Was the 2017 budget good for small business?
Sometimes the budget can be as interesting as watching paint dry for most people. When it is first presented by the chancellor in the house of commons, it tends to be long and drawn out in its delivery and it is traditionally peppered with legal, and financial technical terms which often makes it understandable on first hearing only to those with a degree in economics.
Brexit and public services
But this year it has attracted a great deal attention in the UK as the future with Brexit still needs solid structure and direction and many of our public-sector services (the NHS, the prisons, housing and benefits) are so much in need of extra funding that they are close to collapse.
It was a little bit of a surprise then when there was hardly any attempt clarify the road ahead for Brexit and there appeared to be little concern or major allowances for public services. There was generous injections for social care and triage but is this just another year of throwing money at systems that just do not work anymore?
Increases in National Insurance
What’s more, the conservatives appeared to be going back on earlier promises to the self-employed by hiking National Insurance rates (from 9 to 11% over the next 2 years). For many years now, the conservative party has been behind small businesses and has offered substantial increases in personal allowances, but this specifically goes against David Cameron’s original manifesto.
This move has already come under a great deal of criticism and twitter and the broadsheets are red hot as can be expected.
What perhaps seems a little odd, according to many political commentators, was how this hike in NI rates really does go against conservative policies which usually back small business, capitalism and entrepreneurship. These rises if go unheeded will undoubtedly cause not only hardship, but also hamper small business growth in the UK.
How did Phillip Hammond explain the rises in national Insurance?
“Employed and self-employed alike use our public services in the same way, but they are not paying for them in the same way. The lower National Insurance paid by the self-employed is forecast to cost our public finances over £5 billion this year alone. That is not fair to the 85pc of workers who are employees.”
Even though the chancellor talked about leaving the EU and the need to keep the UK at the cutting edge of global trade he did not go into any real specifics as to how that would be achieved which left many feeling the budget in reality was as dull as ditch water.
The chancellor reminded everyone that statistics show that, against everyone’s expectations, the UK has continued to show growth in most respects – it is a fact that the UK economy grew faster than any other major economy except for Germany in 2017.
But as the conservative party slaps itself on the back, it may be timely to remember that we still haven’t left yet…
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