Today, (22nd November 2023) the Chancellor, Jeremy Hunt, held the Autumn Statement 2023.

In the Autumn Statement, a £50 million commitment to boost skills and apprenticeships in engineering was announced. A strategic move to empower the workforce and drive innovation in this critical sector.

In a bid to position the UK as an “AI powerhouse,” the Autumn Statement also allocated a substantial £500 million over the next two years to establish additional “innovation centres.”

Additionally, the Autumn Statement introduces a new measure: If, after seeking a job for 18 months, a claimant has still not found employment, they will be required to participate in a mandatory work placement.

In a boost to workers, the National Living Wage is set to rise from £10.42 to £11.44 per hour in April next year, marking a substantial increase of 9.8%.

Responding to the needs of both the self-employed and employees, the Chancellor announced significant reductions in National Insurance charges. For the self-employed, the abolition of Class 2 National Insurance brings relief, while for employees, the rate drops from 12% to 10% starting January 6th.

The government has pledged £4.5 billion over the next five years until 2030 to attract investments in strategic manufacturing sectors. This includes £2 billion for zero-emission automotive projects, £975 million for aerospace, and £520 million for life sciences, with an additional £960 million allocated for the Green Industries Growth Accelerator focusing on offshore wind, electricity networks, nuclear, CCUS, and hydrogen.

Chancellor backs business and rewards workers to get Britain growing

Aimed at building a stronger and more resilient economy, the Chancellor set out a plan to unlock growth and productivity by boosting business investment by £20 billion a year, getting more people into work, and cutting tax for 29 million workers – the biggest tax cut on work since the 1980s.

With higher revenues resulting from stronger growth than previously projected and the pledge to halve inflation having been met, the government has stabilised the economy through taking sound decisions. As set out by the Prime Minister this week, the stronger outlook means taxes can now be cut in a serious, responsible way.

To that end, Mr Hunt announced that a 2 percentage point cut to Employee National Insurance from 12% to 10% will come into effect from January 2024.

Accompanying forecasts by the OBR confirm that today’s measures will make the economy permanently bigger, with growth every year of the forecast period. Borrowing and debt as a share of the economy are lower than in Spring this year and next year, with borrowing also lower on average across the forecast by comparison. They also confirm that inflation is expected to return to target in line with the Prime Minister’s economic priorities.

Tax

With inflation halved and debt forecast to fall, Mr Hunt delivered on the government’s commitment to cut taxes – rewarding and incentivising work as part of its long-term plan to grow the economy.

The main rate of Employee National Insurance will be cut by 2 percentage points from 12% to 10%, coming into effect from January 2024 – delivering the benefit of a tax cut quickly for 27 million workers.
The combined rate of income tax and National Insurance for employees paying the basic rate of tax will therefore fall from 32% to 30% – the lowest combined basic rate since the 1980s.
The rate of Class 4 NICs on all earnings between £12,570 and £50,270 will be cut by 1p, from 9% to 8% from April 2024.
The weekly Class 2 NICs – the flat rate compulsory charge which is currently £3.45 paid by self-employed people earning more than £12,570 – will effectively be abolished, with no-one required to pay from April 2024. Access to contributory benefits will be maintained and those currently paying voluntarily will still be able to do so at the same rate.
The cuts to Class 4 and Class 2 together amount to a tax cut of £350 a year for the average self-employed person on £28,200, with around 2 million individuals to benefit.

Business

Measures to back British businesses big and small will remove barriers to investment and help to bridge the productivity gap between the UK and its G7 peers – unlocking £20 billion extra business investment per year over the next decade.

Permanent Full Expensing will create the certainty that businesses need to confidently invest for less. A company can now permanently claim 100% capital allowances on qualifying main rate plant and machinery investments, meaning that for every pound invested its taxes are cut by up to 25p.
A business rates support package worth £4.3 billion over the next 5 years will help high streets and protect those small businesses that are the backbones of communities. This includes a rollover of 75% Retail, Hospitality and Leisure relief for 230,000 properties and a freeze to the small business multiplier, which will protect around 90% of ratepayers for a fourth consecutive year.
Pension reforms, including through establishing a new Growth Fund within the British Business Bank, will help unlock an extra £75 billion of financing for high-growth companies by 2030 while providing an extra £1,000 a year in retirement for the average earner saving from 18.
SMEs will be supported with tougher regulation on late payers to improve prompt payments, the expansion of Made Smarter in Great Britain and continued funding for Help to Grow.
The existing R&D Expenditure Credit and Small and Medium Enterprise Scheme will be merged from April 2024, simplifying the system and boosting innovation in the UK. 
The rate at which loss-making companies are taxed within the merged scheme will be reduced from 25% to 19%, and the threshold for additional support for R&D intensive loss-making SMEs will be lowered to 30%, benefiting a further 5,000 SMEs.
The Climate Change Agreement Scheme will be extended, giving energy intensive businesses like steel, ceramics and breweries around £300 million of tax relief every year until 2033 to encourage investment in energy efficiency and support the Net Zero transition.

Work and welfare reform

Mr Hunt set out steps to reward work, help make work pay, and reform welfare in recognition of the need to expand the workforce and get those out of work back into work to deliver growth. The OBR expect that the measures announced at Autumn Statement will support a further 78,000 people into work by 2028-29, on top of the 110,000 resulting from action taken at Spring Budget.

From 1 April 2024, the National Living Wage will increase by 9.8% to £11.44 an hour for eligible workers. For the first time this will include 21- and 22-year-olds. This represents an increase of over £1,800 to the annual earnings of a full-time worker on the NLW and is expected to benefit over 2.7 million low paid workers.
The government will also substantially increase the National Minimum Wage rates for young people and apprentices: for people aged 18-20 by 14.8% to £8.60 an hour, for 16-17 year olds and apprentices by 21.2% to £6.40 an hour.
The government is reforming the Work Capability Assessment to ensure that people who can work are supported to do so via the welfare system. Changes to the activities and descriptors will better reflect the greater flexibility and reasonable adjustments now available in the world of work, preventing some individuals from being deemed not fit for work and ensuring they will be better supported into employment.
The boosting of four key programmes – NHS Talking Therapies, Individual Placement and Support, Restart and Universal Support – will benefit up to 1.1 million people over the next five years.
The government is exploring reforms of the fit note process to provide individuals whose health affects their ability to work with easy and rapid access to specialised work and health support.
Mandatory work placements will boost skills and employability for those who have not found a job after 18 months of intensive support. Those who choose not to engage with the work search process for six months will have their claims closed and benefits stopped.

Infrastructure and levelling up

The Chancellor unveiled a raft of supply-side measures and funding packages to benefit businesses and local communities.

£4.5 billion of funding for British manufacturers in the high-growth industries of the future, including £960 million earmarked for the Green Industries Growth Accelerator to support clean energy.
The government has published its full response to the Winser review and Connections Action Plan, which will cut grid access times for larger projects by half, halve the time to build major grid upgrades and offer up to £10,000 off electricity bills over 10 years for those living closest to new transmission infrastructure.
Three advanced manufacturing Investment Zones will be established in Greater Manchester, East Midlands, and West Midlands – together generating £3.4 billion of private investment and creating 65,000 high-quality jobs within the next decade.
The Investment Zones programme and freeport tax reliefs will be extended from 5 years to 10 years, and a new £150 million Investment Opportunity Fund will support Investment Zones and Freeports to secure specific business investment opportunities.
Four new devolution deals across England have been agreed. Mayoral deals with Greater Lincolnshire and Hull and East Yorkshire, and non-mayoral deals with Lancashire and Cornwall, will boost investment right across the country and deliver on the Prime Minister’s commitment to levelling-up.
£500 million of funding over the next two years will help establish two more Compute innovation centres, supporting the development of artificial intelligence as a growth opportunity for Britain.
The life sciences will also be supported as one of the Chancellor’s key-growth sectors, with £20 million to speed up the development of new dementia treatments coming as part of the government’s full response to the O’Shaughnessy Review of commercial clinical trials in the UK.
To prioritise those who want to invest in the UK’s future, the government has accepted in principle the headline recommendations of Lord Harrington’s review into increasing foreign direct investment. This includes additional resource for the Office for Investment, allowing it to deepen its world-class concierge offer to strategically important investors.

A summary of measures to supercharge small and medium-sized enterprises.

To create the conditions for innovative and dynamic businesses to thrive, at Autumn Statement we are setting out an ambitious package of measures to supercharge small and medium sized enterprises as the engine room of the economy.

Digital Adoption Taskforce

DSIT will work with industry to create a taskforce to rapidly identify how best to support SMEs to adopt digital technology to improve their productivity.

Growth Hubs

We are committing to continue funding in 2024-25 for Growth Hubs – the network of 37 local Hubs around England that offer free business support and advice.

A recent independent evaluation of Growth Hubs found that:

Growth Hubs directly support over 140,000 businesses per year, with the average firm receiving over 1 hour of support in 2022-23.
Businesses who engaged with Growth Hubs have better business outcomes than businesses who don’t – they are more likely to seek and secure private finance, experience improved turnover, and strong growth in employment.

Help to Grow

We will continue funding for the Help to Grow Management programme past 2024/25 which helps SME business leaders increase productivity, seize investment opportunities and grow their business. The Management programme has already:

Helped 5,300 business leaders to date – 9 out of 10 participants were satisfied
Addressed skills gap issues. Just 28% of participants felt they had the skills to manage their employees before the programme. This increased to 75% post-completion

Future Fund: Breakthrough

The Government has announced an extension to the Future Fund: Breakthrough investment programme of at least £50 million from 2024/25, helping the UK’s most R&D intensive companies to scale up.

This will benefit R&D-intensive companies looking for growth funding

Future Fund: Breakthrough invests directly into UK-based companies working in R&D-intensive areas, such as deep tech & life sciences.

The programme is designed to increase the supply of growth stage venture capital to R&D intensive companies and was launched with £375 million at March Budget 2021.

Tax relief for R&D intensive SMEs

The government is legislating the enhanced tax relief for R&D intensive SMEs that was announced at Spring Budget 2024. Companies claiming the existing SME tax relief will be eligible for a higher payable credit rate of 14.5% if they meet the definition for R&D intensity.

For every £100 spent on R&D, eligible SMEs will receive a cash value of around £27. This is compared to £16.20 for non-R&D intensive loss makers in the merged scheme.
The intensity threshold is being reduced, meaning loss-making SMEs with a qualifying R&D expenditure of 30% rather than 40% will now qualify for the more generous support. This will provide £65 million of support to around 5,000 extra SMEs.
A one year grace period will be introduced, which means that companies who dip under the 30% threshold will continue to receive relief for one year. This will provide certainty to businesses and is worth an extra £25 million by the end of the scorecard.
In total, these changes are worth an additional £90 million p.a. at the end of the forecast period.

The £1 million Annual Investment Allowance, helping companies invest for less

The £1 million Annual Investment Allowance allows SMEs to invest for less by allowing them to deduct 100% of the cost of main rate plant and machinery from their profits before tax, up the value of £1 million.

Since the introduction of the super deduction – the predecessor to full expensing – in 2021, investment in the UK has grown the fastest in the G7.
The £1 million Annual Investment Allowance covers 99% of businesses.
The AIA has been set permanently at £1 million since Autumn Statement 2022. It exists in addition to permanent full expensing, which predominantly helps larger businesses, and is the biggest permanent business tax cut in modern British history – worth over £50 billion over the next five years.
The autumn statement is expected to help unlock growth and productivity by boosting business investment by £20 billion a year and getting thousands more people into work.

Sector Response

Science, Innovation and Technology Secretary, Michelle Donelan, said:

“I believe that the UK’s incredible science and tech success story is all about having the skills for the future, investment in scale-up and sensible regulation.

“The Chancellor’s Statement injects even more fuel into our science and tech economy – and will help to realise my vision for a country where more high value British jobs are driving us faster toward amazing discoveries that will help us live longer, healthier, happier, easier lives.”

Geoff Barton, General Secretary of the Association of School and College Leaders, said:

“We are bitterly disappointed that the Autumn Statement contained barely a mention of education – particularly as the Prime Minister explicitly said in his speech to the Conservative Party Conference in October that his main funding priority in every spending review will be education because it is the closest thing we have to a silver bullet.

“Our schools are literally falling apart, thousands of children are being disrupted because of the crumbling concrete crisis, and large parts of the school estate are riddled with asbestos. Schools and colleges don’t have enough money to meet the likely cost of future pay awards at anything like the level which is needed to address severe and chronic staff shortages, and funding for special educational needs provision is miles short of what is needed to support our most vulnerable children and young people. Yet, none of these problems have been mentioned at all, let alone made a priority. It is lamentable.

“The Prime Minister said that education is the best economic policy, the best social policy and the best moral policy. It was clearly too much to hope that this rhetoric would translate into reality in the Autumn Statement.”

David Hughes, chief executive, Assoication of Colleges, said:

“The Autumn statement today included little for further education, despite the Chancellor claiming it was a plan for growth. The forecasts of very low economic growth for the next couple of years should have been a signal for the need to invest more through colleges in meeting the skills needs and filling the skills gaps that are holding employers back.

The Chancellor’s plans assume that public revenue spending will increase by just 1% a year in real-terms for the next few years. That looks worrying for college funding given the commitments to increase NHS, childcare and defence spending because it implies spending rising by less than real-terms – in other words cuts – in other budgets. That will mean pressure on DfE to cut funding in further education, a sector which has lived through a decade of funding neglect, and one which needs significantly more funding to tackle the pressing issues of teacher recruitment and retention, predicted student growth and qualification reforms. Colleges could play a much bigger role in growing the economy, particularly in the focus areas the Chancellor has identified today, but with funding squeezed further, they will struggle to realise that potential.

“It is interesting that the Chancellor felt the need to announce a modest increase of £50m to increase the number of apprenticeships in engineering and other growth sectors. That goes alongside the welcome increase in the minimum apprenticeship wage announced yesterday. But both of these fall far short of what is needed to maximise the impact of apprenticeships and of the investment needed to boost economic growth through skills.

“I would like to see much more ambitious investment in skills for adults and young people as well as changes to the apprenticeship levy which we set out in our Opportunity England paper, for instance spending at least half of the levy on apprenticeships for younger, new job starters and entry level jobs, and requiring more transparency from employers on how they use the levy.”

Daniel Kebede, General Secretary of the National Education Union, said:

“The economy is struggling to achieve growth, and the Government has downgraded its own growth forecasts in today’s statement. Investing properly in education is an urgent and overriding economic priority, yet what we have seen today is nothing of the sort.

“Just 3.9% of UK GDP is spent on education, compared to the OECD average of 5%. This was highlighted to Jeremy Hunt in a letter earlier this month from the leaders of four education unions, including the NEU. The Chancellor’s response is completely inadequate and makes a mockery of the Prime Minister’s repeated claim that education is at the heart of this Government’s priorities.

“It should be of great concern to Jeremy Hunt that 92% of mainstream schools will be unable to cope with cost increases in 2024/25. For 99% of secondary schools and 91% of primary schools, cuts to education provision are now inevitable.

“These schools have already seen years of under-investment, and in far too many cases school buildings have drifted into serious disrepair. The Chancellor couldn’t even bring himself to fund urgent work on the school estate, following the RAAC scandal which has brought such embarrassment to this Government. This would require at least £4.4bn per year.

“With underfunded and understaffed schools and colleges, and school buildings crumbling, the Government must prioritise investment in schools and colleges and fund a fair pay rise for staff next year. Teachers and support staff have seen their living standards hammered since 2010. Our member surveys show that a majority are ‘very’ or ‘extremely’ worried about keeping up with household bills. They have been hit even harder by pay cuts against inflation than other workers, creating major recruitment and retention problems.

“More of the same is not good enough – and it certainly fails parents and young people, too. In order to recruit and retain the teachers that we so clearly need, the Government must demonstrate they value them. That means an urgent, properly funded and major correction in pay, alongside the investment needed to reduce sky-high workload and to make school and college buildings fit for purpose. The Chancellor’s statement does nothing to repair the damage caused by 13 years of Conservative cuts. The Government will pay a heavy political price for continuing to ignore the problems it has created for educators, parents and young people.”

Elizabeth Taylor, Chief Executive, ERSA:

“The announcements for employment support in the Autumn Statement offers some stability for national provision in England and Wales with the two year extension to Restart.

“However, the tone around some of the announcements mean the sector has to rise to the challenge of delivering objective and quality provision that jobseekers want to engage with. The sector can and will do this by getting people into good jobs that are right for the individual.”

Paul Whiteman, general secretary at school leaders’ union NAHT, said:

“Yet another education promise has been broken immediately after being made.

“Far from being prioritised, as pledged by the Prime Minister at the Conservative conference, education has apparently been sidelined in this announcement.

“There was virtually nothing pledged for schools, and this statement did not touch upon the big challenges facing them, including severe funding pressures, the broken SEND system, and building safety.

“It will not help schools to meet the continuing challenge of inflation, recruit and retain staff, plug the chasm between the needs of SEND pupils and available funding, or repair or rebuild outdated and unsafe buildings.

“If this government expects schools and families to have any confidence it is serious about children’s education, we need to see action, not just empty words and promises.”

TUC General Secretary Paul Nowak said:

“This is not a plan for rebuilding Britain. It’s a plan for levelling the country down.

“At a time when our schools and hospitals are crumbling – the Chancellor has confirmed another round of punishing and undeliverable spending cuts to public services and investment.

“Be in no doubt – if the Tories win the next election, even more austerity is on the way.

“Cutting national insurance won’t make up for 13 continued years of economic failure on wages and living standards.

“Jeremy Hunt has nothing to smile about when working people are on course for a 20-year real wage freeze.

“The Conservatives have broken Britain. They cannot be trusted to fix it.”

Simon Hochhauser, CEO of PiPcall:

“Jeremy Hunt’s announcement that the Government will spend millions of pounds on building homes, busting the planning backlog and supporting local authorities is welcome news. But it’s disappointing there was not more focus on the construction sector. The industry’s role in boosting the UK’s prosperity should not be underestimated – from improving energy efficiency to building new homes and buildings for our public services – construction businesses large and small underpin the country. And yet, it’s no secret that amid economic challenges and rising interest rates, the industry as a whole is facing its most notable downturn since the pandemic.

“While we need the government to consult with construction leaders more frequently and allocate more funding to the sector, businesses themselves can put their best foot forward in this turbulent economy. A major factor holding back the construction industry’s productivity is outdated business communications, hindering information sharing, team collaboration, exacerbating supply chain delays, and culminating in wasteful spend. A robust digital infrastructure that prioritises mobile is fundamental. With a range of emerging mobile innovations now available, poor communication on-site should not be the thing that stifles industry progress.”

An expert from Dojo, a small business and enterprise payment solutions provider, commented:

“The permanent “full expensing” scheme will be a positive move for business owners across the country, allowing companies to continue to claim back 25p for every £1 invested in the UK. A change that is needed as businesses across the country struggle to expand.

“This could really help support further growth in the UK economy by helping businesses invest in resources and equipment. It may also encourage new businesses to take steps to launch if they are subject to corporation tax. All of which could be paramount in contributing to the future of the economy.

“Extension to the scheme will mean that support will continue beyond April 2026, meaning a £10 billion-a-year tax break for businesses. However, whilst this will support new businesses and businesses wanting to expand, there are still pressing issues for many SMEs across the country. The ongoing cost of living crisis remains a key concern for many business owners, especially alongside ongoing implications from Brexit. Many small business owners will still be calling on the Chancellor to further reduce business rates and provide better support for businesses during the winter period.”

Nicholas Hyett, Investment Manager at Wealth Club commented;

“The announcement that the government is extending the VCT and EIS sunset clauses out to 2035 is good news for two schemes that have supported billions of pounds worth of investment into UK start-ups. It removes uncertainty that has been lingering over the sector for some time, potentially putting off new entrants and new investors, and secures a crucial source of funding for the UK’s blossoming start-up scene.

It is a shame that the sunset clause hasn’t been abolished altogether – which would have avoided a repeat of the current uncertainty in a decade’s time – but with the Labour Party also voicing support or the schemes the extension is welcome nonetheless.”

Ben Harrison, Director of the Work Foundation at Lancaster University said:

“The Autumn Statement represented the Chancellor’s last chance to improve working lives across the UK and help grow the economy before the next General Election.

“The headline 2p National Insurance cut will be welcomed by workers struggling with rising prices, but the Chancellor is giving with one hand and taking away with another by continuing to freeze tax thresholds.

Raising benefits and wages

“It was positive that the Chancellor chose to prioritise boosting the incomes of 1.6 million workers on the minimum wage via a 9.8% increase to the minimum wage to £11.44 per hour and confirmation that benefits will be uprated by 6.7% – in line with September’s inflation rate.

“But let’s be clear – the cost of living crisis continues to hit the most vulnerable in society – especially the 6.2 million people in insecure work. Food inflation remains above 10%, and energy prices are likely to rise. And the UK still has one of the lowest levels of unemployment benefits in the OECD, at just 17% of the recipient’s previous income levels.

Tax incentives for businesses – no strings attached

“While the Chancellor introduced a series of tax allowances to incentivise business investment, these allowances will not come with any requirement for businesses to improve the quality of jobs they offer via increased pay or strengthened terms and conditions for their workers.

Employment support – strings attached

“This stands in stark contrast to the additional employment support measures on offer. It is welcome to see more funding for dedicated employment and health support for those currently out of work. But, if individuals cannot find work after two years, their welfare case would be closed, their benefits withdrawn entirely and their access to wider services such as free prescriptions and legal aid ended.

“Even the Department for Work and Pensions’ own evidence from 2020 suggests sanctions are not effective and slow people’s progress back into work. The reality is these measures will likely only serve to heighten anxiety amongst already very vulnerable people.”

Naomi Phillips, deputy chief executive at Learning and Work Institute, said:

“Today’s Autumn Statement talks about taking decisions for the long term, but for benefit claimants this is more rhetoric than evidence. While expanding schemes to support more people into work are welcome, L&W’s new analysis of Understanding benefits questions the effectiveness of sanctions in the benefits system. To plan for the long term, we need much greater access to high-quality employment support, investment in skills, and support for employers on job design and recruitment. Then we could see a boost to the UK economy of £23 billion a year.”

Rachel Solomon Williams, Executive Director at the Aldersgate Group, said:

“This Autumn Statement takes some positive steps forward, but higher ambition and policy stability are critical if the Government is to get the economy back on track in the coming year. Ultimately, making decisions for the long term demands a commitment to implementation now, supporting the development of low-carbon industries that will drive future growth. Businesses recognise this and are acting accordingly – Government must match their ambition by building on today’s announcements and creating a supportive environment.

We welcome the announcement that capital full expensing will be made permanent, as it can drive business investment in decarbonisation – but it is not enough on its own. This urgent need for action is demonstrated in clean energy investment, where the UK has fallen from fourth to seventh in attractiveness to investors, in part due to global competition from the United States and the EU, but also a lack of consistent policy support from the Government. A comprehensive response to the US Inflation Reduction Act remains critical, as part of a clear industrial strategy which provides the UK economy with a clear direction that businesses can rely on. Funding for engineering apprenticeships is also a welcome development, but should be expanded further to include support for on-the-job learning, in order to address the green skills gap holding back the net zero transition.

Finally, it is good to see Government announcing the aim of reducing grid access delays by 90%, an absolutely critical element of delivering net zero. To ensure that we meet our climate and nature ambitions, it is vital that we see planning reform that takes a holistic approach to supporting the net zero transition, housebuilding and restoring nature.

Neil Carberry, REC Chief Executive, said:

“The Chancellor has taken some significant pro-business steps today, but the downgraded growth forecasts prepared by the OBR show the scale of the challenge he faces. We need to get the UK powering on all its cylinders to really make progress. And we should remember that – despite today’s news – we are still heading for a post-war high on the tax burden over the next few years.

“Reducing employees’ NI is a great way to make work pay – and we also welcome the extension of the Restart programme and reform of fit notes as these steps will help ensure that we make the most of the UK’s labour force. Extending Restart was a key REC aim – it is a programme that effectively harnesses joint working between public and private sectors to get people into work.

“Making full expensing permanent is also great news for business and will drive investment – but only in the sectors that can really benefit from it. Services firms – the bulk of the economy – benefit far less. That’s why freezing the small business multiplier on business rates was an important step, especially when the substantial rise in the minimum wage will stretch many firms after a year of low growth and higher wages already. Changes to national insurance for the self-employed will help, too.

“By delivering real terms cuts in public investment, the Chancellor has put the ball into the private sector’s court. It is for business to drive growth, we agree. But the public sector must provide a framework. We saw some of that today in the support and incentives on offer – but it does not yet add up to the industrial strategy the country really needs. And in some areas – like skills – the investments announced today were woefully inadequate. Really engaging with firms on apprenticeship levy reform is long overdue.”

Russell Dean, Residential Product Group Director at Mitsubishi Electric:

“This Autumn Statement presented a major opportunity for the government to address the interlocking cost-of-living and energy crises. The introduction of a ‘green stamp duty’ would have been a step in the right direction to spur investment in energy efficiency, but it sadly didn’t make an appearance in the Chancellor’s bumper wedge of announcements.

“Fundamentally, the nation needs to firmly keep on the path to achieve Net Zero by 2050. In an Ipsos report commissioned by Mitsubishi Electric, 80% of respondents agree that the government has a responsibility to act to reduce carbon emissions, and 41% say the government should set a deadline for decarbonisation of the economy.

“Planet and wallet-friendly policies don’t have to be mutually exclusive. There are savings to be made on the running costs of fossil fuel boiler alternatives, such as heat pumps over their lifecycle. Decoupling the cost of electricity from gas, could bring immediate savings for households if the government were to take this step. And this is before we include the heat pump grant of £7,500 available to homeowners to install a heat pump. On top of this, the government must set an end date to the installation of fossil fuel boilers and should increase the support for training of more heat pump installers if we are to hit our ambitious Net Zero targets and decarbonise home heating.”

Tony Wilson, Institute Director at IES, said:

“As we said last week, there’s a lot of welcome news in today’s Autumn Statement, with an extension of support for long-term unemployed people, more investment in specialist help for those with long-term health conditions and an expansion in access to talking therapies. However set against this, these measures are being more than offset by very significant cuts to benefit entitlements for people with long-term health conditions. Overall, over the next five years the government expects that its changes to the Work Capability Assessment in Universal Credit will save around £2.8 billion, with just £2.6 billion of this being reinvested in additional support. It’s hard to escape the conclusion that the government is giving with one hand but taking even more away with the other.

“Alongside this though, the government has also announced very significant cuts to employee National Insurance, which will cost nearly £10 billion a year by the end of the forecast period and lead to the equivalent of around 100 thousand more people in employment. This is welcome news for those in work, and lower labour taxes also generally support higher employment. However the evidence suggests that these positive impacts tend to be particularly driven by people increasing working hours rather than more people entering employment.

“Finally, today’s announcements also confirm that the sanctions and workfare measures that were briefed so heavily last week will be all-but non-existent in practice. We think that the government is costing for at most one in ten of the long-term unemployed being placed on a mandatory work placement, while the proposal to close claims for those under longer-term sanctions appears to actually have been scored as a cost to taxpayers rather than a saving. These were bad ideas, so we’re relieved that the reality won’t quite match the rhetoric, but as we said last week the rhetoric itself will have been pretty damaging.”

Lee Parkinson, chief executive at Efficiency North

“As ever, it’s encouraging to see additional measures put in place during the autumn budget to ensure further uptake and reach of apprenticeships across all sectors. I believe we’ve passed a tipping point whereby apprenticeships are now a truly viable option particularly for advanced and managerial roles; however, this is only achieved through proper flexibility.

“Having successfully employed 500 apprentices over a 10-year period, we’re acutely aware of the need for constant innovation in apprenticeship models to make it an attractive option for both apprentices and businesses. Without the right flexibility and support, such as the EN:Able Futures model, many wouldn’t even consider the route.

“The proposed £50m investment in the two-year pilot is welcomed, but it must be used to address barriers to these training opportunities through innovative solutions, especially for higher level training at level 4 and above.”

EngineeringUK responds to Autumn Statement 2023

“The chancellor highlighted the importance of skills in his autumn statement, yet there was little to address widespread issues in the skills systems. We welcome the modest announcement of £50 million for engineering apprenticeships, but are concerned that this is limited to a two-year pilot to explore ways to stimulate training in these sectors and address barriers to entry in high-value standards.

“As outlined in our recent report ‘Fit for the Future’, we need large scale investment in getting more apprenticeships for young people off the ground now and to ensure that the country has the engineering and technology workforce it needs for the future. We urge the government to take a bolder approach.”

Hetti Barkworth-Nanton, CEO of Ploughshare

“The Autumn Statement is a welcome moment for high-innovation businesses.

“The new British Business Bank Growth Fund and additional funding under the Long-term Investment for Technology and Science (LIFTS) initiative will drive investment into UK science and technology, complementing the Government’s record public R&D budget commitment. The measures further advance on the Chancellor’s Mansion House Compact to boost the supply of investment capital to grow high-potential businesses.

“Altogether this drives forward the government’s ‘science superpower’ ambitions through helping spin-outs and start-ups bring their innovations to market.

“Crucially, these measures will help to support the conversion of world-class research into new, world-class companies, which has been a long standing issue in the UK. This will not only support the innovations that could solve the challenges of today, and the future, but also unlock billions of pounds of untapped assets and growth in our economy.

“Through our work with some of the most exciting spin-outs emerging out of public sector research, we know that carefully considered equity stakes can make a huge difference to the pace and ambition of spin-outs – something we recognised at Ploughshare two years ago and it’s been game-changing. As such, we welcome the recommendations of the Independent Review of University Spin-out Companies on how we can improve the commercialisation of university research.”

IPPR North Director, Zoë Billingham, said:

“This felt like the last chance saloon for the Chancellor to show serious commitment to our regions. Levelling up language might be back but the overall offer for our regions in today’s Autumn Statement was lacklustre.

“We welcome the newly announced devolution deals, simplified funding in some areas and more powers for selected counties. Extending investment zones to 10 years and to new areas shows promise. But in making real-term cuts to public investment, the government risks undermining any progress on their flagship agenda.

“Overall, it seems like the government is on ‘go slow’ when time is running out to address regional divides and turbo charge our whole economy.”

Dr Marc Warner, CEO of Faculty:

“As the CEO of a British-founded AI company, it’s encouraging to hear the Chancellor announce an additional £500 million in funding for the sector over the next two years.

AI is already at the heart of this country’s growth and will be one of the defining technologies for global productivity in the coming years. For these reasons, funding further innovation centres to build on the success seen in Edinburgh and Bristol will only help to move us further towards better public services, better performing companies, and more empowered individuals.

More statements of intent like the £100 million investment in and creation of the AI Safety Institute, alongside the AI Regulatory Sandbox planned for next Spring, are needed to ensure innovation is balanced with safety.

I see this commitment from the UK Government as another positive step along the Yellow Brick Road – a path to safely harnessing the technology’s vast benefits whilst managing its risks. What’s crucial now for governments, businesses and individuals is to continue making good choices – and that means safe, connected, and human-first AI.

Choosing safe AI means using the technology in a narrow way to solve specific problems. Connected AI means not building models in isolation and ensuring central governance across systems and processes. Finally, human-first AI should support people in making critical decisions – not replace them. Humans should always be in control of what an AI system is doing.”

Dr. Paul Pallath, VP -Applied AI practice at global cloud and computing service provider, Searce, comments on the encouraging news of the government investing in AI:

“Engaging a diverse group of voices is essential, including ethicists, field experts and those in surrounding communities that AI deployments might impact. By working together, we gain a deeper understanding of ethical concerns and viewpoints and develop AI systems that are inclusive and respectful of diverse values.

GenAI has revolutionised the enterprise landscape, ushering in an era of accelerated innovation and productivity. Its transformative impact is felt across various industry verticals, particularly in enterprise search, software development, and customer engagement.

In the domain of enterprise search, GenAI has democratised access to information by enabling direct querying of digital content, regardless of its location within the enterprise. This has significantly enhanced decision-making, expedited issue resolution, and bolstered overall enterprise productivity by an average of 30%.

For software developers, GenAI serves as an invaluable wing mate, accelerating development timelines, reducing errors, and improving code readability. This has led to striking productivity gains of over 55% for developers using GenAI compared to those who don’t.

In essence, GenAI has unlocked new levels of productivity, creativity, and customer engagement within the enterprise. It is not merely a tool; it is a driving force shaping the future of work, empowering businesses to achieve unprecedented levels of efficiency, innovation, and customer satisfaction.”

Sir Peter Lampl, Founder of the Sutton Trust and Founder of the Education Endowment Foundation, said:

“It’s positive to see investment in apprenticeships, along with broader efforts to put apprenticeships and academic learning on an equal footing. However, £50m over two years, for a pilot focused on a narrow set of sectors, is a drop in the ocean. These pilots should be targeted at creating opportunities for young people, particularly those from disadvantaged backgrounds.

“It’s also disappointing that no new investment was announced for the UK’s education system, despite the ongoing funding crisis. Over the past decade we’ve seen school funding eroded, teachers leaving the profession, the pandemic having widened the attainment gap, the cost-of-living crisis impacting low-income young people and most worryingly persistent school absence.

“We need a national strategy to close the attainment gap and a set of evidence-based policies, such as the National Tutoring Programme. Today was a missed opportunity to create more opportunities for young people.”

Anthony Painter, Policy Director at the Chartered Management Institute, said:

“CMI welcomes the Chancellor’s focus on growing the economy through increased support for businesses both large and small. Investing in a skilled workforce will be key to that growth and we are pleased to see an increased investment in apprenticeships in areas with key shortages. We also encourage the Government to explore further tax measures to help employers make further necessary investments in skills.

“The evidence tells us that UK employers continue to hesitate to fund meaningful, long-term training. A mixed approach of mandated investment through the Apprenticeship Levy and new incentives such as through further tax relief for standards-based training would be a welcome added intervention. Both measures, combined, would send the strongest possible message to employers that investing in people is vital to improved productivity.

“The UK skills gaps, including the significant shortage of skilled managers in our economy, will not be addressed without this concerted, longer term approach to upskilling our workforce at every age and stage of people’s working lives. Quality, standards-based training such as management apprenticeships have been shown to deliver significant productivity gains and are playing their part in delivering both high-performing businesses that grow our economy and world-class public services that people can rely on throughout their lives.”

Ben Blackledge, WorldSkills UK Chief Executive, said:

“WorldSkills UK welcomes the Chancellor’s Autumn Statement today and its focus on the commitment to increase apprenticeships in key sectors such as engineering that are held back by skills shortages.

“We know from benchmarking against other leading economies such as South Korea and France that the development of world-class skills is vital for the international competitiveness of our leading sectors, to help create high quality, high wage jobs for the next generation.

“Research commissioned by WorldSkills UK shows that fewer than three in five young people in the UK would consider a career in manufacturing, while well over half of manufacturing employers are experiencing a skills shortage.

“That’s why WorldSkills UK is already pioneering world-class skills in areas such as additive manufacturing, industry 4.0 and industrial robotics, to demonstrate that skills in advanced manufacturing can lead to prestigious and well-paid jobs.

“We look forward to working with educators, independent training providers and employers on the Government’s new long-term sector strategies, by making sure young people have internationally competitive skills that can attract inward investment and boost productivity for employers, across all sectors, in all parts of the UK.”

Ben Rhodes, CBI South West Director, said:

“With tough decisions to be made, the Chancellor was right to prioritise ‘game-changing’ interventions that will fire the economy.

“While the move on National Insurance will give hard-pressed households some much needed breathing room, making full capital expensing a permanent feature of the tax system can be transformational for accelerating growth and improving living standards in the long-term.

“Helping firms to unleash pent-up investment is critical to getting momentum into the economy. Making full expensing permanent will give firms the stability they need to press on with decisions on investment whilst keeping the UK at the top table internationally for investment incentives.

“Moves to speed up planning and grid connectivity should also bolster business confidence to invest in high growth areas like green technologies, renewable energy and advanced manufacturing.”

Torsten Bell, Chief Executive at the Resolution Foundation, said:

“Today the Chancellor used an inflation-driven surge in tax receipts to go early on pre-election giveaways – announcing the biggest package of tax cuts since 1988. In doing so, the Chancellor has rightly prioritised workers’ earnings and firms’ investment plans. Raising the Local Housing Allowance will also help 1.6 million households struggling with surging rents.

“But the truth is taxes are up not down. Today’s cuts are dwarfed by tax rises already underway. By the end of this decade taxes are set to be up by the equivalent of £4,300 per household compared to 2019.

“Worse, the giveaways announced today are funded by handing whoever wins the next election implausibly large spending cuts. Tax cuts to boost business investment are welcome, but undermined by plans to cut public investment by over a third – it’s hard to think of a more anti-growth policy.”

Dr Maya Singer Hobbs, senior research fellow at IPPR, said:

“On the eve of COP28, this budget had nothing on net zero. Instead, it kicks the can down the road on climate, leaving a deferred problem for future generations.

“With the exception of some changes to the planning system to speed up grid connections, this budget had several glaring omissions – nothing remotely close to echoing the investment seen in the US and EU on green investment, nothing on providing active travel options, and nothing on energy efficiency.”

Josh Emden, senior research fellow at IPPR, said:

“A week ahead of COP28, the Autumn Statement largely failed to deliver anything that looked like global leadership on net zero. Even with commitments to green manufacturing the UK is already being severely outcompeted by its neighbours.

“Tweaks to the planning system to accelerate EV charging infrastructure and heat pump deployment are welcome, as are reforms to speed up grid connections for renewable energy developers.

“But there is nothing new at all on funding for energy efficiency or clean heat despite having some of the worst housing stock in Europe – there is currently only enough public funding to install around 60,000 heat pumps over three years, compared to public support in France which last year alone saw over 600,000 heat pumps installed.”

On the Chancellor’s tax measures, Sam Robinson, SMF Senior Researcher said:

“Today’s cuts to National Insurance rates barely touch the sides of the tax increase from frozen thresholds, meaning they aren’t really a ‘cut’ at all for many households. But these changes do represent a welcome rebalancing of personal taxes, shifting away from national insurance towards income tax, which covers a broader range of earnings including pensions and rental income.

Out of all the Autumn Statement’s measures, full expensing has by far the biggest potential to stimulate economic growth. But given the big price tag associated with the tax cut, and OBR projections that business investment will decrease as a share of GDP, it is vital that full expensing is rigorously monitored to ensure it is as effective in the real world as it looks on paper.”

From a fiscal point of view, the tax cuts announced today are built on sand. Most of the headroom the Chancellor used to deliver them was based on departmental spending projections that seem implausibly low and that few people think can be met. To deliver good news today, Hunt may be kicking the bad news down the road.”

On the neglect of skills and education, Dani Payne, SMF Senior Researcher, said:

“Given the Chancellor’s ambition to build a world-class education and skills system, it is disappointing to see core school spending per pupil being held flat in real terms, and little else announced to support our young people.

The announcement of modest additional funding for apprenticeships is welcome, however it is unlikely that what the sector really needs is a new pilot scheme, as opposed to a whole-sale reform to bring together our post-secondary education systems, encourage growth in technical education and tackle the unproductive competition between HE and FE that leaves both sectors fighting for pupils and funding.

If the government is to truly grow the supply side of the economy, human capital and skills must be at the forefront of our plan for growth and schools, addressing funding and staffing crises to deliver the next generation of skilled young workers and help those already in work to upskill and retrain.”

On measures for long-term unemployment, Jamie Gollings, SMF Deputy Research Director said:

“The Chancellor’s £2.5bn for the long term unemployed, equivalent to roughly £1,500 a head per year, comes with the threat of mandatory work placements and benefits being removed if claimants don’t engage. That will send a shiver down the spine of those off work with mental health issues and disabilities, causing them anxiety that could set people back in their recoveries and push them even further from the job market.

Most of those off work with mental health issues and disabilities want to get back into work, and the investment in such programmes is welcome. Working with employers to build forms of employment that can work around people’s conditions, from remote working to ‘stress-freelancing’, would help to create those routes. Better to do so with a supportive atmosphere that fosters rather than stifles recovery.”

On support for business growth, John Asthana Gibson, SMF researcher said:

“The Chancellor taking forward the Mansion House reforms is a positive outcome from today’s Autumn Statement. Measures that put more cash from pensions funds’ deep pockets into growth hungry scale-ups should be encouraged, and the Government’s intention to channel greater institutional investment through the British Business Bank, something the SMF has called for, should receive particular praise.

However, high growth business not only need to be well-financed, but well-staffed with talented and capable workers to succeed. A lack of human capital, not the financial sort, is the greatest barrier holding back companies in Britain today, and the Chancellor’s lack of ambition to develop the UK’s skills base with significant investments in education and training will weaken the effectiveness of these measures.”

On planning reforms, Gideon Salutin (SMF researcher) and Jamie Gollings (SMF deputy research director) said:

“A permitted development right to convert single family homes into duplexes is a good idea on paper. Yet such measures have been tried in a number of cities, including Brisbane, Chicago, New York, and Toronto, without increasing actual housing supply because they were not combined with appropriate targets and strict regulations.

If the government really wants to increase housing supply, it will need to undertake more ambitious planning reform to fast-track large housing projects that maximise the number of units permitted on a lot, and twin this with tight affordability rules to ensure that new capacity genuinely drives down costs.

Other housing measures in the statement are similarly welcome, but not enough to address the crisis. £450m to the local authority housing fund to deliver 2,400 new homes is a drop in the ocean compared to the scale of social housing waiting lists, while faster processing times may speed approvals but fail to greatly increase stock.”

On green investments, Gideon Salutin, SMF researcher said:

“The Chancellor’s announcement of £4.5 billion through 2030 is a welcome move in the right direction, but is too small. By comparison, the US is pouring over £300 billion into green manufacturing, Japan is offering £120 billion in long term bonds.

Our research benchmarking global green investment shows that the UK would need to immediately budget at least £54 billion over the next ten years – over 12 times the current offer – to match peer countries. The Chancellor has taken a first step by acknowledging the problem, but until he makes larger commitments, the UK will remain a step behind.”

On investment zones, Gideon Salutin said, SMF researcher said:

“Today’s announcement increased the number of investment zones and the length of time they receive subsidies, but failed to increase the money annually being transferred to local authorities. At present, investment zones receive just £16 million annually, increasing average local budgets by just 7.4% according to our research.

Local authorities outside London want to attract more investment, but to do so they need more startup cash. The £16 million cap is too small, and should be boosted by creating a larger funding stream for local authorities or by giving them new financial powers. Extending the program may help reassure private investors, but the major transformations the chancellor is promising cannot be achieved without deeper reform.”

On public sector productivity, Niamh O Regan, SMF researcher said:

“The UK’s public sector productivity has been poor for over two decades, growing just 4% between 1997 and 2018, and so planning to grow this by 0.5% a year, while welcome, is very ambitious. There also appears to be a stark contrast between the Government’s plan for boosting productivity in private and public sector.

The Chancellor said that productivity in other countries is higher due to investment, but this diagnosis seems to be limited to the private sector. The Government plans to improve public sector productivity, largely through adopting new technology, to cut bureaucracy and resolve administrative tasks faster for both the police and the NHS. Technology can help, but doing it well will require up-front investment in time and resources. Trying to do it on the cheap is bound to fail.”

On support for small businesses, Richard Hyde, SMF Senior Researcher said:

“A big impediment to smaller firms investing for growth is cashflow. Without adequate resources at hand investment in capital and workers by entrepreneurs in their small business has to be put off, again and again.

One of the most common and significant constraints on SME cashflow is late payment by customers. It has been estimated that half of invoices issued by SMEs are paid late. The problem has been worsening, with more than £23 billion outstanding and owed to small firms according to the Government in 2022. Research has suggested that as many as 50,000 firms could be going out of business each year because of the culture of poor payment practices in the UK.

The government wants an investment boom in the UK. To achieve that, it is imperative that small firms do not suffer from unnecessary cashflow problems. That is why the announcement in the Autumn statement to use public sector procurement to put obligations on contractors to pay their suppliers on time is welcome. However, it should only be seen as a start. Many businesses in the private sector are late payers too, and these will be unaffected by these measures. A more ambitious agenda is needed.”

On the pensions pot-for-life, Aveek Bhattacharya, SMF Interim Director said:

“Moving from an employer-led pension system to one where each individual has their own ‘pot for life’ could help avoid the clutter and inconvenience that many of us have experienced from accumulating multiple – often small – pots from different jobs. More fundamentally, it could shift the onus for pension savings from bosses to workers, which has the potential to boost engagement, personalisation and value for money.

A forthcoming paper from the Social Market Foundation will explore these issues, and we look forward to informing the consultation announced today.”

Paul Johnson, Director of the IFS, said:

“That was not the quiet Autumn Statement we were promised. Before assessing the specifics, it’s worth getting a few things straight. The public finances haven’t meaningfully improved. The growth outlook has weakened. Inflation is expected to stay higher for longer. Higher inflation pushes up tax receipts by more than it pushes up spending on debt interest or social security benefits; but rather than use the proceeds to ease the ongoing ‘fiscal drag’ effects of threshold freezes, or to compensate public services for higher costs, the Chancellor opted to cut other taxes. His immediate cut to National Insurance will put more money into workers’ pockets when it comes in but won’t be enough to prevent this from being the biggest tax-raising parliament in modern times. These cuts will also not stop tax revenues rising to their highest ever levels. The “full expensing” cut to corporation tax is a welcome extension of the temporary cut announced in March and, alongside a slew of other reforms, does indicate that this was an event focused on medium term growth as well as a pre election giveaway.

“Announcing immediate tax cuts in response to highly uncertain changes in assumptions about the UK’s medium-term economic prospects does not feel like a recipe for good management of the public finances, especially when some extra “space” is opened up by announcing another year of very low increases in public service spending, and cuts in investment spending, which may prove hard to deliver.

“This may turn out to be risky even in the short run. His so called “headroom” against a rather loose fiscal target is minuscule and the OBR could easily take it away in the Spring Budget with some very small changes to forecasts. What will he do then? Certainly, whoever is Chancellor after the next general election is going to have very little room for manoeuvre.

“All that being said, if the Chancellor was determined to cut taxes, he has picked a pretty sensible set of taxes to cut. Making full expensing permanent rather than temporary is welcome. Cutting rates of National Insurance is preferable to cutting rates of income tax and may help boost employment. But these tax cuts have been ‘paid for’, in effect, by letting fiscal drag become even more of a tax rise than previously expected and through a bigger squeeze on the real-terms value of public service budgets and an even bigger squeeze on public investment, which is frozen in cash terms. There’s a material risk that those plans prove undeliverable and today’s tax cuts will not prove to be sustainable.”

UCU general secretary Jo Grady said,

“This Autumn Statement is yet another missed opportunity to address the crisis in our public services. The statement says ‘Long-term investment in human capital is crucial for growth and productivity’ – this government has a funny way of showing it.

“Further education, for so long a Cinderella service, gets some warm words, and while the promised £600m ‘downpayment’ over two years sounds like a big number, it won’t go very far given all the things the Chancellor says it will have to cover. Ministers don’t understand further education. They don’t consider it a priority because they don’t send their kids there. It’s simply not a service that people like them use. The truth is that more than a decade of underfunding has hollowed out provision by driving down pay to the point where many leave the sector simply because they can’t afford to stay working in it. If this government cared about long term investment or growth, they’d put their money where their mouth is and properly fund our colleges so they can retain crucial staff.”

Claire Brook, Employment Law Partner at Aaron & Partners, said:

“The Government’s decision to increase the minimum wage is certainly a ground breaking move, however, employers who will have to fund the increase now have very little time to reforecast the associated costs.

“In short, this will have a big impact on the bottom line for many and will come as a concern to HR leaders and business owners.

“Starting in April 2024, the national minimum wage will rise by over £1 per hour, aligning with the Low Pay Commission’s recommendation, also reflecting strong growth in pay across the economy.

But employers across many sectors now face a big challenge as they navigate the imminent need to adjust budgets for swift pay increments.”

Gavin Poole, CEO, Here East comments:

“This was a pro-business and pro-productivity Autumn Statement.

“Committing £50m to engineering apprenticeships will pay dividends not only for industry, but also for the budding engineers that will realise the value of a career in this growth sector. As the product of an engineering apprenticeship myself, I recognise the importance of investing in people in this way.

Cllr Jim O’Boyle, Cabinet Member for Jobs, Regeneration and Climate Change at Coventry City Council said:

“The West Midlands Gigafactory joint venture welcomes the Chancellor’s announcement that the site will be part of the West Midlands Investment Zone earlier today. Our site is a prime location offering future investors an all-in-one solution for battery manufacturing, research, industrialisation and recycling. Today’s announcement delivers significant additional tax incentives and breaks, making the site even more attractive for future investors.

“The West Midlands Gigafactory, the UK centre of electrification in Coventry, is the only available site in the UK with planning permission in place for a large-scale battery production facility with capacity for up to 60GWh per annum – enough to power 600,000 electric vehicles. It is perfectly placed as a pioneering centre of excellence for battery technology and manufacturing, located at the heart of the UK’s manufacturing industry.

“The ground-breaking location is the first of its kind in the UK, offering an all-in-one solution for battery research, industrialisation, manufacturing, testing, recycling and electrified logistics, designed to foster the UK’s growing battery ecosystem.”

“The Chancellor’s acceptance of all the recommendations of the University spinout review is significant. Our universities are one of our greatest assets and their excellence should translate into entrepreneurial success. The recommendations of this review will ensure that spinouts become the next tranche of the UK’s business success stories.

“Furthermore, pledging £500m over the next two years to fuel Britain’s innovation centres is also considerable. For the UK to fulfil its potential as the next ‘Silicon Valley’, productivity must become a mainstay of the policy agenda. London’s Here East is a demonstration of this policy in action.”

Hannah Peaker, Director of Policy and Advocacy at NEF said:

“Levelling down was never in the manifestos, but the facts speak for themselves: we are all poorer because of decisions made by successive Conservative Prime Ministers since 2015, and today’s Autumn Statement gives us no reason to think things will get any better.”

“In two years, the cost of energy leapt 49% and the cost of food is up 29% with prices still rising. For the most vulnerable families, this is a living standards disaster. A small cut to National Insurance will provide little relief, and it will benefit the wealthiest households and regions the most – at the same time as forcing further cuts to our already fragile public services.”

“In the long run, any plan to tackle these issues needs to grasp the fundamental drivers of regional inequalities, which will require giving local areas the powers and funding to make long-term investments in things like housing, transport and places. But in the short term, more should be done to help families through the social security system, instead of putting them under further pressure of sanctions. NEF’s proposal for a Living Income would ensure an income floor that reflects the true cost of living for families.”

Dominic Caddick, Economist at NEF, said:

“This would be an indictment of any government, let alone one for whom “levelling up” is at the heart of its agenda. The families and places that were already poorest have continued to fall even further behind the rest of the country.

“This analysis shows the social safety net is in tatters. We need to completely reimagine the way we support the most vulnerable in our society. We need a living income to help people deal with the challenges and opportunities presented by the fast-changing economy we’re all living in.”

Bill Jones, Deputy CEO at Luminate Education Group, said:

“While pleasing to hear the Chancellor recognise further education as a mechanism for future growth in today’s Autumn Statement, it was disappointing this was not matched with adequate investment to maximise the impact of colleges on economic growth. A £50 million injection to encourage apprenticeship schemes in growth sectors is welcome, although far more is needed to reinstate a thriving further education sector.

“Similarly welcome was the recommitment to retention payments for college teachers in the first five years of their careers, as announced last month. At a time when re-training is becoming ever more important, restoring overall further education funding to 2010 levels would alleviate significant pressure on colleges and go some way to unlocking the value our sector can bring the economy as a whole.”

The Mayor of Greater Manchester, Andy Burnham:

“The Chancellor’s Autumn Statement contained some good news for Greater Manchester, and we welcome that as far as it goes, but there are also gaps which give us cause for concern going into a difficult winter.

“One of our biggest calls has been the urgent need to unfreeze Local Housing Allowance and I am pleased that the Chancellor has listened. However, his uplift won’t come into effect until April 2024 which means we are still facing a difficult winter with a rising rough sleeping and homelessness crisis. There is a clear case for more homelessness funding now for our 10 councils, given the extra costs they will face this winter from both this ongoing freeze and from Home Office evictions. It is essential if the Government is to have any hope of achieving its manifesto commitment of ending rough sleeping in this Parliament. We are also concerned about plans to reintroduce the freeze in 2025 and would ask the Government to reconsider this.

“We very much welcome the confirmation from the Chancellor that Greater Manchester will get an Investment Zone backed by £160 million of Government funding, boosting the growth of our thriving advanced manufacturing and materials sector. It will help us bring forward our plans for Atom Valley and deliver industries of the future and jobs to match in the north-east of Greater Manchester.

“This Autumn Statement also brings a significant deepening of devolution in Greater Manchester with the publication of a Memorandum of Understanding with the Treasury on how our new Single Settlement will work. This moves our city-region towards a Welsh-style or Scottish-style funding arrangement with Whitehall and is a big vote of confidence in Greater Manchester. It will give us much greater control of our budget at the next Spending Review and help us get better outcomes for our residents and businesses.

“While there are some good things in the Autumn Statement, I fear it will not ease the cost-of-living pressures this winter on our residents with the lowest incomes. Benefit uplifts will not come into force until April 2024 and the cut in National Insurance won’t benefit those on the lowest pay rates. Residents in all ten of Greater Manchester’s boroughs will face a tough time over the next few months and our councils will continue to face unprecedented pressures on their budgets. Overall, it feels like a missed opportunity to do the right thing.”

Rain Newton-Smith, Chief Executive, Confederation of British Industry said:

“With tough decisions to be made, the Chancellor was right to prioritise ‘game-changing’ interventions that will fire the economy.

“Moves to speed up planning and grid connectivity should also bolster business confidence to invest in high growth areas like green technologies, renewable energy and advanced manufacturing.”

Eve Williams, General Manager, eBay UK said:

“The hundreds of thousands of UK small businesses who use eBay and other online marketplaces will warmly welcome the Chancellor’s cuts in national insurance, more support for the self-employed, as well as the decision to make permanent full expensing.

“There are enormous productivity gains to be had from encouraging the long tail of Britain’s SMEs to invest in existing digital technologies. And given that around half of our online businesses also trade offline, they will benefit hugely from the measures on business rates for retail as well as freezing the business rate multiplier.”

Kate Nicholls, Chief Executive, UKHospitality said:

“The Chancellor has brought forward a significant package of business rates measures that will help hospitality businesses across the country. UKHospitality led the calls for Government to extend relief and take action on the multiplier and I’m delighted the Chancellor has acted on our asks.

“Reforms to the planning system to drive quicker approvals will remove a significant barrier to business investment. This type of reform to reward the best performing local planning authorities is exactly the type of change we have been suggesting to drive growth in hospitality.

“We’re also pleased that the Chancellor has acted on our proposal and frozen alcohol duty until August next year to support our supply chain.

“The reduction in National Insurance for employees will put more money in people’s pockets and provide a boost to hospitality in the New Year, often a challenging time for the sector.”

Nuno Teles, Managing Director, Diageo GB said:

“Today we raise a glass to the Chancellor and the Prime Minister, who have listened to the industry’s plea for support and decided to back our homegrown sector, that employs so many people across the UK. Drinkers and pub-goers across the country now have even more reason to celebrate this festive season. Cheers Chancellor!”

Mark Gardiner, Chief Executive, Community Security Trust (CST) said:

“The commitment to fund education to tackle antisemitism in universities and schools, alongside the promise to continue the increase in funding for security guarding in the Jewish community, is not just a welcome, concrete contribution to the fight against antisemitism: it sends an important and powerful message to the Jewish community that we have the sympathy and support of government in this struggle. We are grateful for the Chancellor for this commitment and we will work with government and communal partners to ensure it is put to effective use.”

Caroline Abrahams, Influencing Director, Age UK said:

“We’re pleased and relieved the Government kept its promise to older people to honour the Triple Lock. For the 4.2 million older people who recently cut back on food and groceries to make ends meet, having a State Pension that delivers the basics in life is essential. Today’s decision also crucially makes is more likely that older people will keep their homes adequately warm this winter, with less fear of facing an energy bill they simply cannot afford to pay come the spring.”

Anna Wright, Chief Executive, the Armed Forces Covenant Fund Trust said:

“We are delighted by Chancellor of the Exchequer’s announcement of an additional £10 million to support the Veterans’ Places, People and Pathways programme. These projects have delivered significant work already to support our veterans, growing collaborative cross sector working and giving a more seamless interface between statutory and charity or not for profit support. They have great potential to help even more veterans, and further develop better, more inclusive local support and better coordination and communication that sustains into the future”

Peter McGettrick, Chairman of British Safety Council, said:

“This was a Chancellor keen to show his support for businesses and working people, and several measures in the Autumn Statement will be welcome in the face of the continuing cost of living pressures and ongoing skills shortages – especially for self-employed people and those on the national living wage.

“Artificial intelligence and automation are already changing many aspects of work, including how we practice health and safety. With the right regulation in place, we can make the most of this opportunity while protecting people, so the investment announced today can only be a positive boost to a growing sector in the UK.

“Likewise, the £4.5 billion of investment to support UK manufacturing and unlock unexploited manufacturing potential will help attract business investment across a range of sectors.

“Extra funding to boost apprenticeships is welcome, but they must continue to deliver skills which employers and their workforces need for their future.

“Announcements by the Government to reform occupational health and encourage people to take up employment support are to be applauded, as long as individuals’ needs are taken into account. Working from home can offer welcome opportunities for many people with health conditions or caring responsibilities but it is not always possible, or even appropriate, for every disabled person looking for work.”

Dr Hassaan Khan, Head of Digital Finance at Arden University, says:

“We wait to see whether today’s Autumn Statement will help drive the growth needed in the UK economy. As the statement was business-driven, it will also be interesting to see the reaction it receives from the public.

“According to Goldman Sachs, the UK is expected to still lag on several fronts – its growth-inflation trade-off is more adverse than in other developed markets, including the US and Euro area economies, so the Chancellor has a challenge on his hands.

“Prices are still rising, even if they are increasing more slowly than previous months. While lower taxes may also incentivise consumer spending, the Chancellor’s main onus herewas to boost confidence for businesses to drive forward economic growth. It makes sense, as a better economy will benefit its people; fewer taxes mean more room to potentially spend – but with the cost-of-living pressures still hitting many hard, many are expected to still be struggling to make ends meet as we enter the holiday season.

“The Chancellor remains on a mission to entice people who have left the workforce to re-join the employment market in hopes to boost growth, especially pertaining to those currently on benefits. Where this will potentially push long-term growth, it doesn’t necessarily solve today’s problem. Boosting the economy in such a way will take work: effective support is still needed for those that have caring responsibilities and health issues, for example.

“Now is as good a time as ever for the Government to invest in opening access to education. While pushing apprenticeships is a good step forward, there needs to remain a focus on offering better support for workers with special requirements – including those with disabilities. If done correctly, it will push for a more active labour market and will naturally boost the economy.”

NUS Vice President for Liberation and Equality, Nehaal Bajwa, said:

“Instead of prioritising tax cuts, the Chancellor should be investing in our education system and vital public services.

“69% of students work on top of full-time study just to make ends meet. Many are missing classes because they can’t afford the cost of transport, and are living in poorly insulated, mould-infested accommodation because they cannot afford to put the heating on. The minimum wage rises for apprentices and young people are a step in the right direction, but don’t do enough to combat years of suppressed wages.

“What we needed in this budget was a sharp increase in maintenance loans immediately to keep students afloat and a plan to reintroduce maintenance grants. What we got was benefit sanctions, which will leave many people without the lifeline benefits are supposed to provide and disproportionately impact disabled students.

“There is a General Election around the corner in 2024. Students will be deciding who to vote for based on their plans for education, the cost of living, housing, and mental health. The Autumn Statement does little on these vital issues.”

Susan Loughlin and Simon Hawthorn from the National Society of Apprentices said:

“£6.40 might not seem much but it’s a big win for us. This 20% rise shows that the government are finally listening to apprentices, to unions, educational campaigners and to industry. With this increase we see things starting to move in the right direction.

“Apprentices, students, students’ unions, and our friends in the trade unions can take heart that their hard work together has paid off.

“But it is not enough; 20% might sound like a lot, but £6.40 is still barely half what the government’s Social Mobility Commission, and indeed the many companies that are part of the Real Living Wage, say is needed to even survive. Apprentices are workers as well as learners. We are building your houses, running your childcare centres, and designing the planes you go on holiday in.

“Creating an educated, highly skilled workforce is crucial to improving our country, to filling the skills gaps and providing a space for all of us to become our best selves. It’s time for a living wage for all, apprentices included.”

Scott Parkin FIEP, Group CEO, Institute of Employability Professionals (IEP)

“The Autumn Statement has taken some steps to encourage work and make it more rewarding, including the increase in the National Living Wage, which is good news. The 2-year Restart extension has also provided stability for the employability sector and our members.

“However, it is important to recognise that the measures implemented around welfare reform will result in more people with complex barriers requiring targeted support. Employability professionals possess the necessary talent, passion, skills and dedication to support these people and are well-equipped for the challenges ahead through their membership of the IEP.

“The IEP is committed to upskilling practitioners, in whatever setting they deliver services, to ensure they can easily access our specialist training, learning and networks to meet this growing demand so they can provide effective support to the additional individuals projected to enter the workforce by 2028-29, supporting them to gain meaningful, fulfilling and sustainable opportunities for employment.”

Stewart Watts, VP EMEA at D2L:

“There’s clearly a disconnect between the skills required in the modern day workplace and those that are currently taught and honed across higher or further education. It’s great to see the government is committed to developing home-grown talent, but the way in which we value, deliver and measure learning needs to change. However, reforming education to meet current business needs will take time.

“The current talent shortage is particularly complex as it is centred around technical skills. One of the key areas apprenticeships will focus on is digital skills, as the government attempts to address the digital divide, and also help those industries who are struggling to fill vacancies and create a steady talent-pipeline. Digital skills are difficult to nurture, and even harder to assess. For these apprenticeships to be effective, all subject matter experts should be involved in the design phase. Modularity, or an omnichannel approach toward education and training, will be essential.

“Designing courses in this way takes time. Governments, businesses and education providers will have to be patient and constantly review these programmes to ensure young workers are engaged. Over time, it should be a lot easier for employees to top up their skills periodically, so colleges should provide options for part-time learning to make these courses accessible. This will only be achieved as colleges and businesses continue to work more closely and identify new ways that they can work together as we look to answer the more complex business challenges.”

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