RDA welcomes budget's focus on skills and green economy
22 April 2009
Today's Budget included a number of measures that can be
welcomed in South West England according to the South West RDA
(Regional Development Agency).
The RDA especially welcomed the Budget's focus on skills, the
green economy and help for businesses struggling in the recession
but warned that the region must ensure it can capture its fair
share of the benefits on offer.
Commenting on today's Budget, Nigel Jump, RDA chief economist,
said: "Today's Budget included a number of measures that we can
welcome in the region - some of these are short-term measures and
some long-term. Moreover, whilst our unique business (a high
proportion of SMEs) and household structure (an older population)
suggests some measures will have an impact here, the real question
is how we capture, at least, our fair share of the benefits on
offer."
The Budget made a number of proposals for business innovation
and workforce skills. The short term doubling of capital allowances
should support business investment, the extension of tax loss rules
should ease cash flow pressures, and the car "scrappage" scheme
should bring forward some demand in the motor supply chain.
Mr Jump added: "The new trade credit insurance guarantees will
also help businesses in the South West's supply chains who are
finding it difficult to access traditional bank funding. This will
reinforce existing measures put in place since the recession
started, such as finance guarantees and transition loans, as well
as our own £10 million loan fund for viable businesses.
Furthermore, the £750 million Strategic Investment Fund, especially
its low carbon and trade related elements, should be a target to
aim at for our dynamic and innovative entrepreneurs, as will the
promise to look at the tax treatment of intellectual property
before the next pre-budget report."
More broadly, the region needs to make the most of the
engagement of Dorset, Bournemouth and Poole with the new "Total
Place" initiative and to ensure we capture what we need from the
commitment to the government's overall capital investment
programme.
The Budget made progress in support of the switch to business
opportunity and jobs in the "green" economy; an area where the
South West has some comparative advantage.
Mr Jump added: "As well as the overall carbon budgeting, aiming
to reduce UK carbon emissions by 34% by 2020, there is new funding
for a range of research and investment in off-shore wind, other
renewables (especially, we hope, wave and tidal which are of
particular importance to this region), carbon capture and Combined
Heat and Power research and investment. There was also further
support for energy efficiency in our housing stock."
The Budget helped workers by raising the funding for Job Centre
Plus to help the newly unemployed and the long-term unemployed, and
through its changes to pensioner and child support. The £600
million effort to unblock short term house building will also help
a region where housing affordability and supply remain an economic
constraint. There was also some modest help for savers, including
the potential for the "savings gateway".
Mr Jump added: "Today's Budget predicted a V-shaped recession,
with output growth back into positive territory before the end of
2009, recovery in 2010 and above trend growth in 2011. The 2%
inflation target was retained. We must expect further tightening in
public sector budgeting, however, in the years ahead."
Ends
Note to editors
1. The South West RDA leads the development of a sustainable
economy, investing to unlock the region's business potential. It is
helping companies respond to the economic crisis and charts a
course for recovery. The RDA is developing or expanding initiatives
which include: establishing a Business Loan Fund; coordinating the
response to large companies in difficulty; preparing for economic
recovery.
Contact: Billy McKenna - South West RDA press office on Tel:
07918 690 228