Responses to the Budget were variously
critical and praising, with disagreement over whether or not the
measures will enable economic growth. Here, Leasing Life
gathers insight from around the industry.
GE Capital
John Jenkins, CEO, GE Capital
UK
“The measures announced in today’s Budget are
not about to solve the central issue facing UK SMEs, which is the
lack of funding available to support business growth. It’s clear
that many UK businesses are suffering from a strained relationship
with their commercial lenders; and are lacking the range of
alternative forms of finance that are more widely available to
their competitors in countries such as France and Germany.
“Greater disclosure of a company’s financials
is critical to enabling a wider range of potential investors to do
credit analysis, and helps to speed up the loan approvals
processes. The government has a huge opportunity to encourage
competition in the UK market by allowing this information to be
made more freely available. Independent lenders don’t have access
to the same real-time information that large banks have developed
over the years through their internal credit scoring systems,
making the decision to lend, or not to lend to a particular
customer more difficult.
“Enabling alternative lenders to provide more
diverse sources of funding will give businesses deeper pools of
liquidity and more execution options, which in turn increases
sales, enables companies to hire more people and reduces the
potential impact of future financial shocks.”
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataGary Killeen, GE Fleet Services, UK
commercial director
“The reduction in fuel duty is welcomed and
not to be dismissed but is likely to be quickly swallowed up in
future fuel price rises. It is interesting to note that the new
stabilizer is being proposed at $75 per oil barrel limited but with
prices currently above $115, this seems unlikely to every be
triggered, certainly while unrest continues in the Middle East and
worldwide demand continues to rise.
“The increase in tax payable on free fuel for
company cars has risen from £18,000 to £18,800 and this rise is
well below the increase in petrol and diesel prices seen in the
last few months in percentage terms, meaning that it will
effectively represent a net reduction in most free fuel bills.
Governments have been discouraging free fuel provision for years,
so is this a change in policy?”
Finance and Leasing Association
Julian Rose, FLA head of asset
finance
“The change to treatment of short-life assets
seems useful and confirms the government’s intention following our
lobbying before the general election, to maintain capital
allowances at rates reasonably equivalent to economic
depreciation.
“We’ll be putting the case to the government
for enhanced capital allowances in enterprise zones to be available
via leasing.
“The accelerated plans for the Green
Investment Bank – which is expected to encompass the Carbon Trust –
are encouraging, particularly given the Carbon Trust’s announcement
earlier this month that its small business loan scheme will be run
by FLA member Siemens Financial Services.
“The draft Finance Bill changes to deal with
the new lease accounting rules, which were developed with our
support, were confirmed without any revision. This is just the
start of a longer and vitally important process to adapt the tax
system to cope with the accounting changes.”
British Bankers’ Association
Angela Knight, BBA CEO
“While corporation tax is paid on profits, the
bank levy represents an additional fixed cost for larger banks
operating in the UK. It also controversially can include the
business that banks are doing outside the UK. Without satisfactory
double taxation arrangement in place, this is putting banks
operating in the UK at a long term disadvantage – both
internationally, as they compete against banks not paying such a
levy, and domestically, as they compete with other sectors of the
financial services industry. This change is not as straightforward
as it first appears. Banks like other businesses want a predictable
tax regime so they can plans their business accordingly.”
Confederation of British Industry
John Cridland, CBI
director-general
“This Budget will help businesses grown and
create jobs. The Chancellor has made clear the UK is open for
business.
“The extra 1p cut in corporation tax will help
firms to increase investment.
“Reductions in regulations on businesses and
the promise of a faster planning system will provide relief to
companies trying to take on staff and invest.
“Support for manufacturers through the Climate
Change Agreements will help them to manage energy costs, which is
particularly important give that the Government is pushing ahead
with a carbon price floor.
“Widening the scope of the Enterprise
Investment Scheme will bridge the funding gap for small and
medium-size businesses, and could unleash a new wave of finance for
the most entrepreneurial firms.”
Neil Bently, deputy
director-general
“This is a Budget that will help businesses
grow and create jobs, and the Chancellor announced a number of
measures to help boost the UK’s construction pipeline and speed up
the planning process.
“The CBI welcomes the government’s two-year
programme for infrastructure and construction. A longer-term
pipeline will also boost confidence over future revenues, allow
greater innovation and enable the industry to reduce cost.
“We welcome the government’s action on a
presumption in favour of sustainable development, as this would
lead to a pro-growth planning system.”
Forum of Private Business
Phil Orford, CEO
“It was an important Budget heralded as being
pro-enterprise, focused on easing the dual burdens of tax and red
tape – two of the biggest barriers to business growth and job
creation facing small businesses. In that sense, we weren’t
disappointed and this was certainly more than just a nod in the
direction of UK SMEs.
“However, while there have been some definite
steps in the right direction the government could have gone further
in reducing taxes and making the tax regulation systems more
proportional to all small businesses so that they incentives to
entrepreneurship rather than act as a barrier to it.”
