Loading...

Spring Statement 2019

Red briefcase

The Chancellor has today delivered his Spring Statement. Against the background of continued uncertainty around the UK’s departure from the EU, what will probably be seen as the main message of the Statement is that the Chancellor’s so-called ‘war chest’ of around £26.6bn is earmarked for preparations for a ‘no-deal Brexit.’

If the possibility of a ‘no deal’ exit is removed with the EU’s agreement, it will free up a significant amount of money to be spent in areas such as healthcare and education. However, as our last update noted, ‘no deal’ remains very much a possibility, in spite of this week’s parliamentary vote.

If a Brexit deal is agreed, the Chancellor has committed to a full, three-year spending review before Parliament’s summer recess, ahead of the next budget.

We look at a few other key announcements from the Statement below.

Housing & construction

The Government has made up to £3bn available to housing associations in England, through the Affordable Homes Guarantee Scheme, to support delivery of around 30,000 affordable homes.

In addition, £717m is earmarked for constructing 37,000 homes in London, the Oxford-Cambridge Arc and Cheshire.

The Chancellor also said that a National Infrastructure Strategy will be published along with the Autumn Budget.

For more on the implications of the Statement for the construction industry, see the latest Construction Online update.

Local areas

Alongside the above-mentioned areas for housing development, the Statement announces up to £260m for the Borderlands region, which comprises which comprises Dumfries and Galloway, the Scottish Borders, Northumberland, Cumbria and Carlisle City. There will also be £60m of investment in ten cities and local areas across England, from the ‘Transforming Cities Fund.’

Technology & innovation

While the major news in terms of technology may be around the Government’s planned reviews of digital advertising and the dominance of ‘tech giants’, there were announcements in other areas too, with over £200m earmarked for science and innovation projects. Major funding has been granted for state-of-the-art laser technology projects in Oxfordshire, genomics research and industry in Cambridge, and £79m for a supercomputer to be developed in Edinburgh.

Skills & jobs

The last Budget included updates to apprenticeship reforms. These mean that, from 1st April, employers will see the co-investment rate they pay reduced from 10% to 5%, while levy-paying employers are “able to share more levy funds across their supply chains”, with the maximum amount rising from 10% to 25%.

The Chancellor also reiterated that the previously-announced £37bn National Productivity Investment Fund, covering areas such as roads, the rail network and full-fibre networks, will help boost productivity.

Sustainability & environment

Sustainability and efficiency are one of the major areas of focus in the Statement, with the Chancellor pledging to increase the amount of ‘green gas’ in the National Grid. Additionally, from 2025, all new homes will be ‘future-proofed’ with low carbon heating, as opposed to fossil fuel-based heating systems.

The Statement also announced a ‘call for evidence’ specifically focusing on the benefits of energy efficiency and carbon reduction for SMEs. The results of this will lead to SME-specific investment commitments.

Autumn Budget 2017 – Industry Highlights

Chancellor of the Exchequer Philip Hammond presented the Government’s first Autumn Budget on 22 November. An optimistic Mr Hammond opened his Budget stating that he hoped for a “Britain that we can be proud of”, and after he promised us a “Britain fit for the future”.

This forward-thinking Budget very much focused on the needs of millennials, start-up businesses and the technology sector with stamp duty land tax (SDLT) on homes under £300,000 for first-time buyers abolished and investment allocated to a range of initiatives from artificial intelligence to 5G and full fibre broadband.

Housing, Health and Infrastructure were also given a boost, which is great news for those looking for future procurement opportunities in these key sectors. The Chancellor announced that the UK is on track to build 300,000 new homes per year, and that he wanted to connect those who are living outside of city centres with new transport initiatives.

If you want the breakdown of all the Autumn Budget 2017 figures, here you can discover what public sector pipelines of work await your industry sector.

Technology

  • Philip Hammond said that there is a “new tech business in Britain founded every hour”; he wants that to change to “every half hour”.
  • The Government plans to invest over £500m in a range of initiatives from artificial intelligence to 5G and full fibre broadband.
  • The Government wants to invest in driverless vehicles, with fully self-driving cars to be on UK roads by 2021.
  • A new £400m charging infrastructure fund will be introduced. The Government will invest an extra £100m in the Plug-In-Car Grant, and £40m in charging R&D.

Transport

  • £30m to trial new solutions on the Trans Pennine route to improve mobile and digital connectivity on trains.
  • The Government will fund the replacement of the 40-year-old rolling stock on the Tyne and Wear Metro.

Regional Government

  • The Chancellor announced spending power increases for the Scottish and Welsh Governments and the Northern Ireland Executive.
  • £2bn more for the Scottish Government.
  • £1.2bn more for the Welsh Government.
  • £660m more for the Northern Ireland Executive.
  • Government in talks to provide Northern Ireland with new city deals.

Local Authorities

  • The Government will invest £38m in the West Midlands, Liverpool and Manchester to help rough sleepers.
  • More than £1bn of lending will be made available to councils to fund high-investment projects.
  • The Government will provide Kensington and Chelsea Council with a further £28m for mental health services, regeneration support for the surrounding areas and a new community space for Grenfell United.
  • The Chancellor urged local councils that require funding for fire safety (housing) to reach out to the Government.

Health

  • An additional £10bn has been assigned to the NHS over the course of this Parliament to support the NHS’s Sustainability and Transformation plans.
  • Additional commitment of resource funding of £2.8bn to the NHS in England.
  • £3.5bn to upgrade NHS building plans to improve care.
  • NHS staff will receive a pay rise.

SMEs & Business

  • Mr Hammond said that “this Conservative Government is listening to small businesses”.
  • He aims to bring forward the planned business rates switch from RPI to CPI by two years.
  • The Government is extending the £1000 discount for pubs with a rateable value of less than £100,000 for one more year to March 2019.
  • The ‘Staircase tax’ will be axed.
  • Businesses to gain £2.3bn thanks to a change in the rules for the uprating of business rates.

VAT

  • The UK has the highest VAT registration threshold in the OECD, at £85,000. This will not be lowered but Mr Hammond will look at reforming it.
  • No reduction in the VAT threshold for SMEs.
  • Scottish Police and Fire will get a VAT refund from April 2018. The Chancellor puts the VAT change down to the influence of Scottish Tory MPs: “I am getting used to having my ear bent by my 13 Scottish Conservative colleagues.”

Housing

  • Over the next five years the Government will commit a total of at least £44bn to capital funding, loans and guarantees to support the housing market.
  • Mr Hammond announced that the UK is on track to reach 300,000 new homes per year.
  • New money for the Home Builders Fund to get SME housebuilders building again.
  • The Government is allocating £1.5bn to help smaller firms build more houses.
  • Housing Infrastructure Fund to increase to £2.7bn.
  • Abolition of stamp duty for all first-time buyers (up to £300,000).
  • Government committed to build up to one million homes in the Oxford-Cambridge-West Mids Corridor.

Autumn Budget Procurement Budget

What does this Budget mean for procurement?

The Chancellor announced that he will extend the National Productivity Investment Fund for a further year and expand it to over £31bn.

What we can take away from this year’s Budget is that the Government is spending money in the following areas:

  • Transport
  • Digital Communications
  • Productivity
  • Housing
  • Infrastructure

This means that now is an excellent time to invest in public procurement. If you would like to find out how you can start to win government tenders, there is more information about this in our Ultimate Guide to Winning Government Contracts.

To find out more about our business and products, visit the BiP Solutions website.

Select a page to copy this section to:

Select where in the level you want it inserted: