Andrew Harding, FCMA, CGMA, Chief Executive — Management Accounting at the Association of International Certified Professional Accountants, representing AICPA & CIMA, said:
“The U.K. is facing very tough economic circumstances, with inflation being among the highest of the G7. In Friday’s fiscal statement, the government will need to set out a bold response if they are to meet their growth targets and deliver on their plans. AICPA & CIMA have suggested a number of policies which could increase the country’s productivity and generate more sustainable and long-term growth.
“One key area is helping small to mediums sized businesses (SMEs) grow through investment. We have called for the creation of an SME ISA to simplify the existing government support schemes for SMEs. This would channel investment to SMEs while generating returns for savers. A government funded bonus, spread over several years, would then be added to the investment to provide patient capital and support long-term growth.
“It is also vital that businesses have some certainty about the environment they will be operating in. The government should outline their tax and regulatory plans for the next two years and quickly provide more details on what will happen to businesses on their energy support scheme after the first six months. This would give businesses a solid framework to base their medium-term investment decisions on.
“We are currently undertaking research among our members about the impact of inflation and their strategies for managing in this environment. Early indications are that they are concerned about the resilience of U.K. supply chains and the additional price pressures to their already hit bottom lines caused by increased tax on businesses.”