Government continues to tell us that the UK manufacturing base needs to export more. The Chancellor now has a golden opportunity to help rebalance our economy in this Budget with a package of tax reliefs and investments that will assist businesses in achieving this goal.
A ‘Made in the UK’ badge is still seen as a hallmark of great quality overseas, particularly in the defence sector, but the long term sustainment of our industrial base requires us to also price competitively and invest in the future.
To stem the decline in the UK industrial base we need to see further investment in infrastructure, particularly in the North West and to incentivise companies to expand and invest in young people. We therefore need to see increases in capital allowances on investments, greater support for the funding of apprenticeships and a reduction in National Insurance for new employees would be welcome.
From a price perspective, the current duty on fuel has not only caused our own overheads to increase but those of our suppliers, if we are to remain competitive in Europe we need competitive fuel pricing via a reduction in duty.
To encourage businesses to export more and remove some of the bureaucracy that surrounds it, the Defense Trade Co-operation Treaty has been warmly welcomed by many companies, but the Government Departments that will have to deal with the vetting and registration process of suppliers are already over stretched. Government policies such as the DTCT, although applauded, need to be fully funded and the downstream implications and the costs they impose on UK companies considered and suitable tax breaks offered.
Further incentives, in support of growing the export market, should be a series of corporation tax breaks for SMEs related to their percentage of export business, this will help to reduce costs and increase competitiveness and foster further growth.
Looking at the economy as a whole the concern is that while George Osborne has remained committed to his ‘Plan A’ of austerity, there has yet to be a clear and concise blueprint for growth. Government statements such as 'We need to export more' are insulting and of little help if not supported by a package of tax incentives and reliefs that help businesses increase their competitiveness and market penetration.
The multiplier effect of an expanding manufacturing business is significant and when our goods are still highly prized overseas there has rarely been a better time to help promote them.
While low-skill production will always be done where labour is cheapest we have an opportunity to foster and grow a highly skilled manufacturing economy to once again be the envy of the world.
Ian joined WFEL, a global manufacturer of temporary bridges for the armed forces, as a 16 year old technical apprentice. In 2006, he executed a management buy-out as its MD. WFEL has been exporting to more than 40 armed forces globally since the 1960s and still designs and builds all of its products from its sole base in Stockport, Cheshire. It employs around 230 people with global sales of almost £40m.