Employment groups offer mixed reaction to Budget

There has been a mixed response to today’s Budget, during which the Chancellor George Osborne unveiled a number of measures that will affect employers.

Among Osborne’s announcements was confirmation of last week’s declaration by business minister Mark Prisk of a three-year moratorium on business regulation for small businesses and start-ups.

Outlining his desire for the UK workforce to be the most educated and flexible in Europe, Osborne committed to investment in technical colleges, aimed at increasing vocational training. He also said that there would be increased access to work placement schemes for a further 100,000 people.

In addition, 40,000 more adult apprenticeships will be created, with Osborne claiming this meant a total of 250,000 apprenticeships.

Katerina Rudiger, CIPD skills adviser, welcomed this commitment: “It is more important than ever for the Government to invest in the right skills to aid economic recovery,” she said.

“The increased workplace-based training funding, especially for 40,000 extra apprenticeships, will allow British businesses to grow and become more competitive through their people. The focus on highly skilled trades, also through the creation of 24 new technical colleges, is a welcome step in the right direction as more needs to be done to improve the quality and reputation of the vocational education on offer for young people.

“On top of this, the increased funding of work placements for young people is an efficient way to target youth unemployment, helping to break the vicious circle of no experience/no job and give young people an opportunity to develop and demonstrate the skills and commitment employers need,” Rudiger concluded.

No-change Budget?

The Recruitment and Employment Confederation broadly welcomed today’s announcements, but said the Government can still do more. Chief executive Kevin Green said: “It is promising to see that the Government has prioritised youth employment with a new £300 million package to help young people into work. Our Youth Employment Taskforce has urged the Government to take decisive action on the rising number of young people outside of education or employment, and it is good news that 40,000 new apprenticeships and 100,000 work experience opportunities are coming onboard.

“However, we urge the Chancellor to consider further fiscal incentives to help employers take on young people, such as a national insurance holiday of at least one year for SMEs who take on additional young people.”George Osborne announces budget

Commenting on the employment regulation moratorium, CIPD employee relations adviser Mike Emmott said: “We are concerned about the moratorium on all new employment regulation for small firms for three years. The onus should be on government to bring forward only light-touch employment regulations that do good, not harm – irrespective of company size. A moratorium for the smallest firms is a dangerous precedent that risks creating a two-tier labour market, and could, even at the margins, act as a perverse disincentive for growth among firms considering employing the extra staff member that would bring them into the ‘regulated tier’ of the labour market.”

Meanwhile, TUC general secretary Brendan Barber called it a “no-change Budget”, adding: “Today’s measures do nothing to end the basic error of imposing deep, rapid and unfair spending cuts on an economy where unemployment is rising and growth faltering.

“While there are some welcome measures on funding for apprenticeships and much needed relief on fuel duty, most of today is about taking us back to the 1980s with deregulation gimmicks, hand-outs to big business and a deterioration of working conditions that failed to deliver jobs or growth then and won’t today.

“Overall, there was little in the way of help for hard-pressed ordinary people fearful for their jobs and reeling from inflation driven by the VAT increase. And for the young unemployed, the best the Chancellor had to offer was cut-price unpaid work experience,” concluded Barber.

Work/life organisation Working Families chief executive Sarah Jackson said: “This is not a budget for families. The moratorium on any new domestic employment laws for three years for micro-businesses is disappointing. There is a danger that there will be a bigger gap between the best employers and the rest.

“Good employers know that offering strong employee benefits boosts commitment and performance. It is a shame that the Government doesn’t encourage all employers – of whatever size – to heed the business case that flexible working is good for the bottom line. Instead, they have unpicked their earlier commitment to parents to extend flexible working for parents of 17-year-olds.”

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