Forget Corporation Tax ‘virility symbol’ - give us genuine help

Sheffield Forgemasters International chairman, Tony Pedder
Sheffield Forgemasters International chairman, Tony Pedder
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High value manufacturers across the Sheffield city region area are continuing to weather the recession and make the most of their opportunties, but could do with more encouragement from the Government, according to leading local industrialists.

A rising chorus of calls for increased support for research, dev elopment and investment can be heard from local industry, alongside increasing concern about the damaging uncertainty over energy costs for major users, including steelmakers.

“I get the impression that manufacturing is doing quite well,” says Master Cutler Pam Liversidge.

“Order books are holding up, but I think margins are coming under pressure and that reverbarates back on investment plans. Firms are also coming under pressure from energy costs.”

Forgemasters’ chairman Tony Pedder echoed recent comments by Mark Broxholme, managing director of Tata Steel’s South Yorkshire operations, when he warned that high energy users in the UK were being put at a disadvantage to continental competitors as a result of the coalition government policies.

Mr Pedder says the evidence about energy prices and the incentives offered to protect high energy users by continental countries is “pretty conclusive” and adds that the uncertainty in Britain over energy costs is only discouraging investment.

He also criticises the Government’s focus on lowering Corporation Tax.

“The problem is that Corporation Tax is a national virility symbol. It’s great if you are a big business earning lots of profits, but, if you are a small company, the level of Corporation Tax is irrelevant,” says Mr Pedder, who headed an in depth study of business taxes for the manufacturing organisation, the EEF.

He and other industrialists would rather see the Government demonstrating its business friendly credentials by increasing capital allowances for investment and support for research and development. Meanwhile, some are calling for cuts in National Insurance to boost job creation.