Sowing the Seeds of Success
Helen Hewitt, CEO of the British Woodworking Federation (BWF) has high hopes for the future, as the Spring Budget may signal a promising year for the woodworking and joinery sector.
The
2021 budget was always going to be focused on Government's role in supporting
COVID-19 recovery for sectors and individuals hardest hit by the pandemic.
However, when summarising the economic outlook, the Chancellor acknowledged
that in the construction industry, output was significantly higher in the
second half of last year, reflecting its ability to bounce back. Although, as
in all sectors, our members have been looking to the year ahead with some
apprehension, many of the measures announced give hope for cautious
optimism.
We welcome the extension to business rates relief, as well as the continued
VAT deferral scheme and the new loan guarantee scheme to support businesses'
access to loans and overdrafts. Maintaining cashflow is crucial for our members,
many of which are SMEs. The additional discretionary business grant funding to
be distributed through local authorities is also positive, and the sooner
businesses can receive details of the criteria for application the better.
In addition to the measures aimed at shoring up business finances, the budget placed a welcome focus on initiatives enabling them to plan for and invest in their futures. New funding provided for high quality traineeships for young people being just one of the measures where we see particular benefit to our sector. From September, employers providing work placements for 16-24 year olds will receive £1,000 per trainee.
Similarly, many skilled industries, including the woodworking and joinery sector, will welcome the extended and increased incentives for employers to take on apprentices. Those hiring new apprentices will now receive double the previous payment at £3,000 per placement.
The new Help to Grow Management and Digital courses will help businesses get world-class management training, while the digital provision will offer free expert training and a significant 50% discount on new productivity-enhancing software. For BWF members and the construction industry's SMEs, these courses will be a real support for businesses looking to grow and expand this year and beyond. Recruitment and training will be vital in driving our sector's post COVID-19 recovery. While apprenticeship recruitment was heavily impacted in 2020, we hope the new measures will provide effective incentive to increase apprentice uptake in the coming year, and we will fully support our members in identifying and accessing available funding.
While it is disappointing that the budget didn't contain a stimulus package for UK housebuilding, we were encouraged by the newly-announced Modern Methods of Construction (MMC) Taskforce, co-ordinated by The Ministry of Housing, Communities and Local Government (MHCLG), which is charged with accelerating the delivery of MMC homes in the UK. This presents not only an opportunity for the woodworking and joinery sector, but for the UK to become a global leader in sustainable construction by harnessing the benefits of timber products. The extension of the Stamp Duty holiday is also a welcome boost for the housing market and our members, providing new opportunities for property renovations and refurbishment.
But what was missing? In our view, the Budget lacked a clear green building stimulus. The Green Homes Grant, announced in 2020's Budget, has not been fit for purpose. This has resulted in poor take up due to the lack of flexibility it provided homeowners. There remains a gap here. We know from separate research that demand for home renovation is high, but it is vital homeowners are incentivised to make choices that positively impact the environment.
We believe that the increase to Corporation Tax – currently set to rise from 19% to 25% in April 2023 for companies with profits over £50,000 – will have a potentially detrimental impact on larger companies within our membership. This is a time where businesses of all kinds need to be encouraged to invest in growth, and we would welcome further consultation on all incentives to support this.
The Spring Budget is a light at the end of a long tunnel. The combination of support for business finances, extensive investment in skills and training, and recognition of sustainable methods of construction all provide vital support for the growth of BWF members and the wider construction industry. As we move through 2021 and the COVID-19 recovery, the BWF will continue to champion our sector's role in helping the UK to build back stronger and lobby the Government to ensure the voice of our membership is heard.
Read Structural Timber Magazine- Issue 26 here
