With the intention of encouraging growth, the Chancellor unveiled his plans in the Autumn budget yesterday.

Dids Macdonald OBE., CEO of ACID said, “We welcome many of the changes which will certainly help many businesses in the UK’s SMEs, in particular holding large corporates accountable for slow payments. On growth, maybe Chancellor Hunt would do well to look at the design economy which has grown exponentially year on year with design exports doubling from 2013 to £70 billion in 2019. The design economy produces nearly one hundred billion to the UK’s GVA, 4.9% of its total. One in 35 of us in the UK knows someone working in design or design skills as an incredible 1.97m people are employed in the sector”.

Budget Summary

Late Payments – the challenge for most SMEs

Support from the Chancellor to drive out the worst large corporate payers who use their small suppliers as a form of free credit which causes so much time, effort, and stress to pursue. When there are so many other challenges facing small businesses, the consequence of overdue payments is to erode working capital which could otherwise be put to business building efforts. Driving out bad payment practices is very well received.

National Insurance

Down 2 per cent to 10% in January. What does this mean for lone, micro and SME? The threshold of earning less than £12570 remains zero so the benefits are for those earning between £12570 and £50,268.

VAT – unchanged

Inflation – which measures the rising cost of living

To drop to 2.8% by the end of 2024, The target set for inflation is 2%, which the Office for Budget Responsibility (OBR) says will be hit during 2025.

Minimum wages

• The national Living Wage for over-23s rises from £10.42 an hour to £11.44 an hour
• The National Minimum Wage for 18 to 20-year-olds rises from £7.49 to £8.60 an hour
• The National Minimum Wage for under-18s will rise from £5.28 to £6.40 an hour
• The apprentice rate for those under 19 goes up from £5.28 to £6.40 an hour

Business rates

There will be tax breaks for businesses to offset their investments for machinery and equipment. There will be a business rate relief of a 75 per cent discount for SMEs in hospitality, retail, and leisure sectors.

Benefits

Will rise by 6.7% in April

Welfare Payments

Those who fail to find work for 18+ months will be required to undertake work placement.

State Pension increase

By 8.5% in April 2024

Growth forecasts downgraded

Read the full Autumn Statement here