The Chancellor delivered his Spring Statement under the shadow of Brexit, with little to announce and little to give away.
A full spending review following agreement of a Brexit deal and a detailed Budget in the Autumn is promised, but the Chancellor was unable to deliver the much-needed certainty businesses, investors and individuals now crave.
Here are the five things you need to know following today’s Spring Statement.
National Minimum Wage review – the introduction of regional rates?
The Chancellor said that he has instructed a Low Pay Commission Report to undertake a review of the National Minimum Wage from April 2020 with a view to ensuring that rates are set: “as high as possible without damaging the employment prospects of each group”. Might this lead to National Minimum Wage rates varied perhaps geographically, by age group or even by sector?
Future Homes Standard – an end to fossil fuels in new homes
The Chancellor announced the end of fossil fuel heating in all new homes from 2025. This raises two important questions - will the Government guarantee future energy supply, and will developers pass on costs to new home buyers for potentially costly alternative heating systems? Will the new energy supply be itself green?
Late Payment reporting
The Federation of Small Businesses (FSB) has long campaigned on the issue, estimating that £14.9bn was held back from small businesses in 2018. The Chancellor today acknowledged the FSB’s hard work, with measures to encourage rapid payment. Larger audit regulated companies will have to report annually in their financial statements on the number of days taken to pay suppliers.
Just as Gender Pay Gap reporting captured media interest, so too will companies that consistently or deliberately pay suppliers late.
Development and biodiversity
The Spring Statement focused on the environment and biodiversity, asking commercial and residential developers to ensure wildlife is not compromised. Government will mandate developers with net gains to wildlife with the view to increasing biodiversity. Details will be announced in a consultation, but questions remain particularly for developers looking at brownfield sites.
Research and development driving innovation
The Chancellor announced steps designed to encourage the continuation of world class innovation and research centred on the UK. Financial commitments to research programmes with European organisations were confirmed whatever the outcome of the next two weeks. Measures to remove restrictions on immigration for PhD level recruits should also support continuing innovation from UK businesses. Changes to the R&D relief for SME businesses, due to be implemented from 1 April 2020, would also favour companies employing their researchers rather than subcontracting that work anywhere in the world.
Given the current political picture, it is great to see a politician doing what they said they would do; the Chancellor said there would be little tax announcements. And he did what he said!