In its submission to the Migration Advisory Committee (MAC), the CIPD argued that a freezing of the current Tier 2 visa limit for April 2012-13 would still amount in real terms to a 25% decrease in the total number of non-EU skilled workers available to employers, because many of those who formerly came through the post-study route would now transfer to Tier 2.   The CIPD argues that a fall of this magnitude may still leave many employers struggling to fill skilled vacancies in the first half of next year if business conditions improve in the next 12 months.

The CIPD also recommended that the £40,000 income threshold for intra-company transferees be maintained as it does not lead to migrants under-cutting UK workers, a position the MAC has also agreed with.

CIPD research suggests that the ongoing economic crisis and the resultant stagnation in the labour market has meant that only a tiny proportion of UK employers say that the permanent cap has had a damaging impact on them since its introduction in April 2011.  However, the CIPD has warned that the Government will need to be ready to respond flexibly as the economy recovers if the UK wants employers to have access to a sufficient supply of skilled labour to drive growth and international competiveness. The migration cap was introduced to put an annual limit on the number of non-EU economic migrants that can live and work in the UK.

Gerwyn Davies, CIPD Public Policy adviser, comments: “With the post study route due to close in April, the Government needs to be ready to raise the Tier 2 visa bar to ensure UK employers have access to the skills they need to drive growth. As the economy recovers, demand for skilled staff could quickly outstrip demand. Tier 2 visas account for a very small proportion of total immigration but could make a big difference to British business. Growth must be prioritised over symbolic measures to ‘crack down on immigration’.  Even at current levels, the number of Tier 2 visas is so low that any further reductions would have a very limited impact on its overall aim of reducing net migration levels to the level of the tens of thousands”.

Michael Hudson - head of development Carter Jonas eastern region

THE identification of the right sites and the ability to bring them forward for housing as quickly as possible will be crucial to fulfilling the Government’s strategy for boosting housing and home ownership, say the new homes experts at Peterborough property consultancy, Carter Jonas.

The comment comes after the Government unveiled its housing strategy towards the end of last year (November 2011), in which it acknowledged that, when the housing market grinds to a halt, the effect ricochets around the economy affecting all the trades and professional services and supporting business that depend on a housing market that is moving.

In the strategy, a £400 million fund was allocated to kick-start building and to unlock the mortgage market, with targeted help for first-time buyers.

While welcoming the Government’s announcement and, in particular, its identification of the fact that building more homes will help create more jobs, Carter Jonas’s development and new homes specialists in Peterborough are saying that, in this area, the identification of the right sites is crucial to fulfilling the Government’s hopes for the market.

Michael Hudson, a partner of the firm who, on the development side underpins the new homes sales operation of the Peterborough office which is headed by senior associate Zoe Davies, believes that proximity to London and a favourable price comparison with other commutable locations further south in the country, are the key characteristics of the brand new homes markets in Peterborough and the surrounding villages.

He also believes that this area’s appeal will only strengthen in the coming years, if the right sites are identified.

“On the sales side, Zoe and her colleagues confirm that there is always strong interest in any new homes development launched for sale in our patch and this interest has been maintained through the toughest of markets. On my side of the business, developers’ interest in the area has been sustained throughout this time too and many are actively returning to the land market to seek suitable sites they know will attract buyers in the coming years.

“To meet the Government’s hopes for the housing market, it’s important that a policy context is created – locally and nationally – to bring forward the right sites in the right locations with the right product and mix of homes to have a package in which developers and housebuyers have confidence.

“After all, on a business level, it is the developers who are the real experts at knowing what their customers want and what the market will bear at any one time.”

Speaking at the second annual Skills Summit in Peterborough on October 5, Mr Hyman said the conference will help young people fill gaps in their knowledge and experience and help them prepare for work and training.

Click play to listen to Mr Hyman’s speech in full.

The FSB welcomes the government’s plans to help unlock growth by accelerating investment in infrastructure, but it must be targeted in the right areas, particularly the road network which creates delays and costs for small businesses and acts as a barrier to growth.

Amir Butt, Peterborough Branch Chairman, Federation of Small Businesses, said, “Small businesses feel plagued by the poor state of repair of the UK road network. They should not have to pay £5,000 because of failing roads – it is significant waste to their business at a time when they can ill-afford it.”

In the FSB’s ‘Voice of Small Business’ survey panel of more than 1,700 businesses, half said that the problems with the UK’s infrastructure has cost their business up to £5,000 over the last 12 months.

Another 12 per cent said it cost them between £5,000 and £19,999 – this is a huge figure when considering that the average turnover for small firms is around £500,000.

Amir added, “It is vital that the government rebalances the amount spent on the road network with the amount collected so that small firms can get on with the job at hand of growing the economy, without worrying about roads impacting negatively on their business.”

The FSB welcomes the government’s plans to handpick 40 of the biggest infrastructure projects for investment, but urges it not to neglect existing infrastructure that also requires investment, warning that more needs to be done to address the problem of congestion and the state of repair of UK roads in order to get businesses moving and growing. At a time when small firms’ cash-flow is already being squeezed, the cost to small firms in lost productivity and damage to their vehicles is one that significantly hampers their growth.

In a new report, ‘Small Business and Infrastructure: Transport’, the FSB is calling on the government to rebalance the funds collected from road users and the amount invested back into improving the road network, to prevent the poor state of roads and high levels of congestion from costing small firms.

While the city has a total of 29 conservation areas, currently, Beacon Planning will concentrate on the city centre area which takes in the cathedral precincts as well as the historic areas of Cowgate, Priestgate, Westgate and Bridge Street.

The appraisal – which is scheduled for public consultation this summer (2011) – will see Beacon’s planners assess and appraise the special historic and architectural interest of this part of the city centre.

Local authorities have a statutory duty to designate and review conservation areas which are an important tool in the planning and management of the historic built environment.

The scope of the work in Peterborough’s city centre conservation area includes the examination of development in this area over the years, identifying distinctive characteristics and landmarks as well as making recommendations which seek to preserve or enhance the special character of this built environment.

Beacon Planning – whose offices are in  Stow-cum-Quy – has a proven track record of work in this specialist field for a range of local authorities including Norwich City Council, Cambridge City Council and a range of other Councils in Cambridgeshire, Lincolnshire, Essex, Leicestershire and Bedfordshire.

Dr Jon Burgess (above), director of Beacon Planning, said: “As well as contributing to the on-going positive management of the historic environment and its regeneration, the conservation area appraisal will support Peterborough City Council in delivering planned work on Cowgate funded, in part, by a recent £105,000 grant from English Heritage.”

Peterboroughbusiness.co.uk is bringing you all the reaction to the budget from the city’s accountants and business leaders, who have been telling us what they think the changes will mean for the Peterborough economy.

Kevin Edwards, tax partner at the Peterborough office of MacIntyre Hudson, the top 20 accountancy firm, has reacted positively to topline analysis of today’s budget.

“The reduction in Corporation tax rates and the changes to EIS, R&D tax credits for SMEs and the extension of Entrepreneurs’ Relief to £10 million all sound like joined up thinking for smaller and medium-sized, entrepreneurial companies.

“The Plan for Growth offers some very useful access to finance measures for SMEs. However, it was disappointing to hear that Peterborough will not be classed as one of the Government’s Enterprise Zones to attract more manufacturing businesses to the city – let’s hope we will be included in the 10 to be announced later on in the summer.

“We’re delighted to see that the Time to Pay scheme is continuing and that UKTI will be offering more support to SMEs who want to export. Increasing numbers of our clients are looking to expand their business that way, so this is a very welcome measure.”

Ken Craig from Rawlinsons said, “Against a background of rising inflation, considerable public debt and borrowing requirements, George Osborne has stepped up to the plate today to confirm his changes to the UK tax system. Prior to the event we were advised that he would be confirming significant increases to personal allowances, taking steps to help with rising petrol prices and perhaps simplifying the tax system, in particular a possible merger of National Insurance and Income Tax.”

Read the full Rawlinsons budget summary here (click).

Simon Chaplin, managing director of Greenstones, said, “For Greenstones customers, namely the small owner managed business, there are not really any new surprises following today’s budget. Whilst the government’s agenda is clearly one of growth the announcements made will do little to counteract the cuts in public services and government contracts for businesses. Consumers will be hard hit suffering from high inflation, petrol prices, job losses and static wages.”

Read the Greenstones full budget summary and commentary here (click).

Nino Pucacco partner at Peterborough accountants P&A Accountancy Services said, “There are some very welcome headline-grabbing announcements in this budget, but the devil is always in the detail, and things are rarely as rosy as chancellors paint them in their speeches. But even if the details turn out not to be too devilish, we shouldn’t get carried away, since the underlying message is that there are two brutal truths.

“The first brutal truth is that the public finances are still in a mess, and soon the huge tax burden and spending cuts announced long before today are really going to start hurting. In fact for some local people the pain is going to be excruciating as their jobs go, their public sector contracts disappear, their businesses fail, and the benefits system no longer gives them what they need. And if they work hard and manage to avoid all of that, they could find the taxman taking up to 60p in income tax from every extra pound they earn.

“The second brutal truth is that it is businesses and not budgets that offer us the best hope of putting things right by replacing the jobs and wealth lost, and generating the extra taxes needed to pay for everything. Mr Osborne billed it as a ‘budget for growth’ but in reality budget measure such as relaxing planning restrictions, setting up new enterprise zones and cutting corporation tax rates will only ever help a bit. It is how businesses respond that really matters, since they are the real engine of growth.  So the region’s job and wealth-creating businesses need to stand up and be counted by taking urgent action to make it happen.

“Despite the promises of simplification in the future, the 2011 tax regime is hideously complicated and contains a huge number of pitfalls for the unwary. The good news though is that it now also allows the really well advised to make some very big tax savings. And that’s why we’ve launched our free 2011 Tax Minimisation Review service for businesses and individuals – to make sure that no-one suffers by paying a single penny more than their fair share of tax.”

Chris Haworth, head of commercial, Carter Jonas, said, “The announcement that the default presumption is in favour of development is good news, but it is very difficult to see how this squares with the Localism agenda.

“We still have the situation where local councillors now stand fully responsible to the electorate for any development proposals in their area and even a small vociferous minority can derail these.

“Until we get more clarity on how the localism agenda will work in practice, and particularly how it will work where cross-boundary development is involved, I am still not convinced that current policy will deliver the commercial and residential development that is much needed to regenerate an economy that has been through the worst recession in living memory.”

John Bridge OBE, chief executive of Peterborough Chamber of Commerce, said, “Today’s announcements will, on the whole, be met positively by business. The additional decrease in corporation tax will be welcomed, while the promise of no new regulation for firms with fewer than ten staff over the next three years is equally positive. Red tape continues to be an issue for business owners who simply don’t have the time or the inclination to sit down and get their head around onerous new rules and regulation.

“The 1p reduction in fuel duty and deferral of the planned increase is a positive step that shows the government understands the challenges facing businesses and individuals in relation to the high cost of fuel.

“On the whole, a positive, forward-looking budget that signals the Chancellor is starting to listen to the needs of business. But it’s not all positive for Cambridgeshire will no official confirmation of an enterprise zone to help generate funds for the Enterprise Partnership to use to tackle barriers to growth in our area, while the tax on jobs, being the rest of the national insurance contributions rise facing employers from April, remains.”

Amrita Parker, Peterborough branch chairman, Federation of Small Businesses, said, “The chancellor has said that this budget would be a ‘Budget for Growth’ and in part that is what we have – however, there are vital components missing for small firms to create jobs.

“We are pleased that the chancellor has introduced a fuel duty stabiliser; has committed to cutting fuel duty and has introduced 21 new Enterprise Zones. This will provide much needed stability for struggling small businesses.

“The government has committed to cutting red tape, but we believe new employment laws will still come into force in this year, which could hinder businesses from taking on staff.

“The biggest opportunity missing from this budget is by not extending the NICs holiday nationwide to existing businesses, which would really have provided incentives for small firms to take on more staff.

“The unpredictable nature of fuel prices damages growth for businesses across the UK – with a recent FSB survey showing that 62 per cent of businesses are increasing prices, one in 10 laying off staff, a quarter freezing wages and 36 per cent reducing investment.

“The FSB has long called for the re-introduction of Enterprise Zones across the UK and the announcement that 21 are to be created is good news. However, with unemployment at 2.5 million the FSB is disappointed that the government has not extended its National Insurance Contributions (NICs) holiday to existing businesses – this is a missed opportunity. This policy would have been cheaper to implement than keeping people on benefits.

“The extension of the Enterprise Investment Scheme and the doubling of Entrepreneurs Relief to £10 million will provide a much needed shot in the arm for entrepreneurship in the UK. Small businesses are key to innovation and the 200 per cent increase in SME R&D is welcomed.

“For small independent retailers struggling with inflation and other VAT rises, the further 12 month extension to Small Business Rate Relief for properties with a rateable value below £6,000 will help greatly.

“Almost seven in 10 apprenticeships currently take place within small firms and so the plan to add an additional 50,000 apprenticeships is a significant development for the small business community and young people alike.

“The FSB also welcomes moves to reduce the main rate of Corporation Tax over the next three years, but is disappointed that there was no mention of how the small business rate of 21 per cent would be affected.

“We are pleased that the government understands that the burden of regulation hinders businesses across the UK and that it has imposed a three year moratorium on new regulation for micro-firms. This will give the smallest firms the confidence to employ more staff without having to worry about constant changes in employment law. But, the government needs to look at extending this to all small firms to really open up an environment for businesses to take on more staff.”

Andrew Smith, chief economist at KPMG in the UK, said, “Last year was the preview, this year austerity is for real with tax rises and spending cuts each of 1% of GDP. Today’s concessions are small beer by comparison with this squeeze.

“The surprise was the cut in fuel duty – financed by the North Sea supplementary charge – aimed at the headlines but nevertheless still welcome to struggling consumers.

“You have to remember we are in uncharted policy waters with effectively zero interest rates. The chancellor’s strategy relies on monetary policy remaining loose to offset the tight fiscal stance – but this is outside his control and the MPC is becoming increasingly concerned about above target inflation.

“And unfortunately for Mr Osborne, it is the wrong kind of inflation – which is pushing up government spending faster than receipts. Combined with a lower profile for growth in the short-term, there is already some slippage in the deficit reduction programme before it has really begun.

“Without being able to pull the fiscal demand levers, this ‘budget for growth’ is relying on low-cost measures designed to improve the working of the economy. While welcome, supply-side improvements are no quick fix and take time and persisitence to come to fruition.

“The fall in fourth quarter output has had a knock-on effect on the economic forecast for this year and next, but growth is projected to get back on track further out. To date, though, there is little evidence of the promised rebalancing of the economy. Consumer spending is certainly taking a back seat – this year’s forecast increase has been halved – but exports and business investment have yet to take off. A triumph of hope over experience?”

The consultation, ‘Business Records Checks’, states that 50,000 small businesses will be targeted by HMRC agents in order to check that their business records meet minimum reporting standards. If not, a fine of up to £3,000 will be levied, with the potential to raise £600 million over the next four years. 

Amrita Parker, FSB Peterborough branch chairman, said, “FSB research has shown that one in 10 small firms spends more than six hours per week fulfilling their tax responsibilities. However, many small businesses do not have a dedicated finance or accounting department and will be unaware of the intricate details of tax obligations – especially when starting out.

“Rather than imposing fines which could cripple some small firms, it would be more pertinent for HMRC to move to a system where small businesses are encouraged to improve record keeping and understand their tax obligations better.

“At a time when the government is looking to promote growth and get the recovery on a firmer footing, adding to the bureaucracy that a business owner has to deal with through additional checks, goes against what the government is trying to achieve.”

The FSB is concerned that the consultation lacked information on how HMRC would choose businesses and carry out the checks. Another worry is that HMRC did not draw up details of what standard criteria would be used to assess each business, and that it will be difficult to justify a ‘significant failing’, as firms across sectors differ so much.

Additionally, the document said that HMRC would raise £600 million over four years, but no breakdown of the model used to reach the figure was included, raising further concern that the process is solely going to be used to raise revenue for the department.

The FSB has recommended that the charging process is left as it currently stands, and that small firms are given the opportunity to improve their records if processes are deemed inadequate. It would not be fair to impose a ‘first offence’ penalty, where the business is unaware of the offence that has been committed.

Guidance should also be produced, so that all small businesses know what actions they can put in place to ensure they are compliant.

Ken Craig, a tax specialist at Rawlinsons, told Peterborough Business that HMRC are planning to carry out 50,000 checks nationwide every year for the next four years on the adequacy and accuracy of company business records.

Mr Craig said, “This programme of checks is being accompanied by a tariff-based penalty regime for failure to keep proper business records. The maximum penalty for transgressors is £3,000. It is highly likely that businesses found to be wanting with their records could end up being given a thorough tax investigation by HMRC. It would be wise for businesses to check their tax investigation insurance policies to make sure they cover Business Record Checks and subsequent investigations by HMRC.”

An HMRC consultation paper was published last month with comments required by February 28 – although Mr Craig believes it is virtually certain that the process will go ahead.

The GCGP LEP proposal was approved by the government in October and since then work has progressed to shape the network. An essential part of this is the recruitment of a chairperson.

Commenting on the position, which is available on a voluntary basis for an initial two year period, Neil Darwin (above), director of economic development at Opportunity Peterborough said, “The next step in putting the LEP into action is appointing a dynamic, business-minded and influential individual to this role and we’re confident we’ll see applications from a lot of well-qualified candidates.”

Those who feel they possess these qualities are strongly encouraged to apply. Other key attributes sought include:

• A strong track record growing and running a significant business
• Good understanding of public policy at a local and national level
• Credibility with a wide range of stakeholders
• The ability to draw together a wide number of people to pursue common goals
• The ability to exert influence at a national level

John Bridge (left), chairman of Opportunity Peterborough and the Local Enterprise Partnership Project Board said, “This is a key appointment and will play a major role in pushing the growth of our area forward, so we’re looking for an individual who can influence policy where it matters and use their networking skills to draw together the strengths of both Peterborough and Cambridge to create a healthy economy.”

Interested individuals should submit a brief CV and a short letter detailing their interest to j.bridge@cambscci.co.uk by 4pm on 26th January 2011.

Council leader Marco Cereste said he intends to refer the matter back to the cabinet in November to overturn a decision to close the business, taken in 2007.

Councillor Cereste said, “When Westcombe Engineering came back into the council’s control in July 2009, the interim managing director was given the brief to turn the business around, or, if that proved impossible, to prepare it for closure.

“A great deal of work has been done into reshaping the business, including introducing efficiencies and price reviews that were long overdue. As a result trading figures have shown a marked improvement this year. Perkins were involved in the process, and this lead to them having renewed confidence in the business, which they demonstrated by nominating Westcombe Engineering for a supplier award for achieving a 100 per cent record in terms of quality and deliveries. This is a fantastic achievement, for which the business is to be congratulated.

“The improvements in Westcombe Engineering have been so impressive that it now has the support of its major customer, Perkins, and a viable future. As a result I am delighted to announce that it is intended that Westcombe will not be closed, and will remain part of the council for the foreseeable future. The workforce and Perkins were told of this yesterday. I am delighted with the progress that has been made since Westcombe came back into council control, and congratulate all who have been involved in that success.”

Westcombe was set up in 1971 through the Health and Welfare Committee of Peterborough City Council to create employment opportunities for individuals with disabilities with the aim of providing them with a foundation from which to seek mainstream employment.

At that time, with the limited legislation supporting people with disabilities, sheltered workshops were seen as an appropriate and beneficial model for assisting individuals into the workplace. The engineering workshop produces precision machine tool components used by a number of engineering companies, with its main customer being Perkins Engines.