We now know what the short-term holds for public procurement at the end of the Brexit transitional period.
The 3 million apprentices that the government hopes to have in place will partly be paid for by the new apprenticeship levy, whereby every employer with a wage bill of over £3m per year will have to contribute 0.5% of that wage bill to the government. The National Living Wage is fast approaching and pensions auto enrolment continues. So larger organisations – of all kinds and across all sectors – will face an increasing responsibility to help foot the bill for the “high-wage, low-welfare” economy George Osborne spoke of. Organisations that employ large numbers of relatively low paid staff consumer – co-operatives in the retail sector, large charities providing public services, social enterprise spin outs – take note.
Charities and others who depend on business rates relief will be relieved that there was no early announcement of changes from the review of this regime. However, the devolution of local authority funding will be complete by 2020, with local authorities keeping their receipts from business rates and no more central government grant. We have already seen an increased reluctance to give discretionary rate relief to third-sector organisations under the current set up, and these further changes will make colleagues feel rightly nervous. Communities will also wonder about the effect on community asset transfer policies of councils being able to spend all of their capital receipts.
On the funding front, third-sector organisations and faith groups will be relieved to see that the Chancellor resisted the temptation to raid the Big Lottery funding pot. The Government will also continue its support for social impact bonds, suggesting an ongoing interest in “payment by results”. Arts and culture organisations will breathe a sigh of relief at the protection of the Arts Council grant.
For those supporting the most struggling neighbourhoods, there are some hidden risks here. No uniform business rates could mean significant differences between the ability of local authorities to generate income – what of those councils that serve areas of market failure, or rural areas? What will be the impact on services as a result?
Tellingly, the Chancellor didn’t mention the reduction in budget for the Department of Communities and Local Government, which settled at an overall reduction of 30% in its funding. There is no information yet on the future of the community rights programmes, the encouragement of community-led housing, or the support for neighbourhood planning. So, whilst the initial headlines may not have been as difficult as some feared, the real impact will remain to be seen – and felt.
For further information
Please contact David Alcock
Daniel Brewer from Resonance talks about his journey into investing in enterprise with a social purpose, and discusses what the landscape looks like for social businesses post Covid-19.
On 1 December 2020 the Court of Appeal handed down judgment in Pimlett v Curo Places Limited EWCA Civ 1621 where prior judgments in the First-tier Tribunal and the Upper Tribunal were overturned.
For part 3 in this series of short podcasts, Chris Lloyd-Smith interviews senior associate Madhur Sharma on how she has been coping during these unprecedented times.
On 26 November 2020 further changes to the 'Building Regulations: Fire safety - Approved Document B' will take effect.
Last week, the NHF published its final version of its new Code of Governance and made some important changes from the previous draft that will impact on those housing associations looking to adopt it.
As the end of 2020 beckons, we take a look at what progress the Sterling market has made in its preparations for the end of the London Interbank Offered Rate (LIBOR) on 31 December 2021.
Finally, there is a glimmer of hope that perhaps the Covid-19 pandemic could be reaching its end.
For part 2 in this series of short podcasts, Chris Lloyd-Smith interviews senior associate Lisa Whitehouse on how she has been coping during these unprecedented times.
To receive invitations to our events, as well as information and articles on legal issues and sector developments that are of interest to you, please sign up to Newsroom.