Budget 2016
Group Finance Director Rob Cressey reflects on Budget 2016
by Rob Cressey Group Finance Director
As Group Finance Director for LTE group, I listened to this week’s Budget with interest from a skills, training and employment perspective.
Mr Osborne’s announcement that the personal allowance and higher rate threshold will increase was, I’m sure, welcomed by many working people. For apprentices, there will be an increased minimum wage and for all over 25’s a new mandatory national living wage. There’s some good news for employers too, as many small businesses will pay no business rates from April 2017. I hope many of them will take the opportunity to spend the released funds on valuable investments to their workforce, such as training programmes, Apprenticeships and recruitment.
In spite of little detail offered in the budget, I’m hopeful that the introduction of the Apprenticeship levy and 10% top-up for employers will lead to greater availability and take-up of training through Apprenticeship programmes. While the levy has come in for some negative media commentary, it is a large-scale investment in our national workforce and the education of our young and not-so-young people. Additionally, the further announcements on devolution, including of adult education budgets, to more regional authorities brings funding decisions close to local communities and increases local control and focus of regional priorities. This presents real opportunities for colleges and training providers to better support local learners. There is also a continued trend towards loan funding, potentially supporting more adult learners into lifelong education and better career prospects.
Greater Manchester will gain new powers, with the extension of its devolution agreement, over local criminal justice and offender management. These are designed to allow more flexibility, innovation and better coordination with other local services. It’s good to see Greater Manchester at the forefront of these developments. Novus, part of LTE group, will be looking to work closely with others to link education provision in prisons with services in the community, to support more sustainable employment opportunities for ex-offenders.
Close to my own heart, as someone who lives in the North West, it was good to hear the Chancellor confirm plans for HS3, with the announcement of the development of the Manchester-Leeds high speed rail link, which is sure to drive economic growth in the North West and Yorkshire regions.
This brings me to a note of caution. Mr Osborne announced further public spending cuts of £3.5bn by 2020 but with no detail as to where these come from. The growth forecast for the UK economy has reduced and the Budget signalled a continuation of austerity. Public sector employers will also see a rise in pension costs, on top of the increase in National Insurance, already coming through.
Many of the Budget announcements made yesterday signal opportunities within training, education and development. However there remains a lot of uncertainty, including around future Apprenticeships levy details and Higher Education plans. To make a real impact on productivity, we need to be building a world-class education and skills system, strong and sustainable, that serves our communities and businesses, both large and small.