Budget 2016: A good start for SMEs, still more to do in tech
This week we caught up with our CEO, Adam Hale, to find out what he thinks of George Osborne’s latest Budget announcements, and how these will impact the technology industry, and the UK’s economic growth.
First off, we asked Adam what he’d been hoping to see from this year’s Budget…
In the run-up to it, I’d actually spent a few days mulling this over. One thing I had really hoped to see was more money being allocated to University Technical Colleges (UTCs), to expand specific technology in secondary education.
With regards to investment in tech education, I was hoping to see greater spend allocation on attracting women into technical careers. Of the five thousand people who did A level computer science last year, less than 500 were girls, and I’m emphatic that this statistic needs to be 10-20 times greater. I’m constantly disappointed and amazed by the lack of progress in correcting the gender imbalance in technology, as per my recent blog ‘Why we need more women in tech’).
I also wanted Budget 2016 to address the real costs of pensions. Rather than removing tax relief from money purchase schemes, I really believe there needs to be a reduction in the £1.5 trillion of public sector final salary pensions liability.
So in your opinion, what were the highlights and lowlights of Budget 2016?
Well, the Budget for tax stated that the personal tax allowance is set to go up to £11,500 from April next year, with the higher rate threshold to rise to £45,000 at the same time. In addition to personal tax changes, £9 billion will be raised in tax reform applied to larger firms – a sum that will be used to help support the growth of SMEs and which, in my view, is a very positive step for UK entrepreneurship and innovation. As a major scale-up in the fastest growing tech region, I’m sure I’m in good company supporting this move.
A number of the other announcements made by Mr Osborne on Wednesday will also be welcomed by smaller companies, too. The revelation that 600,000 small businesses will be taken out of business rates was one such example, as was the cutting of corporation tax to 17% – both of these spell good news for UK businesses. I welcome and applaud it.
Add to this the fact that interest deductibility will now be capped at 30%, and the headline rate of capital gains tax has been cut from 28% to 20%, and it would seem the Government is showing real investment in supporting home grown businesses.
So, good news for UK business?
So overall, yes, I welcome George Osborne’s Budget this year. As CEO of a global cloud HR software company, I’m delighted to see employment at its highest levels ever. This is good news for the industry we work in, and supports our customers’ journey to expanding and maintaining their workforce.
As a business leader of a rapidly growing SME, I’m delighted with a number of yesterday’s Budget announcements – most notably the reduction in capital gains, which will raise more money for the Government and give people the incentive to succeed. (SMEs aside, I believe there is still too much tinkering and not enough decisive action that addresses the UK’s major cost areas though.)
Still on my wish list? Greater investment in Science, Technology, Engineering and Mathematics (STEM). We have to remain a nation of great British innovation and innovators – on that note, well done to Blue Prism for its IPO today, fabulous to see confidence and investment in British pioneers. I look forward to seeing more of the same from our friends in the wider scale-up network.