Carla Hoppe, founder of employee wellbeing specialists, Wealthbrite: “Older, wealthier workers will be able to put more into their pensions while many younger workers are stopping pension contributions because of the cost of living crisis. While welcome for some, this Budget was a missed opportunity to help struggling young people build long-term wealth and secure their financial future.”
Dean Esnard, director at London-based Magni Finance: “The expectation that inflation will fall to 2.9% by the end of the year is the most important information from the Budget. This will undoubtedly give the Bank of England confidence that the base rate increases have worked and hopefully the end is in sight. All eyes will now be on the Monetary Policy Committee meeting next Thursday where we will really find out where we stand.”
Dean Butler, Managing Director for Customer at Standard Life, part of Phoenix Group, comments: “It’s status quo for the State Pension today, however the Chancellor made a point of referencing last year’s decision to face the music and uprate benefits in line with inflation which included the decision to restore the triple lock. Increasing the payment in line with inflation from next month will be costly but will take the value of the new single tier state pension above £10,000 per year for the first time. This will be welcome news for pensioners but it does move the value of the payment much closer to the tax free personal allowance of £12,570, meaning increasing numbers of pensioners are likely to pay tax.
“Inflation is forecast to fall sharply to 2.9% by the end of 2023 so the debate about its future is likely to be less contentious this autumn when the 2024-2025 rate is announced.”
Alec Collie, head of medical at the Wesleyan Group, the specialist financial services mutual for doctors, said: “For clinicians, today’s increase to the annual allowance hasn’t come a moment too soon. Coupled with the scrapping of the lifetime allowance, these measures should reduce the number of doctors having to leave their pension scheme, cut their hours or quit the NHS altogether because of high pension tax bills. We’ve been calling for an increase in these allowances for some time now and are pleased to see the government taking action.
“These changes will make a real difference to many doctors when it comes to the risk of receiving pension tax charges. We know many have already left the NHS Pension Scheme to try and avoid these charges and they should consider getting advice on re-joining the scheme to get access to valuable benefits.
“The NHS Pension Scheme is amongst the most generous in the country, and has benefits that cannot easily be replicated through private schemes.
Matthew Thompson, Head of Sales at Chestertons, says: “The government’s extension of the energy bills support scheme presents a much needed financial aid for UK households. Many homeowners and tenants will, however, still face higher utility bills overall once the initiative is coming to an end in June. This can put a particular strain on larger households such as families but also the elderly who often reside in homes that have not yet been improved to benefit from a better EPC rating.”
Fred Soneya, Haatch Ventures said: “At Haatch Ventures we were delighted to see the focus in the Budget speech on growth, and the support for new technologies and entrepreneurs. In particular, the attention brought to faster regulatory approval for new drugs, the further support for AI and the fact that the UK is the number one country for female entrepreneurs . The Chancellor also raised the devolution of responsibility for economic growth to local authorities which will encourage local businesses wherever they are.
“Looking ahead, the commitment of the government to looking at how pension fund money can be used to invest in technology and innovation is exciting and could potentially unlock billions. More will be announced in the Autumn so we will have to watch this space!
“It has also been confirmed that the SEIS legislation changes proposed back in the Autumn budget will be introduced in the Spring Finance Bill 2023. A move which we are highly supportive of and will be truly transformational for entrepreneurs and investors.”
Steve Dobson, GrowthInvest, said: “Hunt continues to demonstrate his commitment to supporting growth and innovation within the UK economy. Notable assistance to growth companies came via improvements to the capital allowances system and increased support for R&D. This alongside an increased commitment to the Levelling Up campaign with the development of 12 new Investment Zones around the UK. Importantly, he confirmed that within the Autumn Statement he would set out plans to make pension capital available for investment into growth companies.
“Finally, great news that there was confirmation of the extensions to the SEIS scheme as per the announcement first made on 23rd September 2022.”
Toby Ryland, Corporate Tax Partner at the accountancy firm HW Fisher said:“The Chancellor has missed a huge opportunity to ease the pain for all small businesses across the country – not just those in the new investment zones. By deciding to go ahead with the corporation tax rise from April 1st, the Chancellor has added an extra burden to British businesses at a time when they need all the help they can get.
“Full capital expensing is a very welcome measure to encourage investment, but we’ll need to see the small print to see how much this benefit in reality offsets the increase in corporation tax. At the least it will bring a long overdue simplification of the current complex rules around capital allowances.”
Lauren Thomas, Glassdoor’s UK Economist said:“The UK sorely needs a ‘back-to-work’ budget to combat the rising millions who are economically inactive. A too-tight labour supply has restricted economic growth – exacerbated by the high numbers of long-term sick, retirees, and working parents who’ve left the jobs market. Otherwise we are headed for long-term declines in productivity.
“Severe labour shortages in the UK are a long-term problem that need immediate solutions. Still, the Chancellor has his work cut out for him with issues such as the UK’s ageing population driving retirement figures beyond his control. Childcare for working parents and training for early retirees are a good start, but what impact this will have remains to be seen.
“The path ahead will not be easy: hiring will remain difficult throughout 2023, those who want to work will need more support and continued long-term thinking will be needed to meet the staffing crisis we face head-on.”
Jonathan Prescott, partner at Praetura Ventures, commented on the Spring Budget: “The changes to the research and development (R&D) tax credit scheme are an example of giving with one hand while taking away with the other. It’s not yet clear which businesses will qualify for the enhanced credit package, so it’s likely huge swathes of Britain’s SME community – that would otherwise be primed to invest in innovation – will now have limited access to the support. By incentivising larger businesses more than the wider start-up community, the Treasury risks undermining the Chancellor’s vision to “make the UK home to the next Silicon Valley.”
“In a more welcome development, the news that the £1m prize for the most innovative AI research will be dubbed the ‘Manchester Prize’ is a great recognition of the region’s momentum in this space, and a tribute to the many pioneering early-stage businesses based here.”
More to follow…
