Retail reacts: Gov has taken ‘first step to longer term reform’

The retail industry has welcomed chancellor Jeremy Hunt’s Autumn budget announcement, with the BRC saying it shows “the government has heard the concerns of retail”, despite the CBI adding it believes “businesses will think there’s more to be done on growth”.

Jeremy Hunt unveiled his Autumn budget on November 17, introducing a raft of measures aimed at “stabilising” the economy and reducing inflation.

Responding to the chancellor’s Autumn Statement, Helen Dickinson, chief executive of the British Retail consortium, said: “High inflation remains a major threat to the UK economy and we support the government’s objective of bringing this down. Inflation is making people poorer, damaging consumer confidence and holding back demand. It pushes up the costs to businesses which further increases prices for consumers. As the retail industry enters the crucial Christmas period, it is vital that inflation is brought to heel.

“The announcements today show the government has heard the concerns of the retail industry. Retailers are working incredibly hard to support customers – expanding value ranges, fixing the prices of essential items, and offering discounts to vulnerable households. This Autumn Statement supports that commitment by reducing upwards pressure on prices in the short term, and helping retailers protect jobs, keep shops open, and protect the vibrancy of local communities.

She added: “The Government has taken an essential step towards longer term reform of the broken business rates system by announcing the scrapping of downwards phasing of transitional relief. This decision means that April’s bills reflect market conditions and retailers will pay only what they owe, rather than being forced to overpay their rates bill when the value of their property has already fallen. This represents the first step towards a more fundamental reform of the broken business rates system.”

Rain Newton-Smith, CBI chief economist, said: “The test for the Autumn Statement was to deliver stability at the same time as unveiling a clear plan for growth. The Chancellor deserves credit for delivering stability, as well as protecting the most vulnerable, but businesses will think there’s more to be done on growth.

“Backing the CBI’s call for a freeze in business rates and smoothing the increase for those facing higher bills is very welcome. Staying the course on R&D spending and major infrastructure, including Sizewell C, HS2 and Northern Powerhouse Rail will give a major boost to communities and the country. Similarly, a renewed energy efficiency drive will take us closer to our goal of a low carbon, energy secure future.

She added: “But stabilising public finances inevitably means difficult decisions have to be taken. Businesses will view a freeze in NICs thresholds and further windfall taxes as the sharpest stings in the tail. Firms will also need more detail on what happens with the business energy support scheme in the coming weeks.”