Champion Round-Up | By Ged Cosgrove, group managing partner
We’re accustomed, at Champion, to talking about change. Running alongside the minutiae of financial management is a big picture outlook. Horizon-scanning is a crucial part of the job. We are always working to understand what’s coming next, and how best we can prepare ourselves for inevitable change.
As we find ourselves in the opening scenes of a new government, change is front of mind for all of us. What does a Labour government promise, and how can we prepare ourselves for what’s to come?
Firstly, a breakdown of some of Labour’s key policies most likely to influence you:
Business taxation
Labour promises to ‘stop the chaos’ of changes in taxation, with a ‘strategic approach that gives certainty and allows long-term planning.’ Taxes may rise, but Labour has committed to giving fair warning, and to announce change only once a year.
Corporation Tax will be capped at 25 per cent, the lowest rate in the G7. It has plans to incentivise investment, supporting entrepreneurship through a replacement of the business rate system, which will level the playing field between online and high street businesses.
National Wealth Fund
£7.3 billion has been earmarked for a National Wealth Fund, which will ‘support growth and clean energy missions, making transformative investments across every part of the country’. For businesses connected to ports, electrification technology, steel, carbon capture and green hydrogen, this could present new opportunities.
Pensions
Plans for pension reforms are also included in the Labour manifesto. We’re told to expect changes that will ensure workplace pension schemes benefit from consolidation and scale, as well as a review of the wider pensions landscape with a view to future improvements.
Innovation
Labour hints at a handful of policies intended to drive innovation, including the creation of a new Regulatory Innovation Office which will speed up regulation approval times for new products. It intends to scrap short funding cycles for R&D institutions in favour of 10 year budgets, and devise an industrial strategy that supports the development of AI.
Small businesses and the self-employed
The Labour Party manifesto describes small businesses as ‘the lifeblood of communities and high streets’. Its priorities for supporting SMEs include taking action on late payments, removing barriers to exportation, and improving access to capital. If they come to fruition, these could have a significant impact on the operations of many Champion clients.
Capital Gains Tax
While there was lots of speculation around raising CGT during the run up to the election, nothing was confirmed in their manifesto. As such, we’ll keep a close eye on any announcements in Labour’s first budget (expected this autumn) and will keep you updated with any changes and what they could mean for you.
It is, of course, early days for this new Labour government, but we expect to hear more details quite soon. While it will take time for us to feel the impact of any change, we can expect some policy changes to land reasonably quickly as Starmer and his cabinet seek to make an early impact. For a better understanding of what the change in government might mean for your business, speak to your Champion advisor
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