The first Conservative-only Queen’s speech in nearly 20 years was announced on Wednesday May 27th. Izzy has put together the main points to help you with interview preparations and commercial awareness focusing on the main issues that affect our clients here at Grant Thornton.
Unlocking growth in dynamic businesses
- Employment Bill – proposals for creating 3 million apprentices to reduce the skills gap felt in dynamic businesses. Businesses are looking for continued progress on having more control of skills funding.
- Tax Lock Bill – income tax, VAT and NIC rates have been locked for the next 5 years bringing more certainty to businesses in terms of payroll and VAT administration. It will be interesting to see if George Osborne announces wider tax changes in his next Budget on Wednesday 8 July with the main taxes frozen.
- The Tax Free minimum wage – a boost for all income tax payers but businesses should be aware that the threshold for employer National Insurance Contributions has not changed.
- Enterprise Bill – put in place to reduce regulatory burdens to mid-sized businesses following on from the Coalitions reduction in regulation for the smallest firms. It is important that the Government treat mid-sized businesses differently to large businesses.
- EU Referendum Bill – will provide clarity on the timetable and process ahead for the promised EU referendum by David Cameron. It is important that mid-sized businesses views are heard in the EU debate as the focus tends to be around ‘small firms’ and ‘big business.’
Vibrant places where business and people can thrive
- Scotland Bill – devolving further powers to the Scottish government should give business some long term certainty in Scotland and the tools to build a vibrant economy. However, there may be uncertainty if promises of further devolution on unspecified powers in the future is announced further down the line in a separate Bill.
- The Wales Bill – an opportunity for the Welsh Assembly to devolve powers to local authorities. In particular to develop the relationship between the major conurbations of south Wales and Bristol to build a “western powerhouse.”
- Right to Buy Bill – extends the right for housing association tenants to purchase their property at a significant discount so it becomes applicable to a much wider tenant base. This does raise serious concerns for housing policy which could impact local communities. Housing associations may find it harder to borrow to build more housing stock and tenants may take financial risks to take advantage of this opportunity. An alternative approach would be to devolve powers to local authorities to work with housing associations to increase the supply of social rent and affordable homes for key workers and families.
- Continued investment in infrastructure is critical to stimulating growth and raising productivity. The Government’s commitment to legislate for high speed rail links will be welcomed by businesses.
Trust and Integrity in markets
Public trust in business is essential for business growth. We need business cultures that encourage long termism, rather than short term profit.
The Enterprise Bill for Small Business Conciliation Service is a step in the right direction to support long term supply chain relationships between large and small firms. There was little else on this subject which seek to restore trust and integrity in markets and promote long term approaches to corporate culture.
It is hoped that the business and City ministers in the government will engage in a debate on this in coming months.
Other items to note:
- A freeze on working age benefits, tax credits and child benefit for two years from 2016/17.
- 30 hours free childcare a week for three and four-year-olds by 2017.
- Cutting the total amount one household can claim in benefits from £26,000 to £23,000.
- 500 more free schools and more failing and “coasting” schools turned into Academies .
- A ban on so-called legal highs.
- A “truly seven day” NHS by 2020.
The Budget on the 8 July will provide further details on the Government’s agenda and an opportunity to raise ambition, provide more certainty and fill in some gaps identified above.
If you have any questions please feel free to email Izzy at firstname.lastname@example.org or tweet @izzycandy