ACCA's response to the Chancellor's Budget

In response to the Chancellor's Budget, ACCA (the Association of Chartered Certified Accountants) says the following:

Business

Claire Bennison, head of ACCA UK, said:

‘We are concerned about pressures building on small businesses who are now faced with paying back tax on the £20 billion plus worth of grants and support they received to keep them afloat during the early stages of the pandemic until April 2021. This huge tax demand will hit companies who are just regaining profitability and adds to squeezes due to increased tax on dividends and employers’ National Insurance for the health and social care levy.’

Public sector 

Alex Metcalfe, global head of public sector at ACCA, said:

‘The government has announced an extra £5.9 billion for the NHS in England but it’s vital that we raise professional standards to ensure that money is spent wisely. Just 31% of finance workers in the NHS have a professional accountancy qualification, according to a 2020 Healthcare Financial Management Association survey, at a time when the country urgently needs finance skills to get the very best value for taxpayers’ money.’

Backlog

‘Long term spending settlements for the NHS, defence and schools leave other public services, such as the court service and local government, facing a crisis to clear backlogs caused by the pandemic. The chancellor’s additional capital investments must prioritise increasing capacity in the areas with significant public service backlogs.’

Tax

Claire Bennison, head of ACCA UK, said:

‘While the chancellor has cut costs by announcing cuts in business rates for the retail, hospitality and leisure sectors, we are disappointed that today’s budget did not take the opportunity to support the tourism and entertainment sectors further by keeping their VAT rate at 12.5% beyond next April and for the remainder of this parliament. A lower rate of VAT would help to ensure people keep coming through the doors regardless of locality or size of the business.

‘Historically, the UK has had one of the highest VAT rates for these sectors across Europe and we have shared our fear with the Treasury that returning to a rate of 20% within months has the potential to inflict huge damage on an already struggling sector and make many businesses unsustainable.’

Climate Crisis

Claire Bennison, head of ACCA UK, said:

‘We welcome the chancellor’s statements about government and business investment in green technology and job creation, but we haven’t heard any details about enabling the broader skills needed to make this a reality. We need to invest in skills, reskilling and continued learning to ensure the government achieves maximum impact and value from green investment. Finance teams can help their organisations to plan, measure and report on their efforts to reach net-zero.’

Skills

Claire Bennison, head of ACCA UK, said:

‘We would like to hear more from the chancellor about greater investment in skills development. It’s more important than ever that the UK has a strong pipeline of professional and ethical business advisors, as we seek to boost productivity and take advantage of new opportunities.’

Wales

Lloyd Powell, head of ACCA Wales, said:

‘As we build back the Welsh economy after the pandemic, it’s important to ensure that an appropriate level of funding comes to Wales to support business and skills development. A joined-up approach between the UK and Welsh governments is needed to ensure effective and efficient delivery.’

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