Ahead of the Spring Statement on 26 March, ICAEW’s Chief Executive, Alan Vallance, has written to Rachel Reeves, outlining the three areas that members believe are critical to support exponential business growth.

Skilled workforce

The Chancellor must prioritise action that encourages businesses to invest in the skills of their workforce, says ICAEW.

While welcoming the creation of Skills England, Vallance cautions that proposals from the Department for Education to revise Level 7 Apprenticeship funding risks undermining the government’s growth ambitions and calls for a change of approach.

“I urge a rethink on this policy, not only due to the immediate reduction in apprenticeship starts, but also the longer-term consequences of lower tax revenues, reduced business advice, increased offshoring and diminishing social mobility,” says Vallance.

“The impact will be particularly severe for SMEs that rely on the Level 7 Apprenticeship funding and on those from disadvantaged backgrounds who use the L7 route into a professional career.”

Opportunities offered by tech

Technology, in particular artificial intelligence (AI), offers “transformative growth” opportunities, says Vallance, and now is the time for government investment to support its adoption.

In his letter to the Chancellor, Vallance reiterates ICAEW’s support for the development of a new business growth voucher scheme. 

Such schemes have worked for previous governments to enhance productivity, and ICAEW is able to support the design of a scheme to maximise growth drawing on members’ experience and expertise.

“This will enable SMEs to access expert advisory services that will help them harness AI and technology for growth,” says Vallance.

Move faster on infrastructure

Vallance’s letter is positive about the announced increase in spending on infrastructure over the next two financial years but urges more action.

“The government must take advantage of multi-year capital budgets together with planning and regulatory reform to accelerate existing infrastructure projects and to bring forward new projects as quickly as possible,” says Vallance.

He also calls on the government to target investment so it lowers the cost of capital for difficult projects, “rather than replacing capital on projects which would likely be invested in anyway”. Vallance cites the offshore wind sector as a successful example of where government investment reduced the risk profile of a project.

Shaped by member expertise

Vallance offered ICAEW’s support to government departments in shaping policies and initiatives, drawing on the real-world experiences of ICAEW members and their clients.

“ICAEW stands ready to support the government in its mission for sustained economic growth,” he confirms.