April 2021

APRIL 2021 AFTERMARKET 11 www.aftermarketonline.net we had hoped to see more measures to support the transition. This is an opportunity lost, so we look ahead to this year’s Comprehensive Spending Review for the commitment to the infrastructure, incentives and wider competitiveness measures that will enable the UK automotive industry to be the global leaders in the shift to net zero mobility.” Build back Looking at the Budget from a tyre perspective, NTDA Chief Executive Stefan Hay commented: “The new super deduction has got to be good for those companies that wish to invest in equipment. During the lockdown we also saw many individuals setting up their own mobile tyre-fitting businesses, including many existing NTDA members that hitherto had only operated from a static tyre centre. For them, and many more, the new Help to Grow Scheme, providing the digital and management tools needed to innovate, grow and help drive recovery, could be useful.” Summing up, Stefan observed: “I would say it is, especially under the difficult circumstances we find ourselves in, as an industry and nation, quite positive.” Significant Looking specifically at the decision to freeze fuel duty, PRA Chairman Brian Madderson said “As the PRA has campaigned heavily against any rises in fuel duty, we naturally welcome the Chancellor’s decision. Fuel duty is a regressive tax on business and livelihoods so any attempt to increase it would have been entirely counter- productive as the economy gets back on track. It is by no means an over- exaggeration to say our members have kept this country moving during the pandemic and it is right that the government has recognised that undeniable fact.” Looking at the Budget’s key points from the franchised perspective, NFDA Chief Executive Sue Robinson started her observations around business rates: “We have previously highlighted that the business rates holiday represented one of the most welcome forms of financial support offered by the government during the pandemic. Following our requests for a business rates holiday extension submitted ahead of the Budget, the announcement is positive, as it will continue to support retailers while the economy reopens, and we come out of the pandemic”. On the furlough extension, she said: “It is encouraging that the furlough scheme has been extended, allowing dealers to retain staff while levels of demand remain subdued due to the current restrictions. However, dealers are looking forward to reopening and returning to full operations to be able to meet their customers’ needs.” Looking at corporation tax and the super deduction, Sue declared: “Due to the significant challenges facing our economy, the announcement about the rise in corporation tax was not unexpected. However, the fact that the increase will not come into effect until 2023 will give businesses some time to start to recover from the current disruption. The super deduction tax relief will partly offset this increase especially as retailers need to make further investments into their sites to meet changing demand.” On the decision to freeze the thresholds for income tax, national insurance and personal tax Sue added: “Following months of lockdown, it is important to support consumers and instil confidence; these measures will help the economy bounce back and encourage people back into the marketplace.” Balancing act Noting inevitable trade-offs the Chancellor had to make, IMI CEO Steve Nash said: “The difficult balancing act Rishi Sunak faces of supporting those most in need while starting to try to recoup some of the massive spend over the last year means that there are winners and losers in today’s Budget. For some parts of the automotive sector there will certainly be relief that the furlough scheme is being extended to the end of September. “Our latest analysis of ONS data suggests that since the beginning of November, the proportions of those in automotive on furlough has been increasing in line with the tightening restrictions across the UK. With the path out of lockdown starting in April, hopefully those numbers will start to reduce, and importantly redundancy doesn’t have to be the option for those employees for which there won’t be immediate work. The longer timescale certainly gives businesses time to start to build up their income again and perhaps gives some of the 16,000 plus individuals who have already been made redundant new opportunities in the sector. Employers may also be encouraged by the £126m funding boost offered by government for training. It remains to be seen whether this will encourage greater employer engagement with Traineeships or in offering the required on- the-job training associated with the new T Levels.” It was not all good news as far as Steve was concerned however: “Most disappointing is the lack of any real tangible support to improve apprenticeship take up. With the government still refusing to waive the Apprenticeship Levy clawback, if funds are not used within two years, the picture for the apprenticeship route in automotive still looks bleak. While apprenticeship starts in England as a whole dropped by 9% in November 2020, for the automotive sector the fall was much more significant. Apprenticeship starts in automotive in November 2020 were 33% lower than the previous year. “We are also deeply concerned about the impact of the fall in apprenticeship starts in key parts of our sector which play a fundamental role in keeping Britain moving. Vehicle maintenance and repair, vehicle body and paint operations and vehicle parts operations saw declines of almost 100% in apprenticeship starts in November compared to the same period last year.” Steve concluded: “The IMI will continue to ask government to rethink its stance on the Apprenticeship Levy clawback. It seems utterly counter- intuitive to urge employers to take on apprentices, yet not give them the flexibility and understanding that in the last 12 months the ability to start new apprentices and therefore use the levy fund has been limited. We need all sectors to support our efforts to keep this issue front of mind with the Treasury and Department for Education.” www.aftermarketonline.net There will certainly be relief that the furlough scheme is being extended to the end of September ”