Spring Budget : What you need to know

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 On the 13th of March, the Chancellor of the Exchequer, Philip Hammond announced the Spring Budget 2018. He revealed the plan for the UK and its economy in the coming spring and summer months. The Chancellor referenced the conservatives by saying “we are the party of small business and the champion of the entrepreneur”. We have listed what we feel are the most important points that small businesses owners should know from the budget.

Apprenticeship funding

The most important announcement Hammond made what the fact that small businesses will get an £80 million boost in order to help support possible apprenticeships entering the world of work. “The funding will be released in order to help employees and apprentices achieve their goals”

The apprenticeship funding isn’t strictly new as originally, an apprenticeship levy was put in place last April for large businesses, offering financial support for big businesses who take on apprenticeships. The Treasury later confirmed that the extra £80 million isn’t a new budget, but taken from the £650 million non-levy funding previously allocated to last until April 2019.

Previously concerns were raised over the original “big business apprenticeships”  as out of 714 businesses that won the contracts, did not have apprenticeships allocated the prior to the funding announcement.

Late Payments

Another announcement was made that a review will be launched into how to eliminate late payments to SMEs, as will a review into how to help the UK’s least productive businesses. This announcement comes after the chairman of the Federation of small businesses (FSB) previously called on The Chancellor to tackle the “late payment crisis” that last year caused an estimated 50,000 small businesses to close. Research by the FSB found that 84% of SMEs have reported being paid late.

End of Austerity?

It was hinted at by Hammond that there is a possibility austerity will be erased in the next autumn budget. He said in his speech “if the public finances in autumn, continue to reflect the improvements that today’s report hints at, then… I would have the capacity to enable further increases in public spending and investment in the years ahead”. However it has been said by some experts that testify requires reversing cuts, not just stopping cuts. Without a substantial rise in the tax take, public debt could be increased.

Another major topic in the statement was everyone’s favourite talking point…

Brexit

The Treasury has now released an overview of how Brexit preparations will be funded in the coming year. In total, 1.6 billion will be allocated across 4 departments with the home office receiving the largest sum of £395 million. This large sum offers us insight into the number of difficulties the department will face in the next year. The Department for Environment and rural affairs (DEFRA) is the runners-up with cash allocation, gaining an additional £310 million for Brexit planning. The reason for the high allocation of funding is due to 80% of DEFRA’s work is directly affected by Brexit. Such as new agricultural systems to be developed, fisheries management and environmental protection. This will require a 65% increase in Staff.

HMRC is set to gain an extra £260 million to provide aid in negotiating new customs arrangements by March 2019. Finally, the last department to receive a big allocation is the Department for Business, Energy and Industrial Strategy. The department will receive £185 million. This is because they are in charge of 68 out of 313 of the Brexit work streams. Which is more than any other industry.

Do you think the Spring Budget 2018 is good for SMEs? Let us know in the comments below or tweet us