The UK has drafted a budget to attract and keep business but there are still significant barriers to investment, warns the CIA.
Closure of the Pfizer site in Sandwich intensified concerns about the health of the British pharma industry and prompted criticism of the UK Government. George Osborne, the UK Chancellor, has now detailed how he plans to attract businesses back to Britain and keep existing companies.
“I want Britain to be the place international businesses go to, not the place they leave”, said Osborne. Outlining his “vision for growth”, Osborne said the UK should become a “world leader” in advanced manufacturing and life sciences.
Many of the measures were welcomed by the pharma industry but concerns remain. “For a large number of companies the costs of energy policies will remain a significant barrier to investing in Britain and competing globally”, said the UK Chemical Industries Association (CIA).
Concerns centre on plans to use taxes to increase the cost of carbon over the next decade. This gives stability and reassurance needed to stimulate investment in green energy, said Osborne, but the CIA believes this comes at a price.
“[The plan], as structured leaves energy intensive businesses such as chemicals at the mercy of unilaterally high energy costs for the next decade”, said the CIA. While acknowledging the need to cut carbon emissions the CIA said there is a desperate need for transition agreements.
In an effort to help energy intensive industries climate change levy agreements have been extended until 2023. The extension provides some certainty to industry, said the CIA.
“Britain is open for business”
Many of the measures included in the budget are designed to make Britain more attractive to multinational businesses. “Let it be heard clearly around the world – from Shanghai to Seattle, and from Stuttgart to Sao Paolo: Britain is open for business”, said Osborne.
Initiatives relevant to biopharm manufacturers include capital allowances to support enterprise zones in areas with a strong focus on high value manufacturing. The CIA welcomed this plan and the creation of innovative manufacturing centres.
Corporation tax will also be cut over the next three years. By the end of this process the UK corporation tax rate will be 23 per cent. This is one of a number of measures to stop other countries from “attracting multi-national companies away from the UK”, said Osborne.
“The package of measures around skills, IP, tax credits and breaks and the continuation of translational research partnerships, shows that Britain is a strong competitor and place to do business for our industry”, said the Association of the British Pharmaceutical Industry (ABPI) .