REC's response to Chancellor's fiscal statement

Neil Carberry, REC CEO said:

“Putting business at the heart of delivering prosperity for the UK is always the right call, and the Chancellor’s focus on this will have landed well with employers all over the country. Reducing the counter-productive rise in employer National Insurance – a tax on creating jobs and paying people more, that falls heavily on the sectors most affected by the pandemic – is wise. And ditching the botched changes to IR35 – the rules on how temporary contractors are paid - is also a huge help. These have been big REC campaigns, and we welcome today’s announcements. The changes will provide many businesses with much needed relief, when taken into the balance with short-term support on energy bills.

“It is not enough to simply tear things down though – we also need to build. On IR35, retained European regulation, investment zones and infrastructure there is hard work to do on replacement rules, and in some cases little time to do it. Business is ready to help – but we will need action from Government to make things happen. Nowhere is this truer than on skills, where the failure to reform the failed Apprenticeship Levy continues to hold back employer training investment. Reforming the Working Time Directive allows us the opportunity to preserve rights on holidays, breaks and working weeks while removing the administrative nightmare faced by firms in calculating how they comply with the current rules, which were not designed for today’s economy. But we need to move quickly to do this, given the chaos that has been created by some recent court judgements.

“Tackling rising economic inactivity is a key part of ensuring the UK can grow.  But it is a complex issue. REC members remain unconvinced that benefit sanctions can do the job – there is no point forcing someone to an interview they are unprepared for. We are similarly sceptical about further regulating the process of employers negotiating with trade unions in workplaces, as this could lengthen disputes even more. We need a better workforce plan than that – and recruiters are ready to help deliver one.  And that workforce plan needs to sit alongside a fiscal plan that the markets can believe in. Over the next few weeks, we will be looking for the Government to set out it’s approach to ensuring that the books can be balanced, recalling that public services matter. So much of our inactivity issue is driven by long-term sickness that requires a strong NHS for it to be resolved.”