Autumn Statement 2024: Summary

Make UK has provided the following summary of the Chancellor’s speech

Today’s Autumn Statement was a success for UK manufacturing, with a massive policy win on full expensing with further details of the package enabling another of our victories - the full roll-out of the Made Smarter scheme. There were also announcements on: tax cuts (National Insurance and R&D reliefs for SMEs); apprenticeships; investment zones; planning red tape; and national grid connectivity.

The Chancellor wasted no time in highlighting the OBR’s announcement that the Autumn Statement measures will make inflation lower than it otherwise would have been - with CPI set to fall to 2.8% by the end of 2024 before reaching the Bank of England’s 2% target in 2025. Core inflation is also now lower than half of the economies in the EU. 

Full expensing

The headline piece was our biggest policy win of the day - full expensing being made permanent. The chancellor’s announcement, follows a joint letter from Make UK and CBI sent into the Chancellor last Friday, with 200+ signatories from the sector, which called for the measure to be made permanent. It means that businesses can claim 100 percent of capital allowances on qualifying plan and machinery investments, and for every £1 that a business invests in IT, machinery and equipment, they can claim back 25p in corporation tax. 

Made Smarter scheme

As part of a £4.5bn package of investment for key growth sectors over five years, the Made Smarter scheme is being expanded to all of England in 2025, before working with the devolved nations to explore making it UK-wide from 2026/7. It also includes digital apprenticeships which is a great addition given the need to secure more digital skills in manufacturing. £2bn is also earmarked for green investment in the automobile industry and £975m in aerospace.

R&D tax relief

The government also plans to introduce a simplified R&D tax relief combining the existing R&D expenditure credit and SME scheme. The rate at which loss-making companies are taxed will be reduced from 25% to 19%, while the threshold for additional support for R&D intensive loss-making SMEs will fall from 40% to 30%. 

Apprenticeships & skills

Hunt announced £50m over the next two years to increase the availability of apprentices in engineering and other key growth sectors. It will provide the right support for the many manufacturers who have long called for better support from the Government to invest in training. We look forward to working with the Government on how this pilot can work in practice and we can increase the number of apprenticeship starts in our sector. 

Investment Zones

The Chancellor’s speech touched on the confirmation of the next set of investment zones in Greater Manchester, the West Midlands, and the East Midlands; and a doubling of the flexible funding envelope for each investment zone from £80 million to £160 million by extending the programme and associated tax reliefs from five to ten years. There is also an additional zone planned in Wales for the Wrexham and Flintshire region. Importantly, there was an extension for the incentives, which Make UK called for and will go some way to ensuring that place-based incentives work.

Plus FDI, NLW and more

There was also the publication of the Harrington Review on Foreign Direct Investment (FDI) that Make UK fed into. We will be looking closely at these recommendations and how we can ensure that the UK is attractive place to do business. 

We also saw the Chancellor formally accept the Low Pay Commission’s recommendations to increase the National Living Wage and National Minimum Wage increases.