Civil Engineering Contractors today welcomed three critical policy announcements in the Autumn Statement, but expressed caution over the proposed implementation for reforms to R&D tax credits.
In his annual statement to Parliament, Chancellor Jeremy Hunt showed he had listened to CECA members and said he would:
- Remove barriers to investment in critical infrastructure by reforming the UK’s inefficient planning system and speeding up electricity grid connection times;
- Make full expensing permanent, with the intention to consult on expanding the scope of full expensing to include assets for leasing;
- Create a ‘Star Chamber’ to speed up infrastructure delivery.
Commenting, CECA Director of Operations, Marie-Claude Hemming said: After a few months of doom and gloom news in the infrastructure sector, today’s announcements are pleasantly surprising and we recognise that our members’ concerns have been taken on board.
“Alongside the publication of the Autumn Statement document, is a policy paper focusing on speeding up infrastructure delivery, a key component in which is the creation of a Star Chamber.
“In our recent policy document, CECA called for construction to be put at the heart of policy making, with the establishment of a Cabinet Committee for Infrastructure, and we welcome that this suggestion has been adopted by Government.
“We also welcome moves to make full expensing permanent, allowing companies to claim 100% capital allowances on qualifying plant and machinery investment.
“However, as much of our industry hires its plant and machinery, we welcome the opportunity to continue to work with the Government to develop the policy to include assets for leasing within this allowance.
“Yet, we express substantial concern over the merger of R&D expenditure and SME schemes. The associated guidance published today suggests that contractors may still be able to claim tax credits for some R&D, but we need to see more detail as industry has been worried that proposed changes might make this hard in reality, potentially reversing recent strong growth in innovation in the sector.”
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