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FRP Question Time: Autumn Statement predictions

Thursday October 17, 2024

Navigating economic uncertainty: Insights on tax reform, investment, and growth from industry leaders

Earlier this week, we hosted our annual FRP Question Time event, centred around how the upcoming Autumn Statement announcement could impact key sectors in the UK.

Moderated by Luke Wilson, Restructuring Partner at FRP, the panel consisted of Allen Simpson, Deputy Chief Executive at UK Hospitality London, Julia Court, Partner at Addleshaw Goddard, Karim Palant, Director of External Affairs at BVCA, Mark Gifford, Chairman at Radley and Geoff Rowley, CEO and Restructuring Partner at FRP.

As the UK grapples with economic challenges and looming fiscal policy changes, our panel came together to discuss their concerns and offer insights on how the government can best support growth. The discussion shed light on key issues facing businesses, from tax reform and regulatory burdens to the UK’s potential for attracting international investment.

Tax reform and business concerns

The discussion began with a focus on tax reform and business concerns, which highlighted the challenges businesses face amid anticipated tax increases, with particular emphasis on employer National Insurance and insurance premiums.

The panel spoke about the impact on a number of industries, including how retailers are bracing for higher costs, while declining consumer confidence adds further pressure; Julia spoke of how rising inflation has made long-term project pricing unsustainable in construction, leading to insolvencies, with Allen adding that hospitality businesses, especially in town centres, expect steep increases in business rates, worsening their financial strain.

Speaking more broadly, Karim said that the complexity of addressing the fiscal deficit while fulfilling Election promises has compounded the economic challenges.

Growing the economy: What should the Government do?

In response to a question about fostering economic growth, the panel emphasised the need for government action to address significant economic gaps. They agreed that improving infrastructure, capital access, and planning is essential to create an investment-friendly environment, though recognised that achieving growth will be challenging in the short term.

Reducing regulatory burdens and encouraging investment

The topic of reducing regulatory burdens emphasised how easing regulations could stimulate investment. Karim highlighted that £178 billion in uninvested capital could be unlocked with a more competitive tax environment and agile decision-making. However, the panel warned against excessive deregulation, particularly in financial services, as it could weaken corporate governance, advocating instead for addressing planning issues to support infrastructure growth. The need for government resources to tackle regulatory inefficiencies, particularly in construction was stressed by Julia, whilst Mark noted that high inflation and costly debt have led many businesses to delay investments, further stalling capital deployment.

Selling the UK to international investors

In the final discussion on attracting international investment, the panel emphasised the UK’s strengths and potential. The panel highlighted the UK’s diverse economy and appeal to global investors, Mark expressed optimism about the pro-business stance of the Labour Party and the need for a consistent economic message to boost investor confidence.

Julia highlighted that addressing infrastructure and visa challenges were key to unlocking growth, especially outside London. Karim then added that despite ongoing infrastructure issues, there was some optimism to be had, as a result of the UK’s innovation in life sciences, technology, and AI. He said that strong intellectual property and resilient sectors as proof of its investment potential.

The panel’s discussion highlights the complex economic landscape that UK businesses are navigating. While there are significant challenges, including tax reform, regulatory burdens, and infrastructure issues, the overall sentiment was one of cautious optimism. With the right government support and strategic policy decisions, the UK has the potential to remain a competitive and attractive destination for international investment.

Related team

Geoff Rowley

Geoff Rowley

Geoff Rowley

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  • Restructuring Advisory
Luke Wilson

Luke Wilson

Luke Wilson

  • Partner
  • Restructuring Advisory
  • London
Christopher Osborne

Christopher Osborne

Christopher Osborne

  • Partner
  • Forensic Services
  • London