negative emissions, and decarbonising other industries in the Humber cluster would boost skills and create tens of thousands of jobs – helping to level up while delivering over £3bn in clean growth.”
Dr Liz Cameron, Chief Executive, Scottish Chambers of Commerce said:
“Despite unprecedented falls in GDP and rises in debt and deficit, it is welcome that the Treasury remains committed to supporting the economy in the face of ongoing challenges of Covid-19. However, the forecast for job losses despite £280 billion worth of support thus far should focus all minds on the toll this virus has taken on people’s lives and livelihoods.
“Investment in R&D and through the new National Infrastructure Bank are welcome, we look forward to further detail on these and how they will be accessed in Scotland.
“Barnett consequentials mean the Scottish Government has some leeway in setting its priorities for the Scottish Budget and we believe upskilling and cutting the costs of business overheads should be top of its agenda.’’
Andy Walker, Head of Policy & Research, Suffolk Chamber of Commerce, said:
“The Levelling Up Fund is welcome news for our towns and coastal communities who have endured a tough 2020. Additional infrastructure funding will help our region recover from COVID-19, improve transport links, create job opportunities and boost economic growth, as shown with the third Lake Lothing Crossing in Lowestoft. Commitments to these kind of projects will provide a real boost to the confidence of local business, and act as a catalyst towards further investment and regeneration.”
Gerard Grech, CEO, Tech Nation, said:
"We welcome the Chancellor’s focus on supporting jobs, businesses and public services through this crisis. The coming years will be demanding, but equipping those out of work with the skills needed for the industries of the future and improving our digital infrastructure nationwide will be key. A renewed commitment to research and development will help keep our tech sector driving forward and it is right that we focus on achieving net zero by 2050 for the generations that come next. We appreciate the opportunity of working with HM Treasury to ensure that all corners of the UK can be part of our country’s sustainable, digital future."
Will Tanner, Director, Onward, said:
"The Chancellor's statement today exposes the depth of the economic shock and the hard yards ahead to get back to growth and fiscal sustainability. The Government has undoubtedly had to make some unpalatable choices, but today's borrowing and GDP figures confirm more than anything that there will be many more to come.
"It is welcome that, even as he has confronted these difficult decisions, the Chancellor has doubled down on levelling up. We must never forget that more regionally balanced countries grow faster and the UK remains dangerously out of kilter on measures of earnings, productivity, skills formation and infrastructure quality.
"The National Infrastructure Bank in particular has the potential to catalyse billions of new private capital into lagging regions and to support the transition to net zero. The Levelling Up Fund may be at a different scale but potentially just as vital, if it can successfully identify and invest in the local infrastructure and institutions that underpin the social fabric of communities."
Verity Davidge, Director of Policy at Make UK, said:
“The boost to R&D funding is critically important for manufacturers who invest a greater proportion than other sectors of the economy. If we are to become a global leader in the adoption of digital technologies and, put science and research at the heart of our economy, then financial backing from Government will be vital, especially if the UK is to lose EU funding.”
Hayden Wood, CEO and co-founder of Bulb, said:
“Today’s announcement is very welcome, and we agree with the Chancellor that the recovery from Covid-19 must be green. We’re especially encouraged by the commitments to greening buildings and homes, and to stimulating R&D through the Net Zero Innovation Portfolio. Long term investment is crucial so that businesses like Bulb can create the jobs of the future and build new technology that enables people to lead more sustainable lives.
“Bulb is proud to play our part in this national effort by taking green mainstream, bringing renewable energy to millions of people across the country, accelerating efforts towards achieving net zero by 2050, and making the UK a global leader in green technology.”
Dave Atkinson, regional director for the East of England at Lloyds Bank Commercial Banking, said:
“The Chancellor’s pledge to provide funding to rejuvenate the transport system will be welcomed by many in the region. The plans laid out in the National Infrastructure Strategy will go some way to boost business’ optimism about the coming months and should play an important role in driving the economic recovery post-lockdown.”
Andrew Carter, Chief Executive of Centre for Cities, said:
"The Chancellor’s ambition to level up the country is welcome, as is the clarity on infrastructure in the national strategy. But for levelling up to succeed, it needs to be about more than infrastructure and one-off funds. We need to see sustained, multi-year investment and decisions like those announced by the Chancellor today – on skills, transport and housing – devolved and joined up at a local level.”