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Closing the Say-Do Gap

Trends and Insight 56 Add to collection

Porter Novelli looks at how the budget intentions set out by the UK government are being supported by tangible actions

Closing the Say-Do Gap

“Our credibility comes as much from what we do as what we say” were the words of Rishi Sunak as he revealed the winter Budget this afternoon looking into a “new age of optimism” for the UK.

We help clients close the say-do gap across all their audience groups, so we took a closer look at how the budget intentions set out by the government are being supported by tangible actions

Here is a summary of the key announcements:

Say: “Investment in a high skilled economy”

Do:

• Increased funding per pupil as the UK deals with the consequence of the Covid-19 pandemic on education – an extra £4.7bn by 2024-25

• Multiply Scheme – to help with adult’s basic numeracy skills

• £560m investment in youth services

• “Scale-up visas” to make it easier for businesses to bring in highly skilled individuals 

• £1.4bn set aside for a Global Britain Investment Fund to help lure in foreign investment


Say: “Unprecedented funding into R&D”

Do:

The Chancellor came under scrutiny in the media as he delayed £2bn in annual spending on (R&D). This controversially came as he committed to fund a new advanced research body that was the idea of ex-No 10 adviser Dominic Cummings. 

The delay is also likely to push back the Conservatives’ manifesto commitment to spend 2.4% of GDP on R&D, as Sunak committed just 1.1% of GDP by 2024. The government’s previous commitment of £22bn investment will now be met in 2026-7, opening their ‘say-do’ gap.

Some favourable announcements, however, included:

• Expanded research & development (R&D) tax relief to help encourage investment in cloud computing and data costs

• £900m to fund the Advanced Research and Invention Agency (ARIA), a new body that will fund “high-risk, high-reward” technologies

• £400m boost in the budget of Innovate UK, which gives grants to promising technologies, by 2024-25

• Continued investment in Horizon Europe, the EU’s collaborative research programme


Say: “World class public services”

Do:

• A health care spending increase of £44bn to over £177bn by the end of this Parliament, with the recent national insurance hike boosting NHS and social scare funding

• Pay rises for around five million public sector workers, following the freeze in pay (excluding NHS and lower paid public servants) during the pandemic


Say: “Backing businesses and entrepreneurs”

Do:

As demand for goods post-Covid-19 has proven higher than supply chains anticipated, with roll on effects for various businesses and sectors, the Chancellor highlighted:

• Implementation of temporary visas for lorry drivers

• Suspension of the HGV levy until 2023

• Freezing of vehicle excise duty for HGVs until 2023

• A simpler tonnage tax regime for shipping – enabling it to be simpler and more competitive

As many retail, entertainment and hospitality venues were forced to close their doors during the pandemic, the Chancellor announced:

• Theatres, museums and galleries to receive tax relief until April 2024 

• Firms in the retail, hospitality and leisure sectors to benefit from another year of 50% business rates relief 

• From 2023, every business will be able to make property improvements – and, for 12 months, pay no extra business rates

For the Beers, Wine and Spirits (BWS) industry, there was a sigh of relief with a further freeze in alcohol duties until a proposed reform in 2023.


Say: “Help with rising cost of living”

Do: 

• The Chancellor confirmed that the National Living Wage will rise to £9.50 an hour, up from its current level of £8.91 – an increase of £1,000 a year for a full-time worker

• The planned rise in fuel duty will be cancelled because of the current high fuel price which is already a squeeze on families and small businesses


Say: “Levelling up across different regions”

Do:

• Sunak revealed that Scottish government funding will increase by an average of £4.6bn per year while administrations in Wales and Northern Ireland will receive an extra £2.5bn and £1.6bn, respectively

• He also allocated grants from the £1.7bn “Levelling Up Fund” to a number of towns and cities


Say: “Laying the foundations for a strong recovery and greener economy”

Do:

With much pressure on the government’s green strategy ahead of COP26, Rishi’s speech and budget “red book” gave much less space to climate change and the UK’s net-zero target. The red book uses the word “climate” only nine times, against 31 last year, with seven appearances for “net-zero”, down from 17. The announcements included:

• £30bn towards Britain’s green industrial revolution – including £380m to the UK's offshore wind sector and £6.1bn to help deliver the Transport Decarbonisation Plan

• The release of at least £15bn of “green gilts” this financial year - these are government bonds dedicated to supporting net-zero

• A “green homes grant”, which allows people to apply for vouchers to cover the cost of home insulation or installing low-carbon heating

• The £5.2bn flood and coastal defence programme for England confirmed to begin in April

• A freeze in carbon price support at £18 per tonne of CO2 in 2022-23

• Investment relief for businesses adapting green technologies

• An investment of £57m to support jobs and green growth in Scotland

• A new ultra-long haul air passenger duty, covering flights of over 5,500 miles, shining a spotlight on the negative environmental impact of the aviation sector

• Funding into the Aerospace Technology Institute for research on lower-emissions planes until 2031 - welcome news for the aviation industry after the programme was previously frozen

Despite some notable progress, the renewed freeze in fuel duty was a major blow to the UK’s green credentials, as critics argued that the Chancellor had not gone far enough in the government’s net-zero commitments, ahead of the Cop-26 Summit in Glasgow next week.

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Porter Novelli, Thu, 28 Oct 2021 13:23:00 GMT