Businesses and charities in Sheffield have admitted they ‘hoped for more’ from Rachel Reeves’s Spring Statement.
She also announced changes to the welfare system, cuts to the civil service, increases to defence spending and house building and added that Britons would be £500 better off under the Labour Government.
GB News was at Showcase Sheffield, a business exhibition, organised by Sheffield Chamber of Commerce at the Canon Medical Arena to get reaction to the Spring Statement.
GB News was at Showcase Sheffield, a business exhibition, organised by Sheffield Chamber of Commerce at the Canon Medical Arena to get reaction to the Spring Statement.
GB News
Louisa Harrison-Walker OBE, Chief Executive of the Sheffield Chamber of Commerce, said she hoped there would be more support from the Chancellor for businesses in the retail, hospitality and leisure sectors.
Instead, small businesses have been left to prepare for ‘Awful April’ as National Insurance and minimum wage changes bite.
Harrison-Walker said: “Some of the decisions that were taken and the announcements that were made in the Autumn Budget have affected businesses investment intentions and recruitment intentions.
“So I think businesses were hoping to see that there would be some reflection of that [in the Spring Statement].
“We as a member representative organisation, have about a thousand members from all different industries.
“Although Sheffield is an incredibly resilient city, a city of makers and innovators, and we’ve got a good spread across a lot of industries, there are some industries that are more prone and that are going to, I think, struggle a little bit more so, particularly the retail, hospitality, leisure who have seen an uplift in the minimum wage.
“The lowering of the threshold at which they start paying National insurance, and an increase in the amount of National Insurance that they’re having to pay, and that coming off the back of a difficult few years, coming out of Covid and the pandemic and obviously dealing with rising energy costs, they were just starting to see some green shoots.
“My concern is that we’ve not seen enough for those organisations, and there hasn’t been any consideration about any exemptions or delays that might be appropriate for some of the sectors that have had a really tough time and to try and help businesses, because 96 per cent of the businesses here are micro SMEs that employ ten or less people.
“The more we can do to support small businesses, the better it is for everyone, the better it is for the economy and the more it rises the tide for everybody.”
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Charles Turner, Managing Director of Durham Duplex Ltd
GB News
In the Spring Statement, Rachel Reeves confirmed a £2.2billion funding boost for the Ministry of Defence from next year and announced that the government will spend 2.5 per cent of GDP on defence by 2027, which will be achieved by reducing overseas aid spending to 0.3 per cent of gross national income.
Charles Turner, Managing Director of Durham Duplex Ltd, an industrial blade and machine knife manufacturer, told GB News that an increase in defence spending is welcome in the manufacturing sector.
He said: “There’s a lot of heavy manufacturing firms here [Sheffield], and others who actually are well placed to benefit from offshoring defence spending.
“The big-ticket items like Sheffield Forge Master already MoD [Ministry of Defence] owned, but a lot of other companies are doing MoD work.
“We do some small hand knife work, but if you’re going to increase your defence spending, you are going to need the kit to enable you to deliver on the ground.
“So from Sheffield and a manufacturing perspective, I think any increases in budget is good news. We’ve got a lot of companies here that travel or deal worldwide and they’re all doing well.
“Every time I go and visit someone, their order book seems to be steady, if not growing. So from that perspective, we’re in a good position and on shoring helps, as does less stuff coming from China, to be fair.”
Charles Turner
GB News
Following on from the Autumn Budget, one of the biggest changes for small businesses will be an increase in National Insurance contributions from 13.8 per cent to 15 per cent in April. The threshold at which it is paid has also been cut from £9,100 a year to £5,000 from next year.
A poll by the Federation of Small Businesses at the end of 2024 found that 33 per cent of small employers expect to reduce headcount, up from 17 per cent in the previous quarter as a result of tax changes.
The National Living Wage will increase by 6.7 per cent to £12.21 per hour for over-21s and £10 for 18-21 year olds from next month.
Reflecting on this, Charles Turner, Managing Director of Durham Duplex Ltd, said: “In relation to employment and workers costs, April 1 lifts is going to have an impact on us.
“Hopefully after that we all get the stability we need to continue to build our businesses’ capability and capacity.
“As long as we have stability and going forward, which is something you need with manufacturing, you need to know where you are, particularly to allow you to bring in skills and young people in order to enhance your skill base and give you that longevity you need in manufacturing.
“So as long as we have no more fundamental changes, we will pick up and roll with it because we have to.”
Louisa Harrison-Walker OBE is the Chief Executive of the Sheffield Chamber of Commerce
GB News
In terms of cuts to welfare, the Chancellor announced the Universal Credit Health element will be cut by 50 per cent and then frozen for new claimants and that the Universal Credit standard allowance will increase from £92 per week in the financial year 2025/26 to £106 per week by 2029/30.
The Department for Work and Pensions’ estimate of the impact of the cuts to welfare benefits shows that by 2029/30 there will be 3.2 million families – some current recipients and some future recipients – who will financially lose as a result of this package, with an average loss of £1,720 per year once inflation is taken into account.
It suggests, however, that more people will win financially, with 3.8 million families – some current recipients and some future recipients – set to be on average £420 per year better off, after taking into account the impact of inflation.
Beth Crackles, Chief Executive at Sheffield Hospitals Charity which provides funding above and beyond NHS budgets to improve patient care, experience, and to support a healthier population across Sheffield said she was disappointed that the Chancellor did not reverse the national insurance increase for charities in the Spring Statement, and says more people will now depend on charities due to welfare cuts.
Speaking to GB News, Crackles said: “Our charity is increasingly important and the NHS is operating in an increasingly difficult context- the NHS has been asked to operate to deliver 4 per cent more, with 1 per cent less. So all the additional funding that we can bring is really, really vital.
“In the Autumn Budget, charities were not exempt from the increase in National Insurance contributions as our public sector colleagues were, and that hasn’t been addressed in the Spring statement, which is deeply unfortunate.
“Charities were already operating with this triple threat of increasing costs, increasing demand for services and reduced income as well.
“I think the key point for me and for Sheffield Hospitals charity is that the 50 per cent cuts around the health element of Universal Credit and the freeze on new claimants, will undoubtedly result in more people seeking out charitable services for support, and I believe it will put more pressure on an already stretched NHS.”
Beth Crackles, Chief Executive at Sheffield Hospitals Charity
GB News
Chancellor Rachel Reeves also repeated her promise to slash £2billion per year from the administrative budgets of Government departments by the end of the decade.
There is still no formal target for the number of civil servants who will be cut, but Reeves has previously said 10,000 jobs are at risk.
The Chancellor also promised thousands of new social and affordable homes will be built with a £2billion grant and vowed 18,000 new homes will be built, describing it as the biggest boost to social and affordable housebuilding in a generation, with 1.3 million new homes being built in the next five years.
The Office of Budget Responsibility said the boost means there will be 305,000 homes a year by the end of the decade.
To support this, Reeves said there will be £600million into training up to 60,000 bricklayers, electricians, engineers and carpenters over the next four years, in a move designed to help fill 35,000 job vacancies in construction.
